Last Thursday, Judge Kimbra Wood of the US District Court for the Southern District of New York handed Defendant Lime Group, LLC, operators of one of the more prominent post-Napster peer-to-peer sharing platforms, LimeWire, something of a moral victory in a lawsuit brought by the RIAA and five of the major labels.

The back story is that the RIAA and the major labels joined forces as plaintiffs to sue Lime Group in August 2006, fresh off the heels of the U.S. Supreme Court’s ruling in MGM Studios, Inc. v. Grokster, LTD., 545 U.S. 913 (2005).  Plaintiffs alleged of course that LimeWire committed secondary copyright infringement of its sound recordings – namely that it aided and encouraged its users to share copyright-protected music amongst themselves without paying for it.  In May 2010, Judge Wood agreed and granted summary judgment against Lime Group on Plaintiffs’ substantive claims.  Thus, there is no longer a question as to whether LimeWire committed secondary copyright infringement.  All that remains is a jury trial to determine the amount of damages Lime Group owes the majors.

This is where things get tricky.  In recognition of the fact that copyright holders frequently suffer insignificant actual damages when another party infringes their copyright, Section 504 of the U.S. Copyright Act allows a plaintiff to recover fixed statutory damages in certain situations.  The range of statutory damages extends from as little as $200 where the defendant can prove it was unaware its actions constituted infringement, all the way up to as much as $150,000 in the case of willful copyright infringement.  Importantly, the sum is multiplied by the number of infringing actions – for example, if you knowingly and willingly use two different copyright-protected photographs on your website, you could be looking at a bill for $300,000 unless you have a good defense.

Anyhow, you can probably guess what was coming next.  As Plaintiffs alleged that LimeWire was responsible for potentially thousands of users downloading approximately 9,715 copyrighted sound recordings, Plaintiffs filed for partial summary judgment requesting that the statutory damages be multiplied by the number of LimeWire users who downloaded any of those 9,715 songs.  Meaning, Plaintiffs sought statutory damages of somewhere between $750-150,000 for every LimeWire user that downloaded the song, not merely the same measure of statutory damages multiplied by the 9,715 individual songs.

Instead, Judge Wood allowed cooler heads to prevail and held that Lime Group could at most be saddled with a measure of statutory damages per work infringed, not per work infringed per user.  In addition to a close reading of Section 504′s requirement that a singular award be available where “any two or more infringers are jointly and severally liable,” the court wisely points out that Plaintiffs’ reading of Section 504 would likely lead to an utterly absurd result.  If you do the math real quick, you’ll realize what we’re talking about here.  Under the calculation urged by Defendants, they are at least looking at statutory damages in the fairly large neighborhood of $7.5 million – $1.5 billion.  Under Plaintiffs’ calculation however, Defendants could be staring at the barrel of statutory damages well into the trillions.  Judge Wood wisely considered this absurd for, as the Court pointed out, “Plaintiffs are suggesting an award that is more money than the entire music recording industry has made since Edison’s invention of the phonograph in 1877″.

* The joint and severally liable infringers in this case being LimeWire and the individual user who illegally downloaded the sound recording.

Yes, this is why I use the term “moral victory.”  A potential billion dollar damage award seems like a pretty hefty figure for any defendant to actually be hoping for, but I guess it’s better than a damages ranging well into the trillions of dollars.  All the same, definitely a victory for Lime Group on an interesting legal question that may very well be bound for the appellate courts.

The trial on the damages issue is set to begin on May 2nd.

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We’ve all heard the song.  John Fogerty wants the coach to put him in centerfield.  He’s ready to play.  When you ask?  Oh, that’s right.  Today.  Well, okay, maybe I’m presuming we;ve all been to a baseball game at some point since 1985.  But perhaps that’s a faulty assumption, despite the crossover love fest between indie rock and baseball since the ’90s.  In 1985, John Fogerty, former leader of the East Bay swamp rockers Creedence Clearwater Revival, came out of nowhere to score a huge summer hit with his album Centerfield and its monster baseball jam of the same name.  I say that he came out of nowhere because Fogerty did little recording between the end of Creedence in 1972 and 1985.  To understand his prolonged absence, and to learn the most interesting story stemming from Centerfield*, we have to return to Fogerty’s Creedence days.

* Let me make one thing clear: Centerfield is not what I myself would consider a great record or, for that matter, song.  But this story has nothing to do with the quality of the album or ubiquity of the song.  So don’t worry, I’m not going to urge on you some critical reevaluation of this record.  And though I don’t think Creedence really needs any sort of critical reevaluation, I will say that I only really started to love them when I read a review of the Minutemen that contended they were essentially a sped up version of Creedence.

Fogerty, his classmates Stu Cook and Doug Clifford, and his older brother Tom began playing together in and around the San Francisco Bay Area in the early ’60s.  Band gets going when the boys are a few years out of high school, they develop a local following, and they sign to Fantasy Records, a fledgling SF label known primarily for Vince Guaraldi jazz records.  Initial owners like the boys but get out of the industry after they make some money on Creedence’s early success as the faux-British Invasion band The Golliwogs.  Enter Saul Zaentz, a Fantasy employee who buys out the former owners.  Creedence suddenly hits it big with songs like “Proud Mary,” “Green River,” “Bad Moon Rising,” “Down on the Corner” and (my personal favorite) “Lodi.”  All (legal) hell breaks loose.

When Zaentz took over Fantasy, he presented a new recording contract to the Creedence boys.  Despite the fact that Cook’s father was a prominent San Francisco attorney, the boys decide not to have him or any other attorney review the contract before signing it.  I don’t know how many times to say this:  get an attorney to review your contracts, even if you are signing a contract with your buddy.  Seriously.

Essentially, every year Creedence had to give Fantasy a certain number of “masters,” or completed songs ready to be released.  If Creedence failed to do so, the number of outstanding masters for the year was added to the following year’s requirement.  This was common in the music industry at the time, and given the near impossibility of actually completing all of the contract’s requirements, it essentially turned young artists into the indentured servants of their label.  Importantly, Creedence also assigned the publishing rights to each of their songs to Fantasy.  This was somewhat typical at the time and is very important to our story.

Creedence, now thoroughly, overwhelmingly signed to Fantasy, got to work fulfilling their recording contract.  Which they did for a while, in no less than chartbusting form:  all told, Creedence sold some 20 million albums and 10 million singles worldwide, earning around $75 million in the process.  John, Tom, Stu and Doug – and Fantasy – were suddenly rich.  Rolling in money, Zaentz suggested to the boys that they keep their money in a Bahamian tax shelter, the Castle Bank and Trust.  Our boys jump at the chance.  Oh, and in order to do so, they agree to a lower royalty rate from Fantasy.  But they will be saving so much in taxes that this of course makes sense. … Again, people, legal counsel.

For a few years, things went swimmingly between the Creedence boys.  It seemed John was an eternal fountain of hit songs, and the band played to packed crowds around the world.  But, as per usual, tensions began to flare, particularly the sibling rivalry between brothers John and Tom.  As is so often the case, an extremely successful band broke up at the height of their success amid bad blood and pointed accusations.  Creedence was done by 1972, just five or so years after their breakthrough.

Now, an important piece of this story is that Fantasy’s contract with Creedence stated that should the band break up, each member must execute an individual recording contract with Fantasy in order to provide any remaining masters owed to Fantasy under the contract Creedence signed in 1967 – a very common practice, even today.  And there were many, many masters remaining on that contract.  In a demonstration of magnanimity, Zaentz released Doug, Stu and Tom from their personal contracts at the end of 1974.  However, Zaentz was no fool: unlike his brethren, cash cow John was stuck with Zaentz.

Fresh out of Creedence, Fogerty started writing what would be his first true solo record.  This is where Fogerty’s relationship with Zaentz goes south, for two primary reasons.  First, Fogerty could not keep up with the absurd masters requirement in his personal contract with Fantasy.  No one could.  However, Fogerty was fully aware of his value to Fantasy and figured he could renegotiate the contract to something more reasonable.  Nope.  Again, Zaentz was no fool.

Moreover, while Fogerty was finally rid of Creedence, it also meant he didn’t have Creedence touring revenue lining his pockets, and he developed liquidity issues.  So when he looked into withdrawing money from the Castle Bank and Trust, it turned out that the tax shelter was a scam.  By the mid ’70′s, the Castle Bank and Trust simply no longer existed, taking with it millions from each member of the band.  Fogerty thought Zaentz was in on the scheme, and thus begins Fogerty’s litigious streak.  In 1975, Fogerty and the rest of the band sued the Castle Bank and Trust and Fantasy to recover the lost money.*

* This suit dragged on until 1983, when a jury awarded the band over $8 million from the bank, though nothing from Fantasy.  As a result, the band never saw a dime.

Now thoroughly disgusted with Zaentz, Fogerty put feelers out in the industry for anyone who could get him out of his contract with Fantasy.  It was David Geffen, then with Elektra, that opened up the checkbook.  Geffen gave Fogerty a four record deal and that should have been the end of the matter, right?  Nope.  Fantasy would only sell Geffen Fogerty’s contract for the US and Canada and thus still owned Fogerty for the rest of the world.  The idea of handing over his first real solo record to Fantasy, a company which he felt threw away millions of his money in the Bahamas deal, in any capacity proved too much for Fogerty.  So Fogerty suggested a deal to Fantasy:  any future Creedence royalties Fogerty would earn in exchange for Fantasy releasing him from his contract worldwide.  Have I mentioned that Zaentz was no fool?  Comparing the somewhat lukewarm reception to Fogerty’s solo career to the ongoing moneymaker that was the Creedence catalog, Fantasy jumped at the deal.

While Fogerty was now “free” from Fantasy, he didn’t do a whole lot career-wise from about 1975 until 1985.  Fogerty even refused to perform his own Creedence songs between 1972 and 1987 because he would have to pay a royalty to Fantasy every time he performed one.*  This despite the fact that he would have stood to make millions playing an all-Creedence set.

* I actually find that this point is the source of some confusion born of the ashes of time.  When I mentioned that I was writing a piece about Fogerty’s legal woes, several friends said ‘Oh yeah, he couldn’t play his own music for years, right?’  Actually, this is not exactly true – he could have played Creedence songs in concert.  But since Fantasy owned the publishing copyrights to the Creedence catalog, and thus the right to perform the songs publicly, Fogerty would have to pay a royalty to Fantasy every time he played one of his own Creedence songs.  So Fogerty could have played Creedence songs, and he likely would have cashed in doing so, but the guy stuck to his guns and refused.  The only reason he started playing Creedence songs again in 1987 was because he was worried the world would think Tina Turner wrote “Proud Mary.”  No, really.

Skip forward to 1985.  Dormant for years, Fogerty comes charging out of retirement with his hit record with its peppy title song variously conjuring images of mom, apple pie, summer, and, of course, baseball.  America eats it up - Centerfield reaches number one on the Billboard chart.  Unfortunately, a new hit record means not only a new chance to drag Zaentz’s name through the mud, but it also presents a new reasons for Zaentz to try to screw Fogerty.  By the mid ’80′s, these two dudes must have just completely hated each other.  I mean, when his brother Tom died from complications with AIDS in 1990, Fogerty hadn’t spoken to him in years because he thought Tom took Zaentz’s side by continuing to record for Fantasy.  That’s some old school vitriol right there – refusing to talk to your brother for years until right before he dies because you hate someone else so much.

So, class, as we know Fogerty and Zaentz do not care for each other.  So what does Fogerty do with his first hit record in 12 years?  He writes not one but two songs about Zaentz – “Mr. Greed” and the subtly titled “Zanz Kant Danz.”  Neither are particularly interesting tracks and both stick out like sore thumbs from the remainder of the otherwise upbeat record.  Not much point in giving them a listen now, but of course you know who was listening at the time – Zaentz.  So what does he do?  He sues Fogerty and his label Warner Bros. for defamation over the tracks.  Despite the fact that this claim seems like a loser to me as the lyrics constitute Fogerty’s opinions rather than any actual false allegation*, Fogerty settled, re-edited the songs, and changed the name of “Zanz Kant Danz” to “Vanz Kant Danz.”  Fogerty even publicly apologized.  Phew.  Problem solved.  Right?  Of course not!  Amazingly enough, this has all been merely prelude to the good stuff.

* Another common source of confusion:  a defamation claim does not lie every time someone says something bad about you.  You can shout your negative opinions about others from the highest mountain all day long, so long you don’t spread untruths about them.  Think of the difference between the statement ‘I think Zaentz is a jerk’ and ‘Zaentz is a murderer’ (when the latter is untrue).

Not content sticking it to Fogerty for “Mr. Greed” and “Zanz Kant Danz,” Zaentz devised what has to have been one of the most jaw-droppingly sinister litigious plots ever.  Zaentz sued Fogerty for plagiarizing - himself.

And at that moment, copyright attorneys around the country began to bleed out of their ears.

Here’s how this works from a legal standpoint.  Fogerty wrote the bulk of the Creedence songs alone, including a song called “Run Through the Jungle” from their 1970 record Cosmo’s Factory.  When he wrote the song, as the sole songwriter, he alone owned the publishing copyright to the song.*  See U.S. Copyright Act section 201(a).  Remember, while the Copyright Act determines the identity of the “author” of any song, that author is entirely free to transfer any or all of the rights inherent in a copyright** to anyone else.  See U.S. Copyright Act section 201(d).  This is exactly what happened in Creedence’s 1967 contract with Fantasy – the group transferred the publishing rights of their songs to Fantasy’s publishing subsidiary.  Therefore, by the mid ’80′s, Fantasy had long owned the publishing copyrights to Creedence’s songs, including “Run Through the Jungle.”

* As performers on the recording of “Run Through the Jungle” on Cosmo’s Factory, the Creedence members jointly owned the copyright in the sound recording itself.  See U.S. Copyright Act section 201(c).

** Section 106 of the Copyright Act provides the owner of a copyright the exclusive right to reproduce the work, prepare derivative works, distribute copies of the work, perform the work publicly, distribute the work publicly, and perform the work publicly.  We’re about to learn more about the right to prepare derivative works and to perform the work, so, you know, remember those two.

Still with me?  Now, the first song on Centerfield is a song called “The Old Man Down the Road.”  Zaentz heard the song and decided that “The Old Man Down the Road” is essentially the “Run Through the Jungle” music with new lyrics.  If your band took the music from a Creedence song and slapped some new lyrics on it, you’ve essentially created a work derivative of the Creedence song.  Of course, per Section 106 of the Copyright Act, only the owner of the publishing copyright to a Creedence song can legally make a work derivative of that Creedence song.

So Zaentz decides that “The Old Man Down the Road” is a derivative work of “Run Through the Jungle” and thus infringing upon a copyright owned by Fantasy Records.  Never mind that Fogerty actually wrote. both. songs.  This was pretty much the first time in the history of American jurisprudence that someone defended a suit for infringing the copyright of a song they wrote.  In Zaentz’s defense (or maybe just the defense of his legal counsel), I will say this – prior to Fantasy, Inc. v. Fogerty, this argument makes some measure of sense from a legal standpoint, so long as, you know, you can completely overlook the more practical point of view.  Fogerty assigned the publishing copyright to “Run Through the Jungle” to Fantasy, and it’s hard to deny that “The Old Man Down the Road” bears some resemblance to “Run Through the Jungle.”  Had the songs not shared an author, I would likely advise Fantasy to bring an action against the author of “The Old Man Down the Road.”

So what happens next?  The case goes to trial in 1988.  Fogerty has to bring in a guitar and play parts of both songs for the jury.  He also explains his songwriting process and contends that the only similarities between the songs are incidental to his own distinctive style and not a result of similar compositions.  Unsurprisingly, the jury ruled in Fogerty’s favor.  Really, is there a jury on the planet that would rule that anyone could plagiarize themselves?

Giving at least some (ahem) credence to my argument that Zaentz’s lawsuit made sense from a legal standpoint, the trial court judge refused Fogerty’s request that Fantasy should pay the legal costs he incurred.  At the time, precedent in the Ninth Circuit Court of Appeals held that a successful defendant in a copyright infringement suit could only recover legal costs if the lawsuit was frivolous or filed in bad faith.  Thus, the real legal legacy of the Zaentz/Fogerty feud is the opinion in Fogerty v. Fantasy, Inc., 510 U.S. 517 (1994) in which the U.S. Supreme Court held that a copyright infringement lawsuit need not necessarily be filed in bad faith for a court to award a successful defendant legal costs from the plaintiff.   Ultimately, Zaentz had to pay Fogerty the legal fees he racked up defending what I would contend is one of the more ridiculous and spiteful copyright infringement lawsuits ever filed.  So the twenty five year saga of the Fantasy-Fogerty feud finally comes to any end in 1994 on the steps of the Supreme Court.*

* Actually, the Supreme Court remanded the case back to the District Court for the Northern District of California, where the trial court then awarded Fogerty legal fees from Fantasy.  It just sounds so much more dramatic to say that the feud ended on the steps of the Supreme Court.

So there you have it.  The end of Fogerty and Fantasy.*  Oh, but intrigue!  In September 2005, Fantasy issued a press release announcing – wait for it – that John Fogerty resigned with Fantasy!  By this time, Zaentz no longer had any stake in Fantasy, which is now owned by the Concord Music Group.  The signing kind of makes sense, as Concord co-founder Norman Lear vowed that the company would restore the royalty rights Fogerty gave up to get out of his Fantasy contract 30 or so years prior.  The first step was to issue a Fogerty retrospective set, including both Creedence and Fogerty solo tracks.

* Though it was not the end of Fogerty’s love affair with the legal system.  Some years later, Fogerty sued former band mates Stu Cook and Doug Clifford for trademark violation and copyright infringement for playing Creedence hits and touring under the name “Creedence Clearwater Revised.”  But this is a fascinating story for another time.

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So THERE you have it.  I’ve been trying to come up with a good conclusion to this story, perhaps elucidating something approximating a moral.  I guess it really just comes down to the following phrase:  have a lawyer review your contracts so you know what you are getting into!  You just never know when you could become incredibly famous and then have to defend against a lawsuit from your equally stubborn and litigious former label owner claiming something utterly random, like that you infringed your own song.

* Fret not Michael Snow fans, his place in Canadian music and especially film history is no doubt cemented.  For those that don’t know, his record Music for Piano, Whistling, Microphone and Tape Recorder and film Wavelength, are absolutely mandatory.  And thanks to the internet, you might actually find them.

Okay, here’s another analogy for you:  John Oswald is to sampling as Christian Marclay is to the modern day DJ.  Only Marclay at the very least had the benefit of the existence of turntables in the 1970s.  The digital sampler was a decade away when Oswald first started splicing tape in the late ’60′s.  Hip hop artists who praise the day the sampler was invented should genuflect before Mr. Oswald.  The details as to how he created his initial plundered masterpieces are beyond the scope of this column, but suffice it to say that nutcase, single-frame-at-a-time, tedium-is-my-friend animator Harry Smith would be impressed.  I envision a lot of long nights splicing tape, wondering if anything he did made any sense, but you can find more information on Oswald’s processes on his endlessly fascinating website.

Basically, Oswald takes whole snippets of popular music, which he refers to as ‘plunderphones,’ and manipulates and/or rearranges them as to his liking, typically one performer/group per composition.  But we aren’t talking about five seconds from the outro of some Jethro Tull deep cut.  Importantly, the samples are all immediately identifiable – the opening from “I Still Haven’t Found What I’m Looking For” or MC5′s Rob Tyner screaming “Kick out the jams!”*  For example, the track “O’Hell” from the Elektrax CD slices and dices 14 different Doors songs into one concise four minute masterpiece.  Doesn’t sound that interesting, right?  ”I could do that,” you might think.  Hip hop producers do this all the time, right?  Well, not exactly, as Oswald doesn’t separate out instruments or even ‘beats,’ choosing to sample the musical quotes wholesale out of the source material.  But close enough.  So who cares?

* I remove the “motherfucker!” from this phrase not out of prudishness, but because Oswald doesn’t allow Tyner to finish his famously caterwauled demand, rather forcing him to repeat the word “kick” over and over.  Your brain wants so badly to hear the entire phrase “Kick out the jams, motherfucker!”, as you have a thousand times before (okay, well, as I have a thousand times before), but it never comes.  A comment on censorship?  Perhaps.  A kick in the head to demand greater listener engagement by rendering one of rock’s greatest call to arms impotent?  Definitely.

Well, I do.  Why?  Because unlike most hip hop, Plunderphonics sends my thought processes into overdrive.*  Quite simply, when I first heard Oswald’s landmark 1989 album Plunderphonic, it forced me to entirely re-evaluate the way I listen to music, resulting in my evolution as a more active listener.  What does it mean to be a pop star, and why is our society obsessed with them?  Why does pop music obsessively, monotonously follow its typical verse/chorus/verse structure?  What is the ‘right’ way to listen to any piece of music?  Isn’t every listener who tinkers with the speed on a record player a musician?  And damn, there’s no way he cleared all of these samples, right?

* As every single girlfriend has, shall we say, less than gently pointed out to me, this is not soothing music that fades into the background of your life.  Even listening to the Plunderphonics 69/96 compilation as I wrote this article caused me to complain to a friend of my difficulty writing while listening to Plunderphonics.  His response hit the nail on the head:  ”Cognitive thought generally is difficult while listening to Plunderphonics.”

But what makes Plunderphonics such an engaging, if not outright demanding, listen?  I’ll admit it, though I suppose it should be no surprise from an entertainment attorney:  I’m a little obsessed with pop culture.  I make no secret of my subscription to Entertainment Weekly, my fascination with the Beyoncé/Rhianna model of pop singer, or even my fondness for the current, supposedly zeitgeist-creating nighttime soap opera that has not yet overstayed its welcome, whatever that may be.  And I’ll go ahead and admit it for you:  You are obsessed with pop culture.  You can’t not be.  Pop culture is too prevalent in our society and doesn’t allow you to look away.  That’s why it’s called pop culture.

John Oswald takes several of the pop music touchstones, the objects of my (and your) obsessions, and effortlessly scrambles all of them in my head so adeptly that, well, there are no words.  Put it this way:  what if someone reedited Gossip Girl to make one of those 1950′s classroom filmstrips intending to scare you into not having sex?  Now we’re getting there, but we’re still pretty far afield of the Plunderphonics experience.  It’s just one of those musical experiences that is startlingly different from any prior strain of accepted musical expression that you’ve ever heard, despite the fact that you’ve likely heard virtually every single second of Plunderphonics before.  I mean, you’ve heard Michael Jackson before, right?  If not, uh, well… you should probably just stop reading now.  Thus, the best guidance I or anyone else could possibly put into words is to just listen.

Cultural concerns aside, Plunderphonics obviously raises a TON of provocative legal issues, and for that, I love Mr. Oswald.  I like thinking about provocative issues, legal or otherwise, while I listen to music, watch a movie, or generally take in any art.  So let’s talk law, and let’s start with the obvious.  Q:  Isn’t this completely illegal?  A:  Well, both the American and Canadian copyright laws – to put it mildly – frown upon you taking your favorite pop songs, slicing them up, taping them back together again, putting your name on them, and then distributing the resulting Frankenstein’s monsters to the public.  But there’s definitely more to it than that.

Let’s start at the beginning.  Ostensibly, Congress enacted copyright laws to encourage creativity, research and the pursuit of knowledge and information.*  To do this, Congress decided to provide the ‘authors’ (a heavily litigated term in its own right) of artistic works a legal monopoly over their work.  More specifically, Section 106 of the U.S. Copyright Act allows the author of an artistic or creative work the following exclusive (though transferable) rights:

1) The right to reproduce the work in copies or phonorecords;

2) The right to prepare derivative works based upon the work;

3) The right to distribute copies or phonorecords of the work to the public by sale or other transfer of ownership, or by rental, lease, or lending;

4) The right to perform the work publicly, in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works;

5) The right to display the work publicly, in the case of literary, musical, dramatic, and choreographic works, pantomimes, and pictorial, graphic, or sculptural works, including the individual images of a motion picture or other audiovisual work; and

6) In the case of sound recordings, the right to perform the work publicly by means of a digital audio transmission.

Section Three of the Canadian Copyright Act provides a substantially similar bundle of sticks** to Canadian authors.

* The Constitution actually provides Congress the power to “promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”  Art. I, Sect. 8, Cl. 8.  So if you consider yourself an anti-copyright hardliner, one avenue is to knock yourself out trying to amend the Constitution.  Have fun with that.

** Law professors around the country tell students to think of the rights provided by the U.S. Copyright Act as a “bundle of sticks.”  I only mention this because I always thought the idea of a “bundle of sticks” funny.

Seems fair enough.  Without copyright laws, why would people continue to creatively express themselves or pursue new information or knowledge?  But wait, if the purpose of the copyright laws is to promote science and useful arts, why do we penalize authors who use not a piano or a paintbrush as their means of expression, but rather the art of others?  Is music no less meritorious if it is created by recontextualizing prior works?  This is one of Oswald’s primary arguments in his groundbreaking paper “Plunderphonics, or Audio Piracy as a Compositional Prerogative,” first presented to the Wired Society Electro-Acoustic Conference in Toronto in 1985.  After cheekily noting that in English, the word ‘sample’ is often preceded by the word ‘free,’ Oswald explains that even though the music industry discourages it, the active listener might speed up or slow down their store-bought music or even juxtapose two or more pieces together.  Actions such as these blur the already fine line between sound producers and sound reproducers, even more so in an era of computer software that writes music for a composer.  So what separates a musician that merely imitates, say, Bruce Springsteen’s voice, from a musician that explicitly uses The Boss’ music as a building block?  Why does the former receive protection, nay encouragement, while the latter is potentially a criminal?*

* Yup, copyright infringement is actually a crime.  See U.S. Copyright Act, Sect. 506.

This is precisely the issue Oswald ran headlong into when he found himself on the receiving end of a cease and desist letter from none other than Michael Jackson’s attorneys after he released the wildly inventive Plunderphonic CD, which featured a reworking of Jackson’s “Bad” into the squeaky voiced “Dab.”  Despite carefully crediting the artists on each track and only sending copies to radio stations and libraries, all stamped “Not for Sale,” Oswald ultimately had to lawyer up and agree to a settlement whereby he allowed the master tapes and all remaining CD copies to be destroyed.

Now, query whether Jackson would have cared had the CD’s cover not featured Jackson’s head on the body of a naked woman – while it’s easy to see the artistic merit, Oswald maybe poked the bear a little too hard with that one – but the point is that the stringent copyright laws can actually serve to limit artistic expression.  The drafters of the original U.S. copyright law signed in 1790 could not foresee the manner in which their good intentions were bastardized, taking the tools of expression away from artists, regardless of the societal or cultural value of the resulting work.  To cop a line from one of Oswald’s fellow Canadians, the medium really is the message, but Congress doesn’t care.*

* Neither do the courts.  The two major sampling cases used again and again by copyright owners against illicit samplers can each be boiled down to single sentence bright line rules.  With respect to copying musical works without a license, the court in Grand Upright Piano v. Warner, 780 F. Supp. 182 (S.D.N.Y. 1991), dogmatically proclaimed “Thou shalt not steal.”  Similarly, the court in Bridgeport Music, Inc. v. Dimension Films, 383 F.3d 390 (6th Cir. 2004), informed musicians that they must “Get a license or do not sample” sound recordings.

“BUT WAIT!,” you exclaim.  ”The Electronic Frontier Foundation told me that Fair Use has a Posse!  It must protect Mr. Oswald and, for that matter, my beloved Girl Talk.”  First, let me just say that I love the phrase “Fair Use has a Posse.”  I want one of those bumper stickers.  So very awesome.  Back to the point though, what about fair use?  Most plunderphonics artists swear by it, and note that Gregg Gillis of Girl Talk still hasn’t been sued by any of the artists he’s plundered.  Originally a judicially-created exception to the rights provided in Section 106, Congress codified the fair use doctrine into the U.S. Copyright Act in 1976 (with Canada following suit in 1985 with its similar fair dealing exception).  But does the fair use doctrine protect our favorite brain-melting composer?  Well, that’s tricky.

First, the dry boring law stuff.  Section 107 of the U.S. Copyright Act states the following:

“Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright.”

This means you can infringe a copyright – by say, making a composition explicitly derived from a Michael Jackson song and titling it “Dab” rather than “Bad” – if you do so for the purpose of criticism, comment, news reporting, teaching, scholarship or research.  That’s pretty vague, especially considering the Supreme Court has since added parody to the list of potentially protected types of fair use.  But the Supreme Court has also said that a work need not necessarily be comment, criticism, news reporting, teaching, scholarship, research, parody or even at all transformative to be fair use.  Confused yet?  You probably should be.  Judges certainly are.  So in Section 107, Congress also gave us four factors to consider when deciding if fair use protects an alleged copyright infringer, regardless of whether the work cleanly falls into one of the enumerated categories:

“In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include -”

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

(2) the nature of the copyrighted work;

(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(4) the effect of the use upon the potential market for or value of the copyrighted work.”

Does “Dab” get past these hurdles?  Oswald could no doubt intelligently explain how his use of “Bad” results in a transformative work, rather than merely superseding the original.  But “Dab” is also a commercial product, as Oswald often sells his Plunderphonics tracks to the public.  Moreover, as with all Plunderphonics tracks, Oswald made “Dab” from large chunks of “Bad” and, importantly to the law, doesn’t even add his own sounds.  He ‘just’ reorganizes or manipulates the original sounds, resulting in music made up of entirely verbatim pieces of the copyrighted material.  For the same reason, “Dab” could at least arguably take a bite out of any licensed remixes of “Bad,” themselves derivatives of the original.

So would a court consider Oswald, if sued by one of the hundreds of artists he’s recontextualized, a fair use sheep or an infringing goat?  Well, it’s still largely up to the judge – maybe Oswald gets a progressive judge, or one that loved to play with the speed of his/her record player as a kid.  Point being, it would likely come down to how much weight the trial judge ascribes to the transformative nature of Oswald’s music.  If the judge ‘gets’ Oswald’s points about the benefit and merit of his work, then he may very well win.  Oswald is also a rather sympathetic defendant given the clear artistic nature of Plunderphonics and his status in the art world, and these days he would likely have a cadre of pro bono attorneys jumping to defend him.  These are likely the reasons why he hasn’t been sued since Michael Jackson’s attorneys attacked, but, while I intend no disrespect to Oswald’s ability to articulate, I would still guess more often than not that copyright law considers him an infringing goat.*  A court would be going out on a ledge to rule in his favor.

* One exception might be Oswald’s monstrous twenty-minute masterpiece, Plexure.  Unlike nearly all of his other Plunderphonics works, which typically recontextualize the music of only one or two artists, Plexure revisits the work of hundreds, if not thousands, of popular artists from the early days of the compact disc (i.e. 1984-1994).  The samples in Plexure are so dense and fly by at such a rapid pace that even U2′s battery of lawyers that sued Negativland would have a hard time arguing that Plexure has any impact whatsoever on U2′s otherwise meager financial prospects.

But Oswald has a response on behalf of all the infringing goats:  overhaul the fair use doctrine entirely.  In “Plunderphonics, or Audio Piracy as a Compositional Prerogative,” Oswald notes that “[m]usical language has an extensive repertoire of punctuation devices but nothing equivalent to literature’s ” ” quotation marks.”  Therefore, quoting Milton to argue that music can only be called plagiarism or piracy “if it is not bettered by the borrower,” Oswald proposes the following definition of fair use:  artistic expression that infringes on another’s copyrighted material is fair use if it 1) makes for a different expression from the original; and 2) gives credit to the original.  To put another way, you can’t just make wholesale copies a prior work, but you can rework it to make a distinct work, musical or otherwise, so long as you give credit where credit is due.

There’s a certain ridiculous obviousness to Oswald’s point of view – mostly because this is the method commonly used throughout the literary world.  Graduate students around the country take the exact words of those who came before them in order to argue a point separate from the prior scholar.  While some might argue that graduate students deserve protection because they write their theses in an educational setting for reasons other than direct profit, my response, and I’m guessing Oswald’s, would be that the majority only write their theses as a means to receiving a degree which will presumably make them more attractive on the job market.  Why do we permit a graduate student’s warmed over critique of the universal themes in Slaughterhouse Five, but wag our fingers at Oswald’s innovative and deeply complex critique of popular music?

So if Oswald’s theory makes so much sense, why haven’t the laws changed?  It comes down to a familiar reason:  money. It’s not easy to come by the muscle in this power dynamic to lobby Congress or to seek better judicial interpretations by way of defending lawsuits.  If you receive a cease and desist letter demanding that you refrain from trampling Roy Orbison’s copyright, well, unless you have Luke Skyywalker money* to pay for legal representation during what will be a lengthy court battle, you put your tail between your legs and meekly respond “yes, sir.”  As a result, the fair use doctrine is rarely tested in Court, and The Grey Album is pulled from circulation (though again, thank you internet).

* See Campbell v. Acuff-Rose Music, 510 U.S. 569 (1994).  No really, take a look.  It’s hilarious.  The U.S. Supreme Court held that 2 Live Crew’s immaturely vulgar use of Orbison’s beloved classic “Oh, Pretty Woman” was a parody protected by the fair use doctrine.  I love it when the Supreme Court feels it has to rule in favor a party they clearly loathe.

Legal or not, John Oswald’s Plunderphonics project is fascinating.  Know that and give it a listen.  This terribly professional pop-culture obsessed music reviewer/lawyer gives it his top endorsement.  Rereading this article, I realize that I only scratched the surface of Oswald’s bizarrely disturbing, and yet hilarious, cover art that sent Michael Jackson, unsurprisingly, into a tizzy.  That can wait until a later rumination on rights of publicity, invasion of privacy and moral rights.  But look, all you really need to know is this:  Mr. Jackson wasn’t truly Bad until John Oswald was his (illegitimate) producer.

Last week, Napster simultaneously proved to the world that, 1) they still exist; and 2) they probably wish they didn’t.  For those not in the know (and I doubt anyone other than Best Buy will blame you for not being in the know on this one), Napster in its current incarnation sells subscriptions to their site, where users can stream and download music legally.  In order to do so, Napster strikes deals with record labels and other music rights owners to provide their content to its subscribers.

Enter Rounder Records, the 40 year old label from Massachusetts that started off with bluegrass and hippie folk acts but has survived and flourished ever since, scoring its biggest hit a few years back with Robert Plant and Alison Krauss’ smash album, Rising Sand.  In between, Rounder has released a diverse spate of records by artists such as John Fahey, They Might Be Giants, and even Steve Martin.* They’re also responsible for a series of important releases with the terrific Alan Lomax Collection.  So all in all, Rounder is not exactly a tiny indie label, but they definitely aren’t one of the big boys either.

* Complete aside, but I won’t deny it; I’ve always loved Steve Martin.

Napster wanted to make Rounder’s music available to its subscribers, so the pair struck a deal in 2001 to allow Napster to stream and provide for download music from Rounder’s catalog on its site.  The agreement required Rounder to ensure that it possessed all mechanical licenses for the musical works embodied in the sound recordings it licensed to Napster.  Moreover, the agreement contained a standard indemnity clause.  The basic idea here, as it relates to this case, is that the parties agreed that if a third party sued claiming that Napster’s use of Rounder’s music infringes the third party’s rights, Rounder foots the bill.

In 2006, Rounder and Napster rescinded the 2001 agreement and struck a new one, with a few important differences.  Now Napster was responsible for securing any necessary mechanical licenses, and Napster now had to first receive Rounder’s consent prior to racking up legal bills for which they might demand indemnification under the indemnity clause.  Can you guess what happened?  In late 2006, third party MCS Music America, a music publishing company, sued Napster claiming that it did not possess proper mechanical licenses for musical works MCS owns, including several of the songs licensed from Rounder.  Napster ultimately settled with MCS and turned around and sued Rounder for reimbursement pursuant to the indemnity clause, to the tune of $1.3 million, the amount of the settlement Napster claimed corresponded to Rounder’s music.

Score one for the little(r) guys, as Judge Paul A. Crotty ruled in Rounder’s favor and threw out Napster’s lawsuit in its entirety.  Not only had Napster failed to seek and receive Rounder’s consent prior to settling with MCS, as required for indemnification, but pursuant to the 2006 agreement, the mechanical license issue at the heart of the MCS lawsuit was entirely Napster’s, not Rounder’s, problem.*

* Since the 2006 agreement expressly rescinded the 2001 agreement, the latter, with its requirement that Rounder be responsible for the mechanical licenses, no longer applied.  Napster has to hate that 2006 agreement with a $1.3 million passion.

Though I admittedly haven’t read the briefings, it’s a little hard to even understand where Napster is coming from with this lawsuit.  In the written opinion, Judge Crotty repeatedly lambastes the company for failing to comply with the requirements of the 2006 agreement and even for egregiously misunderstanding New York and federal law.  It does seem as though Napster was throwing its weight around with the smaller (and presumably less funded) Rounder.  Either way, Napster once again found itself of the receiving end of the legal system’s ire, allowing Rounder to resume issuing Steve Martin records.

The only real news is that a few months back the U.S. Government Accountability Office, the non-partisan arm of Congress tasked with figuring out the economic impact of proposed Congressional bills, issued an interesting and seemingly well-reasoned report on the potential impact of the Performance Rights Act, unsurprisingly noting that the bill would drastically alter the symbiotic relationship by helping musicians and labels at the potentially severe financial detriment of many radio stations.  This may be a sign that the tide of public opinion has shifted somewhat in radio’s favor (well, this and the fact that the bill has not yet passed, despite broad support from the White House and both houses of Congress), but only time will tell.

I’ll write more on this topic as there is more to update.

Photo by Susan Archie, Table of the Elements Bohrium Festival, Atlanta GA, Sept 1-3 2006. Yes, I still end up working merch tables now and again.

A few months back, Billboard* provided a list of three tips designed to help a band maximize their merchandise sales.  While Billboard’s sage advice is very useful and can definitely help increase the revenue of bands with all sizes of followings, the tips are somewhat little limited and ignore quite a few of the more cutting edge ideas that a band like, say, U2 wouldn’t touch with a ten foot pole (mostly because, well, they don’t have to).  I thought I would provide a few good ideas I’ve picked up through the years that Billboard wouldn’t dare suggest.

* Tip to other music industry types out there – I kind of hate to admit it, but aside from listing whatever record has falsified their accounting enough to land at Number One on the sales charts, Billboard.biz has an extremely interesting and helpful news section.

1. To start out, lets take a look at Billboard’s tips.  They suggest: 1. tie the merch to the specific tour; 2. limit the overall options; and 3. be inclusive/know your audience.  These make a lot of sense and are worth checking out here.  It’s definitely worth the read.  One note: while most small and mid size bands probably wouldn’t want to make shirts with tour dates on the back, tying your merch to a particular tour isn’t that bad an idea.  For example, make shirts/bags/whatever with your most recent record cover on it.

2. Particularly for mid-sized bands, have at least one member of the band actually sitting at the merch table when you aren’t playing.  This is a golden opportunity to talk one-on-one with your fans.  For smaller bands, this should be a no-brainer.  But I know that the more prominent your band becomes, the harder it is to muster the enthusiasm to actually interact with the superfans.  But it turns out that fans like feeling connected to musicians.  I still tell the story of Kristen Hersh telling my high school girlfriend that she thought I was cute when we went to a Throwing Muses in-store signing.  That was just a cool thing to say, made her seem awesome and down to earth, and I’ll never forget it.  It’s seriously the first thing I think of when I think of the Throwing Muses, followed closely by “what a great band.”  Then there was the time my brother was excited because he found himself talking to one of the members of indie band Velocity Girl in the bathroom.  Given the inherent distance between band on stage and fan in the audience, the one-on-one interactions are the stories fans remember.  I always have a place in my heart for bands who were cool to me during my limited interactions with them.  Particularly Kristen Hersh.

3. Actually take time in displaying your merch on the table and on the wall.  Don’t just tape everything on the wall and plop down in the chair.  Make the merch look decent, because appearances matter.  Actually, they really matter.  Branding is very important for bands and labels, and you want to carry that brand out on the road, in virtually every interaction with the fans, including, maybe especially, at the merch table.

4. Now here’s a somewhat controversial idea from Pampelmoose that I think makes a ton of sense.  Don’t price your merch.  Seriously.  Don’t determine how much that LP, shirt or water bottle costs ahead of time.  When someone comes up to the merch table and asks how much, tell them it’s up to them to determine how much they pay.  In a sense, this idea is sort of the equivalent of putting out a tip jar for the band, or even a low rent version of Radiohead’s In Rainbows success.  Keep in mind that if a fan wants to buy something, they are probably already into the band/were probably into show and eager to demonstrate that to the band, especially if a band member is sitting there at the merch table.  Let them decide how much to pay, and I’ll bet that you’ll end up with more money at the end of the night than if you priced everything.  What about the fan that doesn’t have any money (or claims not to)?  Give them a CD anyway!  They’ll go home thinking you are the coolest band on the planet and sing your praises.

I’ve read of bands having a lot of success with this idea.  Keep in mind however that I’ve suggested to several clients, and I don’t think a single one has ever taken my advice.

5. Accept credit cards!  Another no-brainer.  In today’s era of iPhone apps, companies like Square make it really, really easy to accept credit cards at a merch table.  How many times have I not bought a band shirt because the only ATM in the venue had a $5 fee?  The underlying point is to make it as easy as possible for your fans to give you money.

6. Finally, what exactly is the point in making underwear with your band’s logo on it?  I say this knowing full well that I’ve had clients actually sell out of their run of underwear baring their band name, but wouldn’t you rather someone wear a shirt or anything else featuring the band’s name?  Underwear doesn’t actually advertise for the band to anyone other than the person(s) they are taking home that night, unless it’s worn by the (hopefully small) cult of Courtney Love/Taylor Momsen loyalists?  You know, the music fan that hates pants?*  People have said to me that selling underwear is one more item that the dedicated fan can buy, after they buy the shirt.  To which I respond, yeah, I guess.  But wouldn’t you rather them buy two shirts with different designs?  Or, say, a shirt and a hat?  Or two shirts, a hat, and anything else?  Unless they hate pants, or just really, really get around, underwear isn’t really going to do much in the way of advertising for the band.  Or maybe I just find them really tacky….  Anyone out there have a better argument in favor of band logo thongs that I’ve never really thought of?

* And unless you are either Courtney Love or Taylor Momsen, don’t you need to ask yourself if this is really the type of fan you’re looking for?

It doesn’t take a brilliant music legal mind (*cough*) to recognize that successfully selling band merchandise at shows is of the utmost importance to musicians today.  Of course, it always has been, but this is especially true in the era of internet downloads – legal or not – and a seemingly never ending recession sapping fans’ record-buying funds.  But I would suggest that the merch table is extremely important above and beyond merely as a conduit to selling thongs with your band’s logo on it.  The merch table is one of the most important points of contact with the typical fan.  If you play your cards right, you can take that fan from being a typical fan to a superfan for life.

Capitol merely loaned you this Maiden album.

UMG Recordings, Inc. v. Augusto, 2011 U.S. App. LEXIS 52 (9th Cir. Jan. 4, 2011)

The Ninth Circuit Federal Court of Appeals recently ruled that the third party sale of a promo CD is typically legal under the “first use” doctrine of the U.S. Copyright Act.  This probably seems obvious to anyone who has stepped foot in a used record store over the past, say, twenty years, but legally this issue was actually somewhat up in the air and closely followed by copyright nerds scholars.

The basic facts are as such:  Plaintiff UMG is of course one of the major record labels.  They routinely send out unsolicited promotional CDs to stores and radio stations.  While the CDs typically have language stamped on them indicating that they are not for resale and that they are licensed to the recipient (who hasn’t seen that language stamped on the front of a CD booklet before?), UMG doesn’t keep track of the CDs in any way, and the recipients aren’t required to return or even acknowledge receipt of the CDs.  Defendant Augusto bought promo CDs at used record stores and then sold them on eBay.  UMG saw their promo CDs on eBay and sued Augusto, presumably in the hopes of deterring (a la the lawsuits against music downloaders) other resellers of these promos.  Likely to the surprise of UMG, Augusto fought back… and won at the trial court.  So UMG sunk more money into an appeal… and Augusto won again.

While the Court found that Augusto did in fact infringe on UMG’s right to distribute (one of the many rights granted to copyright holders by Section 106 of the Copyright Act) its copyrighted work, it’s important to remember that not all infringements are actionable, namely when there is a defense to the infringement, such as, for example, the “fair use” doctrine.  Similarly, the “first sale” doctrine provides that “the owner of a particular copy or phonorecord lawfully made under [the Copyright Act], or any person authorized by such owner, is entitled, without the authority of the copyright owner, to sell or otherwise dispose of the possession of that copy or phonorecord.”  U.S. Copyright Act, Section 109(a).  In layperson’s terms, this means that if you buy a copy of a copyrighted work, you have the right to sell that copy.  Hold on there, this doesn’t mean you can run out and make another edition of the underlying copyrighted work, but it does mean you can legally resell (or gift, destroy or whatever) your copy of Justin Bieber’s My World 2.0.

UMG sent the promos to the stores/radio stations, Augusto bought one from somewhere and resold it.  Pretty simple, right?  Well, the one wrinkle (there’s always a wrinkle) that UMG brought up is that the “first sale” doctrine does not apply to licensed material.  UMG claimed that they merely licensed the promo CDs to the recipients (it is, after all, stamped on the cover that they are subject to a license), so the “first sale” doctrine doesn’t apply as UMG still technically owns the CDs.  But the Court made brief work with UMG’s argument.  The Court noted that, unlike legitimate licenses (like the ones commonly used by software companies): 1) UMG sent the promo CDs out to recipients without advance notice to or request by the recipients; 2) the recipients did nothing to agree to the license or even acknowledge receipt of the allegedly licensed CDs; 3) UMG did nothing to keep track of the promo CDs after mailing; and 4) UMG did not require the recipient to return the CDs.  Basically, you can’t just send an item through the mail without any explanation and expect the Court to consider it licensed material.

Granted, it may seem like this case should have been decided, oh I don’t know, during the ’90s when it actually mattered (blame the major labels for pulling out all the stops now in an attempt to grasp onto whatever revenue they can from their clearly faltering business model), but this ruling is actually fairly important.  There haven’t been all that cases dealing with the first sale doctrine, and the Ninth Circuit helpfully explained how it should be applied in a very common scenario.  So, sorry Garth Brooks, but the majors can’t prevent the resale of your promo CDs.

US v. American Society of Composers, Authors and Publishers

The Federal Appeals Court for the Second Circuit recently issued an opinion (found in its entirety here) which no doubt rankled ASCAP executives and ruffled the feathers of the international copyright community.  The Court’s ruling was two pronged:  first, it held that the download of a file containing a musical work did not qualify as a “performance,” thereby cutting off an additional performance royalty to composers; and second, it reversed and remanded to the trial court the issue of the royalty rate to be paid by applicants Yahoo! and RealNetworks for the use of ASCAP’s extensive publishing library.  The second issue is less interesting than the first – the Court disagreed with the lower court’s math, and nobody likes thinking about math – so let’s focus on the first part of the ruling.

Yahoo! and RealNetworks applied for a license to use music in ASCAP’s library on their websites in many different ways, including streaming and downloads.  As part of the license, ASCAP demanded a royalty for the “performance” inherent whenever someone downloads, not just streams, music off those websites.  Everyone agrees that streaming music implicates the performance right, but the websites disagree that downloading alone constitutes a “performance”, and everyone ends up in a federal courtroom.*

* As a result of a 1941 antitrust lawsuit against ASCAP and the rather unique resulting consent decree, the Federal Courts for the Southern District of New York alone possess the ability to set ASCAP’s licensing rates.  This anachronistic arrangement has continued now for nearly 70 years.  It is no doubt extremely costly and time consuming (not to mention aggravating) to have the court set your license rates (you can’t really fault ASCAP and the lower court for wanting to keep things simple in determining the blanket license), and obviously federal judges aren’t themselves savvy business negotiators.  But I have to admit, given the ‘anything goes’ approach to antitrust enforcement these days, it’s kind of refreshing to see one industry in which the courts are keeping a close eye over monopolistic prices, even if it’s just for the benefit of other monopolies.

What does the law say?  Well, along with the right to actually copy a work, Section 106(4) of the US Copyright Act also provides authors the exclusive right to “perform the copyrighted work publicly”.  Section 101 states “[t]o ‘perform’ a work means to recite, render, play, dance, or act it, either directly or by means of any device or process…”  So does that include the process whereby an end user downloads their favorite Lady Gaga track and plays it whenever they want?  Nope.  The Court ruled that a “performance” requires some sort of “contemporaneous perceptibility” – that is, you must be able to experience a performance as it happens.  Unlike streaming media, when you download a track, you can’t actually perceive the work until the download is entirely complete and you use some other program to turn the sound file into actual sound.  According to the Court, this is neither “public” or a “performance.”

ASCAP’s strongest argument comes from international law.  Several commentators note that this opinion distances the US from international copyright law, much of which protects an author’s right to transmit or communicate their work to the public via telecommunication.  For example, the Canadian Wireless Telecommunications Assn. v. SOCAN decision by the Canadian Federal Court of Appeals ruled pretty much exactly the opposite of the Court here, but unlike US Copyright law which only provides for the right to perform the copyrighted work publicly, Section 3(f) the Canadian Copyright Act explicitly provides authors the exclusive right “to communicate the work to the public by telecommunication.”

The idea that authors of musical works don’t have the right to collect a royalty whenever their work is transmitted or downloaded over the internet is a jarring thought.  Still, based solely on the language of the law as written, the Court probably made the right decision.  Therefore, ASCAP’s best bet to get US copyright law up to speed with the music industry’s current business models and international copyright law is likely in the halls of Congress rather than in the courthouse.  That, or maybe develop technology forcing the downloader to listen to a sound file as it downloads.

A trailer for the film is below.

Tears over the legal bill?

Maxwood Music Limited v. Malakian, et al., — F. Supp. 2d –, 2010 WL 2010936 (S.D.N.Y. May 18, 2010)

One request I hear a lot is to explain what happens when two or more people write parts of the same song.  The U.S.Copyright Act is pretty clear in this situation.  Without a contract to the contrary, such a song would constitute a ‘joint work’ – “a work prepared by two or more authors with the intention that their contributions be merged into inseparable or interdependent parts of a unitary whole.”  17 U.S.C. § 101.  In the case of a joint work, each author then possesses an equal copyright interest in that song.  17 U.S.C. § 201 (a).  This opinion (found in its entirety here) provides an interesting behind the scenes decision illustrating some of the evidence needed to prove joint authorship in a song.

Plaintiff Maxwood Music Limited is the publishing company of British musician Casey “Chaos” Chmielinski, best known for his band Amen.  Defendants Daron Malakian and Serj Tankian are half of the band System of a Down, responsible for the Top 40 and Grammy-winning song at the heart of this dispute, “B.Y.O.B.”

* I think I actually saw System of a Down once, years ago in Atlanta.  If I remember correctly, my dad asked me if I had heard of this band called “Lim Biz Ket.”  I had but immediately responded “no” when he asked if I liked them.  He seemed genuinely sad, because he really wanted to surprise me with VIP tickets he got through his job.  (He’s a great guy.)  They were playing that night at the Phillips Arena with Method Man/Redman and, I seem to recall, System of a Down opening.  So my brother and I went, partly out of curiosity.  We definitely had a good time.

A few years prior to the release of “B.Y.O.B.” on System of a Down’s 2005 album Mesmerize, Malakian befriended Chmielinski, with whom he intended to form a side project, Scars Over Broadway.  So the pair jammed together on a few occasions before recording a handful of tracks in a studio.  The pair, of course, didn’t put anything in writing as to who wrote what.  Malakian and Chmielinski fall out, nothing ever becomes of the tracks they recorded, except that Malakian later uses part of one short song recorded during these sessions to form the introductory guitar riff and the bridge for “B.Y.O.B.”  In recognition of Chmielinski’s utterance of a phrase that shows up in “B.Y.O.B.,” Malakian later grants Chmielinski a 2% interest in the song.  Well, System of a Down’s employees, the record label and publishing company all take this to mean that Chmielinski authored 2% of the song, along with Malakian and Tankian (who wrote some of the song’s lyrics), when Malakian allegedly intended to just gift Chmielinski 2% of the writer’s royalties.*  While initially very excited about the 2% grant – which is no doubt valuable considering the success the song – Chmielinski ultimately decides he is a co-author of large chunks of “B.Y.O.B.” and deserves half of the proceeds of the song.  Thus, he (via his publishing company) sues Malakian and Tankian for a declaratory judgment that he is a co-author.

* Copyright authors are of course free to assign, share or transfer any amount of royalties to whomever they want.

The Court, clearly by no means enamored with Chmielinski,* found in Malakian and Tankian’s favor, ruling that Chmielinski was not legally a co-author of any portion of “B.Y.O.B.”  In addition to the Court’s disinclination to believe any of Chmielinski’s testimony that he actually co-authored any part of the jam session song that later became “B.Y.O.B.” – or anything else, the Court clearly didn’t believe a word Chmielinski said** – the Court looks at Malakian’s journals and ownership spreadsheets to determine that Malakian possessed no intent to create a joint work.

* I love the Court’s completely unnecessary and sarcasm-dripping reference to the fact that “Chmielinski has won or been considered for awards for Man of the Year and Second Best Singer of the Year.”  That’s literally a quote from the opinion.  I’m up for Third Best Singer of the Year for 2010.  Fingers crossed.

** Interestingly, indie drumming stalwart Zach Hill, who worked on the jam sessions, actually comes off looking pretty good in the Court’s opinion.  The Court clearly believed his testimony, but that’s usually the case when you’re a disinterested third party who’s not, you know, a vengeance-minded former friend.  In the eyes of the Court, that is.

The Court even relied on the liner notes, which do not list Chmielinski as an author, as evidence that Malakian lacked intent.  I understand the logic here – all of the parties have to possess the intent to create a joint work, so if one of them writes in the liner notes that the other had no hand in writing the song, it is evidence that they didn’t intend to create a joint work – but it doesn’t seem like particularly persuasive evidence.  Someone in Malakian’s situation has very little reason to cite someone like Chmielinski, a former friend, as an author even if in his heart of hearts he knew it was a joint work.  Moreover, in addition to the mountain of clerical records on the part of pretty much the entire major label bureaucracy surrounding System of a Down that recorded a 2% author’s share in Chmielinski’s favor, the Court could have pointed to the fact that Malakian granted Chmielinski the 2% interest in recognition of his (small) contribution to the song.  But the Court didn’t cite this evidence at all; rather it depended solely on the fact that Malakian repeatedly listed only himself and Tankian as authors of “B.Y.O.B.”  Then again, Chmielinski didn’t complain about the lack of authorship credit or the 2% grant until over a year after the release of the album.

So what can a musician take away from this ruling?  Aside from understanding (and hiring employees who understand) the difference between an authorship interest and an entitlement to a portion of the writer’s royalties, put everything in writing, repeatedly, because you never really know when your jam session will form the basis for a song that makes millions.  This rule really applies to everyone.  I understand that it’s ridiculous to think that everyone should sign an agreement whenever they get together to jam, but at least write down who did what, and if you plan to use part of a jam session as part of a track on a major label record, you really ought to nail down all the legal particulars beforehand.  Malakian had several opportunities to completely prevent this no doubt very costly* lawsuit.  For example, it’s unclear why Malakian didn’t get some sort of release agreement to go along with his generous “gift” to Chmielinski.

* Malakian and co. asked the Court to order Chmielinski to pay their legal fees, but the Court declined.  See here.

Oh, one more thing, when you go to court arguing, well, anything, but specifically when you argue that you co-wrote a hit song, get your facts straight.  The judge and jury really, really don’t like it when you change your narrative several times throughout the course of the litigation.

Last week, a New York federal court judge delivered an important ruling that will no doubt be (ahem) music to the ears of the major record labels.  Judge Denise Cote ruled that the sound recording copyrights from key albums recorded by Bob Marley during the 1970s, including the legendary Exodus album, rest not in the possession of Marley’s family but rather with Universal Music Group (UMG), the successor-in-interest to Island Records, Marley’s ’70s label.  Why?  Well, according to Judge Cote, the three recording agreements signed by Island and Marley in the 1970s (prior to January 1, 1978, the effective date of the current 1976 Copyright Act) render those albums ‘works for hire,’ meaning Island is the legal ‘author’ of the sound recordings on the records.

To fully grasp the ramifications of the court’s decision, a little legal back story is in order.  The parameters of the ‘work for hire’ doctrine is of the utmost importance to the entertainment industry on the whole because of a quirky facet of US Copyright law.  The 1909 Copyright Act, which controls the Marley agreements at issue here, provided for an initial 28 year copyright duration, which was then renewable only by the author or their heirs, regardless of whether the author sold the copyright during the initial term, and regardless of the terms of that transfer agreement.  Section 304 of the 1976 Act did away with the renewal process in the case of transferred copyrights and instead allows the creator of a work produced prior to January 1, 1978 to reclaim a transferred copyright 56 years* after date of the copyright was secured, again, regardless of the language in the transfer agreement.  The idea here is to protect authors who sell, for a pittance, their rights to a work that becomes incredibly valuable at a later date.  This way the creator (or their heirs) would at least have the ability to profit from the work several years down the line.

* The Sonny Bono Copyright Act later extended this period to 75 years for certain copyrights.

It should be no surprise that companies that own a large number of copyrighted works, such as, oh I don’t know, major record labels, loathe this idea.  They never want to give up their lucrative copyrights.  So what do they do?  They try and they try to exploit the one exception to this rule, which I hope you can all see coming – works made for hire.  That’s what makes Judge Cote’s decision, should it hold up on appeal, such a resounding win for the major labels.  The court here decided that the sound recordings qualify as commissioned works that Island paid for and had the right to supervise and direct.  Of course, had the court found that Marley merely licensed the sound recordings to Island, his heirs would now own the copyrighted recordings.

The court’s decision is, shall we say, curious for a couple of reasons.  First, the court noted the argument forwarded by Marley’s family that the sound recordings at issue do not fall into a traditional ‘work for hire’ category, but the court blew off this argument in one sentence, saying it “elevates form over substance.”  Next, the court completely disregarded the fact that the agreements specifically and repeatedly style themselves as ‘assignments’ and/or ‘licenses,’ not anything approximating creating ‘works for hire.’  The court also harped on the idea that the agreements state that the sound recordings are the “absolute property” of Island, which of course would be true even if Marley authored and then assigned the copyrights to Island.  Despite this, the court again and again stated that the interpretation urged by Marley’s family – the the agreements amounted to, you know, an assignment or a license of the sound recordings – is not even sort of reasonable.  Judge Cote also cursorily brushed aside testimony from several Island executives (including the label’s legendary founder Chris Blackwell) and Marley’s 1970s attorney – you know, the people who negotiated the agreements – who uniformly testified that the parties did not intend for the sound recordings to be works for hire.  The court even acknowledged the caselaw finding that a work for hire relationship is rarely found where the creator of the work receives royalties – and still ruled against Marley’s family.

As the court itself acknowledged, the Second Circuit (and now this ruling) makes it pretty much impossible to rebut the idea that a person who paid another to create a work copyrightable under the 1909 Act is the statutory ‘author’ pursuant to the ‘work for hire’ doctrine.  So if Judge Cote’s opinion stands, suddenly virtually every sound recording created prior to 1978* amounts to a commissioned work, which means musicians can never reclaim their pre-1978 copyrights.  This means big, big money for the majors, who really don’t want their cash cows to run dry.**

* Fortunately, sound recordings made after January 1, 1978 are virtually never ‘works made for hire’ because of the 1976 Act’s strict definition of that term.

** Psst, hey, Marley family attorneys:  Appeal!

Jean-Luc Godard: Oh yeah, he's still got it.

Boing Boing reported today that famed Nouvelle Vague filmmaker Jean-Luc Godard stepped out of the shadows to take a stance on the issue of piracy.  Godard surprised James Climent, currently charged in France with illegally downloading some 13,788 MP3s, with a 1,000 Euro donation toward his legal defense.  Climent (as would have I) thought at first that it was a joke.  Turns out that Godard is not a fan of copyright law.  He goes so far as to state, “There is no such thing as intellectual property,” and “Copyright, there’s really no such thing.  A creator has no [copy]rights.  I have no [copy]rights.  I only have duties.”

Godard’s point of view shouldn’t be much of a surprise to anyone who has seen his movies like Made in USA or Week End, but I still find it interesting to see Godard take so public a stance on the issue.*  It remains to be seen if Godard, who of course already ushered in one new wave in his lifetime, will spearhead a nouvelle vague in copyright law.  It also remains to be seen if, in light of his politics, the Academy goes through with its plan to bestow an honorary Oscar on the cantankerous French film legend.

* What’s next?  Chris Marker coming forward with a highly publicized donation to PETA?

No doubt most bands have seen a radius clause in some form or another.  You might not be at the point where you’ve run into an agreement requiring you to avoid playing an entire geographic region for nine months, but you may have seen some language requiring you to not play for a few weeks before and after a show.  Or maybe you even self-enforced a similar restriction – not promoting one show as hard so as not avoid annoying the venue of a higher profile show.

But is this standard music industry practice an antitrust violation or just good business sense on the part of the venue?  Well, here’s the deal – the US antitrust laws, namely the Sherman Act and the Clayton Act, prevent unreasonable restraints on trade.  Many state courts throughout the years have noted that radius clauses, typically those found in shopping center leases, are restraints on trade, albeit ones which protect the venue’s (if not the bands’) legitimate business interests.  Therefore, courts tend to weigh, on a case by case basis, the scope and reasonableness of each radius clause to ensure that they are no broader than necessary to protect those legitimate business interests.  Courts have a lot of balancing tests and equations for all of this, but basically it comes down to whether the court thinks the particular radius agreement is reasonable in light of the circumstances.  Courts sometimes go so far as to reform or rewrite a radius agreement rather than declaring the entire thing illegal; for example, a clause preventing a band from playing a 100 mile radius for 6 months could be revised to only prevent the band from playing within a particular city for, say, two months.

Even if a court rules against Lollapalooza’s seemingly overbearing and unnecessary radius clause, which has drawn the ire of several Chicago-area venues, the radius clauses utilized by smaller and mid-sized venues that prevent a band from playing the same city for maybe a month are likely reasonable enough to protect the venue’s interests.  One way or another, it will be interesting to see how this plays out in the Illinois courts – if it plays out at all that is.  At this point, the state Attorney General has just subpoenaed information.  The state has yet to file a lawsuit, and there is no requirement that it do so.

Here’s the basic idea.  Under the U.S. Copyright Act, a recorded song or other musical work consists of two completely separate copyrights: a copyright in the 1) sound recording, and 2) the underlying musical work (i.e. the composition), frequently referred to as the publishing copyright.  The Copyright Act provides the author of each copyright the exclusive right to reproduce the work, prepare derivative works, distribute copies of the work to the public, and display the work publicly.  With respect to the publishing copyright, the Copyright Act also ensures the right to perform the work publicly.  However, since the advent of commercial radio, the Copyright Act has not provided a right of performance to owners of a sound recording copyright.  With me so far?  This distinction is very important.  It means that every time a radio station plays a song, it must pay a royalty to the owner of the publishing copyright – usually the author or their music publishing company – but not the owner of the sound recording copyright – usually the musician(s) or the record label.

Why?  Well, look at the nature of commercial radio.  Playing a band’s song over the air is essentially free publicity for the band.  So the initial idea was that radio stations should not have to pay money to publicize a recording that the label and musician(s) hawk to the public.  Otherwise, it would be like requiring your wingman to buy you drinks all night.  They are there to help you meet ladies, so you should probably be nice to them.  If they happen to score some collateral action in the process (as commercial radio does by raising advertising money), well, that just means everyone is happy.  Thus, for many, many decades, everyone involved seemed to agree this made sense, and labels and radio stations peacefully co-existed.

But slowly, things have changed.  Concerned about the possibility that satellite and internet radio, with their ability to transmit crystal clear digital copies of recordings, would altogether replace the public’s demand for CDs, the RIAA successfully lobbied Congress to pass the Digital Performance in Sound Recordings Act.  The DPSRA requires satellite and internet stations to pay a royalty to the sound recording copyright holder each time they digitally “play” a song.  This constituted the first time that the Copyright Act provided any performance rights to sound recordings.  However, the DPSRA limited this right to “digital audio transmissions” and did not alter the right of terrestrial radio stations (i.e. AM/FM stations) to “perform” a sound recording without paying a royalty.

Now, the RIAA (and, of course, Mr. Corgan) wants to take that extra step and also require sound recording royalties from terrestrial radio stations for every spin.  Basically, what would happen is a sound recording performance rights organization, similar to BMI and ASCAP*, would collect royalties from radio stations and distribute them to its members.  The Copyright Royalty Board would set a standard royalty rate to be paid by the radio station every time it played a song.**  The current draft of the PRA does carve out a niche for smaller stations and college radio:  smaller radio stations – grossing less than $1.25 million per year – can pay a flat fee of $5,000 per year, while public and college radio stations could pay a flat fee of $1,000 per year.

* BMI and ASCAP are organizations representing music publishers and other owners of copyrights in musical works.  These “publishing rights organizations” collect royalties due each time a radio or television station plays one of its member’s songs.  These organizations are necessary because it would be virtually impossible for every radio station to separately negotiate with every composer or publisher.  Likewise, SoundExchange is an organization representing sound recording copyright holders with respect to royalties derived from the performance of members’ songs on satellite and internet radio.

** While this amount is an unknown, it would likely be a matter of pennies for every play. It might not seem like much, but just ask ASCAP – this can add up quickly.

So is the Performance Rights Act a good idea or not?  Well, that depends on whether you are a record label, a musician, or a radio station.

For most record labels – major or indie – and artists, the PRA potentially means a heretofore non-existent revenue stream.*  In this era of overall economic uncertainty, labels and musicians should probably consider any new revenue stream a godsend.  Another point is that many other countries already have laws similar to the PRA on their books.  However, since the U.S. Copyright Act doesn’t presently provide a right of performance to sound recording copyright owners, musicians typically do not receive royalties from international radio stations.  Therefore, the PRA conceivably represents a royalty stream from not only U.S. stations, but from radio stations around the world.

* One note to musicians and bands:  should the PRA pass and become law, carefully review your recording contract with your label to determine who keeps the sound recording performance royalty.

Unsurprisingly, many radio stations and broadcasters vehemently oppose the PRA, despite Mr. Corgan’s assurances that radio isn’t the bad guy.  Several commentators suggest that the PRA is simply an attempt by the RIAA and the major label system in general to grab as much money as they can before they wheeze their collective last gasp.  Organizations like the Free Radio Alliance and the National Association of Broadcasters go one step further to contend that the PRA essentially allows the recording industry to externalize onto radio stations the costs major labels have incurred as a result of their massive failure to keep up with consumer trends.  Moreover, many radio stations, particularly smaller stations and college radio, may not be able to afford even the lesser flat yearly fees.  Like everyone else, these stations are struggling, likely making little to no money whatsoever from playing (and thus promoting) the new Animal Collective record.  Yet the PRA would nickel and dime these stations just that much more.

So while the PRA would certainly help labels and musicians in the short term, in the long run it could have a seriously deleterious affect on music radio, one of, at least traditionally, the best promotional tools of the record industry.  One way or another, the Performance Rights Act, should it pass, will drastically alter the delicate symbiosis in place for decades between musicians and radio stations.