The Harry Fox Agency, an organization that works with tens of thousands of clients to issue and secure licenses, might not look like the typical copyright defendant, but indeed the nearly century-old fixture within the music industry now finds itself stuck in a major copyright case involving Eminem’s publisher, Eight Mile Style, and Spotify. On Thursday, a federal judge refused to dismiss a claim that HFA committed secondary copyright infringement by allegedly facilitating Spotify’s distribution of music without license.
Eight Mile is going after Spotify directly in a suit alleging the streamer failed to have authority to stream 250 of Eminem’s songs including the iconic “Lose Yourself.” The case also challenges the constitutionality of the Music Modernization Act of 2018, one of the major legislative accomplishments during the Trump years.
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The complaint has been amended to also target HFA, which was hired by Spotify, and according to Eight Mile, created the artifice of timely licensing and proper rendering of royalty statements. In reality, asserts Eight Mile, notices were backdated, licenses were never valid, and royalty payments weren’t correct.
Of course, it’s all very much more complicated, but what matters for now is HFA’s insistence that its actions don’t make it Napster, or Grokster, or any of the other entities previously adjudicated as committing secondary copyright infringement.
“HFA protests that all it is accused of doing is sending letters based on information it received from Spotify,” writes U.S. District Court Judge Aleta Trauger in Nashville. “At this stage, however, the court is required to take the plaintiffs’ allegations as true, and those allegations include the plaintiffs’ claims about how and why industry practice and HFA’s own reputation allowed HFA’s actions to conceal Spotify’s lack of a valid mechanical license for the Eight Mile Compositions. The purpose and effect of that concealment, moreover, was not simply to prevent past infringement from being discovered, but to allow infringement to continue. Even if HFA was innocent in Spotify’s first alleged instances of infringement, the plaintiffs have plausibly alleged that its actions contributed to Spotify’s ability to continue infringing over time.”
Trauger later adds, “It may turn out that HFA is right and that its actions were truly blameless (or at least non-actionable). The plaintiffs’ allegations depend, in significant part, on their own contentions regarding how certain documents would have been construed in the context of the conventions and ordinary practices of the music business. Of course, HFA itself is a veteran of the same business, and it disagrees with those assertions. At this stage, however, all the court can do is take the plaintiffs at their word, as it is required to in connection with a Rule 12(b)(6) motion, and wait to reevaluate the plaintiffs’ claims when a record has actually been made. “
See the full decision below.
