ArtsWatch: RIAA Sues Pandora For Pre-1972 Royalties

Performers of classic oldies ask why Pandora streams their tracks with no compensation
April 21, 2014 -- 7:09 am PDT
By Philip Merrill / GRAMMY.com

In recent news ...

Pandora Sued For Unlicensed Streaming Of Pre-1972 Recordings
On April 17, led by the RIAA, indie label ABKCO Music and Records, Capitol Records, Sony Music Entertainment, UMG Recordings, and Warner Music Group sued Pandora in New York state court over the Internet radio service's unlicensed use of pre-1972 recordings. The case is similar to the 2013 case against SiriusXM in California state court, which has a hearing set for May 14, and relies on protections under state law because the underlying recordings predate the 1972 establishment of federal copyright protection for sound recordings. Pandora has claimed licensing pre-1972 recordings would be inconvenient and costly but has avoided the solution of not using them at all. New York's common law property rights might give the plaintiffs a solid argument that Pandora is appropriating their property, raising the question of why Pandora let the case go to court rather than reaching an agreement with the labels. Steve Cropper of Booker T. & The MG's, Buddy Holly's widow Maria Elena Holly, Sam Moore of Sam & Dave, and Dionne Warwick have spoken up in support of this lawsuit. Cropper said, "I don't understand any business that refuses to pay for the products it sells. ... Why would they not want to compensate me for my work? It's an injustice that boggles the mind."

Movie Studios And Record Labels Sue Megaupload And Kim Dotcom
Movie studios led by the MPAA sued Megaupload, it's founder Kim Dotcom and other associated defendants on April 7 in U.S. District Court in Alexandria, Va. Record labels led by the RIAA followed up on April 10 with an independent lawsuit in the same venue. The notorious infringing website has been shut down since January 2012 when authorities raided Dotcom's home in New Zealand, took him into custody, and U.S. criminal law enforcement authorities began pursuing his extradition. Dotcom's next extradition hearing is scheduled for July. "He's a huckster, he's a fraud artist, he's a crook," said Steven Fabrizio, MPAA senior executive vice president and global general counsel. These latest lawsuits zero in on Megaupload's unique business model as encouraging copyright infringement by providing financial incentives to the uploaders of the most popular content. In related news, on April 16 a New Zealand High Court ruled that Dotcom's seized personal assets could be returned to him, including $10 million in financial assets and his $6 million car collection. Although Dotcom, who is not a New Zealand citizen, cannot run for political office there he has founded a new Internet Party to participate in this fall's elections and has been promoting a political alliance with the Maori-oriented Mana Party, which currently holds one seat in the New Zealand legislature. Dotcom's more recent Internet venture, Mega, is also expected to be listed on the New Zealand Stock Exchange by June.

Android App Counterfeiters Plead Guilty
On April 15 the Department of Justice announced that it had obtained guilty pleas from all four of the mobile Android app counterfeiters first charged in January. In the case against Appbucket Group, two defendants already pleaded guilty last month and the third pleaded guilty on April 15 and is scheduled to be sentenced in July. In the independent case against SnappzMarket Group, the lone defendant pleaded guilty on April 14. These represent the first-ever convictions for conspiracy to commit criminal copyright infringement of mobile apps. Each group attempted to distribute more than 1 million illegal copies of copyright-protected mobile software, with estimated retail values of more than $700,000 and $1.7 million, respectively.

Increased Mobile Advertising Revenues: A Sign Of Things To Come
The Interactive Advertising Bureau released its annual revenue report for 2013 on April 10 showing interactive ad revenue totaled $42.8 billion, surpassing broadcast TV ($40.1 billion in 2013) for the first time. Mobile advertising grew 110 percent to $7.1 billion from its 2012 total of $3.4 billion, comprising 17 percent of all interactive ad revenues. IAB President/CEO Randall Rothenberg said, "The staggering growth of mobile is clearly a direct response to how smaller digital screens play an integral role in consumers' lives throughout the day."

The Recording Academy actively represents the music community on such issues as intellectual property rights, music piracy, archiving and preservation, and censorship concerns. In pursuing its commitment to addressing these and other issues, The Recording Academy undertakes a variety of national initiatives. ArtsWatch is a key part of an agenda aimed at raising public awareness of and support for the rights of artists. To become more involved, visit Advocacy Action @ GRAMMY.com and sign up for Advocacy Action E-lerts.

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