Second Circuit Says Digital Downloads Not Public Performances

Makes sense to me.

The Court of Appeals for the 2nd Circuit has ruled that digital downloads are not public performances. The ruling nixes ASCAP's attempt to charge higher rates when consumers download and play songs from online providers.  The court stated " Music is neither recited, rendered, nor played when a recording (electronic or otherwise) is simply delivered to a potential listener."  The court remanded to the district court to determine a fair and reasonable license fee.  ASCAP responded: "ASCAP and its songwriter, composer and music publisher members are, of course, disappointed in the Court's decision that there is no public performance in the transmission of certain musical downloads. We are studying the decision and will determine what further action is appropriate."

The decision will probably have an effect throughout the download world, and hopefully set a precedent for fair royalty rates for consumers and artists alike.

Here's a link to the story on Techdirt: http://www.techdirt.com/articles/20100928/11271611198/appeals-court-tells-ascap-a-download-is-not-a-performance.shtml.

Comments welcome, have a great day. 

Protecting Ideas For Movies Is Difficult

There was an interesting story in the Hollywood Reporter yesterday about a recent New York District Court decision regarding protection of ideas in the movie industry.  The case involves the movie "Disturbia," which is admittedly very similar to Hitchcock's "Rear Window."  The trust that owns Rear Window sued DreamWorks, Steven Spielberg and others for copyright infringement of Rear Window.  Even though movie critics, the cast of the movie, and legal commentators admitted the similarity was great between the two works, the judge in the case saw it differently - at least as to actionable copying.

New York District Judge Laura Swain concluded that: ""The main plots are similar only at a high, unprotectable level of generality," and "Where 'Disturbia' is rife with sub-plots, the short story has none. The setting and mood of the short story are static and tense, whereas the setting and mood of 'Disturbia' are more dynamic and peppered with humor and teen romance."  Judge Swain finally states: "no reasonable trier of fact could find the works substantially similar within the meaning of copyright law."

Here is a link to the story:  http://thresq.hollywoodreporter.com/2010/09/disturbia-decision.html.  There is a link to the decision at the bottom of the article.

Comments always welcome.  Have a great day!

San Diego Music & Technology Conference - Revisiting Music Distribution

I sat on a panel last Friday that was entitled "Remixes, Production, Distribution & The Law."  As I was thinking about our panel discussion over the weekend, I realize we missed hitting an important point about distribution.  We had Jeff Price, CEO of Tunecore on our panel.  But our discussion just touched the surface.  We - and especially Jeff - hit on the fact that distribution is easier than ever in our high-tech, Internet-centric world.  But the real purpose of distribution, at least for many artists, is to get paid for their work.  In most cases, artists are paying for distribution, but they are not getting paid for their music.  That's because the price for music is free.  At least that's what all those who illegally download and share copyrighted music without paying for it like to think.

But they really do pay something - the money just is not going to the artists and copyright owners.  They pay Internet providers for Internet access, and they pay technology hardware companies for computers/players.  Countless advertisers pay Google and other Internet companies for ads on millions of download pages, tremendous revenues are generated there.  While the illegal - but "free" - downloads take place, someone is making millions.

So you may pay a company like Tunecore to distribute your songs, and you may make a few bucks, but for the most part, that's all you will make.  Because somebody somewhere is illegally sharing your music.  And probably many other's music, too.  That's the way it is.  95% of downloaded music is by unpaid, illegal download. (from IFPI - http://www.ifpi.org/)

There is a great article by Paul McGuinness, manager of U2, in this month's Rolling Stone.  It is worth reading.  Here's a link to the story:  http://www.u2station.com/news/2010/08/how-to-save-the-music-industry.php. 

This shouldn't be news to anyone.  Illegal downloads need to be stopped.  ISPs, Internet search engines, music player hardware manufactures and any business that is facilitating illegal downloads should all be paying a portion of their revenues to music creators and copyright owners. 

Even in the context of remixes and mashups, although there may be instances where there is a compelling fair use argument, remixers and mashers should be paying for their use of other's music.  I came up with an analogy I think is apt to try to put it in context:  Painters must pay for their paints.  Similarly, remixers and mashers must pay for their music.

Comments welcome.  Have a great week.

SDMTC - San Diego Music & Technology Conference September 16-17, 2010

I will be a panelist on a legal panel entitled Remixes, Producing & The Law at the San Diego Music & Technology Conference.  The Conference is being held in San Diego at the Hard Rock Hotel on September 16-17.  My panel starts at 4:45pm on Friday, September 17.  The San Diego Music & Technology Conference aims to become the premier venue on the West Coast where people gather to enjoy, advance and support the convergence of electronic music and technology. You can find information and purchase tickets here:  http://sdmtc.com/.

I will be joined on the panel by my esteemed colleagues Kevin Greene, Esq. and David Branfman, Esq.  Also on the panel is my client, co-founder of Sleeping Giant Music, and one of San Diego's top DJs, Fresh One.  Please come hear our panel discuss legal issues related to remixes, music production, and copyright, and enjoy this unique and exciting music industry event!

Have a great day!

Interesting Case Regarding Royalties for Digital Downloads

The case is FBT Productions v. Aftermath Records, 09-55817 (9th Cir. 2010). The appeals court reversed a lower court decision (FBT Productions v. Aftermath Records, 07-3314 (C.D. Cal. 2009). The original suit sought damages for royalties on the sale of ringtones and digital song downloads of Eminem's music. The record company argued a standard royalty applied for the downloads, the same as for CDs. FBT argued that the digital downloads were more like third party licenses, and a much higher royalty rate under a "masters licensed" clause in the recording contract applied - in this specific case, a 50% royalty. The lower court agreed with the record company, but the 9th Circuit panel - based on its review of the "broad but unambiguous" language of the contract - reversed and sent the case back to the jury to calculate damages. The court stated that the transaction was a license under US copyright law.

The bottom line is that not only will Eminem possibly receive millions of dollars in revenue from the court's decision, but all music artists are probably reviewing their contracts to see how this decision might apply to them, and making sure to put similar provisions in their future contracts.

Your comments always welcome. Have a great week!