Agee v. Paramount Communications, Inc.
| Decision Date | 26 June 1995 |
| Docket Number | D,No. 893,893 |
| Parties | , 1995 Copr.L.Dec. P 27,409, 35 U.S.P.Q.2d 1169 Michael L. AGEE, d/b/a L & H Records, Plaintiff-Appellant, v. PARAMOUNT COMMUNICATIONS, INC., et al., Defendants-Appellees. ocket 94-7670. |
| Court | U.S. Court of Appeals — Second Circuit |
Russell J. Frackman, Los Angeles, CA (Robert C. Welsh, Jeffrey D. Goldman, Mitchell, Silberberg & Knupp, Los Angeles, CA; John Walshe, John Walshe & Associates, New York City, on the brief), for plaintiff-appellant.
Leslie Gordon Fagen, New York City (Stuart M. Cobert, Robert A. Atkins, George E. Anhang, Paul, Weiss, Rifkind, Wharton & Garrison, on the brief), for defendants-appellees.
Frank W. Hunger, Asst. Atty. Gen., Vito J. DiPietro, Director, John Fargo, Asst. Director, Commercial Litigation Branch, U.S. Dept. of Justice, Washington, DC; Eric Schwartz, Acting Gen. Counsel, Marilyn Kretsinger, Asst. Gen. Counsel, Charlotte Douglass, Harriett Oler, U.S. Copyright Office, Library of Congress, Washington, DC, submitted a brief, for amicus curiae The Register of Copyrights.
David E. Leibowitz, Washington, DC, submitted a brief, for amicus curiae the Recording Industry Ass'n of America, Inc.
Before NEWMAN, Chief Judge, VAN GRAAFEILAND and COFFIN, * Circuit Judges.
The primary issue presented by this appeal is whether incorporating a copyrighted sound recording into the soundtrack of a taped commercial television production infringes the copyright owner's exclusive right of reproduction under the Copyright Act of 1976, 17 U.S.C. Secs. 106 and 114(b) (1993). We hold that it does.
Plaintiff-appellant Michael L. Agee appeals from the June 3, 1994, judgment of the District Court for the Southern District of New York (Constance Baker Motley, Judge) granting summary judgment against him on his copyright claim against defendants-appellees Paramount Communications, Inc., Paramount Pictures, and Paramount Television Group ("Paramount") and the owners of 129 television stations ("TV stations"), and dismissing his Lanham Act and unfair competition claims for failure to state a cause of action. See Agee v. Paramount Communications, Inc., 853 F.Supp. 778 (S.D.N.Y.1994). Paramount copied portions of Agee's sound recording to make the audio track of a segment of a television program, and transmitted the program to the TV stations, which in turn made their own copies for transmission to the viewing public.
We conclude that Paramount violated Agee's exclusive right of reproduction when it copied his sound recording on tape as part of the television program's soundtrack. However, we find that the copies of the program, including the duplicated portions of Agee's work, made by the TV stations are protected by the statute's "ephemeral recording" exemption, see 17 U.S.C. Sec. 112. We agree with the dismissal of Agee's Lanham Act and unfair competition claims. We therefore affirm in part, reverse in part, and remand.
Plaintiff-appellant Michael L. Agee, a California resident, is proprietor of L & H Records, a music recording studio located in California. Through L & H Records, Agee owns copyrights in two sound recordings, "Laurel and Hardy's Music Box" ("Music Box") and "Laurel and Hardy's Music Box: Volume II" ("Music Box-Two"). Agee does not own the copyright in the musical compositions embodied in these sound recordings.
Defendant-appellee Paramount Communications, Inc. is a Delaware corporation whose principal place of business is California. Defendants-appellees Paramount Pictures and Paramount Television Group are divisions of Paramount. Paramount Pictures produces the daily, half-hour news magazine television program Hard Copy and transmits it to independently owned and operated television stations for broadcast nationwide.
Paramount copied portions of three songs from Agee's "Music Box-Two," entitled "Ku-Ku," "Cops," and "The Donkey's Ears," to make the audio track of a four-minute segment of its Hard Copy feature called "Caught on Tape." After duplicating parts of the recording, Paramount created an audiovisual work that timed or "synchronized" portions of the duplicated recording to visual images showing two young men engaged in an unsuccessful burglary attempt.
Paramount recorded the "Caught on Tape" feature on February 15, 1993, and integrated it into the Hard Copy program for satellite transmission to the TV stations for airing the next day. Portions of the feature, including Agee's recording, were also included in the opening and closing credits of the program. In addition, Paramount produced and transmitted to the TV stations a promotional commercial excerpted from the program, again including Agee's copyrighted work. The TV stations made their own copies of the program and the commercial and broadcast them to the public. Paramount neither sought nor obtained a license from Agee for the use of his recording, nor did it refer to him in the program's credits.
On September 10, 1993, Agee brought a copyright infringement action against Paramount and the TV stations for the unauthorized copying and synchronization of the songs from his sound recording, creation of a derivative work, and distribution or publication of that work to the public. Agee also alleged that defendants had engaged in unfair competition and that Paramount's use of his recording violated section 43(a) of the Lanham Act.
Agee moved by order to show cause for a temporary restraining order on November 19, 1993, seeking a preliminary injunction prohibiting the TV stations from rebroadcasting and Paramount from retransmitting the tape. The temporary restraining order was granted and then dissolved on the same day upon defense counsel's oral representation that the program would not be broadcast again. Thereafter, and prior to any discovery, Paramount and the TV stations moved for dismissal of the complaint and, alternatively, for summary judgment.
The District Court granted defendants' motion, dismissing Agee's state law and Lanham Act claims, and granting summary judgment on the copyright infringement claim after concluding that defendants had not infringed any of Agee's exclusive rights under the Copyright Act, which include the right to (1) reproduce the sound recording, (2) prepare a derivative work based upon the sound recording, and (3) distribute copies of the sound recording to the public. See 17 U.S.C. Secs. 106, 114(b) (1993).
With respect to the exclusive right to reproduce a copyrighted sound recording, the District Court held that although the synchronization or "synch" right (i.e., the right to use recorded music in synchronization with visual images on the soundtrack of a television program or motion picture) had been held to be a subset of a music publisher's right to reproduce his work, see, e.g., Angel Music, Inc. v. ABC Sports, Inc., 631 F.Supp. 429, 433 n. 4 (S.D.N.Y.1986), such a synch right was not part of the sound recording copyright owner's exclusive reproduction right, which was more limited. See 853 F.Supp. at 786-87. Rather, the Copyright Act proscribed only the "unauthorized sale or public distribution" of phonorecords or audiovisual works containing Agee's sound recordings, "which did not happen in this case." Id. at 787.
In addition, the District Court concluded that Paramount had not violated Agee's exclusive right to prepare derivative works from his recording because there was "no evidence that the sounds in [Agee's] recording were remixed, or that additional lyrics or musical variations were added, or that defendant took his recording and transformed it into a new original work." Id. at 788-89.
The District Court also held that Paramount's "transmission" of Hard Copy, together with Agee's sound recording, to the TV stations and the TV stations' transmission of the program to the public did not amount to "distributions" of copies of Agee's recording to the public, but were simply public "performances" of that recording. Because sound recording copyright owners do not have exclusive performance rights, see 17 U.S.C. Sec. 114(a), these transmissions did not infringe Agee's rights. 853 F.Supp. at 789.
Additionally, the District Court noted that the TV stations' copies of the program were protected under the "ephemeral recording" exemption, 17 U.S.C. Sec. 112, which permits "transmitting organization[s]" with the right to transmit any work to make a single copy of a particular program embodying the work if certain prerequisites are satisfied. 853 F.Supp. at 789-90. 1
Finally, the District Court found that Agee had failed to state a cause of action under either the Lanham Act or unfair competition law. Agee's complaint did not allege that Paramount had misrepresented the source of the music used in the "Caught On Tape" segment or that it possessed a copyright in Agee's sound recordings. Rather, Agee's Lanham Act claim arose "from the same basic facts which support his failed copyright claim--defendants' alleged unauthorized use of his sound recording in their television program without paying him a royalty or recognizing him in the credits to the program." Id. at 791. As to the unfair competition claim, the District Court found that Agee had failed to plead facts or introduce evidence that his record sales or licensing revenues had been affected by defendants' use of his sound recording. Id.
This appeal followed.
Paramount's duplication and transmission of Agee's sound recording as part of the soundtrack of Hard Copy, and the TV stations' subsequent duplication and transmission of that program to the viewing public, are far removed from the record piracy that prompted Congress to enact legislation protecting sound recording copyright owners. That legislation is in some respects quite limited, denying owners of copyrights in sound recordings certain exclusive rights that are available to music publishers or to owners of copyrights in...
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