Claims Dismissed In Aretha Contract Suit

BLD Productions, LLC v. Viacom, Inc., NYLJ 1202489492977, at *1 (SDNY, Decided March 31, 2011) (Gardephe, J.)

Summary: Plaintiff and defendant Viacom's affiliate negotiated a March 8, 2001, agreement for a benefit concert by Aretha Franklin. On April 10, 2001, Franklin granted plaintiff her rights to video and audio recordings of the concert. Despite the agreement's March 8, 2001, date and the concert's April performance, plaintiff claimed that the agreement was not finalized until 2006. Plaintiff alleged breaches of oral and written contract, and the implied duty of good faith and fair dealing, contending that Viacom and its affiliate failed to engage a distributor to make, market and distribute recordings of the concert, their failure to account for sales and revenues and to pay royalties to plaintiff.

Judge Gardephe dismissed the case against Viacom because it was not a party to the agreements, and plaintiff did not plead sufficient facts to pierce the corporate veil. Judge Gardephe also dismissed claims against Viacom's affiliate to the extent that plaintiff's breach of written contract claim were based on the affiliate's failure to provide master recordings to plaintiff. Plaintiff's claim that the agreement required the affiliate to secure a distributor was deemed time-barred by the New York statute of limitations. Judge Gardephe alsor dismissed plaintiff's claim for breach of an oral contract.

Copyright Royalty Board Final Rule

37 CFR Part 380: Digital Performance Right in Sound Recordings and Ephemeral Recordings;

Final Rule. The Copyright Royalty Judges announced their final determination of the rates and terms for two statutory licenses, permitting certain digital performances of sound recordings and the making of ephemeral recordings, for the period beginning January 1, 2011, and ending on December 31, 2015. (Effective Date March 9, 2011).

For example, a Commercial Webcaster will pay a royalty of: $0.0019 per performance for 2011; $0.0021 per performance for 2012; $0.0021 per performance for 2013; $0.0023 per performance for 2014; and $0.0023 per performance for 2015. Depending on the number of "tuning hours," a Noncommercial Webcaster will pay an annual per channel or per station performance royalty of $500 in 2011, 2012, 2013, 2014, and 2015; or, $0.0019 per performance for 2011; $0.0021 per performance for 2012; $0.0021 per performance for 2013; $0.0023 per performance for 2014; and $0.0023 per performance for 2015. (Section 380.3).

Who Owns A Grammy?

National Academy of Recording Arts & Sciences Inc. v. Gotta Have It! Collectibles Inc. dba Gotta Have and Roll.com, No. 11-103366 (Sup. Ct. NY. Co. filed 3/18/11) -- summons with notice for conversion of the Grammy Award Statuette awarded to Stevie Wonder for Songwriter of the Year (1973).

LimeWire Damages in Trillions "Absurd"

Arista Records LLC v. Lime Group LLC, 06 CV 5936, NYLJ 1202486126807 (S.D.N.Y. Mar. 10, 2011)

The Court already had granted summary judgment in favor of Plaintiffs on their claims against Defendants LimeWire LLC ("LW"), Lime Group LLC ("Lime Group"), and Mark Gorton (collectively, "Defendants") for secondary copyright infringement. The Court found that Defendants had induced Multiple users of the Lime Wire online file-sharing program ("Lime Wire") to infringe Plaintiffs' copyrights. The litigation is in the damage phase.

Plaintiffs identified approximately 11,000 sound recordings that they allege were infringed through the Lime Wire system. For the over 9,500 post-1972 sound recordings, Plaintiffs elected to seek statutory damages under Section 504(c)(1) of the Copyright Act.

"Squarely before the Court is a threshold dispute regarding Plaintiffs entitlement to statutory damage awards against Defendants: Where, as here, Defendants have been found liable for inducing numerous individual Lime Wire users infringe Plaintiffs' copyrights, may Plaintiffs recover from Defendants a separate statutory award for each individual's infringement of a work as to which Defendants are jointly and severally liable? Or, rather, are Plaintiffs limited to one statutory damage award per work from Defendants, regardless of the number of direct infringers of that work with whom Defendants are jointly and severally liable?"

The Court held that Plaintiffs were entitled to a single statutory damage award from Defendants per work infringed.

If one multiplies the maximum statutory damage award ($150,000) by approximately 10,000 post-1972 works, Defendants faced a potential award of a billion dollars in statutory damages alone. If Plaintiff's were able to pursue a statutory damage theory predicated on the number of direct infringers per work, Defendants' damages could reach into the trillions. As Defendants noted, Plaintiffs were suggesting an award that is "more money than the entire music recording industry has made since Edison's invention of the phonograph in 1877." This result is absurd, the Court found.

In sum, the Court found that the most plausible interpretation of Section 504(c) is one that authorizes only a single statutory damage award per work against a secondarily liable defendant, particularly in the context of the mass infringement found in the context of online peer-to-peer file sharing. Accordingly, the Court held that Plaintiffs were entitled to a single statutory damage award from Defendants per work infringed, regardless of how many individual users directly infringed that particular work.

Trademark Plaintiff Denied Infringement Damages

Rodgers v. Wright, 04 Civ. 01149 (RJH), NYLJ 1202484847172, at *1 (SDNY, Decided March 1, 2011)

Judge Holwell holds (1) plaintiff is not granted damages; (2) plaintiff is not granted attorneys' fees; and (3) the permanent injunction need not be modified.

Plaintiff Nile Rodgers, a founder of the music group Chic, brought the trademark infringement action against two singers who once performed as part of Chic, defendants Norma Jean Wright and Luci Martin. Rogers is the owner of a registered trademark in "Chic," and, along with his late partner Bernard Edwards, has exploited the mark in commerce continuously since 1977. Wright and Martin claimed no ownership of the mark, but had performed in the United States and abroad as "Ladies of Chic" and "Original First Ladies of Chic," and sometimes simply as "Chic." The Court previously found (1) that plaintiff's mark was protectable; (2) that defendants' uses of "Chic," "Ladies of Chic," and "Original First Ladies of Chic," were likely to cause confusion; (3) that defendants could not establish a fair use defense; and (4) that any relevant injunction should have extraterritorial effect. Thereafter, the Court permanently enjoined defendants and each of their agents, servants, employees, attorneys, and persons in active concert or participation with them from using or commercially exploiting the word "Chic" anywhere in the world, generally and specifically in connection with concert promotion, publicity, and performance; and also established other restrictions.

Plaintiff sought defendants' profits under Section 35 of the Lanham Act. The Court concluded that plaintiff had failed to establish that defendants acted with willful deception, and therefore that plaintiff was not entitled to an award of profits. "Having not presented any evidence of willfulness, and as it appears that defendants' actions were not willful, awarding damages in this case would be inappropriate."

Plaintiff also sought attorneys' fees. The Court denied the motion because plaintiff failed to show oppressive litigation tactics or bad faith.

Right Of Publicity In Washington State Hendrix Case

Experience Hendrix, LLC v. Hendrixlicensing.com, Ltd., No C09-285Z (W.D. Wash. Feb. 8, 2011). Decision here.

Washington State enacted a law that rights of publicity do not expire upon the death of the individual. Defendants distribute merchandise bearing Jimi Hendrix's likeness, accompanied with his name. If applied in the litigaiton, the statue would deem all rights to the use of Jimi Hendrix's name, voice, signature, photograph, or likeness in plaintiff (as assignee of Hendrix's intestate heir). Such result would preclude defendants, absent plaintiff's consent, from commercially distributing images of Jimi Hendrix, at least in the State of Washington.

Although plaintiff sought to avoid the "constitutional thicket" concerning the Washington statute by not pleading a cause of action thereunder, the Court held that plaintiff's allegations implicate the right of publicity. Thus, plaintiff could not avoid "the fundamental issue in this case, namely whether [the statue] " had the effect of vesting in [plaintiff] any right of publicity relating to JImi Hendrix such that [plaintiff] may preclude defendants from trading in images of, or art created by, Jimi Hendrix."

In analyzing the constitutionality of the statute, the Court noted that the statute purports to govern whether a right of publicity exists, whether it continues post-mortem, and how it may be transferred during life and after death, regardless of where the particular individual or personality is or was domiciled. The Court held that the statute violated the Due Process and Full Faith and Credit clauses of the Constitution and consequently, under New York law, plaintiff had no publicity rights. The court stressed that the statute purports to govern advertising and fundraising activities everywhere. Also, under the Due Process Clause, to apply its own law, Washington must have a significant contact or significant aggregation of contacts, creating state interests, such that choice of its law is neither arbitrary nor fundamentally unfair. The Court held that applying Washington law to the issue of descendbility was arbitrary and unfair because the domicile at death has substantial relevant contacts.

The court also found that application of the Washington statute would cause forum shopping by having plaintiffs divert sales to Washington, and would require users of the rights (potential defendants) to attempt to restrict commercial activity to avoid application of the statute. Applying the domicile-at-death rule would avoid these problems and provide certainty.

Spanish Language Adapter Loses Suit Against Coke

Vergara Hermosilla v. Coca-Cola Co., No. 10-21418 (S.D. Fla. Feb. 23, 2011). Decision here.

Plaintiff was hired by Coca Cola to adapt a song into Spanish. Plaintiff requested an "adapter's share." During a telephone call with defendant, Plaintiff agreed to relinquish any copyright interest in the work. In an email later that day, Plaintiff wrote "For the adaptation, you may consider it a work for hire with no economic compensation to that respect. I believe what's legal is a dollar."

The Court granted Defendant's motion for summary judgment. Relying on section 204 of the Copyright Act, the Court held that Plaintiff's copyright interest -- the adapted lyrics -- was conveyed by a signed writing (the email). An irrevocable agreement was reached, so that later communications between the parties concerning a written contract that differed from the parties' agreement did not alter the parties' actual agreement. "Therefore, because Coca Cola cannot be sued based on a copyright interest it owns, Coca Cola is entitled to summary judgment on all counts."