Source: https://www.ipmvs.com/filewrapper/ninth-circuit-karaoke-is-audiovisual-work-so-not-fully-covered-by-115-compulsory-license
Timestamp: 2019-04-19 19:04:36+00:00

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In a decision yesterday, the Ninth Circuit affirmed a district court's dismissal of a complaint for declaratory judgment by a karaoke device manufacturer without leave to amend for failure to state a claim. The complaint sought a declaration that a compulsory license under § 115 of the Copyright Act was a sufficient license for a karaoke device to not only play music, but also display the lyrics in real time in coordination with the music.
The Ninth Circuit affirmed the dismissal of the complaint, finding that the § 115 license was insufficient. The § 115 license applies to "phonorecords," but karaoke, because of the lyrics and other content displayed in connection with the song, is an "audiovisual work," specifically excluded from the definition of phonorecords. The court also held that the use of the lyrics also could not constitute fair use based on its commercial nature, aggreeing with a Sixth Circuit decision (blogged here). More details of Leadsinger, Inc. v. BMG Music Publ'g after the jump.
Plaintiff Leadsinger is a New York-based karaoke product manufacturer. Leadsinger describes its karaoke device as "an all-in-one microphone player" that has recorded songs imbedded in a microchip in the microphone. The device also sometimes displays licensed reproductions of still photographs as a background for the onscreen lyrics. Defendant BMG owns or administer copyrights in musical compositions and through its licensing agent, the Harry Fox Agency. BMG has issued to Leadsinger compulsory mechanical licenses to copyrighted musical compositions under § 115 of the Copyright Act. In addition to the mechanical fee required to secure a compulsory license, BMG demanded that Leadsinger and other karaoke companies pay a "lyric reprint" fee and a "synchronization fee." Leadsinger refused to pay these additional fees and filed for declaratory judgment to resolve whether it has the right to visually display song lyrics in real time with song recordings, as well as print song lyrics, without holding anything more than the § 115 compulsory licenses it already possesses.In deciding whether the district court properly dismissed Leadsinger's complaint, the Ninth Circuit first addressed § 102, noting the explicit protections to "among other original works of authorship, literary works, musical works (including any accompanying works), and sound recordings" and that § 106 grants copyright owners the exclusive right to reproduce copyrighted works "in copies or phonorecords" and to "distribute copies or phonorecords of the copyrighted work to the public for sale." The limiting language the Court notes is in § 115 which limits copyright owners' exclusive rights with respect to phonorecords. Additionally the Court noted that "phonorecords" are defined in § 101 as "material objects in which sounds, other than those accompanying a motion picture or other audiovisual work, are fixed by any method," and that, "as the definition of phonorecords indicates, audiovisual works are not phonorecords." Further, the court reviewed the definition of "audiovisual works" contained in the Copyright Act and cited other circuit cases, including its own, in which courts have recognized a copyright holder's right to control the synchronization of musical compositions with the content of audiovisual works and have required parties to obtain synchronization licenses from copyright holders. The Ninth Circuit concluded that Leadsinger's karaoke device met each element of the statutory definition of audiovisual works and, therefore, could not be a phonorecord, reasoning: 1) the visual representation of successive portions of song lyrics that Leadsinger's device project onto a television screen constitutes a series of related images; 2) the related images are comprised of song lyrics, which constitute a literary work, which does not preclude Leadsinger's device from being an audiovisual work; and 3) that Leadsinger's device consists of "a series of related images" that are "intrinsically intended to be shown by the use of machines." Thus, Leadsinger's devices fell within the definition of an audiovisual work, and in addition to any § 115 compulsory license, Leadsinger is also required to secure synchronization licenses to display images of song lyrics in timed relations with recorded music, as the § 115 compulsory license only covers phonorecords.
As well, Leadsinger argued that regardless of whether its device is subject to § 115's compulsory licensing scheme, it is entitled to publish or display copyrighted song lyrics under the Fair Use doctrine, codified in § 107 of the Copyright Act. The Ninth Circuit found Leadsinger's arguments with regard to each of the fair use factors unpersuasive, concluding that Leadsinger's use of the works is intended for commercial gain; song lyrics fall within the core of copyright protection, and Leadsinger uses song lyrics in their entirety. This conclusion was in accord with the Sixth Circuit's decision in Zomba Enterprises, Inc. v. Panorama Records, Inc. involving another karaoke manufacturer.
To read the full decision in Leadsinger, Inc. v. BMG Music Publ'g, click here.

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