Something Old Becomes Something New and Makes Copyright Royalties Disappear

The Old is pre-1972 recordings not covered by federal copyright law. The New is remastered versions of the Old played on broadcast radio. The disappearing royalties are the ones supposed to be paid by radio to copyright owners after Flo & Eddie’s state copyright law victories in California and New York.


With the recorded music industry preoccupied by the question “who owes me?”, another answer came from Los Angeles federal court on Memorial Day when Judge Percy Anderson ruled that CBS Radio owed nothing for its stations playing pre-1972 recordings because they were not pre-1972 recordings. ABS Entertainment, Inc. v. CBS Corporation, et al. CV 15-6257 PA (AGRx) May 30, 2016.


The Flo & Eddie litigation is on appeal while major recording companies walked away with $210 million from a settlement with SiriusXM over pre-1972 recordings as reported last year. The core question in those cases was ─ do state laws actually create enforceable rights to fill the vacuum left by the federal Copyright Act not covering sound recordings made before February 15, 1972? 17 USC §301(c).


CBS asked a different core question in the lawsuit decided Monday, the kind of question so often overlooked in copyright disputes that many commentators found it shocking ─ what recordings was CBS playing?


Aristotle shocked his colleagues in the world of ancient Greek philosophy in much the same way. He ended centuries of debate about how many teeth a horse has by saying in effect “let’s stop arguing and go look.”


When they looked in the ABS Entertainment case, they saw that CBS radio was broadcasting remastered versions of old records, not the original recordings. CBS claimed they were what the Copyright Act calls derivative works. And the since the remastered versions were made after February, 1972, CBS argued they came under the Copyright Act which says radio can play the recordings without paying royalties to rights owners.


Judge Anderson told the parties to brief the question “whether a sound engineer’s remastering of a pre-1972 sound recording – through subjectively and artistically altering the work’s timbre, spatial imagery, sound balance, and loudness range, but otherwise leaving the work unedited – is entitled to federal copyright protection.” In other words, is the New a group of derivative works?


Both sides submitted expert testimony and the answer from the court last Monday was Yes, they are. To qualify as a derivative work under the Copyright Act, the differences between Old and New can’t be trivial mechanical changes and need to be enough for people to notice.

While any artist today knows the differences you hear can be huge depending on mastering, it’s also true people hear, or fail to hear, different things. So what impressed the court were results of forensic tests of timbre, spatial imagery, sound balance, and loudness range. The Old and New were very different.


The remastered recordings in the lawsuit by artists such as the Everly Brothers, Jackie Wilson and Mahalia Jackson were all authorized by the artists in license agreements permitting remastering. That’s important because the Copyright Act gives the owner of the original work the exclusive right to authorize a derivative work based on it.


So CBS won and ABS Entertainment will undoubtedly get in line for the Ninth Circuit appeals court to review the decision. Meanwhile, radio owners are breathing easier while record labels and artists have more cause to complain about the size of their share of the shrunken recorded music revenue pie.


Aristotle, however, would approve of the court looking at the horse’s mouth instead of having the lawyers debate how many teeth were there.


About Craig Pinkus

Craig Pinkus is a partner in the Intellectual Property Group. He also is a member of the Litigation and the Sports, Entertainment and Media Groups. He assists clients with a broad range of disputes and transactions involving all areas of intellectual property, entertainment, and other complex business arrangements. He has conducted trials and arbitrations throughout the United States and has argued appeals before the Seventh, Sixth and Federal Circuit Courts of Appeal, the Indiana appellate courts, and United States Supreme Court.
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3 Responses to Something Old Becomes Something New and Makes Copyright Royalties Disappear

  1. bkeating51 says:

    Nicely written. Is Aristotle in the public domain?

    The person who came up with the remastered recording distinction deserves a bonus, but I can’t agree with the decision. The nature of the law, to have artists fairly compensated when their recordings are performed, calls for the subjective judgment of whether the average listener can detect a difference upon hearing the remastered recording in isolation from the original. In all but the rarest instances, I can detect no difference. Applying scientific measurements to the sound waves generated by the playing of two CDs of the same unchanged recordings would come up with distinct distances.

    By the time all this litigation is over, every artist who ever performed pre-1972 will be deceased. But they have heirs, I suppose.

    Liked by 1 person

  2. Craig Pinkus says:

    Thank you for commenting. Some Aristotle translations may be protected by copyright, but I’ve not investigated. The litigation will indeed continue. Two weeks ago the 6th Circuit finally awarded copyrights to descendants of Albert Brumley for the gospel song “I’ll Fly Away” which he wrote in the 1920’s.


  3. bkeating51 says:

    My first, ignorant reaction to this was that it was a win for Pandora and Sirius. On second thought, is it just a win for CBS and other traditional radio stations? Pre-1972 recordings will converted to post-1972 recordings subject to the Copyright Act, under which Pandora and Sirius have to pay. In fact these two might have gotten a better deal with their settlements with the record labels since the record labels could not be sure that the lower court rulings would not be overturned.

    With no objection, I’m going to link this column to a Seeking Alpha article on Sirius.


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