A U.S. federal judge has given the Inflight music service for commercial airlines 20 more days to fight record companies’ claims of copyright infringement. Universal Music, Polygram and others issued proceedings against Global Eagle Entertainment (Inflight Productions) in May 2014, claiming it provided using music on airlines in the United States without licenses. The federal complaint claimed that Inflight had provided sound recordings and music videos for passenger airlines that infringed copyright. Inflight filed a counterclaim in March, claiming it had contacted Universal through a UK-based intellectual property rights consultant in 2009, to negotiate licenses for the United States to fill gaps in its “patchwork of licenses around the world.” Inflight claims that the companies agreed to licensing terms, and told Inflight it could reproduce and distribute the sound recordings in the United States.
Inflight say that the record companies were secretly intending to hold Inflight liable for using the recordings without a license and the counterclaim alleges that “Ignoring their own misrepresentations and concealments, Universal Music is now attempting to use ‘statutory damages’ under United States copyright law as a so-called Sword of Damocles to extract large sums of money,” Inflight also claims that Universal also interfered with its business by negotiating directly with airlines after sending Inflight a cease-and-desist letter in November 2013. As a result, Inflight says, it was forced to move its operations outside the United States.
U.S. District Judge Margaret Morrow has now made final a tentative order granting the record companies’ motion to dismiss, finding that Inflight had failed to provide sufficient facts to support its claims. However and despite objections the Judge gave Inflight 20 days to file an amended counterclaim. Morrow found that Inflight “failed to plead the ‘who,’ ‘what,’ and ‘why’ of the alleged fraud and negligent misrepresentations”: “Counterclaimants allege that plaintiffs collectively engaged in fraud by making a false promise to permit them to continue their reproduction of the sound recordings,” Morrow wrote. “They do not differentiate between plaintiffs, nor allege even that plaintiffs acted through their managing agents or employees.”
Judge Morrow found that Inflight did not allege that the record companies’ lawsuit was “objectively baseless” even though it asserted that the record companies had sent the cease-and-desist letter in bad faith and contradicted the companies’ representation that use of the licenses would be acceptable.
Universal Music and the co-plaintiffs are seeking maximum U.S. statutory damages of $150,000 for each work that Inflight infringed, or an award of profits and compensatory damages. They also seek restitution of Inflight’s profits, punitive and exemplary damages, and an injunction.