The European Court annuls the European Commission’s approval of the Sony BMG merger

COMPETION Record labels, music publishers ARTICLE The European Court annuls the European Commission’s approval of the Sony BMG merger Case T464/04 Independent Music Publishers and Labels Association v Commission of the European Community By Ben Challis Barrister The European Court of First Instance has annulled the European Commission’s approval of the 2004 merger between Sony Music and BMG, which allowed the music industry to shrink from five major companies to four. The case, brought to court by IMPALAon behalf of European independent record labels, has been closely watched by Warner Music and EMI who must now wait and see how Europe’s top antitrust authority will react to the court’s decision. The court considered two pleas brought by IMPALA: The first plea was in regard to the strengthening of a pre-existing collective dominant position in the market for recorded music and the second plea: creation of a collective dominant position on the markets for recorded music. The Court noted the case-law of the Court of Justice regarding an alleged collective dominant position which has held that the Commission must assess, using a prospective analysis of the reference market, whether the concentration which has been referred to it leads to a situation in which effective competition…

New French law manages to antagonise everyone – consumer groups, online retailers and rights owners
Copyright , Internet , Record Labels / August 2006

COPYRIGHT Internet, record labels After a protacted debate The French parliament has finally adopted a law that could force Apple Computer to rethink its digital music business model and move away from its closed system of iPod players and iTunes online music. The controversial law maintains that all electronic devices should be “interoperable”, so that consumers can play legally downloaded music on any type of digital player. This means Apple, which has previously called the law “state-sponsored piracy”, would have to remove the copy protection measures that prevent consumers playing tracks bought at its iTunes store on music devices that rival Apple’s iPod. The final text, a compromise agreed last week, now gives a new regulatory body powers to impose fines of up to 5 per cent of global turnover on companies that refuse demands to publish the source code to their systems. Industry representatives and consumer groups have savaged the outcome. Those who want interoperability to increase consumer choice say the law has watered down the principle by making the regulatory authority, open only to professional claims, its arbitrator. They say the enw law – the so-called “Loi Vivendi Universal” now favours big companies with the capacity to fight…

French court bars Google from selling trade marks as adwords
Internet , Trade Mark / August 2006

TRADE MARK Internet The Cour d’appel de Paris found that Google had infringed Vuitton’s trade marks, by selling Vuitton’s marks as adwords that were used by sellers of counterfeit or infringing Louis Vuitton products. The most interesting part of the decision is that  Google is ordered to refrain from using adwords on its websites if they are accessible in France, regardless of their top level domain extension (such as .com or hk). From the IPKat – the most excellent and feline friendly IP weblog at

Seal ordered to pay commission to ex-manager Wadlow v Samuel pka Seal (2006) By Julian Bentley, solicitor, Swan Turton
Artists , Contract , Restraint of Trade / August 2006

CONTRACT Artists ARTICLE:  Multi-million selling solo artist Seal was managed by John Wadlow under a management agreement signed in 1990. In 1995 Seal wanted out. The two of them signed a settlement agreement that year terminating the management agreement and providing for continuing commission to be paid to Wadlow on Seal’s first two albums, “Seal” and “Seal II”. Seal stopped paying the commission in around 2001. Wadlow issued proceedings. Seal defended the claim alleging amongst other things undue influence and restraint of trade. The judge (Mr Justice Gray) found that Wadlow was entitled to his commission. Under the management agreement Wadlow received commission at the customary rate of 20%. But the agreement was, by today’s standards, unusual in two respects. Firstly, Wadlow’s entitlement to commission after the end of the term of the management agreement went on forever at the full rate. Almost always these days, there is a tapering or “sunset” provision reducing and then extinguishing the former manager’s post-term commission over a period of years. Secondly, Wadlow was entitled to commission on Seal’s income from a publishing deal signed in 1989 between Seal and a Wadlow co-owned company. So Wadlow was receiving management commission on Seal’s publishing income…

New piracy laws come into force in China
Copyright , Internet , Record Labels / August 2006

COPYRIGHT Internet, record labels Sony BMG and Warners are among record labels that may use a newly enacted criminal law to fight against Chinese Web sites, including Yahoo China, that allegedly infringe copyright laws according to the International Federation of Phonographic Industries. The new law, effective from July 1 st allows for fines for distributors of illegally copied music, movies and other material over the Internet of up to 100,000 yuan ($12,500). About 90% of all recordings in China are illegal, with sales of pirated music worth about $400 million annually, according to the IFPI. The U.S. has threatened to file a case to the World Trade Organization unless China reduces incidents of intellectual property violation. Last year seven record labels filed a civil case against, China’s most-used search engine. No outcome has been reached yet. In 2005 Baidu lost a civil case brought by Shanghai Bu-sheng Music Culture Media, the local distributor for EMI. Baidu is appealing the case. The new criminal law adopted by the State Council, China’s Cabinet, on May 18 stipulates that a Web site is jointly liable for infringement ”if it knows or should know that the work, performance or sound or video recording…

Music Industry Group proposes digital age copyright reforms
Copyright , Internet , Record Labels / August 2006

COPYRIGHT Internet, record labels, all areas AIM, the PRS-MCPS Alliance, the Musicians Union, the Music Managers Forum (MMF), British Music Rights and the British Academy of Composers and Songwriters (BACS) have launched a new discussion paper at a July 12 th round table meeting chaired by the Smith Institute. The group, representing 85,000 creative and industry members including artists, musicians, independent record labels, publishers and songwriters, say that they posed the question “is copyright law fit for purpose in the digital age?” and came up with a clear and emphatic “No”. The Group say that the current model for monetising sound recordings works neither for producers of music nor for consumers adding that current DRM systems do not work, that litigation doesn’t work but that a way forward can be found which will benefit both the music industry – which wants the widest possible distribution and enjoyment of its creative products but has every right to be paid fairly for use of its rights; and consumers – who needs to be freed from the threat of criminal prosecution for activity they believe is a proper and legitimate use of technology which they are free to buy legal – a “more…

Canadian anti-DRM coalition makes timely debut By Bruce Byfield
Copyright , Internet , Record Labels / August 2006

COPYRIGHT Record labels, internet ARTICLE LINK:  A very interesting article explaining the resistance to DRM in Canada and explaining the difference in approaches to copyright protection between Canada and its neighbour, the USA. In particular the copyright levy system in Canada coupled with the strong protection of consumer privacy present major hurdles for the major record labels and film companies to get over if they are to convince legislators to support DRM.

Hilary Rosen: Singing a new Song? By Eliot Van Buskirk
Copyright , Internet , Record Labels / August 2006

COPYRIGHT Record labsl, internet ARTICLE LINK:  This article explores the views of ex RIAA boss Hilary Rosen (“the bogeywoman who brought the law down on Napster”) and ask interesting questions about the former label association executive’s views on the effectiveness of the RIAA’s policy of suing individuals, the usefulness of DRM and how XM radio (Rosen’s new client) is dealing with the major labels and the RIAA.,71338-0.html?tw=wn_index_4  ARTICLE LINK “Why the music industry’s new piracy tactics will fail” by Bernhard Warner at,,20411-2277187,00.html

BPI asks broadband operators to police file swapping
Copyright , Internet , Record Labels / August 2006

COPYRIGHT Record labels, internet The British Phonographic Industry has written to Tiscali and Cable & Wireless asking them to shut down the accounts of 59 internet users which the BPI alleges are used for widespread illegal file-sharing activities. BPI chairman Peter Jamison said that the record labels trade association had provided “unequivocal evidence” of illegal file swapping on an “industrial scale”. In a separate matter ten British Internet Service Providers including BT and NTL have been ordered by the High Court to hand over details of 150 customers suspected of illegally sharing computer software. The action here was brought by FACT, the Federation Against Copyright Theft .

Russian court find in favour of labels in piracy case
Copyright , Record Labels / August 2006

COPYRIGHT Record labels The Arbitration Court of the Moscow Region has ruled that Russobit-Soft, a Moscow-based optical disc plant, had manufactured counterfeit CDs by artists including Depeche Mode, Destiny’s Child, Enrique Iglesias, Macy Gray, Michael Jackson, Radiohead, Whitney Houston and Westlife. The company has been ordered to pay four million roubles (US$148,000) in statutory damages. Russobit-Soft will also have to pay compensation for costs, including state duties and experts’ fees in full as well as a substantial proportion of the claimant’s attorney’s fees.  The court also issued an injunction preventing Russobit-Soft from manufacturing any of the 30 albums involved in the case. The International Federation of Phonographic Industries (IFPI) acting on behalf of record label members filed eight claims against Russobit-Soft in December 2003.

RIAA loose infringement case as defendant requires details of alleged infringements
Copyright , Internet , Record Labels / August 2006

COPYRIGHT Record labels, internet As AIM and others lobby for a new approach to copyright in Europe the RIAA’s reliance on litigation has hit the buffers in one case in the US. During a court hearing on infringement matters brought by the RIAA, defendant Debbie Foster requested that the RIAA provide specifics such as the dates of the alleged downloading and the names of the files involved. The RIAA was unable to do so and the case was dismissed. It had been seeking $5,000 in settlement but Foster decided to take the case to court. To date some 18,000 alleged file-sharers have been targeted by the RIAA but only 4,500 of them have reached settlement (with around $4,000 being the average paid out). Whilst the RIAA now say they are embracing education, former RIAA head Hilary Rosen (who initiated the litigation approach in the first place) has said that legal action has gone too far (see link above).

Grateful Dead photographs were covered by fair use doctrine
Copyright / August 2006

COPYRIGHT Book publishing ARTICLE LINK By Irena A Kushner In a recent fair use case, the U.S. Court of Appeals for the Second Circuit affirmed the district court’s grant of summary judgment in favor of the defendants, agreeing that their reproduction of copyrighted Grateful Dead images in its book,Grateful Dead: The Illustrated Trip, was “protected by the fair use exception to copyright infringement.” Bill Graham Archives v. Dorling Kindersley Limited, Case No. 05-2514-cv (2nd Cir. May 9, 2005) (Restani, J.).

Commercial Censorship Meets Copyright
Censorship , Copyright / August 2006

COPYRIGHT / CENSORSHIP Film and televison On July 6, 2006, the US District Court for the District of Colorado ruled that companies that produce sanitized copies of Hollywood films on DVD are violating copyright law and must stop editing out the content they find offensive. The defendants (by counterclaim) included CleanFlicks, a Utah-based company which creates and publicly distributes copies of the plaintiffs’ movies that have been altered by deleting “sex, nudity, profanity and gory violence”.  CleanFlicks sells directly to video stores and to consumers online through its web site.  Purchasers are required to buy both the authorized and edited copies. The plaintiffs (by counterclaim) included major movie studios, such as MGM, Paramount, and Twentieth Century Fox, and a number of high-profile directors such as Robert Altman, Steven Soderbergh and Steven Spielberg.  The studios sell and distribute movies to the public on DVD and VHS for purchase and rental.  They also sell and distribute edited versions of the movies for use by airlines and network television. The plaintiffs argued that the defendants were violating their right to create derivative works, or edited versions of their films.  They did not seek damages but rather an injunction preventing the defendants from copying…

New noise penalties are proposed in UK
Health & Safety , Live Events / August 2006

HEALTH & SAFETY Live event industry Pubs that cause late-night noise will face the threat of a £500 on-the-spot fine under new government plans. If the matter goes to court the penalty for licensees could rise to £5,000 on conviction. Under the proposals, which are part of theClean Neighbourhoods and EnvironmentAct, councils will be given extra powers to deal with one-off incidents of noise. The changes, which come into effect in October, have been prompted by residents’ fears over later pub opening under the new licensing laws. Ben Bradshaw, local environment minister, explained that the new law will allow for penalties for one off incidents of noise rather than ongoing noise saying “With the new powers, local authorities can deal with one-off incidents of excessive noise from licensed premises in the same way they can from households: quickly and effectively.” Licensed premises could be fined for a one-off offence if they are creating excess noise between 11pm and 7am. Licensees have reacted angrily to the new rules. The Publican reports that James Harris (I think I went to school with him, Ed) licensee at the Half Moon in Putney, South London, said: “It’s another piece of legislation we could do without. The government…

Tunbridge Forum fights off moshpit claim
Health & Safety , Live Events / August 2006

HEALTH & SAFETY Live event industry The Forum venue in Tunbridge Wells has won a legal battle after a judge threw out a claim brought by a member of the audience who was injured whilst ‘moshing’ at a Raging Speedhorn concert. The claim was brought on a “no win, no fee” basis. The venue received massive support from loyal music fans who raised over £10,000 from their own pockets towards legal costs estimated at over £20,000 and also generated a petition with over 15,000 signatures supporting the venue. Spokesman Mark Davyd pointed out that the Forum successfully argued that the venue had a disclaimer about mosh pits on all of their tickets, they had disclaimers on venue walls saying that customers shouldn’t get involved in moshing and a very heavily advertised policy that mosh pits were allowed but were by their very nature likely to cause injury. Davyd added that “it’s been extremely expensive to defend – but we were left with no choice ….. the other option was to accept that we would regularly have to fork out thousands of pounds to anybody that asked for it on the grounds that we were responsible for whatever they did to themselves. We…