Bob Marley Heirs Succeed On Appeal In Merchandising Case

Fifty-Six Hope Road Music v. A.V.E.L.A., No 12-17502 (9th Cir. Feb. 20, 2015).

The 9th Circuit Court of Appeals affirmed judgment in favor of Bob Marley's heirs based on defendants' use of Bob Marley's image on t-shirts and other merchandise in a manner likely to cause confusion as to Plaintiffs' sponsorship of approval of the merchandise.  Additionally, the Court found that Defendants have waived several defenses by failing to properly raise them in the district court.  The appellate court also found that the lower court had not abused its discretion in determining defendant's profits and there was a sufficient evidence to find that defendants willfully infringed plaintiff's rights.  Nor did the lower court err in awarding plaintiffs their attorney's fees, as plaintiffs were the prevailing parties, and defendants' conduct was willful.  Plaintiffs also succeeded on their tortious interference claims because Plaintiffs' licensing agent testified that one of Plaintiffs' licensees lost an order intended for Wal-Mart because defendant sold t-shirts there. Defendants did succeed, however, in dismissing the right of publicity claim because under Nevada law a publicity right successor waives its publicity rights when it fails to timely register its rights.

Covenant Not To Sue Upheld In Run-DMC Co-Author's Case Against Publisher Assignee For Royalties

Reach Music Publishing, Inc. v. Warner/Chappell Music, Inc., No. 09-cv-5580, 2014 BL 317978 (S.D.N.Y. Nov. 2014).

A Run-D.M.C. co-author's claim for breach of contract failed because that co-author "long ago sold all rights to the subject songs -- including his entire copyright interest -- in exchange for royalty payments," and in that agreement, he plainly acknowledged that the songs could be transferred to another publisher (Protoons) and that "he would only ever seek royalty payments from" the original publisher (Rush Grooves).  The Court found that the covenant not to sue Protoons was enforceable and was not unconscionable under New York law.  Therefore, the co-author breached the contract when he filed suit in 2008, and the defendant's damages were their resulting attorney's fees pursuant to the express attorney's fees provision in the contract.  Defendant also counterclaimed that the plaintiff (another publisher, Reach, to whom the co-author had purportedly transferred his interest), tortiously induced the co-author to breach the covenant not to sue.  The Court found that there was a question of material fact whether Reach had knowledge of the covenant not to sue, preventing either party from winning summary judgment on the tortious interference claim.  "Even though knowledge of the contract need not be perfect, Reach must have knowledge of the covenant not to sue in order to be liable for helping Reeves violate that particular contractual provision."

Beatles Rights Holders Did Not Interfere With Film's Release By Asserting Copyright Claims

Ace Arts, LLC v. Sony/ATV Music Publishing, No. 13-cv-7307-AJN (S.D.N.Y. filed Sep. 26, 2014).

This action arises from the use of eight Beatles songs in a documentary film, "The Lost Concert."  Plaintiff alleges that defendants (publisher and record label) interfered with the US distribution of the film by asserting copyright claims regarding those songs.  According to the allegations in the complaint and certain judicially noticeable documents (e.g., copyright registrations), the Beatles first performance in the US took place in 1964, twelve songs were played, and defendant had copyright registrations for 8 of the songs.  The concert was preserved on a certain video tape.  In 2009, a production company acquired the video tape and produced The Lost Concert film, which consists of the concert footage and other sequences and interviews.  Plaintiff was granted distribution rights by the producers.  In 2009, the producers approached Sony ATV for a synch license.  Plaintiff's allege that at Apple's request, Sony refused to grant the producers a synch license, and instead Sony granted Apple an exclusive synch license for Apple's distribution of certain Beatles material on iTunes.  Nonetheless, the producers and distributor believed that there was no legal obstacle to distributing the film and arranged for a premier and distribution in the USA and UK.  Sony ATV sought an injunction against the producers in the UK alleging that the film would infringe Sony's copyrights.  The US premier was then cancelled after Sony ATV made a claim to the distributor's partner.  Eventually, the plaintiff commenced the action seeking a declaration, inter alia, that neither Sony ATV nor Apple has rights that would be infringed by exploitation of the film in the USA, and that Sony ATV "misused its copyrights."

First the Court denied the defendants' request to stay the US federal action pending resolution of the UK action.  The Court found no exceptional circumstances to justify abstention.

Second, the Court found that the controversy was ripe for a declaratory judgment claim.

Third, the Court analyzed plaintiff's anti-trust claim under Section 1 of the Sherman Act.  The Court found that, as alleged, the agreements between Sony ATV and Apple -- in particular their efforts to enforce Apple's exclusive synch license by preventing the US distribution of the film -- did not constitute horizontal restraints on trade that are a per se violation of the Sherman Act.  Nor was there an anti-trust violation under the "rule of reason" because the allegations concerned a routine dispute between business competitors that is not cognizable under the Sherman Act.

Fourth, the Court considered the tortious interference with contract and economic relations claims, which was based on the allegation that Sony ATV and Applied conspired to interfere with the distribution contract by stating that the film infringed on Sony ATV's copyrights.  The Court found that plaintiff failed to adequately plead breach of the contract because it was possible that the distribution contract was lawfully terminated.  The complaint did not identify which section of the contract was breached, "a particularly damaging omission in light of the provisions in the contract suggesting that [the distribution partner] had the right to suspend working on, distributing or exhibiting all or any portion of the film for which the partner received a demand or claim.  Further, plaintiff failed to allege the use of "wrongful means."  Sony ATV steadfastly  maintained that it owns the rights to the song, and it did not assert copyright claims in bad faith.  The bare legal conclusions of malice were insufficient.

Fifth, the Court considered plaintiff's unfair competition claim under New York common law.  The Court rejected an extension of the common law claim (which has two theories: for palming off and misappropriation) to include "commercial immorality."

Finally, the Court considered Plaintiff's claim under NY GBL sec. 349.  The Court found that defendants' alleged conduct was not consumer-oriented.  It was not a standard-issue consumer oriented transaction that section 349 was designed to protect.

Suit Filed Over Beatles Movie

Ace Arts LLC v. Sony/ATV Music Publishing LLC et al.; No. 13-cv-7307 (S.D.N.Y. filed Oct. 16, 2013).

The Beatles' music publisher and record company were sued in connection with plaintiff's contract to distribute a film, The Beatles: The Lost Concert, which documents the impact the Beatles had in the USA and their first concert in Washington DC in 1964.  Plaintiff claims $100 million in damages for alleged violation of the Sherman Act, tortious interference with contract, interference with prospective economic relations, unfair competition, and violation of the N.Y. General Business Law.

9th Cir. Orders Trial Over Bob Marley Licensing Rights

Rock River Commc'n v. Universal Music Group, No. 11-57168 (9th Cir. filed 9/18/13) [Decision]

This case concerns licensing rights for early Bob Marley recordings.  The absence of legal documentation has led to confusion as to who owns licensing rights for the recordings.

The 9th Circuit found that the chain of title to the recordings, by both sides claiming rights, was "spotty."  Therefore, the case was remanded for trial.

Pre-1972 Recordings Subject To DMCA

UMG Recordings, Inc. v. Escape Media Group, Inc., No. 100152/2010 (Sup. Ct., N.Y. Co. July 10, 2012) (Kapnick, J.S.C.).

New York State Court holds that the "safe harbor" provisions of the DMCA extend to common law copyright claims relating to pre-1972 recordings.

Plaintiff moved to dismiss defendant's "safe harbor" affirmative defense under the DMCA [17 U.S.C. 512(c)(1)].  Section 301(c) of the Copyright Act makes clear that the copyrights of pre-1972 recordings are not protected by the federal Copyright Act, and the Court analyzed whether the DMCA may provide a defense or "safe harbor" to internet service providers facing New York State common law copyright infringement claims (as opposed to claims under the federal act).  The Court observed that only one court has considered the issue (Capitol Records, Inc. v. MP3Tunes, 821 F. Supp.2d 627, 640 (SDNY 2011), and concluded that "there is no indication in the text of the DMCA that Congress intended to limit the reach of the safe harbors provided by the statute to just post-1972 recordings."  In response to a report by the Register of Copyrights that "it is for the Courts to interpret the applicable statute and decide the issues raise by this motion.  This Court is not attempting to extend the Copyright Act to pre-1972 recordings, but, nonetheless, does find, based on the relevant language of the statutes...that the safe harbor provisions codified by section 512(c)(1) of the DMCA is applicable to pre-1972 recordings."  Accordingly, plaintiff's motion to dismiss the DMCA affirmative defense was denied.

However, the Court did dismiss defendant's affirmative defense based on the Communications Decency Act of 1996 (the "CDA") [47 U.S.C. 230].  Lastly, the Court dismissed defendant's counter-claim for violation of a New York State anti-trust statute, the "Donnelly Act" (NY General Business Law 340), but denied plaintiff's motion to dismiss the counter-claims for tortious interference with contract and business relations.

'Beat It' to Promotor's Claims Against Jackson Estate

Allgood Entertainment, Inc. v. Dileo Entertainment Entertainment & Touring, Inc., et al., No. 09 Civ. 5377 (S.D.N.Y. opinion & order June 29, 2010).

"This case is about whether or not Michael Jackson, through his alleged manager Frank Dileo, agreed to perform a concert with the plaintiffs, AllGood Entertainment, Inc. and AllGood Concerts, LLC, and then later reneged on this agreement in order to perform a different concert with the defendants Anshutz Entertainment Group, AEG Live, LLC, and AEG Live NY, LLC. Plaintiffs allege breach of contract, promissory estoppel, and fraud by Frank Dileo and his management company, Dileo Entertainment and Touring, Inc., and allege tortious interference of contract on the part of Anshutz Entertainment Group and the other AEG entities; Plaintiffs also seek a permanent injunction. Both sets of defendants have moved to dismiss for failure to state a claim. For the reasons below, the tortious interference, fraud, and permanent injunction claims are DISMISSED."

Sony Loses Employment Suit Against EMI and Top Executive

Sony Music Entertainment, Inc. v. Werre, No. 601441/09 (Sup. Ct., N.Y. Co. Mar. 19, 2010)

Sony sued a top EMI executive for alleged breach of contract, and EMI for tortious interference with that contract. The Court granted Defendants' motion to dismiss for failure to state a claim. (CPLR 3211(a)(7)). The Court found that the letter agreement at issue was not a binding, enforceable contract because a contingency, namely the executive's availability for employment on April 1, 2010, did not occur. Nor did the "prevention doctrine" apply because there was not binding contract in effect that contained the condition precedent in question; the contract was not binding on the parties until the condition precedent occurred such that the prevention doctrine did not apply. Similarly, since there was no valid contract, the tortious interference claim against EMI failed. Lastly, the fraud and breach of covenant of good faith and fair dealing claims against the executive were dismissed as duplicative of the (failed) breach of contract claim.

Sony v Werre (NYS)

Suit Against Singer's Heirs Advances Over Royalties

Artists Rights Enforcement Corp. v. Haskins, No. 105227/04, 2008 NY Slip Op 33357(U), 1/2/09 N.Y.L.J. "Decision of Interest" (N.Y. Sup. Ct., N.Y. Co., Dec. 16, 2008)

Plaintiff corporation specializes in assisting artists, songwriters and music publishers with the recovery of royalties and other fees due from their artistic material and/or performances. Plaintiff now asserts causes of action for breach of contract, tortious interference with contractual relations and tortious interference with prospective economic advantage against the heir of John Kendricks, a singer and composer, whose work includes "The Twist." The action is based on a 1984 agreement between plaintiff and the singer/composer. For many years, until the mid-1980s, the singer/composer was not receiving royalties. In an effort to collect the royalties, he entered into a written letter agreement with plaintiff in 1984. It was undisputed that the singer/composer signed the 1984 agreement, under which plaintiff was entitled to receive 50% of all amounts realized as a "proximate result" of plaintiff's activities in recovering royalties due to the singer/composer. The court denied plaintiff's summary judgment motion.

ODB - In the News, from the Grave

New York Supreme Court, complaint filed:

Jarred Weisfeld; Cherry Jones v. Richard Flanzer; Control Room Productions LLC; Safe Productions Inc.; Icelene Jones individually and as the administrator of the estate of Russell Jones pka ODB; Ol' Dirty Bastard. No.08-601002, filed 4/4/2008

Summons for declaratory judgment, intentional interference with contractual rights, and breach of contract. $500,000.

Trade Secrets Case Against UMG (NY)

A global leader in the arts management business, IMGA, filed suit in New York Supreme Court, New York County, against Universal Music Group, International Entertainment Consultancy Services Ltd., and a Universal employee arising from a scheme by defendants to "surreptitiously: (1) misappropriate IMGA's confidential and proprietary information; (2) conspire among themselves, and with others, to unlawfully compete with IMGA; (3) wrongfully steal clients from IMGA; and (4) assist and cause others to breach their fiduciary duties to IMGA."

As alleged, IMGA and IECS entered into a written consulting agreement in March 2007 wherein IECS agreed, among other things, to advise and assist IMGA "in relation to the development and implementation of IMGA Artist's activities, operations and opportunities." The agreement contained an exclusivity clause, a non-solicitation clause (12 month duration), a non-compete clause (same), and various definitions of IMGA's confidential and proprietary information, which IECS agreed to keep "in trust for the sole benefit of IMGA" and in the strictest confidence. Additionally, the agreement contained various remedies for breach of the consulting agreement, e.g., agree that IMGA will be irreparably harmed and entitled to injunctive relief. (Can parties agree to that?)

Thereafter, IMGA alleges that IECS "surreptitiously conspired with Universal and [the Universal employee] to steal IMGA's proprietary information, business opportunities, and clients, in particular, opportunities and clients in the music, touring, event management and promoting area. Each of defendants and their co-conspirators are doing so in order to form a new joint venture by and among them that will exploit opportunities that belong exclusively to IMGA, and to unfairly gain for themselves a competitive advantage."

Based on the above, Plaintiff asserted the following causes of action:

-Misappropriation of Trade Secrets (including IMGA's proprietary and confidential nformation)
-Breach of Fiduciary Duties – including duties of loyalty and confidentiality
-Breach of Contract, to wit: IECS agreed to perform services exclusively form IMGA; IECS agreed not to furnish any services to any company during the term of the agreement; IECS failed to keep all proprietary information in trust for the sole benefit of IMGA; IECS used and disclosed proprietary information in violation of the non-disclosure provisions, and breach of the non-solicitation and non-competition clauses.
-Tortious Interference with Contractual Relations (solely against Universal and its
employee)

IMG Artists, LLC v. Int'l Entertainment Consultancy Servs. Ltd., No. 08-600549 (Sup.Ct., N.Y. Co. complaint filed Feb. 25, 2008).

EMI Sued for Alleged Poaching of Band from Indy

Beating OTCS to the punch is earthtimes.org, who today reported that indy label Victory Records sued EMI/Virgin in federal court (Southern District of New York) for alleged tortious interference with contract and business relations relating to platinum-selling band Hawthorne Heights.

The alleged inducement to repudiate the contract includes EMI providing $55,000 to the band to sue Chicago-based Victory in 2006, and assistance in finding a litigator.

Victory seeks $10 mil. in damages, and another $25 mil. in punitive damages for "willful, wanton, and deliberate conduct." $35 million!

...all in all, not a good day for EMI. Plus, the allegations likely leave many of the laid-off EMI employees wondering if that $55,000 could have gone towards their salary and/or figuring out a way to not have to fire people.

[** Update 1/15/08, 10:15AM: Victory Records Inc.; Another Victory Inc. v. Virgin Records America Inc.; EMI Music North America; filed, 1/14/2008; case no. CV-0314]

One Way Or Another

Blondie, and her label EMI Music NA (Chrysalis) sued in New York Supreme court for alleged breach of contract and tortious interference arising from a 1979 agreement between plaintiff and defendnats. Allegedly, Blondie misinterpreted the agreement and are not seeking to renegotiate and "extort concessions" from plaintiff.

OTCS' question is: WHO IS PLAINTIFF PETER LEEDS?

According to a 1979 article in Rolling Stone, Leeds was Blondie's manager...but things must have soured. The article continues: "They are now engaged in the legal process of dissolving their relationship..." So what went wrong? Leeds' own claim to fame - Under his tutelage with Blondie, "When in the history of rock & roll music did somebody lay down $500,000 to buy the recording rights to a group that had sold fourteen records?"

And what is going on today, in 2007?

[Peter Leeds v. Deborah Harry; Christopher Stein; James Mollica; Clement Bozewski; EMI Music North America. Filed 12/4/2007 07-603978 ]