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LAWSUITS & BUSINESS UPDATES: BPA Drops CCE From Conspiracy Lawsuit … And More!

In a surprise move, the Black Promoters Association has withdrawn its conspiracy lawsuit against CCE and the SFX concert promotion companies acquired by SFX and then bought by Clear Channel. " Upon further investigation, the BPA, the Southern Christian Leadership Conference, the National Action Network and other civil rights groups have determined it is appropriate to dismiss Clear Channel from the BPA lawsuit." the BPA said in a statement. "In fact, the groups said they believe that in many respects Clear Channel is to be commended for its efforts in reaching out to, supporting and partnering with a very racially diverse network of people."

Plaintiffs Leonard. Rowe, Fred Jones, Lee King and Jess Boseman praised the statesmanship demonstrated by Clear Channel. "Clear Channel is a relatively new player in the concert promotion industry, and has brought a new energy, level of professionalism and spirit of fair play to it," continued the statement. "As a company unburdened by the troubling legacy of segregation and discrimination in the music industry with which the other defendants in this case are saddled, Clear Channel has been pointing the way toward a new model of business that affords equal opportunities for African-American and other minority participants."

In a joint statement, National Action Network President Rev. Al Sharpton, Southern Christian Leadership Conference President Emeritus Rev. Joseph E. Lowery and BPA President Leonard Rowe, said: "In many ways, Clear Channel is a company that has demonstrated a deep and growing commitment to supporting the African-American and other minority communities. At the national level, we have seen good work being done through Clear Channel's internal Diversity Initiative, their longstanding partnerships with groups such as the National Urban League and the Black Executive Exchange, and their support of historically black colleges and universities. Locally, as the largest owner and operator or urban radio stations, Clear Channel has raised much-needed funds; created clothing drives, facilitated neighborhood watch programs and celebrated Black History Month in communities nationwide. Recently, Clear Channel's Urban Broadway Series is providing a platform for stage productions written by and starring people of color who have not historically had such access to participating in theater productions. Not many companies can match these efforts. We look forward to working with Clear Channel on these and other efforts in the future."

The plaintiffs will continue to prosecute their claims of an unlawful conspiracy to restrict African-American concert promoters from the promotion of white and major black artists against the remaining concert promotion defendants – Jam Productions, Beaver Productions and Fantasma Productions – and agency defendants Creative Artists Agency, the William Morris Agency, Renaissance Entertainment, Monterey Peninsula Artist and the Howard Rose Agency.

Music Industry Wants Payola Reform

LOS ANGELES (AP) — Charging that payola has made a comeback, a coalition including the music industry's major trade groups is calling for a federal investigation into the practices of the deregulated radio industry.

The group of musicians, songwriters, record labels, retailers and unions intends to submit a letter Friday to the Federal Communications Commission and Congress asking for tougher scrutiny of practices they say restrict competition — and artists' chances of getting on the air.

The coalition also wants an investigation into the rapid consolidation of radio ownership and the impact of combined ownership in broadcasting, concert promotion and live performance venues.

The letter was drafted by the Recording Industry Association of America, the Recording Academy and other major trade groups. The recording industry association represents major recording companies EMI, Bertelsmann, Vivendi Universal, AOL Time Warner and Sony, as well as dozens of smaller ones.

The letter claims that payola has resurfaced in a new form since it was outlawed. Payola rules introduced 40 years ago made it illegal for radio stations to take money in return for playing a song without disclosing the practice to listeners.

Today, however, some promoters pay radio stations annual fees. The promoters say the payments are not for playing specific songs. But the coalition claims the stations tend to play mostly records suggested by their independent promoters, unfairly keeping scores of talented and diverse artists off the public airwaves.

"Artists must pay small fortunes in so-called independent promotion fees for the chance to be heard on the radio," said Tom Lee, international president of the American Federation of Musicians, one of the signers of the letter.

But a lot of artists cannot afford to pay, he said.

"The effect is ruinous for artists, consumers and the growth of American music and culture," Lee said.

Record companies have said that the practice costs them between $150 million and $300 million a year.

"It's been 40 years, and it's important for the government to take a fresh look at the issue and clarify the law as it applies to current market conditions," said Amy Weiss, spokeswoman for the RIAA.

In its letter, the coalition contends that since deregulation in 1996 a few groups of powerful radio stations have come to wield an unhealthy amount of control over the industry.

The group specifically targets Clear Channel Communications, the largest owner of radio stations and the biggest live concert promoter in the country.

The coalition wants the FCC to investigate whether an artist's decision not to play in a Clear Channel venue, or not to use a Clear Channel promotion company, results in Clear Channel removing the performer from its playlist.

Pam Taylor, a spokeswoman for Clear Channel Radio, called the accusations "absolutely false and ill-founded."

"We welcome the chance to highlight that we operate in a manner that's best for everyone," she said.

Clear Channel, of San Antonio, Texas, and three other radio station groups — Chancellor, Infinity and Capstar — have 63 percent of the 41 million listeners of Top 40 music nationwide, according to the coalition's submission.

Music Industry Sues Napster-Like Firm

LOS ANGELES (AP) — The recording and music publishing industries extended their legal pursuit of online music swapping firms Friday, suing Audiogalaxy for copyright infringement.

The Recording Industry Association of America and the National Music Publishers Association accused the Austin, Texas, firm of "willfully and intentionally" encouraging and facilitating millions of users to copy and distribute copyright work of artists, ranging from Dave Mathews and Celine Dion to Alicia Keyes and the Beatles.

The two industry groups claim that Audiogalaxy, with more than 15 million registered users, uses a system that is even more egregious than Napster, which the music industry effectively shut down in the courts last year.

Founder Michael Merhej and other AudioGalaxy officials did not immediately return calls placed to their offices late Friday afternoon.

Merhej said previously that AudioGalaxy was taking measures to prevent copyrighted music from being illegally shared, but RIAA officials complained that the measures were insufficient.

Audiogalaxy, which grew out of a music search engine at the University of Texas, not only allows users to download songs and albums, but also cover artwork and software.

The firm uses some 430 computer servers as a hub for users to trade through, providing a huge database that lists thousands of available songs, their file size and download speeds.

In their claim filed late Friday in a New York federal court, the plaintiffs said billions of copyright works may have been downloaded illegally.

The Texas firm reported more than 1.5 billion monthly hits in November, and makes money by selling online advertising and subscriptions for access to premium services.

The RIAA represents all the major recording companies. The NMPA represents music publishing firms as well as songwriters through its licensing affiliate, the Harry Fox Agency.