How art gets generated.
In a first-of-its kind case establishing liability for posting unlicensed song lyrics on a website, law firm Arent Fox has won $6.6 million in statutory damages on behalf of a group of leading music publishers against the operator of online music sites.
The damages were awarded to publishers Peermusic, Bug Music, Inc. and Warner Chappell Music, Inc., whose portfolios include copyrighted songs written or performed by such artists as David Bowie, Van Morrison, Bob Seger, Green Day and Ray Charles, among others.
In addition to setting $6.6 million in damages for willful copyright infringement, a judge in the U.S. District Court for the Central District of California imposed permanent injunctive relief for the plaintiffs as well as attorneys’ fees and related costs. The case caption is Peermusic,III, LTD.,et al v LiveUniverse,Inc. and Brad Greenspan.
The publishers were represented by Arent Fox intellectual property partners Ross Charap and Paul Fakler, who have handled a number of cutting-edge cases involving digital music and the intersection of copyright and the Internet.
The case is the first to establish copyright infringement liability for displaying song lyrics on a website without a license from the song’s copyright owner. Because plaintiffs established that Mr. Greenspan – one of the founders of MySpace – controlled the affairs of the corporate defendant, the defendants are jointly and severally liable for damages along with costs and attorneys’ fees. They are also bound by the terms of the permanent injunction which will forbid either defendant from using all or part of any of plaintiffs’ copyrighted musical compositions without first obtaining a license.
Plaintiffs were awarded $12,500 in damages for each of the 528 compositions cited in the lawsuit as having been posted by Mr. Greenspan on various websites under the umbrella ownership of LiveUniverse.
Among the songs whose copyrighted lyrics were displayed without permission were hits such as “China Girl” performed by David Bowie, “(Don’t Go Chasing) Waterfalls” performed by TLC, “Wake Me Up When September Ends” performed by Green Day, “Moondance” performed by Van Morrison, “Old Time Rock and Roll” performed by Bob Seger, and “Georgia On My Mind” performed by Ray Charles. The Arent Fox attorneys note that the 528 songs are “merely representative of the millions of songs in the plaintiffs’ respective catalogs. In addition, the three plaintiffs are merely representative of the thousands of music publishers whose works were infringed by the LiveUniverse websites.”
Mr. Greenspan is no stranger to controversy and the courts. He was one of the founders and original investors in MySpace and received more than $60 million from the sale of that company to News Corp. He promptly challenged the sale, unsuccessfully, on the grounds that the company had been undervalued by management. At the same time, he founded LiveUniverse and created dozens of social media sites under the LiveUniverse umbrella, all of which subsequently failed. He also acquired the three illegal song lyric sites that were at the heart of this lawsuit.
Lyric sites are among the most visited destinations on the Web and generate many millions of dollars in advertising revenues. Many have entered into licenses with representatives of the music publishers in order that they may display copyrighted lyrics lawfully. Unfortunately, many others, like those in suit, refused licenses and continue to profit on the backs of the songwriters and music publishers who share revenues generated by the songs.
“One of the principal purposes of our lawsuit was to obtain a large statutory damage award which would serve as a warning to persuade illegal lyric site operators that it makes good business sense to become licensed and avoid having their site shut down and damages awarded against them,” said Mr. Charap.
Mr. Fakler added, “In fact, at an earlier stage in the proceeding, we obtained a preliminary injunction from the Court, shutting down the infringing websites. When that decision was publicized there was a significant upturn in the licensing of previously illegal sites. We expect this multi-million dollar judgment to have a similar effect, to the benefit of publishers and the artists whose works they license.”
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