Broadcast Music, Inc. v. 84-88 Broadway, Inc., Civil Action No. 94-5470.

• Decision Date: 22 October 1996
• Docket Number: Civil Action No. 94-5470.
• Citation: 942 F.Supp. 225
• Parties: BROADCAST MUSIC, INC., et al., Plaintiffs, v. 84-88 BROADWAY, INC. d/b/a J.P. Anthony's and John A. Schepisi, Defendants.
• Court: U.S. District Court — District of New Jersey

942 F.Supp. 225

BROADCAST MUSIC, INC., et al., Plaintiffs, v. 84-88 BROADWAY, INC. d/b/a J.P. Anthony's and John A. Schepisi, Defendants.

Civil Action No. 94-5470.

United States District Court, D. New Jersey.

October 22, 1996.

Lindsey H. Taylor, Friedman Siegelbaum, Roseland, NJ, for Plaintiffs.

Denise J. Waltuch, Schepisi & McLaughlin, P.A., Englewood Cliffs, NJ, for Defendants.

ORLOFSKY, District Judge:

Plaintiffs and Defendants have filed cross-motions for summary judgment on Plaintiffs' claims for violations of the Copyright Act, 17 U.S.C. §§ 101 et seq. Jurisdiction is proper in this Court pursuant to 28 U.S.C. § 1338(a), which vests a federal district court with original jurisdiction over "any civil action arising under any Act of Congress relating to patents, plant variety protection, copyrights and trade-marks."

The primary issue raised by the parties' cross-motions is whether a sub-licensing agreement entered into between Digital Music Service ("Digital") and Defendant, 84-88 Broadway, Inc. d/b/a J.P. Anthony's ("Anthony's"), to provide background music containing copyrighted compositions vests Anthony's with the right to host live or disc jockey performances of the same copyrighted compositions licensed by Plaintiff, Broadcast Music, Inc. ("BMI"). I conclude that the sublicensing agreement between Anthony's and Digital does not confer such authority upon Anthony's, and therefore find that the live or disc jockey performances at Anthony's of compositions licensed by BMI infringed the Plaintiffs' copyrights.

Accordingly, Plaintiffs' motion for summary judgment will be granted as to Defendant, Anthony's, and Defendants' cross-motion for summary judgment will be denied as to liability. Plaintiffs' motion for summary judgment as to Defendant, John Schepisi, will be denied, because the Plaintiffs have failed to provide the Court with evidence in the summary judgment record that Mr. Schepisi had the right and ability to supervise the infringing activities. Because I find that there is a genuine issue of material fact as to whether the Defendants' infringement was wilful, I will deny both Plaintiffs' and Defendants' motions for summary judgment as to damages, attorney's fees and costs.

I. Facts and Procedural Background

Plaintiff, BMI, is a performing rights society, which, pursuant to separate agreements with copyright holders, purchases all the rights that the copyright holders possess to perform and to license others to perform their copyrighted works. (Schepisi Cert ¶ 6). BMI then licenses the right to perform the copyrighted works to third parties such as Digital. The other Plaintiffs are the original holders of the copyrights in the musical compositions which are the subject of this lawsuit. (Amended Complaint ¶ 4)

In August, 1993, Anthony's, entered into a sub-licensing agreement with Digital (the "Sub-licensing Agreement" or "Agreement"), for the provision of background music via the "Digital Music Service." (Schepisi Cert.Ex. B).¹ Prior to November 30, 1993, BMI learned that Anthony's was offering live and disc jockey performances of musical compositions of copyrighted works, the rights to which BMI had purchased from the individual copyright holders. (Stevens Decl. at 1-2).

BMI did not issue Anthony's a license to offer such live and disc jockey performances, nor had Anthony's obtained permission from the copyright owners whose music was being publicly performed. (Id. at 2). By letters dated, December 3, 1993, December 22, 1993, January 11, 1994, February 9, 1994, May 20, 1994 and July 14, 1994, respectively, BMI advised Anthony's that a license from BMI was required in order for such copyrighted music to be publicly performed. (Id. at 2, Ex. C).

In response, Defendants wrote to BMI on February 9, 1994, stating that "[a]ny fees for music [at J.P. Anthony's] are being paid pursuant to a licensing agreement with [Digital] which is presently servicing the subject premises." (Id. at 2, Ex. C). BMI then informed Defendants that the Sub-licensing Agreement with Digital only granted Defendants the right to broadcast the copyrighted music over the Digital cable system and did not give Defendants the right to host live performances, or the playing of CD's and tapes of copyrighted music licensed by BMI. (Id. at 3; see also Schepisi Cert.Ex. A ¶¶ 14-15).

BMI offered to license directly to the Defendants the right to host live or disc jockey performances of the BMI-licensed copyrighted music, however, Defendants refused to enter into such an agreement, contending that to do so simply would be paying again for that which they already had the right to do. (Stevens Decl. ¶ 4).

In an effort to confirm that Anthony's was, in fact, continuing to host such live performances, BMI sent investigators to Anthony's on May 11, 1994, and May 13, 1994. The BMI investigators observed the performance at Anthony's of at least ten musical compositions licensed by BMI. (Stevens Decl.Exs. A and B).

After Anthony's refused to cease hosting the public performances of the BMI-licensed works, Plaintiffs filed their original complaint in this copyright infringement action on November 23, 1994, alleging that, in at least ten instances, the Defendants, Anthony's and its stockholder and officer, John Schepisi, hosted the public performance of their copyrighted musical compositions without authorization.

Subsequent to the filing of the original complaint, BMI investigators discovered that on February 1, 1995, and February 5, 1995 Anthony's continued to host the public performance of at least seventeen BMI-licensed works. (Stevens Decl.Exs. A and B). As a result, Plaintiffs sought leave to file, and filed an amended complaint on April 25, 1995, incorporating their earlier claims and adding the seventeen additional instances of alleged infringement. (See Amended Complaint).²

Both Plaintiffs and Defendants have cross-moved for summary judgment on Plaintiffs' amended complaint.

II. Summary Judgment Standard

A party seeking summary judgment must "show that there is no genuine issue as to any material fact and that [he or she] is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). See also Orson, Inc. v. Miramax Film Corp., 79 F.3d 1358, 1366 (3d Cir.1996); Hersh v. Allen Products, Co., 789 F.2d 230, 232 (3d Cir.1986); Lang v. New York Life Ins. Co., 721 F.2d 118, 119 (3d Cir.1983). In deciding whether there is a disputed issue of material fact the Court must view all inferences, doubts and issues of credibility in favor of the non-moving party. See Pennsylvania Coal Ass'n v. Babbitt, 63 F.3d 231, 236 (3d Cir.1995); Helen L. v. DiDario, 46 F.3d 325, 329 (3d Cir.), cert. denied, ___ U.S. ___, 116 S.Ct. 64, 133 L.Ed.2d 26 (1995); Hancock Indus. v. Schaeffer, 811 F.2d 225, 231 (3d Cir.1987) (citation omitted); Meyer v. Riegel Prods. Corp., 720 F.2d 303, 307 n. 2 (3d Cir.1983), cert. denied, 465 U.S. 1091, 104 S.Ct. 2144, 79 L.Ed.2d 910 (1984). The threshold inquiry is whether there are "any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986).

Moreover, Federal Rule of Civil Procedure 56(e) provides:

When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but the adverse party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If the adverse party does not so respond, summary judgment, if appropriate, shall be entered against the adverse party.

Fed.R.Civ.P. 56(e).

Under this rule, a party must be awarded summary judgment on all properly supported issues identified in its motion, except for those for which its opponent has provided evidence to show that a question of material fact remains. Put another way, once the moving party has properly supported its motion, "its opponent must do more than simply show that there is some metaphysical doubt as to material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986). A summary judgment movant may meet its burden by showing that the opposing party is unable to meet its burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 2553-54, 91 L.Ed.2d 265 (1986). Nonetheless, the moving party bears the initial responsibility of demonstrating the absence of a genuine issue of material fact. Id.

III. Discussion

In order to prevail on a claim for the infringement of a copyright in a musical composition, a plaintiff must show: (1) originality and authorship of the composition; (2) compliance with the formalities of the Copyright Act; (3) proprietary rights in the work involved; (4) public performance of the composition involved for profit; and (5) lack of authorization for public performance. Broadcast Music, Inc. v. WPBK, Inc., 922 F.Supp. 803, 805 (W.D.N.Y.1996) (citing Boz Scaggs Music v. KND Corp., 491 F.Supp. 908, 912 (D.Conn.1980)); Broadcast Music, Inc. v. 3-B, Inc., No. 95-70499, 1996 WL 426486, *2 (E.D.Mich. Jan. 16, 1996). Plaintiffs must establish each of the five elements in order to succeed on their claim for copyright infringement.

A. Originality, Compliance with Copyright Act and Proprietary Rights

Defendants do not contest that the Plaintiffs are able to establish the first three elements of a copyright infringement claim. (Defendants' Reply at 6). The originality, registration and proprietary interest elements of copyright infringement are satisfied by the uncontroverted facts contained in the Declaration of Judith M. Saffer, Assistant General Counsel of BMI, together with the documents annexed to her declaration. See 3-B, Inc., 1996 WL 426486, *2 (...