You Gotta Have a License

My old friend, former restaurateur and new attorney, Jody Faison has written an article for the Nashville Bar Journal explaining why and how the performing rights organizations, BMI, ASCAP, and SESAC go about licensing the public performance of music to the bars, clubs and restaurants which  provide music to the public. 

            Jody does a good job in explaining this whole process which to the new proprietor is most likely bewildering. Those who have not been raised in an environment which understands intellectual property rights are often shocked when they find out they have to pay for the privilege of providing music, live or otherwise, in their facility.  Jody also points out that unless the proprietor fits into one of the narrow examples provided by the Fairness in Music Licensing Act, there is really no way around the licensing requirement and paying licensing fees to each of these  organizations.  I can speak from personal experience from representing  bar owners in the past that the consequences of not being properly licensed can be disastrous.  I am obviously a  fan of performing rights organizations but their enforcement and litigation strategies can seem merciless.

            The article “Blueprint for the Blues: Building Strategies for Performing Rights Fees” in the November 2013 Nashville Bar Journal should be required reading for anybody going into the restaurant or bar business and  those who advise them.

On The Legal Status of a Rock and Roll Band

Dealing with disputes among band members (and former band members) is one of the most difficult areas an entertainment lawyer can get involved with.  The legal organization of a musical group involves intersecting area of corporate law, copyright law and trademark law, as well as basic human emotions.  When group members function together in perfect harmony their business models can be a source of inspiration.  However, when human conflicts enter the picture, even the best organized entity can show its shortcomings.

            I have read about two interesting cases recently.  The first involves the 1980's band Queensryche.  According to published reports, the band's corporate entity voted to remove founding member Geoff Tate as lead singer of the band, following a Spinal Tap-like series of events.  The other band members apparently set forth very good reasons why they felt they could no longer continue with Tate in the band and based on provisions set out in their original partnership agreement, they expelled him-subject to a duty they recognized to account to him for his share of profits.  In order to avoid even further controversy, the "new" entity even began performing under a different name, "Rising West" to avoid potential trademark problems.

            Nonetheless, Tate has sued his former partners alleging a host of indignities the most significant being corporate oppression.  This seems to be a text book case in using corporate law to attempt to wrestle some benefit out of an entity and to essentially punish former band mates from working without him.  This scorch the earth technique is far from certain in most cases, especially those involving human feelings and egos.

            An even stranger case  I just read about involves a former member of the J. Geils B Band who happens to be named J. Geils, who is apparently involved in a trademark battle with his former band mates.  It seems that both J. Geils and the J. Geils Band (under their corporate entity T& A Research and Development Corp.) have filed competing trademark applications to try and protect the band's trademark.  This has apparently led to litigation in both the Patent and Trademark Office and in federal court. Buried in the evidentiary murk of all of this, is the fact that at some point in the past all the band members signed a shareholders agreement restricting their right to use the name "J. Geils Band" independently.  If that is true, we may end up with a case of an individual being able to perform under his own name due to activities he once undertook as a shareholder.

            All of this seems to demonstrate the point of this tale,  which is that dealing with disputes among band members is usually very, very difficult.  I've been involved in a lot of these disputes and I can say that more often than not, corporate structures and shareholder agreements as well as form cookie cutter LLC agreements have been virtually worthless in resolving these disputes; while a good well thought out partnership agreement always seems to be both enforceable and convincing to all parties involved.  The moral here is that a band needs to have these discussions early on in their careers and to commit their agreements to writing in a cogent, equitable manner.  It is a discussion that no band wants to have, but it is absolutely vital.

Revenge of the Bratz

I remember reading a few years back that the Mattel Toy Company has obtained an injunction against the makers of the Bratz dolls because of their alleged similarity to the Barbie Doll. I was confused-on the surface the two dolls are not at all similar. The case, Mattel v. MGA was premised upon Mattel’s argument that the Bratz dolls infringed upon Mattel’s copyrights’ among other claims. Ultimately, Mattel’s argument was based upon the mistaken premise that one can assert a copyright in a mere idea or concept. Remember that this is the same company which unsuccessfully sued a group for recording the song “Barbie Girl”.

The kicker to the Bratz case is that in prevailing, the Bratz manufacturer was awarded a judgment for its costs and attorneys fees in the amount of $137,000,000 (yes, one hundred thirty seven million.I triple checked it.) Section 505 of the Copyright Act provides that the prevailing party in a copyright infringement case is entitled to petition the court for an award of its costs and attorneys fees. This point was famously demonstrated in the case Fantasy v. Fogerty, wherein John Fogerty recovered his attorney’s fees in defending himself against his former publisher’s erroneous claim that he had somehow infringed his own work.

This is the reason one has to be dead certain of their legal position before instituting a copyright infringement case and it is, I believe, one of the main deterrents to more frivolous copyright lawsuits being filed. Still, if you can afford to pay $137 million in legal fees, I guess deterrence is not really an issue.

Elie Wiesel, the First Amendment and the Sad Truth

The Wall Street Journal ran an interesting story last week by its drama critic Terry Treachout about a theater company in Washington which backed out of producing a play called "Imagining Madoff" because it had received threats of litigation from famed author and Holocaust survivor Elie Weisel.

Apparently, Weisel and his foundation were victims of Madoff's fraud and the playwright, Deb Margolin became interested in trying to imagine conversations between the two. Weisel took offense at his fictional portrayal. According to the article, he found it "defamatory" and "obscene" and in words which could have only been written by a playwright or a lawyer threatened to sue, if the play was performed "any time in any venue".

The article goes on to examine the First Amendment and the current state of libel law but then hits upon the sad stark reality that in this country, all one has to do is threaten to sue someone else to curtail their right to free expression. Mr. Weisel is a public figure and the playwright and theater company were most likely in their rights in producing the work, embarrassing as it might have been to Mr. Weisel. However, as Treachout writes, "when a world famous plaintiff decides to stare down a not so rich defendant who can't afford to fight back, the defendant usually blinks." I don't do a lot of work in libel law but I do find myself advising clients in the trademark area and quite often, when evaluating a mark that might draw negative attention from a rich corporate defendant, we end up evaluating the financial might of the potential plaintiff much more than the legal merits of the defendant's case or the relative strength of his mark. This is a sad unfortunate fact of advising clients in the 21st century; they might be able to win the case but they can’t afford to fight the case.