508 F.Supp. 798 (S.D.N.Y. 1981), 71 Civ. 602, ABKCO Music, Inc. v. Harrisongs Music, Ltd.

Docket Nº:71 Civ. 602.
Citation:508 F.Supp. 798
Party Name:ABKCO MUSIC, INC., Plaintiff, v. HARRISONGS MUSIC, LTD., Harrisongs Music, Inc., George Harrison, Apple Records, Ltd., Apple Records, Inc., Broadcast Music, Inc., and Hansen Publications, Inc., Defendants, v. ABKCO INDUSTRIES, INC. and Allen Klein, Additional Parties with Respect to the Counter-Claims.
Case Date:February 19, 1981
Court:United States District Courts, 2nd Circuit
 
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Page 798

508 F.Supp. 798 (S.D.N.Y. 1981)

ABKCO MUSIC, INC., Plaintiff,

v.

HARRISONGS MUSIC, LTD., Harrisongs Music, Inc., George Harrison, Apple Records, Ltd., Apple Records, Inc., Broadcast Music, Inc., and Hansen Publications, Inc., Defendants,

v.

ABKCO INDUSTRIES, INC. and Allen Klein, Additional Parties with Respect to the Counter-Claims.

No. 71 Civ. 602.

United States District Court, D. New York

Feb. 19, 1981

Page 799

Pryor, Cashman, Sherman & Flynn, New York City, for ABKCO Music, Inc. and ABKCO Industries, Inc. and Allen Klein; Gideon Cashman, James A. Janowitz, Donald S. Zakarin, New York City, of counsel.

Santora, Shenkman & Kushel, New York City, for all defendants except Hansen Publications, Inc.; Joseph J. Santora, New York City, of counsel.

Barovick, Konecky, Braun, Schwartz & Kay, New York City, for Hansen Publications, Inc.; Richard Z. Lehv, David S. Rosenthal, New York City, of counsel.

Cleary, Gottlieb, Steen & Hamilton, New York City, for Apple Records Limited and Apple Records, Inc.; Albert S. Pergam, New York City, of counsel.

OPINION

OWEN, District Judge.

In this action by Bright Tunes Music Corporation for infringement of its copyright in the 1963 hit song "He's So Fine", I earlier concluded that defendant George Harrison had subconsciously plagiarized "He's So Fine" in arriving at the melody of his hit song, "My Sweet Lord", in 1971. Bright Tunes Music Corp. v. Harrisongs Music, Ltd., 420 F.Supp. 177 (S.D.N.Y.1976). I thereafter scheduled hearings to determine the damages flowing from that infringement and the parties responsible therefor, and extensive discovery commenced. Prior to the date for hearings, however, Bright Tunes sold, for $587,000.00, its copyright in "He's So Fine" and its rights in this litigation to ABKCO Music, Inc., of which Allen B. Klein, the "ABK" of ABKCO, is the moving spirit, owner, and principal officer. This immediately caused strong reaction from the Harrison interests 1 because ABKCO had been the exclusive business manager for George Harrison and his musical interests from November, 1970 to March 13, 1973, 2 the period in which the claim of infringement was first asserted.

Upon ABKCO being substituted as plaintiff herein, the Harrison interests amended their pleadings to assert, in one form or another, a breach of fiduciary duty by ABKCO, which, according to Harrison, disqualifies ABKCO from recovering in this action.

Testimony has now been taken on both the issue of damages and the question of ABKCO's disqualification. While I am of the view that ABKCO's conduct from 1975 to 1978 limits its recovery herein, see infra, it is nonetheless appropriate to determine first what the recovery would have been had ABKCO not become the plaintiff in the way it did, and to set forth the court's findings accordingly, albeit in somewhat summary fashion.

The earnings of the song "My Sweet Lord" have come from four principal

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sources: mechanical royalties, 3 performance royalties, 4 the sale of sheet music and folios, and the profits of Apple Records, Inc., the Harrison-owned manufacturer of the principal recordings of "My Sweet Lord".

Mechanical royalties attributable solely to "My Sweet Lord" total $260,103. Plaintiff contends that it is also entitled to some portion of the mechanical royalties Harrison received for the relatively unsuccessful songs on the same discs with "My Sweet Lord" which, it argues, would not have been earned but for the unusual popularity of "My Sweet Lord". In assessing plaintiff's argument, two things must be kept in mind. First, on the single record, the song "My Sweet Lord", a hit, was teamed with "Isn't It a Pity", a non-hit; on the twelve-inch album, "All Things Must Pass", "My Sweet Lord" was one of twenty-two Harrison songs, only one other of which achieved even modest popularity. Second, exactly the same mechanical royalty is payable to Harrison for each of his songs on any given record, whether memorable or not. Common sense dictates that a hit song contributes more to the sale of a record than does a less popular song. In such circumstance, mechanical royalties paid to a composer for a less-than-memorable song on the record are, in fact, earned by the memorable song which has caused the public to purchase the record. While not susceptible to quite the precision one might prefer, a reasonable determination of the total earnings allocable to "My Sweet Lord" can be made here and is an appropriate item of damage for the court to award. 5 Lottie Joplin Thomas Trust v. Crown Publishers, Inc., 456 F.Supp. 531 (S.D.N.Y.1977), aff'd 592 F.2d 651 (2d Cir. 1978).

I turn first to the earnings of the single. By a ratio of sixteen to one disc jockeys played "My Sweet Lord" more frequently than the song on the single's flip side, "Isn't It a Pity". With respect to the album "All Things Must Pass", containing twenty-two songs, disc jockeys played "My Sweet Lord" seventy percent of the time that they aired any song from the album. I therefore find that, conservatively, seventy percent of the total mechanical royalties earned by the single were attributable to "My Sweet Lord". 6 In addition, I find,

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again calculating conservatively, that fifty percent of the mechanical royalties earned by the album "All Things Must Pass" are attributable to "My Sweet Lord".

The album entitled "The Best of George Harrison" is another matter. The trial record provides me with no guidance as to the relative popularity of a number of the album's songs. Since this album was issued several years after the initial release of "My Sweet Lord", has a number of different songs, and is entitled "The Best", I conclude that these are all songs with substantial popularity...

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