Polygram Intern. Pub., Inc. v. Nevada/TIG, Inc., Civ. A. No. 92-10785-REK.

• Decision Date: 20 June 1994
• Docket Number: Civ. A. No. 92-10785-REK.
• Citation: 855 F. Supp. 1314
• Parties: POLYGRAM INTERNATIONAL PUBLISHING, INC., Yellow Brick Road Music, Aerostation Corp., MCA, Inc., Bourne Co., Williamson Music, Inc., Cy Coleman, Jobete Music Co., Inc., Brockman Enterprises, Inc., Fourth Floor Music, Inc., Hudmar Publishing Co., Inc., Cowbella Music, Bleu Disque Music Co., Inc., WB Music Corp., and Webo Girl Publishing, Inc., Plaintiffs v. NEVADA/TIG, INC., f/k/a Interface Group, Inc., Interface Group-Massachusetts, Inc., and Interface Group-Nevada, Inc., Defendants and Third Party Plaintiffs v. McGRAW-HILL, INC., Third Party Defendant.
• Court: U.S. District Court — District of Massachusetts

855 F. Supp. 1314

POLYGRAM INTERNATIONAL PUBLISHING, INC., Yellow Brick Road Music, Aerostation Corp., MCA, Inc., Bourne Co., Williamson Music, Inc., Cy Coleman, Jobete Music Co., Inc., Brockman Enterprises, Inc., Fourth Floor Music, Inc., Hudmar Publishing Co., Inc., Cowbella Music, Bleu Disque Music Co., Inc., WB Music Corp., and Webo Girl Publishing, Inc., Plaintiffs v. NEVADA/TIG, INC., f/k/a Interface Group, Inc., Interface Group-Massachusetts, Inc., and Interface Group-Nevada, Inc., Defendants and Third Party Plaintiffs v. McGRAW-HILL, INC., Third Party Defendant.

Civ. A. No. 92-10785-REK.

United States District Court, D. Massachusetts.

June 20, 1994.

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COPYRIGHT MATERIAL OMITTED

Stephen S. Young, Sherburne, Powers & Needham, Boston, MA, for plaintiffs.

Franklin H. Levy, Abrams, Roberts, Klickstein & Levy, Boston, MA, for defendants and third party plaintiffs.

Michael J. Liston, Glass, Seigle & Liston, Boston, MA, for third party defendant.

OPINION

KEETON, District Judge.

This is a civil action for copyright infringement. Jurisdiction is based on 28 U.S.C. § 1338(a). Plaintiffs are members of the American Society of Composers, Authors, and Publishers (ASCAP) and are the copyright holders of ten songs played by various exhibitors and entertainers at a computer trade show and awards ceremony. Defendants organized the trade show and co-sponsored the awards ceremony. Plaintiffs seek to hold defendants liable under the federal Copyright Act, 17 U.S.C. § 101 et. seq., for ten counts of copyright infringement based on performances of copyrighted music by the exhibitors and entertainers.

The contentions of the parties raise two questions of first impression in this Circuit: first, whether a trade show organizer is liable, either vicariously or as a contributory infringer, for the copyright violations of its exhibitors and entertainers; second, whether the defendant in a copyright action can recover either contribution or indemnity from a third-party defendant. The disposition of the case, however, turns on the determination of the required elements of a prima facie case of copyright infringement.

For the reasons stated below, I conclude that plaintiffs have failed to establish a prima facie case of copyright infringement and that judgment for the defendants must enter. Because I have had to decide reasonably disputable legal issues, however, and a higher court might decide them differently, this Opinion, to facilitate final disposition, also addresses other issues bearing on liability and damages.

I. Procedural History

Early in the history of this case, the parties filed cross-motions for summary judgment. As a matter of prudential case management, it is my practice to discourage such motions and to encourage, in their stead, a trial on stipulated facts of the potentially dispositive issues that are the subject of one or both of the proposed cross-motions. This practice often results in a more efficient use of judicial resources because it allows the court to decide the case in one proceeding even if concluding that the stipulated historical facts leave undecided some evaluative adjudicative fact that must be resolved by a finding of "fact" rather than decision "as a matter of law." See, e.g., Continental Grain v. Puerto Rico Maritime Shipping, 972 F.2d 426, 429 n. 7 (1st Cir.1992) (commending to district courts the use of this procedural alternative to cross-motions for summary judgment); see also Buirkle v. Hanover Ins. Companies, 832 F.Supp. 469, 471-72 (D.Mass.1993).

The parties were receptive to the court's suggestion of a trial, and on February 9, 1994, the parties appeared before the court for a one-day, non-jury trial. Affidavits, deposition transcripts, an exhibit book, stipulations, and proposed findings were received in evidence. See Transcript, Docket No. 63. The American Society of Association Executives earlier filed a brief amicus curiae (Docket No. 16).

During the trial, each party made objections to parts of the evidence offered by the party's opponents. Some of the evidence was received for limited purposes only; other objections were reserved. As to the reserved objections, I find, as fact-finder, that fully weighing the challenged evidence would not lead me to make findings different in any way from those recited in this Opinion. The objections are therefore moot.

II. Findings of Historical Fact

Defendant Nevada/TIG, Inc. was dismissed from this case by stipulation (Docket No. 21). The two remaining defendants, Interface Group-Massachusetts, Inc. and Interface Group-Nevada, Inc. (collectively "Interface") organize and promote major conventions and trade shows, including the world's largest trade show for the computer industry, "COMDEX/Fall."

The plaintiffs are members of the American Society of Composers, Authors, and Publishers (ASCAP), and have granted to ASCAP the non-exclusive right to license public performances of their copyrighted musical compositions. ASCAP functions as a clearinghouse that takes in license fees from those who wish to perform or authorize performances of copyrighted material and then distributes these fees, after deducting operating costs, to its more than 50,000 members. ASCAP also prepares and conducts copyright infringement litigation on behalf of its members to enforce their copyrights. ASCAP's royalty distributions are the single largest source of income for most composer and songwriter members.

Almost two years before the COMDEX/Fall show, ASCAP communicated with Interface in the hope of entering into a license agreement that would authorize performances of any of the copyrighted music in the ASCAP repertory at Interface's trade shows. ASCAP has licensed other trade show organizers, but despite repeated offers by ASCAP, Interface did not obtain a similar trade show license, which would have cost about $4,000 for the COMDEX/Fall show. Interface states that it believed no license was necessary for the COMDEX/Fall show because Interface itself did not intend to perform any music.

The COMDEX/Fall show was held in October, 1991, in Las Vegas. The show occupied over 2.5 million square feet in seven separate convention centers and hotels. Over 2,000 exhibitors rented space from Interface for exhibition booths from which they could display their wares. Exhibitors were responsible for the content of their booths, but they were required to abide by the general Rules and Regulations established by Interface. Rule 1 of these Rules and Regulations forbids exhibitors from using music at a volume that might intrude upon adjacent exhibit areas, and advises exhibitors that it is their responsibility to obtain proper copyright licenses from ASCAP or other licensing authorities for any music played.

During the five days of the show, about 132,000 persons attended. Two of these attendees were investigators for ASCAP, who overheard copyrighted music of the plaintiffs being performed at five exhibition booths. Specifically, the investigators heard the following copyrighted songs: "Man in the Mirror" and "ABC" (Proton booth), "Three Times a Lady" and "Third Rate Romance" (Televideo booth), "Africa" (LSI booth), "Into the Groove" (Neotec booth) and "Into the Groove" (Darius booth).

The investigators also attended the "Best of COMDEX" awards ceremony, which was co-sponsored by Interface and BYTE magazine, a McGraw-Hill publication. The awards ceremony was held in the Hilton hotel, in a ballroom leased by the Interface group. According to the written agreement between Interface and BYTE, Interface was responsible for promoting the ceremony to the public and press and for supplying "all audio/visual needs" for the ceremony; BYTE was responsible for the content of the ceremony.

The top prizes at the awards ceremony were called "Shellys" in honor of Interface president Sheldon Adelson. Advertising for the event compared "Shellys" to the "Oscars" of the film industry and invited the show attendees to a "Gala Award Ceremony" in the Las Vegas Hilton Showroom.

At the awards ceremony, the ASCAP investigators heard a disc jockey and a band, the "Jazz Barons," perform the following songs: "The Way You Look Tonight," "I'll Take Romance," "Hey, Look Me Over," and "Strike Up The Band." Plaintiffs own the copyright on each of these songs.

No party offered any evidence at trial on how the disc jockey came to be performing at the awards ceremony. The band was obtained by the Public Relations Manager of BYTE Magazine, Dawn Mathews, through the Las Vegas Hilton Hotel. The requisition form for the band states that the Hilton "is acting as the agent for the Convention in booking the entertainment services."

Interface derived its profit from COMDEX/Fall from three sources: booth rentals at $35.95 per square foot, admission fee charges of $75 per person for attendees, and advertising revenues. Gross revenues from these three sources at COMDEX/Fall exceeded $44 million. Interface did not earn any revenue directly from any business activity generated at exhibitors' booths, or from the Best of Comdex awards.

III. The Prima Facie Case

A. The Legal Background

The federal Copyright Act grants to the owners of copyrights in musical works the exclusive right, with express limitations, to perform or to authorize public performances of the work. 17 U.S.C. § 106(4). Anyone who violates the exclusive rights of the copyright holder is an infringer, for whose acts the copyright holder may seek actual or statutory damages, id. § 504(a), injunctive relief, id. § 502(a), and reimbursement of the costs of suit, including a reasonable attorney's fee, id. § 505.

The purpose of the Copyright Act is to protect the interests of composers and authors by granting them a limited, legal monopoly over the publication and performance of their artistic works. See Sony Corp. v. Universal City Studios, Inc., 464 U.S. 417, 429, 104 S.Ct. 774, 782, 78 L.Ed.2d 574 (1984); Herbert v....