In a lawsuit filed last week (see the complaint here), Flo and Eddie, the artists who were behind the 1960's band The Turtles, claim that Sirius XM has infringed on the copyrights in their songs by allowing copies of these recordings to be made by the satellite radio service and in certain Internet offerings that Sirius XM makes available. The article in THR.esq (the Hollywood Reporter's legal blog) that first announced the lawsuit talks much about the ambiguous status of pre-1972 sound recordings under Section 114 of the copyright act (the section providing for royalties for the public performance of sound recordings by digital services), and seems to view the suit as a reaction to the decision in the satellite radio proceeding before the Copyright Royalty Board finding that Sirius XM owed no performance royalty to SoundExchange for its playing of pre-1972 sound recordings (see our article about that decision). As pre-1972 sound recordings are not entitled to Federal copyright protection, the Board decided that there could be no payment due to SoundExchange (which collects royalties for payments made under Section 114) as there was no Federal right. While that point seems to be well-established, a close reading of the complaint makes it appear that it is not the public performance that is the principal basis of the lawsuit, but instead the copies that are made in the digital transmission process and by certain features of Sirius's Internet streaming services that allow the download or on-demand playing of their digital streams.
As we have written before, pre-1972 sound recordings were left out of Federal statutes as, until 1972, sound recordings (a specific recording of a song by a particular artist) had no protection at all under Federal copyright law. As these sound recordings had no Federal protections, state laws were adopted – principally to prevent bootlegging or other unauthorized copies of such sound recordings from being made and distributed. As there was not, and still is not, a general public performance right in sound recordings, there has been little in the way of court cases suggesting that pre-1972 sound recordings have rights that other sound recordings do not have, e.g. a general public performance right. If the Flo and Eddie suit were really alleging that there is a public performance right in pre-1972 sound recordings, then seemingly every restaurant, bar, or stadium that plays the original hit versions of Good Vibrations, Rock Around the Clock, Johnny Be Goode, the Twist or the Turtles' Happy Together could find themselves looking at potential liability for public performance of these sound recordings. Certainly, these state statutes, many of which have been around for decades, did not contemplate the exclusively digital public performance right that exists for post-1972 sound recordings, which was not adopted until the late 1990s. So, if the plaintiffs are asserting that there is a public performance right inherent in these statutes, it would seem that it would have to be a general public performance right. But it sure seems difficult to believe that courts would find ambiguous state statutes adopted to prevent illegal copying created a public performance right where none has ever before existed in the common law of the United States.
If one carefully reads the complaint that was filed, the focus seems to center on the reproductions of the songs that the plaintiffs allege are being offered by Sirius XM. In that case, the right to control the reproduction and distribution of these songs may be more easily fit into the parameters established by the state laws. We will have to see the response of Sirius to see if indeed they agree that reproductions are made, and if so, where they believe that the rights to make such copies have been obtained.
The issues raised by the lawsuit demonstrate the complexity of the music rights issues generally, and the added complication raised by pre-1972 sound recordings. This case raises the issue of whether the buffer and server copies used in a digital transmission process have any real independent value – a value that the copyright office has questioned before as these copies are really just incidental to the public performance (a question raised last week in the Commerce Department’s “Green Paper” on copyright, a report that I hope to write about in more detail soon). Questions about pre-1972 sound recordings have also been raised by the recording industry in a thus-far successful state law case arguing that these recordings are not covered by the DMCA safe harbor for user-generated content (see our article here), another issue raised in the Green Paper. The Copyright Office itself has suggested that these sound recordings be brought under Federal law to eliminate some of these questions (see our article here about the Copyright Office's recommendation).
There are broadcaster exceptions in most state laws dealing with pre-1972 sound recordings, so this appears to be mostly a digital media issue, and perhaps, as we set out above, if an expansive public performance right was to be found, an issue for businesses who play background music. There are obviously many issues to sort out, and I'm sure that these developments will be closely watched.