Appeals Court Overturns BMI’s Rate Hike on Concert Promoters

Photo Credit: Thurgood Marshall United States Courthouse by Americasroof / CC by 3.0

An appeals court overturns BMI’s significant rate hike for live events, which forced promoters to pay more than double their previous rate.

A federal appeals court has overturned BMI’s recent and dramatic price hike on Live Nation, AEG, and other concert promoters. According to the ruling, the 138% rate increase approved by the lower court judge was “unreasonable,” and that there was “no precedent in the history of the industry” for a new approach to concert revenue.

On Tuesday, the U.S. Court of Appeals for the Second Circuit said that the lower court judge needs to rethink his 2023 ruling, which significantly increased the public performance royalties paid by members of the North American Concert Promoters Association (NACPA). These include major promoters such as Live Nation and AEG.

“The district court adopted a definition of the revenue base that had no precedent in the history of the industry without a compelling reason,” the appeals court stated. “And it identified no change in economic circumstances that would justify a rate of more than double what NACPA has historically paid.”

At issue is not just the rate hike itself, but the lower court judge’s expansion of what concert revenue could be targeted by BMI. That expanded the pool to include not only face-value tickets but also secondary sales, VIP packages, and service fees.

NACPA said it was “gratified” by the ruling on both the rate and the expanded revenue base. “This is a great result for performing artists—who bear the brunt of the royalty costs paid to BMI for live concerts—and for concertgoers and the live concert industry,” read NACPA’s statement.

“We are unwavering in our belief that our songwriters, composers, and publishers deserve more, and we are evaluating all of our options moving forward, including seeking further appellate review,” said BMI, noting it disagrees with “many aspects of the court’s opinion.”

However, despite the overturned rate increase, the appeals court’s decision wasn’t a complete loss for BMI. The appeals court suggested that BMI would still potentially be owed an increase—just not one quite as dramatic as the one approved in the initial ruling back in 2023.

“A well-supported rate for the new BMI/NACPA license would be significantly lower […] but it may be higher than the [previous] rate,” wrote the court. “We remand for the district court to [re-evaluate its decision].”