Abkco Music, Inc. v. Lavere

• Decision Date: 08 February 2000
• Docket Number: No. 98-56145,98-56145
• Citation: 217 F.3d 684
• Parties: (9th Cir. 2000) ABKCO MUSIC, INC., Plaintiff-counter-defendant-Appellee, v. STEPHEN LAVERE, as an individual, dba King of Spades Music; DELTA HAZE, INC., in its corporate capacity, dba King of Spades Music; MIMOSA RECORDS PRODUCTIONS, INC., in its corporate capacity, dba King of Spades Music, Defendants-counterclaimants-Appellants
• Court: U.S. Court of Appeals — Ninth Circuit

Page 684

217 F.3d 684 (9th Cir. 2000)

ABKCO MUSIC, INC., Plaintiff-counter-defendant-Appellee, v. STEPHEN LAVERE, as an individual, dba King of Spades Music; DELTA HAZE, INC., in its corporate capacity, dba King of Spades Music; MIMOSA RECORDS PRODUCTIONS, INC., in its corporate capacity, dba King of Spades Music, Defendants-counterclaimants-Appellants.

No. 98-56145

U.S. Court of Appeals for the Ninth Circuit

Argued and Submitted February 8, 2000--Pasadena, California

Filed June 26, 2000

Anthony Kornarens, Kornarens & Howard, Los Angeles, California, for the defendants-counter-claimants-appellants.

Donald S. Zakarin (argued), Pryor, Cashman, Sherman, & Flynn, New York, New York, and Max J. Sprecher, Lavely & Singer, Los Angeles, California, for the plaintiff-counter-defendant-appellee.

Appeal from the United States District Court for the Central District of California; Terry J. Hatter, Jr., Chief District Judge, Presiding. D.C. No. CV-95-07682-TJH

Before: Pamela Ann Rymer and Raymond C. Fisher, Circuit Judges, and Lloyd D. George, Senior District Judge^*.

RYMER, Circuit Judge:

The ultimate question in this case is whether a phonorecord distributed in the late 1930s "published" the underlying work such that the clock started ticking under the Copyright Act of 1909.¹ In La Cienega Music Co. v. ZZ Top, 53 F.3d 950 (9th Cir. 1995), we held that it did. However, in 1997 Congress amended the Copyright Act to provide that distribution of a phonorecord before January 1, 1978 shall not constitute a publication of the musical work. See 17 U.S.C. S 303(b). This action (for declaratory relief that a record released in 1938-39 is in the public domain) was filed after La Cienega but before the amendment. Thus, the appeal turns on which controls: La Cienega or the 1997 amendment to the Copyright Act.

ABKCO Music, Inc., whose library includes two Rolling Stones hits -Love in Vain, released in 1969, and Stop Breakin' Down, released in 1972 -sought a ruling that the versions of these two songs recorded by Robert Johnson and distributed on a phonograph in the late 1930s were in the public domain under La Cienega. The district court determined on summary judgment that the Johnson versions of Love in Vain and Stop Breakin' Down irrevocably entered the public domain when the copyrights were not renewed within the last year of the initial 28-year term of copyright protection. Stephen LaVere, Mimosa Records Production, Inc., d/b/a King of Spades Music, and Delta Haze, Inc., who claim legal title to the Johnson copyrights, appeal. We now join the Sixth Circuit in concluding that the 1997 amendment applies to pending cases.² Accordingly, S 303(b), rather than La Cienega, controls. We therefore reverse.

I

Robert Johnson, a blues artist, recorded 29 songs before he was murdered in 1938. Sixteen were recorded in a November 1936 session, and, after the 1936 recordings were successfully distributed by Vocalion Records, Johnson returned to the studio in June 1937 to record 13 more songs including Love in Vain and Stop Breakin' Down. Vocalion released Stop Breakin' Down on March 20, 1938 and Love in Vain on February 9, 1939. No copyright registration for either song was filed. In the early 1960s, Columbia Records re-released Johnson's recordings.

In 1969, The Rolling Stones released an album called Let It Bleed, which contained an adapted version of Love in Vain, and in 1972, the Rolling Stones adapted Stop Breakin' Down for their album Exile on Main Street. ABKCO's predecessor filed a copyright registration on Love in Vain in May 1970 and ABKCO filed a copyright registration claiming protection for The Rolling Stones' adaptation and arrangement of Stop Breakin' Down in 1972.

Meanwhile, LaVere became interested in Johnson's music and by 1974 had located Carrie Thompson, Johnson's sister, who was thought to be his only surviving heir. LaVere agreed to try to generate income from Johnson's legacy and to pay Thompson (on behalf of Johnson heirs) fifty percent of all royalties collected in exchange for her assignment to him of her copyright interests in Johnson's works. LaVere formed King of Spades Music, a publishing company to administer the Johnson compositions and copyrights. Over time he assigned his copyright interests to Mimosa, which in turn assigned them to Delta Haze (whose dba is King of Spades Music).

In 1990, Columbia Records released a two-CD boxed set of Johnson's recordings entitled Robert Johnson -The Complete Recordings. Love in Vain and Stop Breakin' Down were included. It was quite successful. Columbia evidently recognized Johnson's common law copyrights as, eventually, did other successful pop artists who adapted Johnson's works. However, ABKCO did not. LaVere filed a copyright registration for the Columbia release in 1991. In February 1993 Delta Haze demanded that ABKCO cease and desist from unlicensed uses of the Johnson songs. Protracted negotiations followed. When it became clear they were going nowhere and Delta Haze threatened to sue in the summer of 1995, ABCKO filed this action for declaratory relief on November 9, 1995. It sought an order that the Johnson versions of Love in Vain and Stop Breakin' Down are in the public domain under La Cienega. Delta Haze counterclaimed for a declaration that no protectable copyright interest exists in The Rolling Stones' versions of Love in Vain and Stop Breakin' Down and that it, rather than ABKCO, is the sole owner of the legal copyright in these compositions.

Delta Haze moved to dismiss pursuant to Rule 12(b)(7) on the grounds that the Johnson Estate was an indispensable party and that ABKCO lacked standing. Both motions were denied. Each party moved for summary judgment, but before the district court could rule, S 303(b) was signed into law. The district court granted ABKCO's motion, and denied Delta Haze's cross-motion, holding that the Robert Johnson versions of Love in Vain and Stop Breakin' Down irrevocably entered the public domain when the copyrights were not renewed within the last year of the initial 28-year term of copyright protection.

Delta Haze timely appealed.

II

We first address two arguments advanced by Delta Haze that would require dismissal, if correct.

A

Delta Haze contends that ABKCO lacks standing because it did not allege ownership and registration with respect to Stop Breakin' Down as well as Love in Vain, and averred that it filed this action on account of a threatened suit for infringement arising only from Love in Vain . We disagree that the complaint's failure specifically to mention Stop Breakin' Down matters, for the record shows that ABKCO in fact filed a copyright registration (No. Eu 326810) on Stop Breaking Down April 27, 1972 as an "adaptation of words & music of a work in P.D." The registration reflects Mick Jagger and Keith Richard as authors. Further, the record shows that from Delta Haze's February 22, 1993 letter on, both parties understood the dispute to involve all Johnson works recorded by the Rolling Stones, including Stop Breakin' Down as well as Love in Vain. Suit was clearly threatened in June and August of 1995. Therefore, when ABKCO filed its action for declaratory relief on November 9, 1995, there was an actual controversy with respect to rights in the Johnson works sufficient to confer standing. See, e.g., Coral Constr. Co. v. King Co., 941 F.2d 910, 929 (9th Cir. 1991) (a plaintiff seeking declaratory relief must show a very significant possibility of future harm for standing); Hal Roach Studios, Inc. v. Richard Feiner & Co., 896 F.2d 1542, 1555-56 (9th Cir. 1990) (for standing a plaintiff must have a real and reasonable apprehension that he will be subject to liability if he continues to manufacture his product).

B

Delta Haze also argues that ABKCO's action should have been dismissed for failure to join the Johnson Estate, the beneficial owner of the copyrights, as an indispensable party under Rule 19 of the Federal Rules of Civil Procedure. Although the transactions are not entirely clear, it appears from LaVere's declaration that the Johnson Estate acknowledged his agreement with Johnson's sister, and that he and the Administrator of the Johnson Estate entered into a contract whereby the Estate authorized LaVere to act as the Estate's agent for purposes of exploiting the Johnson copyrights (as he had with Thompson) in exchange for LaVere's remitting fifty percent of the royalties received from the boxed set of Johnson compositions. He has been doing so for years. Nothing in the record suggests that the Estate's interests diverge from LaVere's, or Delta Haze's, with respect to anything at issue in this lawsuit, or that LaVere does not adequately represent whatever interests the Estate has; they are the same as his in establishing that the Johnson copyrights did not fall into the public domain before the Columbia release in 1990. Under these circumstances, we do not see how the district court could have abused its discretion in declining to find the Estate indispensable.

III

Turning to the central issue on appeal, Delta Haze argues that applying S 303(b) to this case presents no retroactivity problem because Congress was clarifying, not changing, the law when it affirmed through S 303(b) that"[t]he distribution of a phonorecord before January 1, 1978 shall not for any purpose constitute a publication of the musical work embodied therein." ABKCO sees the amendment to S 303 as a departure which changed prior law and whose application to a pending case would have an impermissible retroactive effect under Landgraf v. USI. Film Products, 511 U.S. 244 (1994). Delta Haze disagrees that, even if retroactivity analysis is required, the amendment is retroactive because Congress expressly prescribed its reach "for any purpose" to all releases of phonorecords before January 1, 1978.

A

This issue has a long history, stretching back to 1831, when Congress first extended copyright protection to original musical...