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All the leading providers of streaming music are now in the scorching hot legal zone involving pre-1972 music, after seven lawsuits were filed on Thursday against Apple’s Beat Electronics, Sony Entertainment, Google, Rdio, Songza, Slacker and Escape Media Group (operator of Grooveshark). (Update: Dismissals, see note at bottom.)
The proposed class actions are being led in California federal court by Zenbu Magazines, which says it owns older sound recordings created by The Flying Burrito Brothers, Hot Tuna and New Riders of the Purple Sage.
The lawsuits on behalf of these rights-holders and others seek the disgorgement of profits, punitive damages and a restraining order that would prevent the companies offering digital radio services from further exploiting pre-’72 sound recordings without license. In bringing the claims of misappropriation and conversion, Zenbu is following in the path of The Turtles and the RIAA, which upset long-standing assumptions about the distribution and performance of older music in lawsuits filed against SiriusXM and Pandora.
The legal opening happened because when Congress amended the copyright laws in the 1970s to cover sound recordings, it protected only those authored after Feb. 15, 1972, under federal law. Since then, a wide variety of music users — including TV broadcasters, terrestrial radio and bars and restaurants throughout the nation — have performed pre-’72 sound recordings without much legal trouble. As for digital radio, most operators assumed they were covered by compulsory fees established by the Digital Performance Right in Sound Recordings Act of 1995 and collected through SoundExchange, even if the money wasn’t flowing to the owners of pre-’72 music.
But in August 2013, The Turtles filed a $100 million class action against SiriusXM alleging that its sound recordings were protected by state laws, and last September, the plaintiff prevailed on summary judgment. The RIAA also scored an early success in its own battle against SiriusXM, leaving the door wide open for more lawsuits against others.
Thursday’s parade of proposed class action lawsuits, filed by attorney Jack Fitzgerald, is more evidence that this issue isn’t going away anytime soon and has the potential of wiping out older music from the Internet without new royalty agreements or intervention by Congress or maybe the U.S. Supreme Court.
Here’s the lawsuit against Sony, which offers music through its PlayStation. According to the complaint, “Sony’s conduct as alleged herein was unfair because its conduct was immoral, unethical, unscrupulous or substantially injurious, and the utility of its conduct, if any, did not outweigh the gravity of the harm to its victims.”
In response to earlier lawsuits, SiriusXM has attempted a variety of defenses, first challenging whether California and New York laws really cover pre-’72 music or are preempted before trying out arguments ranging from having an implied license to the lawsuits being an impermissible trampling of the commerce clause under the U.S. Constitution. Thus far, the defenses have been rejected by judges even upon pleas of reconsideration. The pending litigation, though, has spurred furious new lobbying attempts to get Congress to address pre-’72 music.
In the meantime, none of the lawsuits filed thus far have yet been certified by judges for class action status nor entered the damage phase. That will likely be the next step, as efforts are also being made to take the issues up on appeal.
Update 1/26: With the exception of the lawsuit against Sony, the other Zenbu lawsuits were quickly dismissed. Although the reason isn’t stated in a notice of voluntarily withdrawal, it could be because the music on these systems came about though catalog-wide licenses.
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