Metered Music, Inc. v. Powell Meredith Communications Co.

Full title: METERED MUSIC, INC., et al., Plaintiffs, v. POWELL MEREDITH COMMUNICATIONS…

Court: United States District Court, N.D. Texas, Abilene Division

Date published: Mar 2, 2005

Civil Action No. 1:04-CV-015-C (N.D. Tex. Mar. 2, 2005)

Opinion

Civil Action No. 1:04-CV-015-C.

March 2, 2005

ORDER

SAMUEL CUMMINGS, District Judge

On this date, the Court considered Plaintiffs' Motion for Summary Judgment, filed December 15, 2004. Defendants failed to file a response. The Court further considered Plaintiffs' evidence submitted in support of its Motion. Plaintiffs' Motion for Summary Judgment is GRANTED.

I. BACKGROUND

On January 23, 2004, Metered Music, Inc.; Sweet City Records Inc.(BEMA Music Co. Division); Alma Musical/BMG Songs, Inc.; EMI April Music Inc.; Milk Chocolate Factory, Hand in My Pocket, Windswept Holdings, LLC d/b/a Music of Windswept; JKMC Music Publishing, Inc. and Ramon Roberto de Ciria d/b/a Livi Music; AJS Publishing Copyright Services d/b/a Lanfranco Music; and Emi Full Keel Music Co. ("Plaintiffs") filed a complaint alleging copyright infringement under 17 U.S.C. § 501(a) against Powell Meredith Communications Company, Amy S. Meredith, and Scott B. Powell. Defendants answered on February 25, 2004. Plaintiffs moved for summary judgment on December 15, 2004, and Defendants did not respond.

Since 1994, Amy Meredith and Scott Powell have been the sole owners and officers of Powell Meredith Communications Company, which operated radio station KKHR-FM in Abilene, Texas, from 1994-2004. KKHR-FM is now operated by Radio Lane, also solely owned by Amy Meredith and Scott Powell. The station plays a Hispanic music format, and at different times listeners may call and request songs to be played over the air.

All Plaintiffs are members of the American Society of Composers, Authors, and Publishers (ASCAP), an organization that acts on behalf of its members to grant blanket licenses to radio stations, night clubs, and others to perform the works in the ASCAP repertory. ASCAP bases the typical license fee on a percentage of revenues or a flat amount, not the genre of music played by the station. Int'l Korwin Corp. v. Kowalczyk, 855 F.2d 375, 377 (7th Cir. 1988). Organizations such as ASCAP benefit both copyright owners and radio stations. The radio station may obtain permission to perform thousands of songs with one license instead of contacting the copyright owners individually, and the copyright owners have access to a practical method of protecting their rights. Lodge Hall Music, Inc. v. Waco Wrangler Club, Inc., 831 F.2d 77, 79 (5th Cir. 1987).

When Defendants bought KKHR-FM in 1994, the ASCAP license had lapsed. Defendants renegotiated an ASCAP license and met payments from 1994 through part of 1995. After Defendants ceased making payments, ASCAP allowed the station to play ASCAP songs under a de facto license until December 31, 2000. ASCAP contacted Defendants by registered mail in both December 2000 and January 2001 regarding termination of the de facto license. The January 16, 2001 letter clearly notified the Defendants that they were no longer operating under any type of license, de facto or otherwise. From January 2001 through January 2003, ASCAP contacted Defendants five times; each communication advised Defendants not to play ASCAP songs without a license. Defendants also rejected ASCAP's offer to settle.

Plaintiffs allege that Defendants played eight songs within ASCAP's repertory without permission: "Genius of Love," "Play That Funky Music," "Se Me Olvido Otra Vez," "Hey," "Differences, Se Me Va, Vida," and "Oye Como Va." After ASCAP unequivocally revoked the de facto license, ASCAP sent an individual to Abilene, Texas, to record two KKHR-FM broadcasts — one on October 5-6, 2002 and another on July 4-5, 2003. Oleksander Kuzszn, a professional musician employed by ASCAP, compared the recorded broadcasts with the sheet music from the copyright registration files and confirmed that the eight songs at issue had been broadcast by KKHR-FM.

II. STANDARD

Summary judgment is proper when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). All evidence and justifiable inferences must be viewed in the light most favorable to the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). The moving party has the burden of establishing that no genuine dispute of material fact exists. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). No genuine issue of material fact exists unless a reasonable jury could find for the non-moving party. Anderson, 477 U.S. at 247.

After the moving party initially establishes an absence of a genuine issue of material fact, the non-moving party must provide significant probative evidence showing a genuine issue of material fact to defeat the summary judgment. State Farm Life Ins. Co. v. Gutterman, 896 F.2d 116, 118 (5th Cir. 1990). A factual dispute alone does not defeat summary judgment. Anderson, 477 U.S. at 247. Thus, the nonmoving party cannot submit a "mere scintilla of evidence"; the evidence must be sufficient for a jury to reasonably find in the non-moving party's favor. Id. at 252. Conclusory statements, speculation, and unsubstantiated assertions do not show a genuine issue of material fact. Douglass v. United Servs. Auto Ass'n, 79 F.3d 1415, 1429 (5th Cir. 1996) (en banc).

The court cannot grant a motion for summary judgment simply because the non-moving party has not responded. Hibernia Nat'l Bank v. Adminstracion Central Sociedad Anonima, 776 F.3d 1277, 1279 (5th Cir. 1985). Yet, if the non-moving party does not identify specific issues of disputed fact, the court may take the moving party's description of the facts as prima facie evidence supporting summary judgment for that party. Eversly v. MBank Dallas, 843 F.2d 172, 173-74 (5th Cir. 1999).

III. DISCUSSION

This suit was brought under 17 U.S.C. § 501(a). A copyright owner of a musical composition owns the exclusive right to perform that musical composition publicly. 17 U.S.C. § 106(4) (West 2004). Anyone who violates that right infringes upon the copyright. 17 U.S.C. § 501(a) (West 2004). To establish copyright infringement, the plaintiff must prove the following elements: (1) originality and authorship; (2) compliance with the Copyright Act in 17 U.S.C. §§ 101-914; (3) ownership of the copyrights; (4) defendants performed the compositions publicly; and (5) defendants did not have permission from the plaintiffs or their representatives for the performance. See Engineering Dynamics, Inc. v. Structural Software, Inc., 26 F.3d 1335, 1340 (5th Cir. 1994); Fermata Int'l Melodies, Inc. v. Champions Golf Club, Inc., 712 F. Supp. 1257, 1259 (S.D. Tex. 1989), aff'd, 915 F.2d 1567 (5th Cir. 1990).

1. Originality, Registration, and Ownership

Registration certificates "constitute prima facie evidence of the validity of the copyright and the facts stated" within the registration documents. 17 U.S.C. § 410(c) (West 2004). Plaintiffs have submitted registration certificates of each of the eight songs involved, and the certificates establish originality and authorship, compliance with the statutory requirements, and ownership. The defendants submitted no evidence contradicting the registration certificates; thus, the first three elements are established.

2. Public Performance

Broadcasts over a radio station constitute public performance. See Canopy Music, Inc. v. Harbor Cities Broadcasting, Inc., 950 F. Supp. 913, 915 (E.D. Wis. 1997). A composition is performed publicly when the work is "transmit[ted] or otherwise communicate[d] . . . to the public" so that the public is "capable of receiving the performance . . . in the same place or in separate places." 17 U.S.C. § 101 (West 2004). Affidavits show that KKHR-FM broadcast the eight songs at issue to their radio audience on October 5-6, 2002 and July 4-5, 2003. No genuine issue of material fact exists regarding whether the station broadcast the songs over the radio. Realsongs v. Gulf Broadcasting Corp., 824 F. Supp. 89, 93 (M.D. La. 1993) (no issue of material fact when no evidence or logs are available to rebut sworn affidavits that the songs were played). Defendants admit that the radio station keeps no records of the songs played each day and that the disc jockeys would not remember the songs played on the dates in question. Id. (citing to Boz Scaggs Music v. KND Corp., 491 F. Supp. 908 (D. Conn. 1980) for the proposition that absence of knowledge whether songs actually were played is insufficient to controvert plaintiff's affidavits).

3. Failure to obtain permission

Defendants admit that they lacked permission to play the songs involved in this suit; thus, no genuine issue of material fact exists regarding lack of permission. As of January 16, 2001, Defendants were not licensed to play the songs at issue. Although Defendants had operated under a de facto license in the past, a letter from ASCAP dated January 16, 2001, advised Defendants that they were no longer licensed to play songs in the ASCAP repertory and that broadcasting any of those songs would constitute copyright infringement. All recorded copyright infringement incidents which are the subject of this lawsuit occurred well after the January 16, 2001 letter, which clearly informed the Defendants that were no longer operating under any type of license. Defendants did not obtain permission to broadcast the songs.

Plaintiffs have established each element of copyright infringement.¹ Thus, no genuine issue of material fact exists regarding those elements and Plaintiffs are entitled to judgment as a matter of law.

1 Defendants assert that they are not liable for copyright infringement because Plaintiffs failed to put notice of the copyright ownership on the CD jackets. This defense is invalid because intent is not an element of copyright infringement. See Engineering Dynamics, Inc., 26 F.3d at 1340; Fermata Int'l Melodies, Inc., 712 F. Supp. at 1259.

Joint and Several Liability

Defendants are jointly and severally liable for the copyright infringement violations. Corporate officers may be held jointly and severally liable if the officer has a financial stake in the infringing activity and can supervise the activity causing the infringement. Fermata Int'l Melodies, Inc., 712 F. Supp. at 1262. Both financial stake and supervision are issues of law for the court to decide. Warner Bros., Inc. v. Lobster Pot, Inc., 582 F. Supp. 478, 482 (N.D. Ohio 1984). Corporate officers are liable for copyright infringement even if they told their employees not to play the copyrighted music. Id.; Rare Blue Music, Inc. v. Cismek Corp., 1986 WL 517 (S.D. Tex. 1986). The court finds that as the sole shareholders in Powell Meredith Communications Company, Scott Powell and Amy Meredith benefitted financially from the copyright infringement. Further, Powell and Meredith supervised and controlled the radio station policies, employees, and activities. Although Powell and Meredith asked their employees not to play ASCAP songs, they should have more closely supervised their employees and required that a log be kept of all songs played each day.

Statutory Damages

At any time prior to final judgment, the plaintiff may elect to receive statutory damages in lieu of actual damages and profits. 17 U.S.C. § 504(c) (West 2004). The court has broad discretion in setting statutory damages within the suggested range of $750-$30,000 per infringement. See 17 U.S.C. § 504(c); Lodge Hall Music, Inc. v. Waco Wrangler Club, Inc., 831 F.2d 77 (5th Cir. 1987). The suggested range is not less than $750 and not more than $30,000 per infringement. 17 U.S.C. § 504(c). A court may increase the award of statutory damages to a sum of not more than $150,000 per infringement if the infringements were committed wilfully. Id. § 504(c)(2).

The statutory minimum award can properly penalize and deter the infringer. Broadcast Music, Inc. v. Beach Ball Benny's, 1993 WL 483478 (E.D. La. 1993). Factors for the court to consider in setting the damages are deterrence, expenses saved and profits gained from infringement, and the infringer's state of mind. Malaco, Inc. v. Cooper, 2002 WL 1461927 (N.D. Tex. 2002). In a similar case, where the plaintiff contacted the defendant on numerous occasions to resolve the matter without litigation, an award of $1,000 per violation was considered reasonable. Broadcast Music, Inc. v. HOBI, Inc., 1993 WL 404152 (M.D. La. 1993).

The record shows that ASCAP contacted Defendants on numerous occasions regarding the owed license fees. Before clearly stating that the de facto license was revoked, ASCAP wrote Defendants on multiple occasions requesting back fees and annual reports. Then, ASCAP notified Defendants via registered mail three times that they were operating without a license, faxed Defendants a letter, and spoke with Scott Powell on the phone twice. The Court awards statutory damages of $1,000 per violation for a total sum of $8,000.²

2 Statutory damages of $1,000 is appropriate under 17 U.S.C. § 504(c) whether or not the conduct was found to be wilful. See Broadcast Music, Inc., v. HOBI, Inc., 1993 WL 404152 (M.D. La. 1993).

Injunctive Relief

An injunction may be granted to prevent further copyright infringement. 17 U.S.C. § 502(a) (West 2004). An injunction is necessary because Scott B. Powell and Amy S. Meredith continue to operate KKHR-FM under a new corporation, Radio Lane. Scott B. Powell, Amy S. Meredith, and Powell Meredith Communications Company, and their agents, servants, employees, and attorneys, and any others in active participation with them who receive notice of this order or the final judgment in this action, are permanently enjoined and restrained from presenting public performances of the copyrighted musical compositions in the ASCAP repertory, including those belonging to the Plaintiffs, without permission obtained in advance of the performance from the copyright owner involved or a license from their performing rights licensing organization, ASCAP, at any radio station, establishment, or business owned, managed, controlled, or operated, in whole or in part, directly or indirectly, by Scott B. Powell, Amy S. Meredith, or Powell Meredith Communications Company.

Attorney Fees

Plaintiffs requested attorney fees. Attorney fees may be awarded at the discretion of the court but are routinely awarded. See Hogan Sys., Inc. v. Cybresource Int'l, Inc., 158 F.3d 319, 325 (5th Cir. 1998). Defendants have not shown good cause why attorney fees should not be granted. Plaintiffs must submit an affidavit accounting for attorney fees on or before 9:00 a.m. on March 15, 2005. Defendants must file any controverting affidavit on or before 9:00 a.m. on March 25, 2005.

IV. CONCLUSION

For the reasons stated above, the Court finds that

1) Plaintiffs' Motion for Summary Judgment should be granted, with the exception of statutory damage amounts being lower than requested in the Motion;

2) Defendants, Powell Meredith Communications Company, Amy Meredith, and Scott Powell, are jointly and severally liable to Plaintiffs for statutory damages in the total sum of $8,000;

3) Plaintiffs are entitled to injunctive relief; and

4) Plaintiffs are entitled to reasonable and necessary attorney fees.

Judgment will be entered after the Court has determined the amount of attorney fees to be awarded.

SO ORDERED.