Tom Petty Does Not Back Down

“What happened? I conclude that the composer, in seeking musical materials to clothe his thoughts, was working with various possibilities. As he tried this possibility and that, there came to the surface of his mind a particular combination that pleased him as being one he felt would be appealing to a prospective  listener; in other words, that this combination of sounds would work. Why? Because his subconscious knew it already had worked in a song that his conscious mind did not remember. Having arrived at this pleasing combination of sounds, the recording was made, the lead sheet prepared for copyright and the song became an enormous success.”  Judge Richard Owen, Bright Tunes Music v. Harrisongs Music 420 F.Supp 177 (1976)

I am in the process of preparing to teach my Music Business law class tonight and re-reading my notes on copyright infringement. Taking an ill advised break to look at Facebook, I see that British singer songwriter Sam Smith has apparently settled an infringement claim by Tom Petty and Jeff Lynne over his song “Stay With Me” and Petty’s “I Won’t Back Down”. According to an article posted on the Consequence of Sound website, Petty and Lynne now share a 25% interest in Smith’s “Stay With Me”.

Since there was no lawsuit, we have no record of what happened but my guess is that Petty and his lawyers, armed with at least one expert witness musicologist made a demand upon Smith et. al. claiming infringement of the Petty composition. It probably helped that Petty is known for not backing down.  An equitable settlement was reached.

The quote above is from the trial Judge in the well known  case involving Petty and Lynne’ s fellow Wilbury George Harrison, in which the plaintiff proved that Harrison subconsciously infringed upon the hit “He’s So Fine.”  I don’t know if the general public is aware of the fact that subconscious infringement is a viable cause of action. As Judge Owen concluded in the Bright Tunes case, “Did Harrison deliberately use  the music of “He’s So Fine”? I do not believe he did so deliberately. Nevertheless, it is clear that “My Sweet Lord” is the same song as “He’s So Fine” with different words….That is, under the law, infringement  of copyright and is no less so even though subconsciously  accomplished.”

The  two songs are similar. The two things you need to prove in a copyright infringement case are access and substantial similarity. Clearly, Smith had access to “I Won’t Back Down”.  Had the case continued the battle would have been waged over the legal elements of substantial similarity and it would have involved musicologists arguing about the similarities between the two songs and most important, whether  those  alleged similarities are capable of copyright protection?  In other words, just because we can hear similarities between the two songs, it does not mean that they are “substantially similar” from a legal standpoint.  Many litigants have learned this the hard way.

The case would have been ugly and expensive with no clear cut result. All involved should be commended for settling this dispute.  On another note, this gives me the opportunity to post my favorite Petty video of my favorite Petty song:

https://www.youtube.com/watch?v=nvlTJrNJ5lA

You Really Got a Hold On Me

            I recently read that Smokey Robinson had settled a dispute with his ex-wife Claudette over his right to exercise the termination of copyright assignment in his songs under the 1976 Copyright Act.  While I am all for both marital harmony and post-marital harmony it would have been fascinating to see how a court might have interpreted this intersection of federal copyright law and domestic relations.

 

            Robinson had taken the somewhat unusual step of filing an action for a declaratory judgment apparently after receiving a letter from his former wife's counsel asserting a community property interest in the compositions in question, despite the fact that the couple  had been divorced nearly for three decades.  He wanted the court to confirm the fact that the Copyright Act gives the right to terminate assignments and recapture copyrights to the author alone and not an ex-spouse and presumably, despite whatever economic effect this might have on the ex-spouse).

            The Copyright Act is pretty clear in this particular area but it does provide some fairly troublesome questions for divorcing spouses.  One wonders if when divorcing in 1985, the Robinsons even contemplated that Smokey would be able to recapture the copyrights to his greatest hits.  Was there a duty of disclosure (of an event that might occur 29 years in the future)?  We often see how divorce settlements can be impacted by the Copyright Act but I think that this might have presented a different take on the issue.  As the clock begins to run on some of these massive hits from the 60s and beyond we will no doubt see more of these cases and they are tremendously important.

Let Us Now Praise Flo and Eddie

I have been thinking a lot about Flo and Eddie (Mark Volman and Howard Kaylan a/k/a the Turtles) and their recent victories over Sirius XM Radio in California and New York.  Although subject to appeal, both these cases have established the principle of a digital public performance royalty available to the owners of sound recordings in those states which recognize these rights fixed in sound recordings prior to February 15, 1972. 

            What does this mean? 

            The U.S. Copyright Act provides for a public performance royalty (from digital transmission) to be paid to owners of sound recordings created after February 15, 1972.  This right led to the creation of Sound Exchange and all of those current arguments about how little Spotify, Pandora and the other streaming services are paying to recording artists..  For reasons that I cannot recall, the Act excluded those recordings created prior to February 15, 1972 but allowed the owners of those recordings to pursue common law remedies under state law against infringers.  This is one of the few areas not preempted by federal law under the Copyright Act.

            Historical trivia:  Neil Young's "Harvest" was released on February 14, 1972 – (one day before the law went into effect).

            Several states such as California, New York and Florida have laws on the books that give protection to owners of sound recordings (Tennessee is currently looking at updating its law).  California law is pretty clear.  The relevant section of California Civil Code § 980(a)(2) reads as follows:

                        The author of an original work of authorship consisting of a sound recording initially fixed prior to February 15, 1972 has an exclusive ownership interest therein until February 15, 2047 as against all persons except one who independently makes or duplicates another sound recording that does not directly or indirectly capture the actual sounds fixed in such prior recording, but consists entirely of an independent fixation of other sounds, even though such sounds imitate or simulate the sounds contained in the prior sound recording. 

 

            The court in the California case agreed that the language gave Flo and Eddie the right to pursue an infringement action against Sirius Radio for digitally transmitting the Turtles' recordings and accordingly gave them a summary judgment on this particular issue. 

            Note that this judgment applies to the State of California.  How that judgment works out on a national basis in practice is open to debate.  The plaintiffs have won a similar case in New York and my understanding is that they are pursuing a case in Florida as well.

            Shortly after the decision a friend of mine asked what ramifications this decision would have for other "heritage" artists such as classic country artists whose  recordings are played on other Sirius XM stations.  Ultimately, my gut feeling is that the effect will be minimal for the reason that the Turtles (unlike the vast majority of recording artists from that era) own their master recordings.  The master recordings of most other artists are owned by record companies – major labels and/or once independent companies who were absorbed by major labels.  I have no idea what is going on behind closed doors but I am going to assume that the majors don't have any interest in suing satellite radio – one of their de facto partners in promoting music.  The smaller independents or artists who might own their own back catalogs may not have the resources to take on such a battle on their own.

            Nonetheless, Flo and Eddie have won an impressive and important battle because they addressed  an issue that everyone knew was blatantly unfair and they have claimed a moral and economic victory.This is not the first time they have gone to Court  to take a stand for artist’s rights and we all owe them a debt of gratitude.  It seems absurd to treat artists and the owners of sound recordings different due to an arbitrary date.  I don't know if this will ultimately be resolved through Congress, the courts or a grand compromise but the issue is now unavoidable.  Congratulations to  Flo and Eddie for taking it on. 

Advice for Corporate Citizens: Those Forms You Get in the Mail

Last week I had lunch with my friend and client Mark Linn.  He wanted to discuss a form he had received in the mail in connection with his Tennessee corporation.  I confidently told him that it had to be the Annual Report from the Tennessee Secretary of State and that all he needed to do was to send it back with a check for $20.00. 

            Mark told me that he thought this was something different and proceeded to pull out a document  called "2014-Annual Minutes Form – Shareholders, Directors and Officers (Tennessee Corporation)".  The document asked you to provide information regarding the name and title of various people associated with the corporation and then asked you  to send $125.00 to a company called Annual Business Services.  In consideration for this payment the company would prepare minutes for said corporation. 

            I am not going to say that this is a scam (like the Trademark scam I wrote about here: http://tripaldredgelaw.blogspot.com/2012/03/those-official-looking-trademark_08.html) but I will say it is completely unnecessary.  While the Tennessee Code does require corporations to hold annual meetings (or take action by consent in lieu of said meeting) the statute does not require that the minutes be filed with the state.  Further, the form promulgated by this company looks almost exactly like the Annual Report form used by the Tennessee Secretary of State's Office (I can't reproduce it here because Annual Business Services has claimed a copyright in it's form).  To be fair, the company does provide three disclaimers between the form and the instructions and they do state "you can engage an attorney to prepare (the minutes) prepare them yourself, use some other service company or use our service." 

            Nonetheless, and despite the disclaimers, I am  sure that many people believe that filling out such forms and paying these unnecessary fees are a required part of corporate compliance.  This is simply not the case and I hate to see any small business pay unnecessary fees.  If you receive a form in the mail and you are not certain what to do about it, call your lawyer.  We live for this stuff

Book Report: Unfair To Genius

Anyone who has been around the music business for any length of time begins to assume that certain things are immutable and it shakes our foundations when their existence is threatened.  For example, the recent   We may all grumble about these organizations but it feels strange to look at a future where their relevance is diminished.  Of course,  in the grand scheme of things these are relatively recent institutions. ASCAP was founded in 1914, BMI followed in 1939.  The history of both organizations-their early competition and their interaction with the US Department of Justice is fascinating.

attacks on BMI, ASCAP and SESAC.

            This is just one reason why I recommend Gary A. Rosen's book Unfair  to Genius (Oxford 2012).  On the surface, the book is about (as its subtitle states) "The Strange and Litigious Career of Ira B. Arnstein."  Arnstein was a little-known Russian-born composer who with some sense of self-delusion and bravado waged a one‑man war against some of the most famous composers of the 20th century (such as Irving Berlin and Cole Porter) together with their publishers, as well as BMI and ASCAP.  Arnstein literally believed that everyone was either infringing upon his work or conspiring to cover up the infringement. He filed countless lawsuits, many pro se, including one which counted 23 defendants.

            From a legal history standpoint,  this book is compelling in its exploration of  the early history of modern copyright infringement litigation in this country.  That sounds like a dry premise but in reality, many of the concepts that define copyright infringement litigation were developed in these cases and in the judge’s opinions. The bonus is that the book also chronicles the beginnings of the music publishing world as a big business, shows in captivating detail the early rivalry between ASCAP and BMI and brings such characters as Edward B. Marks, David Sarnoff, Judges Jerome Frank and Learned Hand to life.  One of the most colorful characters in the book is Sigmund Spaeth a self-described musical detective and a name I remember dimly from my childhood. Who knew that he was the first celebrity expert witness?

            I have yet to read a better account of the music business in the early 20th century and like all good histories, the book provides perspective to some of the current problems facing the music industry.