Back in 2011, Mood Media purchased background music company Muzak.
Muzak isn’t required to pay market value on royalties. The company was grandfathered into an older standard of setting royalty rates when the DMCA went into effect in 1998.
In 2012, Mood Media also acquired DMX, a branding agency that provides music to satellite and cable networks.
Now, SoundExchange is suing Muzak for allegedly cheating artists by underpaying royalties.
SoundExchange says Mood Media moved DMX’s cable and satellite contracts over to Muzak, and slashed rates based on Muzak’s older royalty standard.
Michael Huppe, President and CEO of SoundExchange, accuses the company of “playing a shell game to cheat artists and rights holders out of royalties.”
Nina Ulloa covers breaking news, tech, and more: @nine_u
Photo by StockMonkeys.com on Flickr used with the Creative Commons License