Jondora Music Pub. Co. v. Melody Recordings, Inc.

• Decision Date: 27 December 1974
• Docket Number: No. 74-1241,74-1241
• Parties: JONDORA MUSIC PUBLISHING COMPANY et al., Plaintiffs-Appellants, v. MELODY RECORDINGS, INC., et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Third Circuit

Page 392

506 F.2d 392

184 U.S.P.Q. 326

JONDORA MUSIC PUBLISHING COMPANY et al., Plaintiffs-Appellants, v. MELODY RECORDINGS, INC., et al., Defendants-Appellees.

No. 74-1241.

United States Court of Appeals, Third Circuit.

Argued Oct. 25, 1974.

Decided Dec. 27, 1974, As Amended Jan. 16, 23, 1975.

Sidney S. Rosdeitcher, Steven B. Rosenfeld, New York City, C. Stephen Barrett, III, Newark, N.J., for plaintiffs-appellants; Daniel J. Kornstein, Paul, Weiss, Rifkind, Wharton & Garrison, New York City, Lum, Biunno & Tompkins, Newark, N.J., of counsel.

Sheldon A. Weiss, Glauberman & Weiss, Jersey City, N.J., for appellees U.S. Tape, Inc. and George Tucker.

Hellring, Lindeman & Landau, Newark, N.J., for appellees National Cinematape, Inc., American Cartridge Recording, a division of National Communications Arts, Inc., Alexander Magosci, Jr., Davidow Gellert, Inc., Telecor Industries, Inc., Harold Davidow, Charles Gellert, Grandy, Inc., John French, Audiotape, Inc., Elias Saka, Sunshine Music Corp., Incentives, Inc., Byron Hawley, American Copyright Research, Inc., and Joseph Barone; Joel D. Siegal, Newark, N.J., of counsel; Joshua A. Kalkstein, Newark, N.J., on the brief.

Appeal from the United States District Court for the District of New Jersey (D.C. No. Civil 1741-72).

Before KALODNER, GIBBONS and WEIS, Circuit Judges.

OPINION OF THE COURT

WEIS, Circuit Judge.

To a schoolboy, 'piracy' may mean swashbuckling adventure, lumbering merchantmen, booty, and the Jolly Roger. To a musical composer or a record manufacturer, however, piracy means not doubloons, but dollars, not cutlasses, but cut-rate losses, not the creaking of a ship under way, but the almost imperceptible hum of a reel-to-reel tape, and certainly no jollity about unauthorized copies of a musical work. We conclude here that a composer is not defenseless but, using the guns of the Copyright Act, can force the pirate to heave to in response to an injunctive shot across the bow.

The plaintiffs are publishers who own the copyrights for a number of musical compositions ¹ and thus stand in the shoes of the composers of the musical works. The defendants manufacture and sell sound-tape duplications of popular phonograph records. ²

Suit was brought in the district court on the allegation that the defendants had infringed the rights granted to the composers by the Copyright Act, 17 U.S.C. 1 et seq. The district court denied relief, holding that the compulsory license provision, 17 U.S.C. 1(e), serves to insulate the defendants from liability. ³

This particular provision of the Copyright Act was passed by Congress in 1909 after the Supreme Court in White-Smith Music Publishing Co. v. Apollo Co., 209 U.S. 1, 28 S.Ct. 319, 52 L.Ed. 655 (1908), had decided that a composer could not copyright a perforated piano roll of his musical work. Although it desired to give protection to the composer, Congress wished to avoid granting a monopoly to a certain company which then held a dominant position in the piano roll manufacturing field. The problem was solved by a legislative compromise which granted the composer protection from unauthorized recording of an unreleased work. If, however, the composer chose to license one manufacturer to make mechanical reproductions, ⁴ others would be allowed to record the composition upon payment of a specified royalty. The pertinent provision of the statute reads:

'. . . And as a condition of extending the copyright control to such mechanical reproductions, that whenever the owner of a musical copyright has used or permitted or knowingly acquiesced in the use of the copyrighted work upon the parts of instruments serving to reproduce mechanically the musical work, any other person may make similar use of the copyrighted work upon the payment to the copyright proprietor of a royalty of 2 cents on each such part manufactured, to be paid by the manufacturer thereof; . . .' 17 U.S.C. 1(e).

The composer is thus given the right to select the licensee who will originally produce a record of the musical work, but thereafter any other manufacturer can also record the composition pursuant to this compulsory licensing provision. The effect of the statute is to impose three obligations upon those other than the original manufacturer:

1. To pay a royalty of two cents per record; 2. To file a notice of intent to use; and 3. To make a 'similar use of the copyrighted work.'

The phrase, 'similar use of the copyrighted work,' is the essence of this case.

There has been surprisingly little litigation on the meaning of the phrase, and the few appellate cases interpreting it in terms of the rights of the composer have occurred within recent years.

The first case to construe the language of the amendment of 1909 was Aeolian Co. v. Royal Music Roll Co., 196 F. 926 (W.D.N.Y.1912). The district court there said of 'similar use:'

'. . . but the subsequent user does not thereby secure the right to copy the perforated rolls or records. He cannot avail himself of the skill and labor of the original manufacturer of the perforated roll or record by copying or duplicating the same, but must resort to the copyrighted composition or sheet music, and not pirate the work of a competitor who has made an original perforated roll.' 196 F. at 927.

This case has been criticized for the result it reached, and the strength of the interpretation consequently has been questioned. ⁵

In the years following the Aeolian case, most of the writers in the field were preoccupied with the problem of copyright for the physical recording itself. ⁶ Until Congress recently provided otherwise, it was generally conceded that a record as such could not be copyrighted. See Capitol Records v. Mercury Records Corp., 221 F.2d 657 (2d Cir. 1955); Ringer, The Unauthorized Duplication of Sound Recordings, supra. Hence, the efforts of performers and manufacturers to secure relief from record piracy were unavailing under the Copyright Act, and debate continued on the desirability of extending protection to recordings, per se.

Within the past few years, however, record 'pirates' or 'duplicators,' ⁷ were confronted by direct challenges of the composers. ⁸

In Duchess Music Corp. v. Stern, 458 F.2d 1305 (9th Cir.), cert. denied, 409 U.S. 847, 93 S.Ct. 52, 34 L.Ed.2d 88 (1972), and Edward B. Marks Music Corp. v. Colorado Magnetics, Inc., 497 F.2d 285 (10th Cir. 1974), aff'd on rehearing in banc, cert. denied, U.S. , 95 S.Ct. 801, 42 L.Ed.2d 819, (No. 73-2006, Jan. 20, 1975), the Courts of Appeals held for the composers, though not without some voices of dissent. In both instances the majorities held that 'similar use' under the compulsory license provision did not apply to those who made duplicates from authorized recordings.

The Duchess court reviewed the legislative history of the 1909 amendment and gave favorable consideration to the language interpretation of Aeolian Co. v. Royal Music Roll Co., supra. The Court of Appeals for the Tenth Circuit, in discussing the phrase, 'any other person may make similar use of the copyrighted work,' said:

'This means, to us, that one who complies with royalty payment called for by the statute, though not having any authorization from the copyright owner, may nonetheless then 'use,' not a third party's record, but the copyrighted composition, which has been characterized as the 'raw material,' in a manner 'similar' to that employed by the recording company which did have authorization from the copyright owner . . . Under the statute (defendants) . . . may 'use' the copyrighted composition in a manner 'similar' to that made by the licensed recording company . . . It does not mean that (defendants) . . . may use the composer's copyrighted work by duplicating and copying the record of a licensed recording company. Such, in our view, is not a similar use.' ⁹ 497 F.2d at 288.

We agree with this interpretation of the statute but feel even more strongly that the duplicators or pirates do not 'use' the composer's work in a 'similar' fashion-- indeed, they do not utilize the composer's work at all. It is a recording which is used. Rather than permit the use of a recording of the composition, the statute only authorizes the use of the copyrighted work, that is, the written score.

The use to which the original licensee put the composer's work, i.e., the musical score, was much more elaborate, involving as it did the preparation of an arrangement from the written composition and its performance by musicians and vocalists. The mere duplication of a recording by the pirate is not the same as, or 'similar' to, the efforts made by the original licensee in utilizing the characters on a piece of paper as the basic plan for producing harmonious sounds. ¹⁰

The copyright law is enacted for the benefit of the composer in accordance with the constitutional grant of Art. I, 8, cl. 8:

'The Congress shall have Power . . . 'To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.'

The amendment of 1909 was intended to protect the creative efforts of the composer, and the compulsory license provision was inserted, not in an effort to penalize him, but to prevent monopolization by manufacturers. The statute should be interpreted in that spirit.

The interest of the composer may be adversely affected by the pirating of licensed recordings. The decision by a manufacturer to make a recording of a musical work necessarily involves consideration of the expense in obtaining outstanding performers and arrangers, as well as the initial cost of the master recording. These factors must be balanced against the anticipated number of copies to be sold. Generally, the life of a popular song recording is a short one. If a record producer can arrange for the happy combination of an outstanding performer and an exceptional song, he will be able to sell enough records to make...