Sanchez v. Hacienda Records & Recording Studio, Inc.
| Decision Date | 26 August 2014 |
| Docket Number | Civil Action No. H–11–3855. |
| Citation | 42 F.Supp.3d 845,111 U.S.P.Q.2d 1892 |
| Parties | Adan SANCHEZ, Plaintiff, v. HACIENDA RECORDS AND RECORDING STUDIO, INC., et al., Defendants. |
| Court | U.S. District Court — Southern District of Texas |
David Wesley Showalter, Showalter Law Firm, Richmond, TX, for Plaintiff.
Roland Garcia, Greenberg Traurig LLP, Houston, TX, for Defendants.
This copyright-infringement action is over a song called La Prieta Casada. Adan Sanchez sued Hacienda Records, L.P., Latin American Entertainment LLC, Annie Garcia, Roland Garcia, Sr., and Rick Garcia (together, “Hacienda”),1 alleging that Sanchez owned the song's copyright and that the defendants had recorded and distributed the song without his authorization. (Docket Entry No. 16). Hacienda asserted that it used the song with the rightful copyright owner's permission. Hacienda filed a second summary judgment motion on January 31, 2014, arguing that limitations bars Sanchez's suit. (Docket Entry No. 83). Sanchez responded, Hacienda replied, and Sanchez surreplied. (Docket Entry Nos. 88, 89, 99). Based on the pleadings, the motion and response, the briefs, the summary judgment evidence, and the applicable law, this court grants Hacienda's motion for summary judgment. By September 8, 2014, the parties must file either a statement identifying any issues that remain to be resolved or a proposed form of final judgment.
The reasons for this ruling are explained below.
The factual background is set out in the February 11, 2013 Memorandum and Opinion, (Docket Entry No. 49), and only briefly summarized below. Hacienda is an independent music-recording studio located in Corpus Christi, Texas. The studio opened in 1979, specializing in Tejano music for a predominately Mexican–American audience. It is a family-run business, owned and operated by Annie Garcia, her husband Rick, and Rick's brother, Roland Sr. (See Docket Entry No. 28, Ex. M ¶¶ 1–2). Jedasa is a music publisher initially owned by Johnny Herrera and later by Leonardo Quiroz.
Adan Sanchez, the plaintiff, is a Tejano musician. He has a grade-school education and cannot read, write, or speak English. (Docket Entry No. 41, Ex. E at 11–13, 42). He claims that he composed La Prieta Casada, a Tejano love song, in the 1970s. (Id. at 114). Numerous artists over the years have recorded La Prieta Casada. Hacienda recorded and distributed some of these recordings. (E.g., Docket Entry No. 28, Ex. I). This lawsuit concerns Hacienda's recordings.
La Prieta Casada has been the subject of multiple and inconsistent copyright registrations since 1976. A 1976 copyright registration shows Sanchez as La Prieta Casada' s author. This 1976 registration identifies the publisher and copyright holder as Jedasa Publishing Co. and its owner, Johnny Herrera. (Docket Entry No. 41, Ex. U at 19; Docket Entry No. 31, Ex. B at 3). Another copyright registration, from 1984, shows San Antonio Music Publishers2 as the copyright owner. (Docket Entry No. 41, Ex. N at 1; Docket Entry No. 31, Ex. B at 6). A notarized 1990 document bearing what purports to be Sanchez's signature states that he acknowledges Herrera as the sole publisher and copyright holder of La Prieta Casada. (Docket Entry No. 41, Ex. K). Yet another copyright registration from 1994 shows Sanchez as the copyright owner. (Docket Entry No. 31, Ex. B at 8). A 2004 registration renewal lists Adan Sanchez as the renewal copyright claimant and Jedasa as the original copyright owner. (Id., Ex. at 10).
Herrera died in 2003, and Leonardo Quiroz took over Jedasa. (Docket Entry No. 28, Ex. M ¶ 12). In 2010, Quiroz, acting on Jedasa's behalf, assigned Sanchez any interests Jedasa might have in various songs, including La Prieta Casada. The assignment agreement stated:
This assignment also includes and covers any and all claims, damages and causes of action by or against any party which in any way relate to or arise from the [songs], as well as the right to file suit, make claims and settle same on any terms Assignee deems advisable.
(Docket Entry No. 28, Ex. K at 1). The agreement was backdated to 2000. (Id. ). Sanchez paid Jedasa $5,000.00. (Id., Ex. K at 5).
In October 2011, David Showalter, Sanchez's attorney, wrote Hacienda a letter demanding that it immediately stop unlicensed uses of all the songs that the assignment agreement covered, including La Prieta Casada. (Docket Entry No. 28, Ex. J). The letter also demanded that Hacienda account to Sanchez for royalties for unlicensed uses and purported to revoke any previous permission that may have been given to use the song.
Hacienda responded to Showalter's letter. (Docket Entry No. 28, Ex. L at 2). The response admitted that Hacienda had produced recordings of La Prieta Casada, but disputed whether Sanchez held the copyright for the song. Hacienda also cited various music-industry sources it described as listing people other than Sanchez as owning the song's copyright. Hacienda pointed to the website of the “Sociedad De Autores y Compositores de Mexico,” which appears to be an entity that manages Mexican copyrights, showing Juan Villareal as the composer of La Prieta Casada. The website also features other artists crediting Villareal as the song's composer. (Id. ). Hacienda nevertheless sent Sanchez a check in the amount of $227.50 for royalties for recent uses of La Prieta Casada, “in a spirit of good will, time efficiency and an effort to do the right thing.” (Id. ).3 This lawsuit followed.
As the multiple copyright registrations reflect, the ownership history of La Prieta Casada makes identifying the owner difficult. This is the second lawsuit involving this song. In June 1995, Sanchez sued Herrera and Jedasa in the United States District Court for the Southern District of Texas, Corpus Christi Division, alleging that Herrera did not own the rights to La Prieta Casada and was not authorized to register the copyright on behalf of himself or Jedasa. (See Docket Entry No. 41, Ex. B, Sanchez v. Herrera, No. 2:95–cv–00245, Joint Pretrial Order). That lawsuit settled before trial or dispositive ruling. The settlement terms are unclear. In one document purporting to be a settlement agreement, Herrera and Sanchez agreed to an equal division of any royalties from La Prieta Casada. (Id., Ex. E–7 at 4). This “Wrap Around Agreement” included a provision that Herrera would “remove his name as author of the Song, ‘La Prieta Casada,’ at the BMI registry,” and that Herrera and Sanchez would “execute whatever documents [are] necessary in order to perfect filings or clarify their 50/50 ownership of the songs [sic] proceeds to third parties.” (Id. ). This agreement shows Herrera's signature, but the signature line for Sanchez is blank. (Id. ).
In his deposition in the present lawsuit, Sanchez tried to explain La Prieta Casada' s ownership history. As he apparently did in the 1995 lawsuit, Sanchez took the position that Herrera had tricked or misled him into allowing the 1976 copyright to be registered in Herrera's name. (See id., Ex. E, at 27–29). Sanchez thought that the 1984 registration by San Antonio Music was a formality needed only to collect some song royalties in Mexico. (Id. at 143–45). Sanchez denied having authorized San Antonio Music to file a copyright in its name for La Prieta Casada. (Id. at 30). Sanchez recalled having seen the 1990 document that purported to recognize Herrera's exclusive rights to La Prieta Casada. According to Sanchez, Herrera had prepared the document but Sanchez had refused to sign it. Although the document bears what purports to be his signature, Sanchez testified that the signature was not his. (Id. at 87–104). The document is, however, notarized, and the notary submitted an affidavit stating that the signature was executed by a person claiming to be Adan Sanchez and carrying photo identification. (Id., Ex. L).
Sanchez testified in his deposition that the 1994 registration was an attempt to end the dispute and establish, once and for all, that he owned the La Prieta Casada copyright. (See Docket Entry No. 41, Ex. E at 149–53, 161–62). He denied agreeing to divide ownership of certain songs with Jedasa to settle the 1995 lawsuit. (Id., Ex. E at 107–08). Sanchez also denied that the 2010 agreement showed that Quiroz, Herrera, or Jedasa ever had an ownership interest in La Prieta Casada. Rather, Sanchez testified that he had always been the true copyright owner and the agreement merely showed that Jedasa was abandoning any contrary claims. (Id., Ex. E at 163–64). Sanchez did not know or explain why the agreement was backdated to 2000. (Id., Ex. E at 123–24).
Hacienda argues in response that it is not liable for copyright infringement because it recorded La Prieta Casada under either express written licenses or a general negotiated implied license. Hacienda asserts that when it opened in 1978, Herrera approached Rick Garcia with an offer for Hacienda to use Jedasa's entire music catalog, including La Prieta Casada. In exchange, Hacienda would provide Herrera with records to sell in his music shop. Hacienda described this agreement as a broad “negotiated implied license.” (Docket Entry No. 28, Ex. M ¶ 5).
The record evidence does not include any writing in which Herrera or Jedasa granted Hacienda a license to use Jedasa's entire catalog. The record does include some documents appearing to be express licenses from Jedasa granting Hacienda the right to distribute recordings of La Prieta Casada by certain artists. (Docket Entry No. 18, Ex. A, pt. 1; Docket Entry No. 28, Ex. I at 3). These licenses name Sanchez as the song's author, not the copyright holder. Hacienda claims that these express licenses cover some of the recordings it made of La Prieta Casada, but not all. As to those recordings for which there is no specific written license from Jedasa, Hacienda explained that its business dealings with Jedasa were often informal and...
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