Dawson v. Hinshaw Music Inc.

• Decision Date: 07 June 1990
• Docket Number: No. 89-2643,89-2643
• Citation: 905 F.2d 731
• Parties: , 1990 Copr.L.Dec. P 26,590, 15 U.S.P.Q.2d 1132 William L. DAWSON, Plaintiff-Appellant, v. HINSHAW MUSIC INC.; Gilbert M. Martin, Defendants-Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 731

905 F.2d 731

59 USLW 2026, 1990 Copr.L.Dec. P 26,590,

15 U.S.P.Q.2d 1132

William L. DAWSON, Plaintiff-Appellant, v. HINSHAW MUSIC INC.; Gilbert M. Martin, Defendants-Appellees.

No. 89-2643.

United States Court of Appeals, Fourth Circuit.

Argued Dec. 5, 1989.

Decided June 7, 1990.

Marvin William Krasilovsky, Feinman & Krasilovsky, P.C. (argued), New York City, Philip C. Baxa, Mays and Valentine, on the brief, Richmond, Va., for plaintiff-appellant.

Robert Allen Monath, Lewis & Anderson, P.C. (argued), Chapel Hill, N.C., Susan H. Lewis, Lewis & Anderson, P.C., Chapel Hill, N.C., Marion G. Follin, III, Smith, Patterson, Follin, Curtis, James & Harkavy, Greensboro, N.C., on the brief, for defendants-appellees.

Before ERVIN, Chief Judge, and MURNAGHAN and WILKINS, Circuit Judges.

MURNAGHAN, Circuit Judge:

I

William L. Dawson possesses a valid copyright of an arrangement of the spiritual "Ezekiel Saw De Wheel." Dawson, over the years, has sold many copies of his arrangement. In 1980, Gilbert M. Martin composed an arrangement of the spiritual. That same year, Martin granted Hinshaw Music, Inc. ("Hinshaw"), the exclusive rights to publish, distribute, and sell his arrangement. Martin agreed to indemnify Hinshaw for any loss resulting from infringement of copyright. Dawson brought suit against Hinshaw and Martin, alleging copyright infringement under 17 U.S.C. Secs. 501 et seq. After a bench trial, the district court held for the defendants.

The district court began its analysis by correctly noting that, because of the difficulties in proving copyright infringement by direct evidence, the law has established a burden shifting mechanism whereby plaintiffs can establish a prima facie case of infringement by showing possession of a valid copyright, the defendant's access to the plaintiff's work, and substantial similarity between the plaintiff's and defendant's works. See Concrete Machinery Co. v. Classic Lawn Ornaments, Inc., 843 F.2d 600, 606 (1st Cir.1988); Whelan Associates v. Jaslow Dental Laboratory, 797 F.2d 1222, 1232 (3d Cir.1986); Walker v. Time Life Films, 784 F.2d 44, 48 (2d Cir.1986); Litchfield v. Spielberg, 736 F.2d 1352, 1355 (9th Cir.1984); Original Appalachian Artworks v. Toy Loft, 684 F.2d 821, 829 (11th Cir.1982); Atari, Inc. v. North American, 672 F.2d 607, 614 (7th Cir.), cert. denied, 459 U.S. 880, 103 S.Ct. 176, 74 L.Ed.2d 145 (1982). The district court found that Dawson successfully established (a) the validity of his copyright and (b) Martin's access to his arrangement. What remained for Dawson was the establishment of the substantial similarity between the two works.

As correctly noted by the district court, there are two prongs to the substantial similarity inquiry. The plaintiff must establish substantial similarity of both the ideas of the two works and of the expression of those ideas. ¹ See, e.g., Litchfield 736 F.2d at 1356. It is well established that expert testimony is admissible for proof under the first prong which courts have referred to as an "extrinsic" or "objective" inquiry. See id. The district court accordingly admitted expert testimony on Dawson's proof that the idea of Martin's work was substantially similar to the idea of Dawson's work. The court concluded that "the pattern, theme and organization of [Dawson's] arrangement is unique among any other arrangement of this spiritual." The court further found that "there are substantial similarities between [Dawson's] and [Martin's] arrangements regarding this unique pattern." The district court therefore found for Dawson on the first prong of the substantial similarity inquiry. Thus, if Dawson could satisfy the second prong of the substantial similarity test, he would have made out a prima facie case of copyright infringement.

However, the district court ruled against Dawson on the second prong of the substantial similarity inquiry, holding that Dawson had not shown that the expression of ideas in Martin's work was substantially similar to the expression of ideas in Dawson's work. The court applied what has come to be known as the ordinary observer test, sometimes referred to as an "intrinsic" or "subjective" test, inquiring into the "total concept and feel" of the works without the aid of expert testimony. See, e.g., Litchfield, 736 F.2d at 1356; Concrete Machinery, 843 F.2d at 608. More specifically, the court interpreted the ordinary observer test to be an ordinary lay observer test, which imposed upon Dawson the obligation to prove to a lay observer that the expression of ideas in the works was substantially similar. Other than the expert testimony used in evaluating the extrinsic similarity of the two works, the only evidence on substantial similarity was the sheet music of the two arrangements. Dawson had not presented recordings of performances of the two arrangements. The district court found that, as an ordinary lay observer, with nothing before him other than the sheet music, he could not determine that the two works were substantially similar. It is the district court's holding as to the second prong of the substantial similarity test that we now examine.

II

We direct our attention to the district court's characterization of the ordinary observer test as an ordinary lay observer test. We are well aware of the existence of that characterization in the case law. However, as demonstrated below, obedience to the undisputed principles of copyright law and the policy underlying the ordinary observer test requires a recognition of the limits of the ordinary lay observer characterization of the ordinary observer test. Those principles require orientation of the ordinary observer test to the works' intended audience, permitting an ordinary lay observer characterization of the test only where the lay public fairly represents the works' intended audience.

A

Arnstein v. Porter, 154 F.2d 464 (2d Cir.1946), provides the source of modern theory regarding the ordinary observer test. Arnstein involved the alleged infringement of a popular musical composition. Writing for the panel, Judge Jerome Frank first explained that "the plaintiff's legally protected interest is not, as such, his reputation as a musician but his interest in the potential financial returns from his compositions which derive from the lay public's approbation." Id. at 473. This initial observation gave force to the recognized purpose of the copyright laws of providing creators with a financial incentive to create for the ultimate benefit of the public. See Mazer v. Stein, 347 U.S. 201, 219, 74 S.Ct. 460, 471, 98 L.Ed. 630 (1954) ("The economic philosophy behind the clause empowering Congress to grant patents and copyrights is the conviction that encouragement of individual effort by personal gain is the best way to advance public welfare through the talents of authors and inventors in 'Science and the useful Arts.' Sacrificial days devoted to such creative activities deserve rewards commensurate with the services rendered."); see also Note, The Role of the Expert Witness in Music Copyright Infringement Cases, 57 Fordham L.Rev. 127, 132 (1988) [hereinafter Role of the Expert Witness ] ("Under Arnstein, an action for infringement of a music copyright serves to compensate the plaintiff for the deprivation of potential financial returns that results from the defendant's copying"); Note, Copyright Infringement Actions: The Proper Role for Audience Reactions in Determining Substantial Similarity, 54 S.Cal.L.Rev. 385, 392 (1981) [hereinafter Role for Audience Reactions ] ("[C]opyright protection does not exist for the gratification of the artist's ego; it exists for the gratification of the artist's pocketbook.").

Consistent with its economic incentive view of copyright law, the Arnstein court concluded that "the question, therefore, is whether defendant took from plaintiff's works so much of what is pleasing to the ears of lay listeners, who comprise the audience for whom such popular music is composed, that defendant wrongfully appropriated something which belongs to plaintiff." 154 F.2d at 473 (emphasis added). Thus, under Arnstein, a court should look to the reaction of "lay listeners," because they comprise the audience of the plaintiff's work. The lay listener's reaction is relevant because it gauges the effect of the defendant's work on the plaintiff's market. See Note, Defining the Scope of Copyright Protection for Computer Software, 38 Stan.L.Rev. 497, 514 (1986) ("The total concept and feel of ordinary literary works is relevant because it is the basis on which potential purchasers of the work identify and choose them. If one work appears similar to another in the eyes of the ordinary lay observer, it is likely to appear the same to most consumers, and its adverse effect on demand for the protected work is cause to proscribe it."); see also Role for Audience Reactions at 393 ("it is the actual audience, and not some obscure notion of an average reasonable person, that provides the artist with the economic incentive to create").

Although Arnstein established a sound foundation for the appeal to audience reaction, its reference to "lay listeners" may have fostered the development of a rule that has come to be stated too broadly. Under the facts before it, with a popular composition at issue, the Arnstein court appropriately perceived "lay listeners" and the works' "audience" to be the same. However, under Arnstein 's sound logic, the lay listeners are relevant only because they comprise the relevant audience. Although Arnstein does not address the question directly, we read the case's logic to require that where the intended audience is significantly more specialized than the pool of lay listeners, the reaction of the intended audience would be the relevant inquiry. In light of the copyright law's purpose of protecting a creator's market, we think it sensible to embrace Arnstein 's command that the ultimate comparison of the works at...