Judge Rules Against Sirius XM On Pre-1972 Recordings

from the this-could-be-quite-a-mess dept

Wed, Sep 24th 2014 3:48am — Mike Masnick

Last year, we wrote about the growing list of lawsuits against Sirius XM concerning the legal rights over pre-1972 recordings. As we've discussed, pre-1972 sound recordings are not under federal copyright law (for historical reasons too convoluted to go into now), but are covered under a hodgepodge of messy state copyright laws. Historically, those state laws have been focused on reproduction and distribution and not public performance. Furthermore, terrestrial radio stations have always been allowed to broadcast music without paying performance royalties (though they do pay songwriters/publishers). Post-1972 recordings can be streamed at statutory rates for non-interactive streaming (interactive streaming is a whole different game). It's a bit of a mess, but based on all of this Sirius XM (and Pandora and others) felt fairly confident that they did not have to separately license public performance rights for pre-1972 recordings. There had been no issue about this at all, until the lawsuits started flooding in last year.

And, in a ruling this week, the judge has... ruled against Sirius XM in a manner that may force Sirius and Pandora to eventually have to pay out big. This lawsuit was the first one against Sirius, filed by Flo & Eddie, claiming that their California state copyrights were violated. The court basically found that, because California copyright law says that the copyright holder has "exclusive ownership" of the copyright, that includes public performance rights, despite no further explanation in the law designating that as an exclusive right under California's copyright.

In short, the judge takes a very expansive "property rights" view of the situation, and assumes that California's copyright law basically restricts everything.

Commonly, to have “exclusive ownership” in something is to possess and control it and to not share that right to possess and control with others. See THE AMERICAN HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE 619, 1260 (Houghton Mifflin Harcourt, 5th ed. 2011) (defining “exclusive” and “ownership”). The California legislature defines “ownership” generally in the Civil Code in a manner consistent with the word’s usual and ordinary meaning—“the right of one or more persons to possess and use [a thing] to the exclusion of others.” Cal. Civ. Code § 654. Thus, at base, Flo & Eddie has the right to possess and use its sound recordings and prevent others from possessing and using them. The plain meaning of having “exclusive ownership” in a sound recording is having the right to use and possess the recording to the exclusion of others. There is nothing in that phrase to suggest that the legislature intended to exclude any right or use of the sound recording from the concept of “exclusive ownership.”

The legislature does include a limitation on the ownership right in the statute’s text, “the most reliable indicator of legislative intent.” See Esberg, 28 Cal. 4th at 268. An author has exclusive ownership in his or her sound recording “against all persons except one who independently makes or duplicates another sound recording that does not directly or indirectly recapture the actual sounds fixed in such prior recording, but consists entirely of an independent fixation of other sounds, even though such sounds imitate or simulate the sounds contained in the prior sound recording.” Cal. Civ. Code § 980(a)(2) (emphasis added). In other words, ownership of a sound recording does not include the exclusive right to make “covers” (i.e., recording the song with new instruments) – any person can make a sound recording based on a copyrighted recording, without the permission of the owner, so long as they produce the sounds independently rather than recapture the actual sounds in the copyrighted recording.

Construing the meaning of “exclusive ownership” in context with the rest of § 980(a)(2), which lists the above exception to the ownership right, the Court infers that the legislature did not intend to further limit ownership rights, otherwise it would have indicated that intent explicitly. Because the statute lists an exception, the Court should enlist the “familiar rule of construction…[that] where exceptions to a general rule are specified by statute, other exceptions are not to be implied or presumed.” Geertz v. Ausonio, 4 Cal. App. 4th 1363, 1370 (1992) (citing In re Michael G., 44 Cal. 3d 283, 291 (1988). Courts should “presume the Legislature included all the exceptions it intended to create.” Id. (citing Reynolds v. Reynolds, 54 Cal. 2d 669, 681 (1960)). If § 980(a)(2) had granted “exclusive ownership” in sound recordings without a listed exception, the argument that some limitations on property rights were already inherent in the concept of sound recording ownership might have been more persuasive to the Court. See Opp. 6:21-7:4, 8:25-9:2. However, by finding it necessary to specify an excepted right to ownership in a sound recording, the legislature conveyed that limitations on ownership did not live within the concept itself, rather they required elucidation.

Accordingly, the Court’s textual reading of § 980(a)(2), giving the words “their usual and ordinary meaning and construing them in context[,]” is that the legislature intended ownership of a sound recording in California to include all rights that can attach to intellectual property, save the singular, expressly-stated exception for making “covers” of a recording.

Sirius XM pointed out the legal problems with this, in that California law did not have a public performance right, and thus the court is effectively making up a new right under to bolt onto California's copyright law, but the judge isn't buying it. Sirius further pointed out that California's copyright law was designed to highlight what rights remained under its copyright law after the federalization of copyright for sound recordings, but again the judge isn't buying it.

It's inevitable that Sirius will appeal this ruling so it will be a while before we see where this actually ends up. Furthermore, in one of the other cases against Sirius, brought by the RIAA, it appears that the judge is leaning in the exact opposite direction. So, this situation is far from over.

240691364 Flo Eddie v Sirius XM Order on MSJ (PDF)240691364 Flo Eddie v Sirius XM Order on MSJ (Text)

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: california, copyright, flo & eddie, pre-1972, pre-1972 sound recordings, public performance, streaming
Companies: pandora, sirius xm

41 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

Richard (profile), 24 Sep 2014 @ 4:05am

Constitution
On my reading of your constitution state level copyright laws are unconstitutionsl.

One of the original intentions of the copyright clause was to forestall the development of a messy, inconsistent, morass of state copyright laws (as was beginning to develop).

Constitutionally the right to make copyright law is reserved to Congress.
[ link to this | view in thread ]
DaveK (profile), 24 Sep 2014 @ 4:07am

The judge is an idiot.
Thus, at base, Flo & Eddie has the right to possess and use its sound recordings and prevent others from possessing and using them. The plain meaning of having “exclusive ownership” in a sound recording is having the right to use and possess the recording to the exclusion of others.

But the law does not grant them exclusive ownership of a sound recording; it grants them exclusive ownership of the copyright over that recording. The judge has conflated two different things there.
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 4:30am

anyone able to clarify why it is that in the main, the judges who sit on copyright cases seem to have actually no knowledge of copyright or the laws that are already in place or manage to ignore everything and bring in their own personal take on the subject?
[ link to this | view in thread ]
Ninja (profile), 24 Sep 2014 @ 4:55am

This is idiotic as most of copyright related stuff are. Songs that are over 40 years old already made the money they could and the creators has already got their money (I'd bet that even their afterlife is secured by now).

And, in a ruling this week, the judge has... ruled against Sirius XM in a manner that may force Sirius and Pandora to eventually have to pay out big.

Honestly, simply drop the songs from the service already. If these people want so badly to be forgotten let them be.
[ link to this | view in thread ]
Richard (profile), 24 Sep 2014 @ 5:06am

Re:
nyone able to clarify why it is that in the main, the judges who sit on copyright cases seem to have actually no knowledge of copyright or the laws that are already in place

Because the alternative is worse!

Judges who specialised in copyright would be inevitably "captured" by the big IP lobby and the result would be that all the decisions would be uniformly bad - whereas at present there are good decisions from time to time!

(cf CAFC in patent cases)
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 5:17am

This may create an unsual, unexpected result
Since the judge has now declared exclusive ownership over these sound recordings, how long will it be before terrestrial radio stations will have to cough up public performance fees comparable to what they have wanted to stick the satellite radio services with? After all, if it's wrong to broadcast it, it's wrong to broadcast it.

Lots of talk radio in our future when this happens, and the greedy RIAA and music publishers will indeed have killed off the goose that lays the golden eggs. Me, I can't wait to watch this one unfold.
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

antidirt (profile), 24 Sep 2014 @ 5:18am

Re: Constitution
On my reading of your constitution state level copyright laws are unconstitutionsl.

One of the original intentions of the copyright clause was to forestall the development of a messy, inconsistent, morass of state copyright laws (as was beginning to develop).

Constitutionally the right to make copyright law is reserved to Congress.

The Supreme Court held otherwise in Goldstein v. California: http://scholar.google.com/scholar_case?case=3043821630623021343
[ link to this | view in thread ]
Karl (profile), 24 Sep 2014 @ 5:19am

Unfortunately, the judge is right
As a matter of law, I think the judge made the right call. The rights that California granted under its statutes were pretty clearly designed to be expansive.

This is especially true when you compare California law to the state laws of other states. Most of those other states explicitly limit the rights in a sound recording to reproduction and distribution. (They were written at a time when "bootlegging" was common.) California, in contrast, does not. It's also one of the few states that don't have explicit carve-outs for radio and television performances.

Nor does the "rights remaining" argument make sense, since federal copyright law explicitly leaves all pre-1972 rights intact.

This is a major ruling, and if it stands, it will have a drastic effect on anyone who uses sound recordings in California. Because the ruling isn't limited to Internet performances. In theory, any sound recording rights holder can sue terrestrial radio stations, bars, restaurants, venues, and anyone else who has played that performance in public, at least in California.

I actually wrote something about this on my (just-created) Tritonester blog:
http://tritonester.wordpress.com/2014/09/23/siriusxm-loses-to-turtles/
[ link to this | view in thread ]
BentFranklin (profile), 24 Sep 2014 @ 5:24am

Could there be a service that only streams CC music?
[ link to this | view in thread ]
JWW (profile), 24 Sep 2014 @ 5:26am

B-bye
Bye bye 50's on 5, 60's on 6, and hello to the new 72 and after on 7.

Sirius XM really has no choice now they really have to just stop playing music older than 72. Cold turkey, don't play any of that shit. Let the "rights holders" for this music just go to hell and collect NOTHING because their music will NEVER BE PLAYED AGAIN.

Fuck them, fuck them, fuck them. The greedy bastards need to be taught a lesson. I am so sick of this greedy shit. Its not about sharing music with the world, its about fucking over the businesses that are promoting your music. The companies and people trying to do this have no soul.

Its kind of ironic that Copyright law was supposed to support the creation and sharing of culture, but in this case the only way to solve it is to lock the pre-72 works away and never listen to them again.
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

antidirt (profile), 24 Sep 2014 @ 5:27am

Re: The judge is an idiot.
But the law does not grant them exclusive ownership of a sound recording; it grants them exclusive ownership of the copyright over that recording. The judge has conflated two different things there.

Did you read the opinion? Before calling the judge an "idiot," I would hope so. It seems clear to me that the judge knows the difference between copies and copyrights. He's referring to the intangible rights in the sound recording.
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

antidirt (profile), 24 Sep 2014 @ 5:28am

Re:
anyone able to clarify why it is that in the main, the judges who sit on copyright cases seem to have actually no knowledge of copyright or the laws that are already in place or manage to ignore everything and bring in their own personal take on the subject?

Are you saying that's what the judge did here? If so, could you explain why you think this?
[ link to this | view in thread ]
Richard (profile), 24 Sep 2014 @ 5:42am

Re: Re: Constitution
Yes I am aware that this argument has been unsuccessful in the courts - however that probably refelects their reluctance to upset a well established apple cart.
[ link to this | view in thread ]
scotts13 (profile), 24 Sep 2014 @ 5:44am

Not as foolish as it sounds
Ideally, judges don't make law; they enforce and occasionally have to interpret law as written and passed by the legislature. It seems pretty clear that, based on the law as conveyed in the article, he's doing so correctly. Is it a bad outcome? Yes. Will it have wide negative consequences, contrary to the common good? Yes. But reading between the lines, I almost believe the judge is encouraging the politicians to fix the law by forcing those consequences.

A law actually meaning what it says in plain english.. Who'd have thought?
[ link to this | view in thread ]
Richard (profile), 24 Sep 2014 @ 5:57am

Re: Re: The judge is an idiot.
It seems clear to me that the judge knows the difference between copies and copyrights. He's referring to the intangible rights in the sound recording.

If he knows the difference why does he not refer to the intangible rights directly instead of using a sloppy (if common) conflation between two different things?

Frequent inaccurate usage like this has the effect (possibly intentional) of confusing the public mind about these issues in ways that favour certain parties to the debate. Consequently it has to be called out whenever it occurs.
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 6:10am

Re: Re: The judge is an idiot.
If that does not qualify the judge as an idiot, then he is a corrupt agent of the copyright industry, which is worse.

There is no such thing as "ownership of a sound recording". You own copyrights; nobody owns sounds. For the judge to state that is an absolute misrepresentation of reality.
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 6:13am

Re: Re:
for starters, he doesn't know the difference between "ownership of copyright" and "ownership of sound recordings"
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

antidirt (profile), 24 Sep 2014 @ 7:15am

Re: Re: Re: Constitution
Yes I am aware that this argument has been unsuccessful in the courts - however that probably refelects their reluctance to upset a well established apple cart.

Or, it could just be their honest interpretation of the Constitution. Shocking thought!
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

antidirt (profile), 24 Sep 2014 @ 7:21am

Re: Re: Re: The judge is an idiot.
If he knows the difference why does he not refer to the intangible rights directly instead of using a sloppy (if common) conflation between two different things?

From the second paragraph of the opinion: "Today, Flo & Eddie owns all rights to The Turtles’ master sound recordings." Seems to me like he knows it's about the rights. I read the judges references to the "sound recordings" as referring to them in the incorporeal sense. For example, he says: "Flo & Eddie contends that, in California, copyright ownership of a pre-1972 sound recording includes the exclusive right to publicly perform the recording; therefore, if anyone wishes to publicly perform such a recording, they must first seek authorization from the recording’s owner." He's not talking about ownership of the physical recording, he's talking about "copyright ownership" of those recordings which include the "exclusive rights."

Regardless, can you get past this nitpicking and actually discuss the substance of the judge's reasoning?
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

antidirt (profile), 24 Sep 2014 @ 7:40am

Re: Re: Re: The judge is an idiot.
If that does not qualify the judge as an idiot, then he is a corrupt agent of the copyright industry, which is worse.

It's strange how quickly you guys jump to the conclusion that judges you disagree with are corrupt idiots. Honestly, it just makes you guys seem like idiots.

There is no such thing as "ownership of a sound recording". You own copyrights; nobody owns sounds. For the judge to state that is an absolute misrepresentation of reality.

Of course there is. You can own a physical sound recording. I own many of them. But there's also ownership of the sound recording in the incorporeal sense, which is what the judge is talking about in the opinion. I'll ask you same question: Can you comment on the substance of the judge's reasoning? I know he found that an artist has certain exclusive rights (gasp!), but I'd like to know specifically what in his opinion you think is wrong.
[ link to this | view in thread ]
Ninja (profile), 24 Sep 2014 @ 7:41am

Re:
I'm very interested in it. But it would be limited to those that are not NC. And I wonder if it would be attraxtive enough for the greater audience?
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

antidirt (profile), 24 Sep 2014 @ 7:42am

Re: Re: Re:
for starters, he doesn't know the difference between "ownership of copyright" and "ownership of sound recordings"

The holding of the case is that ownership of the incorporeal sound recording includes the exclusive right to public performance. It's amazing to me you guys are nitpicking like this. Can you actually criticize the judge's reasoning?
[ link to this | view in thread ]
Ninja (profile), 24 Sep 2014 @ 7:46am

Re: Re: Re: Re: The judge is an idiot.
It's strange how quickly you guys jump to the conclusion that judges you disagree with are corrupt idiots.

The same way you say the judge doesn't get the subject or is clueless when you don't agree with them?

I'd like to know specifically what in his opinion you think is wrong.

I'd say the problem is conflating physical property with intellectual (intangible) property. But then again if this sticks the copyright crew is screwed because they can't meddle with the hardware we acquire and will not be able to prevent people from tinkering with their software.
[ link to this | view in thread ]
Ninja (profile), 24 Sep 2014 @ 7:48am

Re: Re: Re: Re:
includes the exclusive right to public performance

This is not written in the law and the judge had to stretch a few definitions to get to this reasoning. There are completely opposed views in the judiciary so we'll have to wait to see if it sticks.
[ link to this | view in thread ]
JEDIDIAH, 24 Sep 2014 @ 7:49am

Re: Constitution
The fact that it is "honest" doesn't make it any more correct.

The whole point of the US Constitution was to create a unified regulatory structure to make up for the quagmire that existed before. Any high school civics student could tell you that.

These men are judges, not Imams.
[ link to this | view in thread ]
JEDIDIAH, 24 Sep 2014 @ 7:53am

Basic conceptual problem.
He seems to be manufacturing an idea of legislative intent from thin air.

On the other hand, you have the problem of basic approach. Should things be permissible unless explicitly made so or should things be banned unless explicitly made so.

One of those is consistent with our founding ideals. The other is not.

Being from California, it is likely he takes the anti-liberty approach.

The rest is just post-factum justification.
[ link to this | view in thread ]
This comment has been flagged by the community. Click here to show it

antidirt (profile), 24 Sep 2014 @ 8:06am

Re: Re: Re: Re: Re: The judge is an idiot.
The same way you say the judge doesn't get the subject or is clueless when you don't agree with them?

The judge very clearly throughout the opinion discusses the intangible copyright rights in a sound recording, so the premise that he doesn't know the difference is just wrong. And it's not the same with me: When I disagree with what a judge says, I explain why I disagree and I back it up with precedent, statutes, etc.

I'd say the problem is conflating physical property with intellectual (intangible) property. But then again if this sticks the copyright crew is screwed because they can't meddle with the hardware we acquire and will not be able to prevent people from tinkering with their software.

But, again, the judge makes no such conflation. "Sound recording" can refer to either the physical recording or the recording in the incorporeal sense. Given that the judge repeatedly mentions that it's the copyright rights at issue, and given that his holding is explicitly about the intangible right of public performance, I see no such conflation. I think you guys are just desperate to think the judge got this one wrong, but since you can't discuss the actual substance of his reasoning, you're focusing on this perceived conflation.
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 8:12am

Re: Re: Re: Re: Re: The judge is an idiot.
IP extremists will try to have it both ways. It's called law buying. If you haven't noticed laws in this country are mostly purchased. This isn't so much a democracy.
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 8:32am

Re: Basic conceptual problem.
It is only permissible if those doing the law biding make a profit. Otherwise it is not. We should just codify that into law explicitly. You have no liberties unless those liberties are profitable to those that buy laws.
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 8:32am

Re: Re: Basic conceptual problem.
law buying *
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 8:40am

Re: Re: Re: Re: The judge is an idiot.
Then why should the law that changed be applied retroactively? If I tried to change a similar legal document to be retroactive, I would be jailed for attempted fraud. So why does another group get to do that, but I can't?
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 8:50am

Re: Re: Re: Re:
Referencing physical property law when defining the scope of copyright protection is bad reasoning. It is the same reasoning that leads to the conclusion that all copyright should be perpetual.
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 8:51am

Re: Re: Re: Re: Re: The judge is an idiot.
It's called law buying.
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 9:09am

Re: Not as foolish as it sounds
Judges often act in the best interests of their career ... and bank account.

Wallace Jefferson recently stepped down from Chief Justice of the Texas Supreme Court, and is now earning the really big bucks as a private attorney arguing cases before the very court he once ran.

I predict this kind of thing will become more common on a national level, as career lawyers see that an appointment as a top judge, once viewed as a lifetime commitment, is just a stepping stone to a fat paycheck with the very companies they gave favorable rulings to as judge.

After all, why should Washington politicians and bureaucrats be the only ones to exploit the revolving door and line their pockets in an obvious (but legal) conflict of interest?
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 10:44am

Re:
There's been one for a while now: Libre.fm
[ link to this | view in thread ]
Ninja (profile), 24 Sep 2014 @ 11:36am

Re: Re:
True, I had forgotten about them!
[ link to this | view in thread ]
Anonymous Coward, 24 Sep 2014 @ 3:35pm

Re: Re: Not as foolish as it sounds
"After all, why should Washington politicians and bureaucrats be the only ones to exploit the revolving door and line their pockets in an obvious (but legal) conflict of interest?"

I agree. It's not fair. If some government positions are exploited for personal gain then all government positions should be exploited for personal gain with little regard for the public interest. It's only fair right?
[ link to this | view in thread ]
gorehound (profile), 24 Sep 2014 @ 4:35pm

When will these stations smarten up and stop pandering to the MAFIAA Asshats and ignorant old timer Artists.
Drop all those songs...........no one will miss them.Lots of cool stuff out there to play and not have to deal with the loser artists and big greedbag labels.
[ link to this | view in thread ]
Anonymous Coward, 25 Sep 2014 @ 8:37am

Re:
If they did that and dropped all the old songs I wonder if the MAFIAA will go crawling back to them begging for them to re add them because you know the MAFIAA are not getting any money from the old songs that were removed.
[ link to this | view in thread ]
Sheogorath (profile), 25 Sep 2014 @ 10:42pm

And, in a ruling this week, the judge has... ruled against Sirius XM in a manner that may force Sirius and Pandora to eventually have to pay out big.
Either that or quit using the recordings so they don't have to pay unaffordable licence fees, meaning people don't hear the music and the rights holders get nothing. Copyright maximalists: they lose even when they win.
[ link to this | view in thread ]
anon coward, 16 Oct 2014 @ 11:38pm

the relevant law
Many posters here feel angry or aggrieved at this ruling but:
a) the law is clear and appeals will fail. Any remotely serious informed reading of the judgement will reveal that this is an extremely carefully argued crushing judgement.
b) the world has changed and has done so to the disadvantage of artists. An enormous amount of artists work is being widely disseminated with no payment. You may take the position that art wishes to be free or that artists deserve to be paid. Bear in mind that artists tend to be poorer than companies like Sirius and Pandora who don't pay them.
[ link to this | view in thread ]