Music Publishers Assn. Fights Defamation Claim After Announcing Lawsuit

Jackson Browne Woodstock Film Festival 2015 H
Alana Davis

Talking about legal matters can be risky. Ask Bill Cosby, who is now facing a rash of defamation lawsuits over how his reps have responded to rape accusers. A Massachusetts judge recently rejected his argument that he was within rights to make "privileged utterances of self-defense."

And how about those on offense? 

They too can face litigation for what is said. Witness what's happening to the National Music Publishers Association and its president David Israelite.

On May 27, the NMPA put out a press release how it had filed a lawsuit against Wolfgang's Vault for massive copyright infringement. There, Israelite stated, "The Wolfgang’s Vault websites have profited in large part because of the significant use of unlicensed music, primarily concert footage, available on their sites. Systematic copyright infringement cannot be a business model, and it is unfortunate that Wolfgang’s Vault chose not to compensate all of the creators responsible for their content."

Wolfgang’s Vault is run by William Sagan and houses a collection by the legendary concert promoter Bill Graham. Recordings include performances by The Rolling Stones, James Taylor, The Allman Brothers Band, The Grateful Dead, R.E.M., and many others. The Wall Street Journal once referred to the works as "the most important collection of rock memorabilia and recordings ever assembled."

After the lawsuit from many music publishers came, and the press announcement from its trade association was disseminated, a counterclaim for defamation was filed in New York federal court.

Sagan asserts he possesses the necessary mechanical and compulsory licenses to offer on-demand streams while disputing the concert videos at issue require synch licenses — ones necessary when music is matched with visuals. Sagan says he has gotten permission from the artists themselves and even if such sync licenses are necessary, copyright claims are barred by the Copyright Act's three-year statute of limitations.

"Thus, upon information and belief," the counterclaim states, "the NMPA masterminded the present litigation in a transparent effort first to destroy the Defendants' business, and later, to force Defendants to choose between depriving the music-loving public of their inimitable collection, or selling the assets to its member publishers at a steep discount."

Israelite's press statement asserting "unlicensed" works is alleged to be "demonstrably false" and he's accused of publishing it in a "grossly irresponsible matter."

On Wednesday, the NMPA and Israelite submitted a motion to dismiss calling its press release a "privileged fair report."

This privilege (in New York, it's codified in Section 74 of the Civil Rights Law) is usually understood in the context of journalism, allowing reporters such as the one writing this story to discuss matters of public record like courtroom filings without fear of being sued for libel. Here, the NMPA looks to use the privilege to its own advantage to cover a press release that it says was a "substantially accurate" report of the complaint.

The NMPA also argues that the press release is non-actionable for another reason.

"Examining the larger context of this lawsuit as well as the particular forum in which the Press Release was published—the website of a trade association—it is clear that a reasonable reader would understand that these were the opinions of a trade association about a lawsuit filed by its members," states a memorandum in support of dismissal.

Here's the full brief.

U.S. District Judge Edgardo Ramos won't make a ruling probably for several months, but at a pre-motion conference held in late October, he gave a signal that NMPA's bid to throw out the defamation counterclaim is hardly a slam dunk.

One issue Ramos addressed was the fact that the NMPA wasn't actually the plaintiff in the lawsuit, even though it presented this in its press release. "I guess the question really is did NMPA seek to cloak itself in immunity by posing itself as a plaintiff in the lawsuit," Ramos asked an attorney for Wolfgang’s.

The judge also discussed how language differed from the complaint to the press release, likely precipitating NMPA's argument of having a substantially accurate press release. "You are saying they are evil people here," Ramos told NMPA's attorney. "They are taking money and keeping money that rightfully belongs to members of the NMPA. And I guess the question I have: Does it paint them in a worse light than what the complaint does?"