Isaiah Poritz (Bloomberg Law.com)
Pandora Media LLC failed to advance allegations that a group of comedians including the estates of Robin Williams and George Carlin have monopolized the market for comedy licensing, a major blow to the music streaming giant that’s facing nine lawsuits claiming it hasn’t paid royalties to stream comedy albums.
US District Judge Mark C. Scarsi on Wednesday dismissed Pandora’s antitrust counterclaims lodged against the comedy licensing organization WordCollections Inc. and other comedians, but allowed Pandora to amend the complaint.
“The Court doubts whether Pandora can allege the necessary facts at this stage,” Scarsi noted.
If Pandora loses the cases, it could be on the hook for tens of millions dollars in damages, and the platform has indicated it would have to remove comedy recordings from its platform all together. An attorney for Pandora didn’t immediately return a request for comment.
Alleged Monopoly
In responding to the lawsuits, Pandora in May argued that WordCollections has created a “monopolistic portfolio” by collectively licensing the rights to the underlying jokes used in recorded stand up routines, which harms competition in the licensing market.
WordCollections only offers a “blanket license” that forces streamers like Pandora to purchase the rights to more comedy albums than the platform actually needs, Pandora said in its filings. A healthy licensing market would allow individual rights owners to compete against each other, Pandora said.
But Scarsi was unconvinced, finding that Pandora failed to show that WordCollections had amassed enough market power to create a monopoly. “Pandora offers recordings by several thousands other comedians,” while WordCollections represents about 30 comedians, the judge said.
Pandora also couldn’t show that the comedy recordings it wanted to use were illegally tied to “less desirable material,” like other spoken-word content. “The counterclaim completely lacks allegations about the volume of commerce in the less-desirable material market affected by Word Collections’ tying,” the judge said.
Price Fixing Claim
The streaming service’s price fixing arguments also failed. The counterclaim lacked specific details about how individual comedians conspired with WordCollections, Scarsi said.
Pandora “has not alleged any agreement other than agreements between the comedians and WordCollections for WordCollections to represent the comedians in licensing negotiations,” he said.
The music streaming service owned by SiriusXM Holdings Inc. filed similar antitrust counterclaims in September against Spoken Giants, another comedy licensing group.
The nine lawsuits from comedians including George Lopez and Lewis Black all allege that Pandora failed to obtain separate licenses from the comedians to use their work since the platform began streaming comedy in 2011. The comedians argued that they should be paid as the authors of their jokes, similar to how songwriters and composers are paid a separate royalty by streaming services as the authors of their songs.
The suits, filed throughout the year by the law firm King & Ballow, were consolidated under Scarsi in the US District Court for the Central District of California.
Mayer Brown LLP represents Pandora. King & Ballow represents the comedians.
The case is Yellow Rose Productions Inc. v. Pandora Media LLC, C.D. Cal., No. 2:22-cv-00809, 10/26/22.
