Newly Discovered Evidence Stays Liability Finding In Shakira Suit

Mayimba Music, Inc. v. Sony Corp. of Am., No. 12-cv-01094 (S.D.N.Y. filed 04/30/15) [Doc. 139].

Finding that newly discovered evidence concerning the authenticity and date of creation of an audio tape, which implicated a potential fraud on the court during the liability phase of trial, resulted in the Court staying a previous finding of liability pursuant to Rules 59 and 60.  The Court had previously found plaintiff had a valid copyright in the song at issue, that the plaintiff's testimony was credible that he had authored the song between 1996 and 1998, that it was an original song, that the song was recorded onto a cassette tape in 1998, and that a copy of the song on the tape was registered at the Copyright Office in November 2011.  After trial, the parties engaged in extensive discovery of damages in preparation  for the second phase of trial.  Four months after the liability opinion was issued, Defendants filed a motion contending that newly-discovered evidence demonstrated that the tape was fabricated in 2011, not created in 1998, and that plaintiff had lied under oath when he testified that the tape had been created in 1998.  Thus, the core issues before the Court were "when the tape was created, and whether witnesses lied on the stand with respect to its creation".  The Court found that "this is newly discovered evidence which could not have been found with reasonable diligence before trial. ... Furthermore, the evidence now put forth, if credited, clearly establishes that Plaintiff attempted to commit a fraud upon this court, going so far as to fabricate evidence and to commit perjury."  Accordingly, the Court suspended the finding of liability against Defendants "until further clarification can be found on these very serious issues."

"Whomp! (There It Is)" $2 Million Jury Award Affirmed

In re: Isbell Records, Inc. (Isbell v. DM Records), No. 13-40878 (5th Cir. Dec. 18, 2014).

The Fifth Circuit affirmed a finding that plaintiff owned the copyright in the composition of the song "Whomp! (There It Is)", that defendant was liable for infringement based on its exploitation of the song for year, and the jury's award of over $2 million in damages.  The primary issue was whether a 50% interest in the song had originally been assigned to the plaintiff or the defendant's predecessor-in-interest (the other 50% remained with the writers/producers of the song).  The 5th Circuit held that California contract interpretation law applied, and that the lower court correctly found that the contract granted the 50% interest in the song to the plaintiff.

On appeal of defendant's trial motion under Fed. R. Civ. P. 50 for judgment as a matter of law, the defendant raised two issues regarding the district court's interpretation of the recording agreement as assigning a single 50% interest to plaintiff.  First, the Court rejected defendant's argument that the lower court erred in interpreting the agreement without asking the jury to make any findings on extrinsic evidence.  Second, the Court rejected defendant's argument that the agreement also assigned a second 50% interest in the composition copyright because the argument had not previously pursued that theory and had disclaimed the theory at an earlier hearing.  In short, the defendant could not raise its "two assignments theory" after not previously asserting it at trial or in its earlier Rule 50 motion.

On appeal of defendant's motion under Fed. R. Civ. P. 60(b) for relief from judgment based on fraud and lack of standing, the Court rejected defendant's argument that it was prevented from presenting the defense of plaintiff's lack of standing.  Even if the plaintiff had improperly withheld a certain document, it would not have affected plaintiff's standing and thus would not have affected defendant's defense.

With respect to the jury's damage award of over $2 million, the Court rejected defendant's argument that plaintiff should have only been awarded 1/2 of that amount as 50% owner of the copyright.  First, defendant did not object to the jury charge during trial.  And under the plain-error standard of review, the district court did not err.  Notably, the 5th Circuit found that Edward B. Marks Music Corp. v. Jerry Vogel Music Co., 140 F.2d 268 (2d Cir. 1944), was inapplicable to the issue of first impression whether a partial owner of a copyright can ever be awarded infringement damages for his co-owner's share.  Specifically, the jury could have found that plaintiff was entitled to 100% of the royalties in the first instance as administrator/publisher of the song.  In other words, because plaintiff was obligated to account to the other 50% owners (the producers/writers), plaintiff could recover 100% damages and any issue as to distributions would be a separate case between the co-owners not involving the defendant.

Lastly, in affirming denial of defendant's Fed. R. Civ. P. 59 motion for a new trial, the Court found that plaintiff's closing statement -- referring to defendant as a "thief -- was not abusive and improper.  Defendant did not object to the closing statement at trial and thus the standard of review was plain error.  Evidence was presented at trial form which the jury could find that defendant's conduct was willful and that defendant stole the copyrights from plaintiff.  Further, any prejudice was minimized by the judge's instructions and the statements concerned damages rather than liability.  Further, plaintiff ultimateley elected actual damages which were higher than statutory damages, and willfulness is not an element of actual damages calculation.

Copyright Case Properly Reinstated Against Church

Yesh Music v. Lakewood Church et al., No. 12-20520 [Doc. 00512341666] (5th Cir. filed 08/14/2013).

Plaintiff filed a copyright infringement complaint against Defendants in Texas.  Defendants are a large church and its pastors, Joel and Victoria Osteen.  Plaintiff had granted the church a limited license to use a song
in connection with various  marketing media.  When the church used the song in a televised promotional broadcast, Plaintiff asserted that the limited license did not permit use of the song on television and that in any case, the term of the license had expired. Unable to resolve their dispute, Plaintiff filed a copyright infringement suit against Defendants.

Plaintiffs it later voluntarily dismissed the lawsuit without prejudice.  Plaintiff then filed an identical case in federal court in New York.  Back in Texas, the church has filed a motion for its costs and when the parties were before the Court on that matter, the parties agreed on the record to dismiss the New York action and re-instate the Texas action. Because under Rule 41(a)(1)(B), the two successive voluntary dismissals of the lawsuit had the effect of rendering the second dismissal as one with prejudice, Plaintiff filed a motion to vacate its voluntary dismissal under Rule 60(b), which the district court granted.  Defendant opposed, arguing that Rule 60(b) only applies to a "final" order or judgment, and the first voluntary dismissal was not "final."  The Fifth Circuit found that a voluntary dismissal without prejudice is a “final proceeding” under Rule 60(b) and the district court did not abuse its discretion in reinstating the case.

Songwriter's Widow Sanctioned; Default Judgments In Favor Of Assignee Not Vacated

Bridgeport Music, et al. v. Smith, et al., No. 12-1523 (6th Cir. May 1, 2013).

This action is based on default judgments entered in 2004 that plaintiff obtained against defendants for copyright infringement of the 1974 song "You’re Getting a Little Too Smart" ("Smart").  Plaintiff was the assignee of the songwriter's rights in the song.  In 2011, the songwriter's widow moved to vacate the default judgments, arguing that she, not Plaintiffs, was the legal owner of the copyright by operation of law at the time the lawsuit was filed.  The district court denied the motion, as well as her motion for reconsideration, and the widow appealed.  The Sixth Circuit affirmed, and granted Plaintiffs motion for damages and costs.

After stating the relevant facts, the Court began its analysis by determining who was entitled to what copyright interests in “Smart” under the renewal provisions of the Copyright Act:  "(1) Based on their assigned interest in the initial copyright, Plaintiffs had the right to sue for infringing acts occurring up through December 31, 2002, see 17 U.S.C. § 501(b) ..., and they had three years after that date to bring a cause of action. ... (2) Because Tilmon died prior to the renewal term, Tilmon’s contingency interest in the renewal copyright passed to Tilmon-Jones and Tilmon’s children, on January 1, 2003."

Next, the Court considered whether the widow, as a non-party to the litigation in which the judgments were entered, had standing.  The Court determined she did not have standing to bring a Fed. R. Civ. P. 60(b) motion.  Rule 60(b) provides in pertinent part that a “court may relieve a party or its legal representative” from a final judgment.  Nor was the widow in privity, or were here interests "strongly affected."

The Court also found that the widow's motion to vacate the judgments was untimely under Fed. R. Civ. P. 60(c)(1), which requires such motion be made within a reasonable period of time.  She did not file the motions until 6 years after constructive notice of the judgments (due to recordation of the judgments with the Copyright Office), and 7 years after they were entered.  The motions also were barred by a release the widow signed in another action.

Lastly, the Sixth Circuit sanctioned the widow and her counsel, pursuant to Fed. R. App. P. 38 and 28 U.S.C. § 1912.  "The conduct of Tilmon-Jones and her counsel was objectively and patently meritless and a waste of judicial resources. Tilmon-Jones maintains that her appeal is not frivolous because the question of whether a nonparty has standing under Fed. R. Civ. P. 60(b) was not obviously without merit. This may be true, but it does not obviate the fact that her appeal was utterly without merit because it was untimely and barred by a release. We find that this appeal is frivolous and that sanctions are appropriate."