INFORMATION FOR READERS:
This resource aims to give a brief overview of developments in Intellectual
Property law and other areas of law relevant to the music and entertainment
industries. Each item is categorised according to relevant areas of the
music or entertainment business, and by the date of uploading. Uploads
are undertaken regularly and are organised on a monthly basis. These updates
are designed to give general information for music and entertainment industry
professionals and students interested in these areas. These Law Updates
are not law reports or detailed references. Users who would like further
information should research the relevant area thoroughly. Relevant references
and links are therefore provided.
Law Updates also provides hyperlinks to other sites which may be of use or interest to legal professionals, academics, students and those involved in the music industry. These are provided at the end of Music Law Updates Archive under 'Music Business Law Links'. You will also find all of these links and other hyperlinks on the links page.
This resource is compiled by Ben Challis. Ben is a UK lawyer specialising in entertainment law and a graduate in law from Kings College London and The City University. He also holds the degree of Master of Arts in Mass Communications from the University of Leicester. Ben is a fellow of the Royal Society of Arts. Ben acts as General Counsel for 3A Entertainments, one of the UK's leading concert promoters, and is Executive Producer for television of the Glastonbury Festival. Glastonbury is the UK's leading music and arts festival attended by over 150,000 people. For Glastonbury, Ben combines the role of managing the Festival's broadcast and other media rights alongside acting as General Counsel for the Festival. Ben's other clients have included the Prince's Trust, the Granada Media Group, Pioneer LDCE and British Telecom. Ben regularly writes articles and other material on music business and intellectual property law, contributes to books and is a regular conference speaker in particular on the live music industry. Ben sits as a magistrate in Cumbria, England and is a Visiting Professor in law at Buckinghamshire New University.
We are interested in your views on the Law Updates resource. Please forward any comments to : musiclaw01@aol.com
COPYRIGHT
Books, all areas
Potter Lexicon binned in victory for Rowling
An unofficial guide to the phenomenally successful ‘Harry Potter’ series of books must be scraped after a ruling in the US courts. The Harry Potter lexicon, a 400 page reference book, was held to infringe J K Rowling’s (and Warner Brothers) copyrights and that the defence of fair use would not apply. Judge Robert Patterson said that the book ‘appropriates too much of Rowling’s creative work for its purposes as a reference book and that independent publisher RDR Books had ‘failed to establish an affirmative defence of fair use. As the book had yet to be published the judge made nominal awards of damages to Rowling and Warner Brothers of £430 for each of the seven novels Rowling has written and £3,888 for two companion books she has also written.
Laurie Kaye has this to say in his most excellent and wizard blog at http://laurencekaye.typepad.com/laurence_kayes_blog/
So J K Rowling won a permanent injunction yesterday from a NY federal judge to stop RDR Books from publishing a book entitled "The Lexicon", based on the materials Steven Vander Ark culled from the Harry Potter works (including her companion books) and published on his website "The Harry Potter Lexicon".
The case was portrayed by some as a 'David and Goliath' battle between J K Rowling and her 'big media' partners and the Web community. "Not so", says Neil Blair of J K Rowling's literary agents, Chrstopher Little, who spoke to me this morning about the case.
"This wasn't a battle waged by big media nor was it about money", said Blair. "J K Rowling decided to take a stand on principle for authors and other creators. At the heart of the case was this: where does a creator stand if it's deemed acceptable for a works like the Harry Potter series to be taken like this."
I've got to say that I agree with Blair. Judge Robert Patterson's 68 page judgment is well-reasoned and eminently sensible. It's worth reading because it goes to to the heart of the issue of 'mixing and mashing' in deciding where 'fair use' stops and copyright infringement starts. As the Judge put it: "At stake in this case are the incentive to create original works which copyright protection fosters and the freedom to produce secondary works which monopoly protection of copyright stifles-both interests benefit the public."
What the judgment shows, at least so far as US copyright law is concerned, is that there is plenty of scope to use parts of existing works to create something new and still stay on the right side of copyright law. So why did RDR Books lose? The Court had to decide two issues: First, does J K Rowling prove that the defendants' proposed work "The Lexicon" bears a 'substantial similarity' to "protected expression" in the earlier work - the Harry Potter series and other materials? Second, if there is 'substantial similarity', is the 'fair use' defence available to the defendant to J K Rowling's claim for copyright infringement?
The Judge's 48 part judgment decides those two issues "yes" and "no" respectively. I can't do justice to the judgment in a short blog, but I will highlight a few key points.
The first issue - 'substantial similarity' - was fairly easy to decide. As J K Rowling put it in her testimony to the Court: If Mr Vander Ark has put quotation marks around everything he has lifted, most of the Lexicon would be in quotation marks." Less colourfully, the Judge decided that applying both qualitative and quantitative tests, the amount of direct quotations and "close paraphrases of vivid passages in the Harry Potter works" was sufficient to support a finding of sufficient similarity.
The really interesting part of the judgment is the analysis of the 'fair use' test. There are four factors to be considered: (1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) that amount and substantiality of the portion used in relation to the copyrighted work as a whole and (4) the effect of the use upon the potential market for or value of the copyrighted work. At the heart of the 'fair use' analysis is whether and to what extent the new work is "transformative." This has a special meaning in US copyright law and is the fulcrum that sustains the balance between copyright rights and exceptions. As the Judge put it: "the court asks...whether the new work merely 'supersedes the objects' of the original creation, or instead adds something new, with a further purpose or different character, altering the first with a new expression, meaning or message.". The Judge decided that the purpose of the Lexicon's use of the Harry Potter series is transformative. However, the defendant's use of J K Rowling's companion works was transformative to a much lesser extent. That's because the original purpose of J K Rowling's 'companion books' was as reference works and that was not 'transformed' by the Lexicon. Furthermore - and this was crucial - the "transformative" character of the Lexicon was diminished where it crossed the line from being a new, "transformative" guide or reference work, pointing users to J K Rowling's source material, and became simply a reproduction of large chunks of her original material.
The defendant also failed to meet the tests built into the 3rd factor of the fair use test. As the Judge put it, "Weighing most heavily against the Defendant on the third factor is the Lexicon's verbatim copying and close paraphrasing of language from the Harry Potter works."
Supposing Steven Vander Ark had 'borrowed' less material from J K Rowling than he did? Tellingly, the Judge remarked "there are a number of places where the Lexicon engages in the same sort of extensive borrowing that might be expected of a copyright owner, not a third party author."
I'm not a US copyright law expert but it seems fairly clear that the 'fair use' doctrine has sufficient flexibility to allow creators of new works to use or 'borrow' from existing works - 'mix and mash' - as long as the borrowing is not so extensive as to cross as to cross the threshhold from fair use to infringement. Nice one Judge!
Laurie Kaye
For full details of the case see http://cyberlaw.stanford.edu/system/files/Lexicon+Order.pdf
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DEFAMATION
Record labels
So Def chief Dupri and Daz Dillinger face defamation claim
So Def chief Jermaine Dupri is facing a defamation lawsuit because of the use of a recording of a private phone-call that appeared on Daz Dillinger album 'So So Gangsta' back in 2006. A woman called Aika Kendrick claims that the Dupri and Dillinger recorded a personal conversation with her and then used it as a background to the song 'The One', which is about an emotionally abusive relationship; the conversation ends with Dillinger launching a tirade of abuse at Kendrick. Kendrick says that as soon as she was aware that the call had been recorded she sent a cease-and-desist to Dupri's label, but they ignored it, and adds that her inclusion on the album track has made her "the subject of embarrassment, humiliation, and degradation". She's seeking $250,000 in damages on the grounds of negligence, copyright infringement, defamation, and intentional infliction of emotional distress.
CMU Daily 12 th September 2008 www.cmumusicnetwork.co.uk
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COPYRIGHT
Internet
ARTICLE LINKS – updates on copyright and music in the US
Rendering ‘Fair Use’ fairly useless and other stories from the digital frontline
This is an interesting article by C M Boots-Faubert of the Cape Code Times about proposed US legislation which would immunize entities such as the Recording Industry of America and the Motion Picture Association of America from state and federal laws if they decide that it is necessary to hack, disable, hijack, or otherwise impair "publicly accessible peer-to-peer networks" in order to protect the copyrights they own or represent
http://www.capecodonline.com/apps/pbcs.dll/article?AID=/20080902/BIZ/809020303/-1/NEWS
Suit sends message says Prof – this article by Isshin Teshima writing in the Flat Hat describes how the College of William and Mary complied with a court order from District Judge F Bradford Stillman and released details of 19 students who had allegedly been sharing music online to the Recording Industry Association of America. This is a useful review of where the music industry is at the moment in the US when trying to enforce copyrights.
http://www.flathatnews.com/content/riaa-suits-send-message-says-prof
Here is a review of the RIAA’s actions to date - File Sharing Lawsuits at a Crossroads, After 5 Years of RIAA Litigation by David Kravets on Wired.com – have the RIAA’s actions against individual peer-2-peer file swappers worked? Have these actions been a necessary tool to fight back against illegal fire swapping that is destroying the record labels? or have they been heavy handed blinkered commercial bullying - or the worst public relations disaster in the history of the music industry? This article ends up with a quote "If the goal is to reduce file sharing … it's a failure". Decide for yourself!
http://blog.wired.com/27bstroke6/2008/09/proving-file-sh.html
in Legal Digital Music is Commercial Suicide, Michael Roberts looks at different options for online music services – concluding that perhaps going ‘legal’ isn’t a great business model
http://www.theregister.co.uk/2008/09/09/michael_robertson_music_models/
Finally the Cnet article Bush administration secrecy over Anti-Counterfeiting Trade Agreement prompts backlash describes howan anti-counterfeiting treaty being negotiated by the U.S. government has come under criticism from liberal groups for being negotiated "in secret" and for potentially criminalizing peer-to-peer file sharing
http://news.cnet.com/8301-13578_3-10047945-38.html
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COPYRIGHT
Internet, radio, record labels
ARTICLE LINK: Payola – could an old idea save online radio and the music industry?
Remembering that in the US terrestrial stations (but not satellite or online) pay nothing to labels to use music, this interesting article looks at the illegal practice of record labels paying radio stations to get airtime (“pay for play” or payola) and asks if a reworked idea could be a boon to the music industry.
http://www.alleyinsider.com/2008/9/could-payola-save-online-radio
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COPYRIGHT
Record labels
UK CD Pirate jailed for three years
A UK man has been jailed for three years after running a bootleg CD business from his South East London home, in which he counterfeited all kinds of goods, including CDs, DVDs and video games, and then sold them via a website and eBay pretending they were the legitimate. Neil Norton was tracked down as the result of a three-year investigation involving Lewisham Council, Bromley Police, the Federation Against Copyright Theft and record label trade body the BPI. It's estimated he made up to £850,000 as a result of his counterfeiting over an eight year period, funds which helped him buy the Porsche, BMW, personalised number plates, cameras and computer equipment found at his home - belongings the authorities will now seek to confiscate. A destruction order will also be sought to enable all the remaining counterfeit goods, which include fake designer label clothes as well as the CDs and DVDs, to be destroyed.
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COPYRIGHT
Internet
ARTICLE LINK: China’s nonstop music machine
There's an interesting article on website The Register looking into the operations of Chinese search engine Baidu, Chinas biggest search engine (far bigger than Google with a 70% market share) which provides a MP3 search engine which provides easy access to online sources of digital music, predominantly illegal unlicensed services. This service was been found to be legal by the Chinese courts after Baidu argued that they didn’t actually host any illegal content – merely linked to it. However the Chinese courts then later found Yahoo! guilty for running a similar service and Baidu now face a second case. The Register have noted that Baidu is one of China's big internet success stories and at the end of last year it started to trade its shares on the New York based NASDAQ stock exchange – and is valued at $12 billion - and wonders what the implications were for investors. The Register also note that the Chinese government is starting to crack down on corporate infringers in their country as a result of pressure from the West - earlier this year Chinese authorities fined one of Baidu's albeit smaller rivals, Zhongsou, and seized their servers in relation to a similarly infringing MP3 search service. www.theregister.co.uk/2008/09/13/baidu_investigation/
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CENSORSHIP & POLICY
All areas, theatre
Is music policed and controlled?
The Taliban may rip tape from cassettes and smash radios – but other ways of controlling what we listen to are far more subtle – from copyright to BBC playlists – and this interesting article, which profiles the work of musician and academic Richard Witts, looks at how sound and music are controlled
http://www.independent.co.uk/news/education/higher/is-music-policed-and-controlled-933831.html
And for a look at the history of censorship in the theatre including recent cases see ‘A Disgusting Feast of Filth?’
http://business.timesonline.co.uk/tol/business/law/article4775754.ece
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COPYRIGHT
Internet
New trial ordered in Jammie Thomas case
US Judge Michael J Davis has granted a new trial in the case of Jammie Thomas, the Minnesota woman convicted of pirating music files in the nation's first file-sharing trial, ruling that he had made an error in the jury instructions that "substantially prejudiced" her rights. Thomas was convicted last October and a jury in Duluth found her guilty of copyright infringement for offering to share 24 songs on the Kazaa file sharing network. She was ordered to pay $222,000 to six record companies. The legal issue was whether the claimant record companies had to prove anyone else actually downloaded their copyrighted songs, as Thomas' lawyer argued, or whether it was enough to argue, as the industry did, that a defendant simply made copyrighted music available for copying. Turning to a 1993 appeals court decision, Davis concluded in his 44-page ruling that the law requires that actual distribution be shown. In his jury instructions, he had said it didn't. Judge Davis also called on Congress to change the federal Copyright Act to address liability and damages in similar peer-to-peer file-sharing network cases saying that whilst he didn't discount the industry's claim that illegal downloading has hurt the recording business, the award was "wholly disproportionate" to the plaintiff's damages saying “The Court does not condone Thomas' actions, but it would be a farce to say that a single mother's acts of using Kazaa are the equivalent, for example, to the acts of global financial firms illegally infringing on copyrights in order to profit in the securities market," he wrote, referring to another case he cited.
http://ap.google.com/article/ALeqM5h-s1m5-ok3ONlPQWlBPIv4MJbLpgD93DDFCO0
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COPYRIGHT
Internet
ARTICLE: Nokia takes a bite out of Apple as the west finally catches up
By Cassandra Williams postgraduate student at the College of Law
Two new digital music services have just been announced, each potential threats to the dominance if Apple’s iTunes. Firstly MySpace announced that it would allow artists to stream as many tracks as they like from their MySpace site, funding the costs through advertising, and also announced that it would also compete with iTunes in selling downloads if users wish to keep tracks (on their computers or MP3 players) with a 79p per track offer. All four major labels (Warners, EMI, SonyBMG and Universal) have signed up to the service which will first launch in the US . But this article looks at a different platform – the mobile phone – where a new threat to Apple is perceived. That said, the combination of phone and music player only really took off with the iPhone. 5 million have been sold this quarter according to Information week. However there are drawbacks to Apple’s system: iTunes only offers music on a song by song basis; the tracks are all M4A and thus cannot be easily transferred to other devices; and record label executives are also known to be dissatisfied with the deals they are forced to accept to sell tracks via the itunes site. With these drawbacks, Nokia have stepped up to the challenge, offering a new "Comes With Music" digital music service. Once both the handset and PC are set up, the service gives customers unlimited access to the entire catalogue on the Nokia Music Store, which features more than 2 million tracks from three major labels (Universal Music Group, Sony BMG and Warner Music Group), plus a host of indie labels. Subscribers will be able to download as many songs as they wish to their PCs for one year for free. They are also able to “sideload” the tracks to their Nokia phones. All songs downloaded during the year can be kept indefinitely – so nasty destructive DRM like on other subscription sites which takes away the music once a subscription ends. At the end of the year, users have various options. They can re-subscribe to "Comes With Music" via Nokia Music Store, but they will need an upgraded handset. They can continue purchasing songs a-la-carte via the Nokia Music Store, or they can keep accessing the songs downloaded for free during the one year, but only with the original handset. Although at first it may seem quite risk to expect consumers to upgrade their phone every year the majority of consumers with a contract phone will upgrade their mobile with the renewal of the12 or 18 month contract.
However analysts claim that operators would be unwilling to subsidise the phone to customers as part of a monthly contract as the service will compete directly with their own music offerings. According to Paulo Pescatore at CCS Insight, "You're not going to get a carrier supporting it when it competes with their own services, so Nokia's only route to market is going to be through retailers and distributors," As part of a pay as you go system it may be harder to entice consumers to ‘upgrade’ every 12 months.
At present, the only UK-based unlimited music download service on a mobile phone is Vodafone's Music Station, which allows customers to download unlimited tracks from the collections of all the major labels for £1.99 a week, or about £100 a year. The major difference between Vodafone’s system and Nokia’s is that you can keep the music downloaded from the Nokia which you can not on the Vodafone model. This feature in Mr Pescatore’s opinion is going to be Nokia’s saving grace. "It definitely has the potential to kill any mobile music service that is out there today." This doesn’t come without a price; Nokia will be handing over its entire handset profit margin - and more - to the record industry according to media analysts. The Hollywood Reporter reports that Nokia is paying the world's biggest label, Universal Music Group, $35 per handset to bundle access to the label's catalogue. Music business insiders expressed astonishment at Nokia's generosity: it's seven times what some privately estimated the deal was worth. Paid Content puts the payment to UMG at $33.5 per handset for the first 2.5 million units, falling as volumes increase.
If Nokia succeeds in replicating the deal with other labels then the extent of the programme becomes apparent. According The Register the actual figure including publishing royalties, and the indie sector figure is closer to $150 per handset. That comfortably wipes out any hope of an immediate profit for Nokia on the Comes With Music deal with the average selling price of a mobile handset at around $100 and Nokia's gross margin around a third of that.
Although Nokia (and Vodafone) are billing the idea of a subscription-based music system for mobiles as being ‘new’, its not - since 2002 U-Music in Korea have offered a service allowing subscribers to download full-track music via both mobile and PCs on a monthly fee basis. Indeed the West has always been slow on the uptake of using Mobile phones as anything other than a phone, but Japan and Korea lead the way in South East Asia which took to immobile music almost instantly. Among various mobile internet services that have emerged (such as paying with your phone like a debit card), music-related services have been most successful in the two countries. In South Korea, which has been plagued by piracy, digital sales have soared and now account for more than 60% of the market. In Japan, full-track downloads to mobile phones now account for 40% of all music sales value (the Guardian).
The battle for dominance in the digital market may be more publicly fought in the UK and US but perhaps we should all be looking to but Japan and Korea to see where the war will be won.
http://www.informationweek.com/news/personal_tech/iphone/showArticle.jhtml?articleID=210603717
http://www.billboard.biz/bbbiz/content_display/industry/e3i85d526d9b2781718b0bd0f55bb95558a
http://www.theregister.co.uk/2008/04/17/nokia_comes_with_music/
http://project.hkkk.fi/helsinkimobility/papers/Mobile%20Applications_3_2.pdf
http://www.guardian.co.uk/technology/2008/jan/31/digitalmusicandaudio2008
The Times 25 th September 2008 p51
http://www.paidcontent.org/entry/419-myspace-music-for-once-you-cant-blame-the-lawyers/
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© 2008, Ben Challis