UMG’s Motion for Summary Judgment
Global Eagle’s Response
Judge Wu’s Tentative Order
Judge Wu’s Supplemental Order
UMG’s Motion for Summary Judgment
Global Eagle’s Response
Judge Wu’s Tentative Order
Judge Wu’s Supplemental Order
The Second Circuit delivered its highly anticipated decision in the Capitol Records v. Vimeo case. Various record labels sued UGC site Vimeo for copyright infringement of sound recording fixed prior to February 14, 1972, so-called Pre-72 recordings. The labels argued that the safe harbor provisions of Sec. 512 of the Copyright Act, which provides immunity to copyright infringement liability to UGC host sites subject to certain conditions, do not apply to Pre 72 recordings, which are not covered by the Copyright Act but rather are the subject to various state statutory and common law protections. Relying heavily on a 2011 report concerning the legal state of Pre 72 recordings from the Copyright Office, the federal district court for the Souther District of New York granted the labels’ motion for summary judgment.1 Vimeo appealed.
In discussing the origins of Sec. 512, the Second Circuit describes the “compromise” that Congress sought to establish between content creators and content users. That compromise provided creators with a ‘notice and takedown’ provision, which allowed creators to avoid filing individual copyright infringement actions against each and every unauthorized use online. That compromise provided users immunity from infringement claims and monitoring responsibilities, provided the user expeditiously remove content in response to a takedown request. This compromise, the Second Circuit concludes, would be illusory if Pre 72 recordings weren’t subject to the 512 safe harbor.
The Second Circuit begins by noting that “the district court accepted without discussion the position taken by the United States Copyright Office in a report prepared in 2011 that the safe harbor does not protect against liability for infringement of pre-1972 sound recordings.” The Second Circuit then dissects the report and its shortcomings.
The Second Circuit points out that
The Report begins its analysis by asserting that § 512(c)’s term “infringement of copyright” is defined in § 501(a) as the violation of “any of the exclusive rights of the copyright owner as provided by sections 106 through 122.” Section 501(a), however, does not contain such a definition. The Copyright Act’s definitions are set forth in § 101, and do not include a definition for “infringement of copyright.
The Second Circuit rejects the Office’s conclusion, reasoning
The statement that one who violates rights identified in specified sections is an “infringer of copyright” does not purport to set forth an exclusive definition of “infringer of copyright.” … To state that conduct x violates a law is not the same thing as saying that conduct x is the only conduct that violates the law. (emphasis in original)
The Second Circuit concludes, therefore, that the safe harbor must include Pre 72 recordings or the entire “compromise” envisaged by Congress would be illusory.
what Congress intended in passing § 512(c) was to strike a compromise under which, in return for the obligation to take down infringing works promptly on receipt of notice of infringement from the owner, Internet service providers would be relieved of liability for user-posted infringements of which they were unaware, as well as of the obligation to scour matter posted on their services to ensure against copyright infringement. The purpose of the compromise was to make economically feasible the provision of valuable Internet services while expanding protections of the interests of copyright owners through the new notice-and-takedown provision. To construe § 512(c) as leaving service providers subject to liability under state copyright laws for postings by users of infringements of which the service providers were unaware would defeat the very purpose Congress sought to achieve in passing the statute.
Second Circuit Decision
Copyright Office Pre-72 Report
Also from TufAmerica’s lawsuit against the Beastie Boys over the alleged sampling of TufAmerica’s recording artist Trouble Funk’s 1982 release “Say What” on the Beastie Boy’s “Shadrach” from their 1989 release Paul’s Boutique, I give you Trouble Funk’s recording contract and co-publishing agreement.
Randy California (born Randall Wolfe) was a singer songwriter and original member of the 60s psychedelic rock band Spirit, best known for “I Got a Line on You,” from the band’s second album.
A portion of the intro to the song “Taurus,” an obscure track on Spirit’s eponymous 1968 recording, bears a resemblance to introduction of “Stairway to Heaven,” the 1971 release by Led Zeppelin that is counted among Rolling Stone magazine’s 500 greatest songs of all time.
You can listen to “Taurus” and decide for yourself.
What is more interesting to me than whether Jimmy Page lifted the intro of one of the most famous songs in rock history from one of its most obscure is an argument in Led Zeppelin’s motion to dismiss, which alleges that Randy California isn’t the “author” of the song and, therefore, lacks standing to sue. The argument–which appears quite strong–is based on Randy’s first songwriting agreement, executed in 1968 when he was only 16. That agreement, which is provided below, defines the relationship between Hollenbeck Music (the publishing company affiliated with Ole Records, to which Spirit was signed for an exclusive recording contract) thusly: “Publisher … employs Writer to render his services as a songwriter and composer …” This language appears to be classic “work made for hire” under which the Copyright Act treats the employer as the author of the copyrighted work. (See Sec. 101, defining a “work made for hire” as “a work prepared by an employee within the scope of his or her employment.”). Said differently, in this context the “work made for hire” doctrine treats the copyright in the song “Taurus” as if Hollenbeck had actually written the notes in question. Under the Copyright Act’s Sec. 501(b), only the legal or beneficial owner of an exclusive right under copyright has standing to sue for its infringement. Importantly, however, “[a] creator of a work made for hire does not qualify as a beneficial owner even if he or she is entitled to royalties.” Ray Charles Found. v. Robinson, 795 F.3d 1109, 1116 n. 7 (9th Cir. 2015). This appears to be fatal to Randy’s heirs attempt to sue Led Zeppelin for infringement!
ASIDE: If Jimmy Page did copy the intro to Stairway to Heaven, then Hollenbeck may have a claim for infringement, so succeeding on this motion to dismiss is not necessarily a lasting victory for Led Zeppelin.
The exclusive songwriter agreement is here.
The motion to dismiss is here.
Judge Liam O’Grady of the Eastern District of Virginia has issued his full opinion and order granting partial summary judgment to plaintiff music publisher BMG against cable / ISP-provider Cox Communications. Judge O’Grady found that Cox’s “repeat offender” policy against customers accused of committing copyright infringement by downloading content without authorization using Cox network was insufficient as a matter of law. Cox could not, therefore, take advantage of the “safe harbor” provisions of Sec. 512 to escape secondary liability to BMG.
When Congress passed the Digital Millennium Copyright Act in 1998, it created four safe harbors that protect ISPs such as Cox from direct and indirect liability for copyright infringement when their involvement is limited to certain activities—transitory digital networking communications, system caching, information residing on systems or networks at the direction of users, and information location tools. See 17 U.S.C. §§ 512(a)–(d). As an Internet Service Provider, Cox sought protection as a “mere conduit for transmission” to protect against claims of secondary copyright infringement liability for the unauthorized exploitation of BMG’s copyrights by Cox’ subscribers.
In order for Cox to qualify for this “safe harbor,” however, it must demonstrate that it has “adopted and reasonably implemented, and informed subscribers and account holders of the service provider’s system or network of, a policy that provides for the termination in appropriate circumstances of subscribers and account holders of the service provider’s system or network who are repeat infringers.” 17 U.S.C. § 512(i)(1)(A). Court’s have interpreted this requirement to obligate an ISP such as Cox has to “adopt” a policy that is “reasonable.” As the Copyright Act makes clear, for a policy to be “reasonable,” it must provide “for the termination in appropriate circumstances of subscribers … who are repeat infringers.” See Capital Records, LLC v. Escape Media Grp., Inc., No. 12-cv-6646, 2015 WL 1402049, at *9 (S.D.N.Y. March 25, 2015).
Although Cox sought the Court to find that an “infringer” could only be someone adjudicated as such by a court of competent jurisdiction, Judge O’Grady held that an ISP only requires “knowledge” of infringement by a particular user. While this might seem problematic–since the ISP only gains “knowledge” by receiving take-down notices from copyright owners and, as demonstrated by the “Dancing Baby” case (Lenz v. UMG), the copyright owner might be wrong–in practice, as described below, an ISP only takes actions against a subscriber after receiving multiple take-down notices over short periods of time.
Judge O’Grady details Cox’ Abuse Tracking System (“CATS”), which includes graduated responses to complaints about its customers unauthorized access to copyrighted content. In summary, here is CATS
1st Complaint – Cox does nothing
2nd Complaint – Cox sends an email to the customer
3rd Complaint – Cox sends the same email again
4th Complaint – Cox sends the same email again
5th Complaint – Cox sends the same email again
6th Complaint – Cox sends the same email again
7th Complaint – Cox sends the same email again
8th Complaint – Cox suspends the customers account, placing the customer in a “soft-walled garden,” which means the customer’s landing page is a warning message and link to reactive the account
9th Complaint – Cox sends customer back into “soft-walled garden”
10th Complaint – Cox sends customer to a “hard-walled garden,” a landing page that directs the customer to call Cox, during which call the customer can request reactivation
11th Complaint – Cox sends customer back to “hard-walled garden”
12th Complaint – Cox sends customer back to “hard-walled garden,” but now a higher-level Cox customer service rep must be involved for reactivation
13th Complaint – same as #12
14th Complaint – the customer’s account is considered for termination
Mind you, these 14 complaints against a single account-holder had to occur with a 6 month time period! That’s more than one complaint against a single account-holder every 2 weeks!! But it was not the volume of complaints that Cox had to receive before considering termination that caused it to lose the Sec. 512(a) safe harbor. It was the fact even after receiving 14 complaints, Cox never actually ever terminated anyone.
Initially, Cox “pretended” to terminate subscribers, only to reactive them immediately. As described in an email from Cox’ Manager of Customer Abuse Operations,
if a customer is terminated for DMCA, you are able to reactivate them after you give them a stern warning about violating our AUP and the DMCA. We must still terminate in order for us to be in compliance with safe harbor but once termination is complete, we have fulfilled our obligation. After you reactivate them the DMCA ‘counter’ restarts; The procedure restarts with the sending of warning letters, just like a first offense. This is to be an unwritten semi-policy..
There were numerous other emails imparting similar instructions.
Cox was more lenient with subscribers illegally downloading copyrighted material because it had little impact on the network; “It does not cause a big problem on the network. Not like spam, Dos attacks, hacking, etc. do.”
In late 2012, Cox abandoned even this illusory termination and simply stopped terminating anyone. BMG introduced evidence that from January 2010 until August 2012, Cox terminated an average of 15.5 account holders a month. Between September 2012 and November 2014, Cox terminated an average of 0.8 accounts per month, notwithstanding the fact that Cox issued 711,000 email warnings and suspensions in response to alleged infringements during this same period. “Cox also admits that of the 22 terminated accounts, 17 of those had also either failed to pay their bills on time or were excessive bandwidth users.”
Again, Judge O’Grady cites to numerous emails in which Cox’ customer service team dismiss knowledge that a subscriber is using the network to access copyrighted content, often because the subscriber is paying Cox a lot of money: “So, the BitTorrent client is running on one of their computers (their child’s, etc.) and they need to uninstall it. This customer pays us over $400/month and if we terminate their service, they will likely cancel the rest of their services. Every terminated Customer becomes lost revenue and a potential Detractor to our Net Promoter Score;” and “This customer will likely fail again, but let’s give him one more change [sic]. [H]e pays 317.63 a month.”
The decision is below:
District Judge Gail Standish (C.D. Cal.) has issued a whimsical opinion dismissing without prejudice a songwriter’s claim that Taylor Swift’s “Shake It Off” copied lyrics from his song “Haters Gone Hate.” In her conclusion, Judge Standish quotes several of Swift’s songs:
At present, the Court is not saying that Braham can never, ever, ever get his case back in court. But, for now, we have got problems, and the Court is not sure Braham can solve them. As currently drafted, the Complaint has a blank space— one that requires Braham to do more than write his name. And, upon consideration of the Court’s explanation in Part II, Braham may discover that mere pleading BandAids will not fix the bullet holes in his case. At least for the moment, Defendants have shaken off this lawsuit.
While a nice humorous twist on the often staid language of a federal district court opinion, I did not find this language the most interesting — from a copyright infringement standpoint. Instead, I was drawn to the discussion of what constitutes protectable expression; i.e., sufficiently original. After a brief discussion of internet searches for lyrics containing “haters gonna hate” and/or “players gonna play,” Judge Standish notes, somewhat ominously, that “Braham should consider whether filing a new complaint claiming that his lyrics “Players Gonna Play” and “Haters Gonna Hate” are original would conflict with his duty under Federal Rule of Civil Procedure 11 not to make factually or legally baseless claims.”
Judge Standish’s opinion is below.
The 9th Circuit recently reversed and remanded a Central District of California’s dismissal of a case involving an attempt by the Ray Charles Foundation to invalidate terminations of copyright transfer effected by 7 of Charles’ 12 heirs. The 9th Circuit found that the Foundation had standing to sue the 7 heirs and challenge the validity of their terminations.
Terminating transfers of copyright rights is one of the most arcane areas of copyright law. When Congress amended the Copyright Act in 1976, it eliminated the 2-term structure of copyright, whereby an author received an initial term of copyright and the could file a renewal notice to further extend the term. In its place, Congress created a single term of copyright, but provided [nearly all] authors or their heirs the inalienable right to terminate any transfer of copyright ownership at some specified future date. The public policy rationale for both constructs is the belief that authors need to be protected “against unremunerative transfers … because of the unequal bargaining position of authors, resulting in part from the impossibility of determining a work’s value until it has been exploited.” H.R. Rep. No. 94-1476, at 124 (1976).
As relevant here, the 1976 Act contains two separate provisions that govern how and when an author may terminate a transfer. Sec. 203(a) covers grants made on or after Jan. 1, 1978 (the effective date of the 1976 Act), which Sec. 304(c) covers grants made before Jan. 1, 1978. While both sections specify who may file a termination of transfer (the author or her heirs), neither section specifies who may challenge a termination. In this case, the 9th Circuit had to determine whether the Foundation had standing to challenge the terminations filed by the 7 heirs.
Noting that the Act does not specifically provide for a private right of action to challenge a termination, the Court of Appeals concluded that the Copyright Act created an implied private right of action to challenge terminations. Next, the 9th Circuit looked at “whether Congress intended to allow a party receiving royalties under a contractual assignment or will to challenge the validity of termination notices.” To answer that question, the 9th Circuit considered whether the Foundation fit within the “zone of interest” of this implied right. In concluding that it did, the Court noted that the Foundation had a material interest in the dispute (e.g., the future payment of royalties), had the proper incentive to forcefully litigate the dispute (more on that below), and resolution of the dispute in its favor would satisfy its grievance with the 7 heirs.
One may wonder why the owner of the copyright (in this case, Warner Chappell, one of the 3 major music publishers and sister company to Warner Music Group) wasn’t the one bringing this litigation. After all, if the terminations are valid, then Warner Chappell runs the risk of losing its share in those future royalties as well. The 9th Circuit reasoned that Warner Chappell’s interest was actually less direct than the Foundation’s. It is common practice for music publishers to renegotiate with songwriters after receiving a termination notice, so the 9th Circuit concluded that Warner Chappell (a) didn’t want to litigate and make the 7 heirs angry because (b) its most likely worst outcome was receiving less royalties in the future, not receiving no royalties in the future.
The Circuit’s decision is here:
Jay Z won a motion to dismiss a copyright infringement case alleging that his alleged sampling and use of the word “oh” in an audio recording and music video entitled Run This Town. Jay Z allegedly sampled the recorded “oh” from the recording Hook &Sling Part I Eddie Bo and the Soul Finders. The “oh” in question appears once in Hook & Sling but allegedly appears 42 times in Run This Town. In a direct refutation of the Bridgeport Music case from the 6th Circuit, the SDNY court relied on 2nd Circuit precedent that distinguishes between “factual copying” and “actionable copying.” The former “requires only the fact that the infringing work copies something from the copyrighted work; the latter . . . requires that the copying is quantitatively and qualitatively sufficient to support the legal conclusion that infringement . . . has occurred.” Judge Kaplan concluded that “In arguing that the Court should find qualitative significance simply because defendants have actually copied its work, plaintiff improperly conflates factual copying and actionable copying.”
Judge McMahon has indicated she is considering reconsidering her prior ruling in which she found a performance right in sound recordings fixed before 1972. Her order is below.
A magistrate judge has recommended that the lawsuit brought by VerStandig Broadcasting should be dismissed on jurisdictional grounds; i.e., for lack of Article III standing. In finding that the plaintiffs’ declaratory action failed to raise a justiciable controversy, the judge found that the issue of copyright liability is not “traceable” to SoundExchange because SoundExchange does not own or enforce copyrights Verstandig might infringe. As the judge stated: “Any dispute that may arise in that scenario is between the copyright owner and the broadcaster. Thus, the copyright owners themselves, who are ‘not party to this litigation, must act’ (or not act, as the case may be) in order for this particular injury to be cured.”