Rhoads v. Margolis, No. B249800 (Cal. App. Ct., 2d Dist. - Div. 7, Jan. 26, 2015).
Only a breach of contract claim survived in an action, brought by the family of a well-known rock guitarist who died in a 1982 plane crash, against Defendants based on the family's grant of the right to use personal information and memorabilia to make a documentary film about the deceased guitarist. When the documentary project faltered, defendants instead published a book about the guitarist. The family sued, alleging the book was based on materials they had provided for the exclusive purpose of making the documentary film. Defendants moved to dismiss the complaint.
On appeal, the Court found that the Anti-SLAPP Statute (section 425.16) applied because the principal thrust of every claim was premised on the allegation that the defendants, in researching, writing and publishing the book, used the family's proprietary material provided solely for the purpose of the documentary. Whether or not defendants violated the terms of the agreement, their conduct in writing and publishing the book qualified as a form of protected activity. With the exception of the breach of contract claim, the family failed to establish a probability of prevailing on its claims. The fraud claim failed because there was no allegation that the defendants intended to create the book at the time of the agreement. The misappropriation claim (based on the right of privacy) failed because the alleged acts did not implicate the personal privacy or publicity rights of the guitarist's family members. Additionally, the life and death of the guitarist was a matter of public interest. The unfair competition claim failed because plaintiffs had not articulated an actionable manner in which the public was likely to be deceived by the book or that consumers suffered substantial injury.
January 23, 2015
Don Henley Suit Against Clothing Company Survives Dismissal
Henley v. Duluth Holdings, No. CV 14-7827 DSF (C.D. Cal. Jan. 21, 2015).
Don Henley's lawsuit concerning an advertisements for Henley-style shirts that urged customers to “Don a henley, take it easy,” survives defendant's motion to dismiss. The defendant apparel company had argued that the promotion was a joke. The Court found that Defendant has not established that its use of Plaintiff’s name – and the name of one of his band’s most famous songs – in its advertisement was sufficiently transformative on its face that a motion to dismiss should be granted.
Don Henley's lawsuit concerning an advertisements for Henley-style shirts that urged customers to “Don a henley, take it easy,” survives defendant's motion to dismiss. The defendant apparel company had argued that the promotion was a joke. The Court found that Defendant has not established that its use of Plaintiff’s name – and the name of one of his band’s most famous songs – in its advertisement was sufficiently transformative on its face that a motion to dismiss should be granted.
January 20, 2015
Jay-Z Must Produce Concert Revenue In 'Big Pimpin' Infringement Suit
Fahmy v. Jay-Z, No. 2:07-cv-05715-CAS, 2015 BL 8688 (C.D. Cal. Jan. 12, 2015).
Jay Z's motion for review of a Magistrate Judge's ruling directing him to produce documents concerning his concert revenues was denied. This action concerns Jay Z's alleged unauthorized sampling of "Khosara, Khosara" from the 1960 Egyptian film Fata Ahlami in his 2000 hit song "Big Pimpin'." A Magistrate Judge had ordered Jay-Z to produce the amount of revenue he earned from concerts where he performed "Big Pimpin' in order to allow the plaintiff to calculate his damages. Jay-Z moved for review of the magistrate's order under Federal Rule of Civil Procedure 72(a). The District Court denied the motion. The magistrate's order was not "clearly erroneous or contrary to law." The discovery of concert revenue "appears reasonably calculated to lead to the discovery of admissible evidence" concerning the existence and amount of damages. Fed. R. Civ. P. 26(b)(1). Nor was there evidence that the burden of production was undue.
Jay Z's motion for review of a Magistrate Judge's ruling directing him to produce documents concerning his concert revenues was denied. This action concerns Jay Z's alleged unauthorized sampling of "Khosara, Khosara" from the 1960 Egyptian film Fata Ahlami in his 2000 hit song "Big Pimpin'." A Magistrate Judge had ordered Jay-Z to produce the amount of revenue he earned from concerts where he performed "Big Pimpin' in order to allow the plaintiff to calculate his damages. Jay-Z moved for review of the magistrate's order under Federal Rule of Civil Procedure 72(a). The District Court denied the motion. The magistrate's order was not "clearly erroneous or contrary to law." The discovery of concert revenue "appears reasonably calculated to lead to the discovery of admissible evidence" concerning the existence and amount of damages. Fed. R. Civ. P. 26(b)(1). Nor was there evidence that the burden of production was undue.
January 16, 2015
Sirius To Be Liable To Turtles On Pre-1972 Sound Recording Claims
Flo & Eddie, Inc. v. Sirius XM Radio Inc., 1:13-cv-05784 (S.D.N.Y. filed Jan. 15, 2015) [Doc. 114].
The Court found that Sirius will be found liable to the Turtles' successor in interest for common law copyright infringement of pre-1972 sound recordings, but deferred entering judgment as to liability until the plaintiff decided whether to proceed individually or as a class action representative.
First, the Court rejected Sirius' argument that the plaintiff's had not yet established ownership of the recordings. The Court found that documentary evidence of the transfer of rights from the Turtles to the plaintiff was not required because an assignment of common law copyrights need not be in writing to be valid under New York law; that a court may infer that a transfer has taken place from subsequent conduct.
Second, the Court rejected Sirius' argument that it had an implied license. There was no evidence that the recordings were created at Sirius' request (indeed, Sirius did not even exist when the recordings were made), nor any evidence that plaintiff "handed over" the recordings to Sirius (let alone with intent for Sirius to copy and distribute the recordings). Mere acquiescence was insufficient.
Third, the Court rejected Sirius' waiver and estoppel defenses. The Court found that plaintiff's failure to pursue infringement actions for many years while the recordings were played on the air did not constitute a waiver. Inaction was insufficient. The estoppel defense failed because there was no proof that Plaintiff made any false representations to Sirius or concealed any material fact with intent to deceive. Even if Sirius relied on general industry practice as to pre-1972 recordings, and the lack of any lawsuits over the years challenging that practice, the Court found that was distinguishable from relying on affirmative conduct by the plaintiff.
Fourth, the Court found that there is a three year statute of limitations under New York law, and that while plaintiff's claim was not time-barred, it could only recover damages for infringement going back three years. The Court distinguished the case from those in which ownership of the copyright is in dispute between the parties; here, infringement is the primary issue (there is no claim by Sirius that it owns the copyrights).
Lastly, the Court found that it would defer on ruling on the merits until the issue of class certification was decided. The Court directed plaintiff to notify it if it intends to proceed individually or as a class action representative.
The Court found that Sirius will be found liable to the Turtles' successor in interest for common law copyright infringement of pre-1972 sound recordings, but deferred entering judgment as to liability until the plaintiff decided whether to proceed individually or as a class action representative.
First, the Court rejected Sirius' argument that the plaintiff's had not yet established ownership of the recordings. The Court found that documentary evidence of the transfer of rights from the Turtles to the plaintiff was not required because an assignment of common law copyrights need not be in writing to be valid under New York law; that a court may infer that a transfer has taken place from subsequent conduct.
Second, the Court rejected Sirius' argument that it had an implied license. There was no evidence that the recordings were created at Sirius' request (indeed, Sirius did not even exist when the recordings were made), nor any evidence that plaintiff "handed over" the recordings to Sirius (let alone with intent for Sirius to copy and distribute the recordings). Mere acquiescence was insufficient.
Third, the Court rejected Sirius' waiver and estoppel defenses. The Court found that plaintiff's failure to pursue infringement actions for many years while the recordings were played on the air did not constitute a waiver. Inaction was insufficient. The estoppel defense failed because there was no proof that Plaintiff made any false representations to Sirius or concealed any material fact with intent to deceive. Even if Sirius relied on general industry practice as to pre-1972 recordings, and the lack of any lawsuits over the years challenging that practice, the Court found that was distinguishable from relying on affirmative conduct by the plaintiff.
Fourth, the Court found that there is a three year statute of limitations under New York law, and that while plaintiff's claim was not time-barred, it could only recover damages for infringement going back three years. The Court distinguished the case from those in which ownership of the copyright is in dispute between the parties; here, infringement is the primary issue (there is no claim by Sirius that it owns the copyrights).
Lastly, the Court found that it would defer on ruling on the merits until the issue of class certification was decided. The Court directed plaintiff to notify it if it intends to proceed individually or as a class action representative.
January 13, 2015
Iggy Azalea Granted Preliminary Injunction To Prevent The Posting Of Early Recordings
Kelley v. Primco Management, Inc., No. 14-cv-07263 (C.D. Cal. Jan. 12, 2015).
Pop star Iggy Azalea obtained a preliminary injunction based on claims that Defendants misappropriated the contents of her computer and began releasing infringing songs and music videos. Defendants claims that they had authority to use Azalea's name, likeness and various intellectual property assets pursuant to a Recording Agreement. Azalea claimed that the document was forged, and that was the key issue before the Court because no party disputed that Defendants had exploited Azalea's copyrights, trademarks and right of publicity. The Court held an evidentiary hearing and discussed the evidence presented on whether the document was forged. It concluded that, even though there was sharply conflicting testimony, Azalea had at the very least raised serious questions about the validity of the agreement, and therefore had raised serious questions going to the merits of her claims which were enough to grant a preliminary injunction. The court then considered the factors necessary for a preliminary injunction -- likelihood of success on the merits, threat of irreparable harm, balancing the equities, and the public interest -- and found that an injunction was warranted. Azalea was ordered to post a $20,000 bond.
Pop star Iggy Azalea obtained a preliminary injunction based on claims that Defendants misappropriated the contents of her computer and began releasing infringing songs and music videos. Defendants claims that they had authority to use Azalea's name, likeness and various intellectual property assets pursuant to a Recording Agreement. Azalea claimed that the document was forged, and that was the key issue before the Court because no party disputed that Defendants had exploited Azalea's copyrights, trademarks and right of publicity. The Court held an evidentiary hearing and discussed the evidence presented on whether the document was forged. It concluded that, even though there was sharply conflicting testimony, Azalea had at the very least raised serious questions about the validity of the agreement, and therefore had raised serious questions going to the merits of her claims which were enough to grant a preliminary injunction. The court then considered the factors necessary for a preliminary injunction -- likelihood of success on the merits, threat of irreparable harm, balancing the equities, and the public interest -- and found that an injunction was warranted. Azalea was ordered to post a $20,000 bond.
December 24, 2014
"Whomp! (There It Is)" $2 Million Jury Award Affirmed
In re: Isbell Records, Inc. (Isbell v. DM Records), No. 13-40878 (5th Cir. Dec. 18, 2014).
The Fifth Circuit affirmed a finding that plaintiff owned the copyright in the composition of the song "Whomp! (There It Is)", that defendant was liable for infringement based on its exploitation of the song for year, and the jury's award of over $2 million in damages. The primary issue was whether a 50% interest in the song had originally been assigned to the plaintiff or the defendant's predecessor-in-interest (the other 50% remained with the writers/producers of the song). The 5th Circuit held that California contract interpretation law applied, and that the lower court correctly found that the contract granted the 50% interest in the song to the plaintiff.
On appeal of defendant's trial motion under Fed. R. Civ. P. 50 for judgment as a matter of law, the defendant raised two issues regarding the district court's interpretation of the recording agreement as assigning a single 50% interest to plaintiff. First, the Court rejected defendant's argument that the lower court erred in interpreting the agreement without asking the jury to make any findings on extrinsic evidence. Second, the Court rejected defendant's argument that the agreement also assigned a second 50% interest in the composition copyright because the argument had not previously pursued that theory and had disclaimed the theory at an earlier hearing. In short, the defendant could not raise its "two assignments theory" after not previously asserting it at trial or in its earlier Rule 50 motion.
On appeal of defendant's motion under Fed. R. Civ. P. 60(b) for relief from judgment based on fraud and lack of standing, the Court rejected defendant's argument that it was prevented from presenting the defense of plaintiff's lack of standing. Even if the plaintiff had improperly withheld a certain document, it would not have affected plaintiff's standing and thus would not have affected defendant's defense.
With respect to the jury's damage award of over $2 million, the Court rejected defendant's argument that plaintiff should have only been awarded 1/2 of that amount as 50% owner of the copyright. First, defendant did not object to the jury charge during trial. And under the plain-error standard of review, the district court did not err. Notably, the 5th Circuit found that Edward B. Marks Music Corp. v. Jerry Vogel Music Co., 140 F.2d 268 (2d Cir. 1944), was inapplicable to the issue of first impression whether a partial owner of a copyright can ever be awarded infringement damages for his co-owner's share. Specifically, the jury could have found that plaintiff was entitled to 100% of the royalties in the first instance as administrator/publisher of the song. In other words, because plaintiff was obligated to account to the other 50% owners (the producers/writers), plaintiff could recover 100% damages and any issue as to distributions would be a separate case between the co-owners not involving the defendant.
Lastly, in affirming denial of defendant's Fed. R. Civ. P. 59 motion for a new trial, the Court found that plaintiff's closing statement -- referring to defendant as a "thief -- was not abusive and improper. Defendant did not object to the closing statement at trial and thus the standard of review was plain error. Evidence was presented at trial form which the jury could find that defendant's conduct was willful and that defendant stole the copyrights from plaintiff. Further, any prejudice was minimized by the judge's instructions and the statements concerned damages rather than liability. Further, plaintiff ultimateley elected actual damages which were higher than statutory damages, and willfulness is not an element of actual damages calculation.
The Fifth Circuit affirmed a finding that plaintiff owned the copyright in the composition of the song "Whomp! (There It Is)", that defendant was liable for infringement based on its exploitation of the song for year, and the jury's award of over $2 million in damages. The primary issue was whether a 50% interest in the song had originally been assigned to the plaintiff or the defendant's predecessor-in-interest (the other 50% remained with the writers/producers of the song). The 5th Circuit held that California contract interpretation law applied, and that the lower court correctly found that the contract granted the 50% interest in the song to the plaintiff.
On appeal of defendant's trial motion under Fed. R. Civ. P. 50 for judgment as a matter of law, the defendant raised two issues regarding the district court's interpretation of the recording agreement as assigning a single 50% interest to plaintiff. First, the Court rejected defendant's argument that the lower court erred in interpreting the agreement without asking the jury to make any findings on extrinsic evidence. Second, the Court rejected defendant's argument that the agreement also assigned a second 50% interest in the composition copyright because the argument had not previously pursued that theory and had disclaimed the theory at an earlier hearing. In short, the defendant could not raise its "two assignments theory" after not previously asserting it at trial or in its earlier Rule 50 motion.
On appeal of defendant's motion under Fed. R. Civ. P. 60(b) for relief from judgment based on fraud and lack of standing, the Court rejected defendant's argument that it was prevented from presenting the defense of plaintiff's lack of standing. Even if the plaintiff had improperly withheld a certain document, it would not have affected plaintiff's standing and thus would not have affected defendant's defense.
With respect to the jury's damage award of over $2 million, the Court rejected defendant's argument that plaintiff should have only been awarded 1/2 of that amount as 50% owner of the copyright. First, defendant did not object to the jury charge during trial. And under the plain-error standard of review, the district court did not err. Notably, the 5th Circuit found that Edward B. Marks Music Corp. v. Jerry Vogel Music Co., 140 F.2d 268 (2d Cir. 1944), was inapplicable to the issue of first impression whether a partial owner of a copyright can ever be awarded infringement damages for his co-owner's share. Specifically, the jury could have found that plaintiff was entitled to 100% of the royalties in the first instance as administrator/publisher of the song. In other words, because plaintiff was obligated to account to the other 50% owners (the producers/writers), plaintiff could recover 100% damages and any issue as to distributions would be a separate case between the co-owners not involving the defendant.
Lastly, in affirming denial of defendant's Fed. R. Civ. P. 59 motion for a new trial, the Court found that plaintiff's closing statement -- referring to defendant as a "thief -- was not abusive and improper. Defendant did not object to the closing statement at trial and thus the standard of review was plain error. Evidence was presented at trial form which the jury could find that defendant's conduct was willful and that defendant stole the copyrights from plaintiff. Further, any prejudice was minimized by the judge's instructions and the statements concerned damages rather than liability. Further, plaintiff ultimateley elected actual damages which were higher than statutory damages, and willfulness is not an element of actual damages calculation.
Copyright Royalty Board Royalty Rates For Performance Of Sound Recordings Affirmed
Music Choice v. Copyright Royalty Board, No. 13-1174/13-1183 (D.C. Cir. Dec. 19, 2014).
In 2013, the Judges of the Copyright Royalty Board (CRB) issued a determination setting royalty rates and defining terms for statutorily defined satellite digital audio radio services and preexisting subscription services. SoundExchange, which collects and distributes royalties, argued that the CRB arbitrarily set rates too low and that the CRB erred in defining "Gross Revenue" and eligible deductions. Music Choice, which provides music-only television channels, also appealed arguing that the Judges set the rates too high.
The Court of Appeals held that the CRB acted within its broad discretion to set rates for compulsory licenses of the digital performance of sound recordings, and therefore affirmed the determination of royalty rates. The appellate court found that the CRB did not exercise its broad discretion in an arbitrary or capricious manner when setting royalty rates for satellite digital audio radio services and preexisting subscription services.
For satellite digital audio radio services, the rate was set at 11%; in order to avoid disruption, the CRB adopted a staggered schedule beginning at 9% in 2013 and increasing by 0.5% annually until achievement of 11% in 2017.
For preexisting subscription services, the rate was set at 8.5% with an upward adjustment for Music Choice's planned channel expansion. The rate would start at 8% in 2013 and increase to 8.5% for 2014 through 2017.
In 2013, the Judges of the Copyright Royalty Board (CRB) issued a determination setting royalty rates and defining terms for statutorily defined satellite digital audio radio services and preexisting subscription services. SoundExchange, which collects and distributes royalties, argued that the CRB arbitrarily set rates too low and that the CRB erred in defining "Gross Revenue" and eligible deductions. Music Choice, which provides music-only television channels, also appealed arguing that the Judges set the rates too high.
The Court of Appeals held that the CRB acted within its broad discretion to set rates for compulsory licenses of the digital performance of sound recordings, and therefore affirmed the determination of royalty rates. The appellate court found that the CRB did not exercise its broad discretion in an arbitrary or capricious manner when setting royalty rates for satellite digital audio radio services and preexisting subscription services.
For satellite digital audio radio services, the rate was set at 11%; in order to avoid disruption, the CRB adopted a staggered schedule beginning at 9% in 2013 and increasing by 0.5% annually until achievement of 11% in 2017.
For preexisting subscription services, the rate was set at 8.5% with an upward adjustment for Music Choice's planned channel expansion. The rate would start at 8% in 2013 and increase to 8.5% for 2014 through 2017.
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