Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 1 of 30
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`FILED
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` 2010 Dec-22 PM 03:45
`U.S. DISTRICT COURT
`N.D. OF ALABAMA
`
`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF ALABAMA
`NORTHWESTERN DIVISION
`
`Plaintiffs,
`
`vs.
`
`BROADCAST MUSIC, INC., et al., )
` )
` )
` )
` ) Civil Action No. CV-09-S-1779-NW
` )
` )
`JERRY COCHRAN, INC. d/b/a
`SIDE POCKET LOUNGE, and )
`JERRY COCHRAN, individually,
` )
` )
` )
`
`Defendants.
`
`MEMORANDUM OPINION
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`Plaintiffs — i.e., Broadcast Music, Inc.; Interior Music Corporation; Chris
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`Layton, Thomas Smedley and Reese Wyans, a partnership d/b/a Manchaca Music;
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`Bill Carter d/b/a Blame Music; Six Palms Music Corporation d/b/a Third Palm
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`Music; Warner-Tamerlane Publishing Corporation; Eleksylum Music, Inc.; No
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`Surrender Music, a division of Praxis International Communications, Inc.; EMI
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`Blackwood Music, Inc.; Emerson Lee Hart, an individual d/b/a Unconcerned Music
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`Publishing; Jason L. Ross, Jason Knowles Pollock, Casey S. Daniel and Gurpreet J.
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`Khals, a partnership d/b/a Sevenmary Three Music; Songs of Universal, Inc.; Only
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`Hit Music, a division of Capital Recovery Assistance, Inc.; Bro ‘N’ Sis Music, Inc.;
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`Dianna L. Maher, an individual d/b/a Estes Park Music; Tia Maria Sillers, an
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`individual d/b/a Choice is Tragic; Sony/ATV Songs, LLC d/b/a Sony/ATV Melody,
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`

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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 2 of 30
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`LLC; Rivers Cuomo, an individual d/b/a E.O. Smith; Michael Balzary, John Anthony
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`Frusciante, Anthony Kiedis and Chad Gaylord Smith, a partnership d/b/a
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`Moebetoblame Music; and Bradley Kirk Arnold, Robert Todd Harrell, Matthew
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`Darrick Roberts and Christopher Lee Henderson, a partnership d/b/a Escatawpa
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`Songs (collectively, “plaintiffs”) — assert ten counts of copyright infringement under
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`the United States Copyright Act of 1976 (the “Copyright Act”), 17 U.S.C. § 101 et
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`seq., against defendants Jerry Cochran, Inc. d/b/a Side Pocket Lounge and Jerry
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`Cochran, individually. The case currently is before the court on plaintiffs’ motion
`1
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`for the entry of summary judgment in their favor on all counts. Upon consideration
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`of the motion, the briefs, and the evidentiary submissions, the court concludes the
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`motion is due to be granted, and judgment is due to be entered in plaintiffs’ favor for
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`the relief requested in their amended complaint.
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`I. STANDARD OF REVIEW
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`Federal Rule of Civil Procedure 56 provides that a court “shall grant summary
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`judgment if the movant shows that there is no genuine dispute as to any material fact
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`and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). In2
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`1
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`See doc. no. 1 (Complaint); doc. no. 9 (Amended Complaint).
` Rule 56 was amended, effective December 1, 2010, in conjunction with a general overhaul
`2
`of the Federal Rules of Civil Procedure. The Advisory Committee was careful to note, however, that
`the changes “will not affect continuing development of the decisional law construing and applying
`these phrases.” Adv. Comm. Notes to Fed. R. Civ. P. 56 (2010 Amends.) (emphasis supplied).
`Consequently, cases interpreting previous versions of Rule 56 are equally applicable to the revised
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`2
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 3 of 30
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`other words, summary judgment is proper “after adequate time for discovery and
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`upon motion, against a party who fails to make a showing sufficient to establish the
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`existence of an element essential to that party’s case, and on which that party will
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`bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
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`“In making this determination, the court must review all evidence and make all
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`reasonable inferences in favor of the party opposing summary judgment.” Chapman
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`v. AI Transport, 229 F.3d 1012, 1023 (11th Cir. 2000) (en banc) (quoting Haves v.
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`City of Miami, 52 F.3d 918, 921 (11th Cir. 1995)). Inferences in favor of the non-
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`moving party are not unqualified, however. “[A]n inference is not reasonable if it is
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`only a guess or a possibility, for such an inference is not based on the evidence, but
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`is pure conjecture and speculation.” Daniels v. Twin Oaks Nursing Home, 692 F.2d
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`1321, 1324 (11th Cir. 1983). Moreover,
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`[t]he mere existence of some factual dispute will not defeat summary
`judgment unless that factual dispute is material to an issue affecting the
`outcome of the case. The relevant rules of substantive law dictate the
`materiality of a disputed fact. A genuine issue of material fact does not
`exist unless there is sufficient evidence favoring the nonmoving party
`for a reasonable jury to return a verdict in its favor.
`
`Chapman, 229 F.3d at 1023 (quoting Haves, 52 F.3d at 921) (emphasis supplied).
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`See also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986) (asking
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`“whether the evidence presents a sufficient disagreement to require submission to a
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`version.
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`3
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 4 of 30
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`jury or whether it is so one-sided that one party must prevail as a matter of law”).
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`II. SUMMARY OF FACTS
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`Plaintiff Broadcast Music, Inc. (“BMI”), is a “non-profit making music
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`performing rights organization.” 3
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`Through agreements with copyright owners such as music
`publishing companies and composers, BMI acquires non-exclusive
`public performance rights. . . . BMI, in turn, grants to music users such
`as broadcasters and the owners and operators of concert halls, nightclubs
`and hotels, the right to publicly perform any of the works in BMI’s
`repertoire by means of “blanket license agreements.”4
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`BMI distributes all of its license income to the copyright owners with whom it
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`contracts, after deducting operating expenses and reasonable reserves. 5
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`The other plaintiffs are owners of registered copyrights in the ten musical
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`compositions that are the subject of this lawsuit, and BMI has acquired non-
`6
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`exclusive public performance rights to each of those compositions. Additionally,
`7
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`Plaintiffs’ evidentiary submission, Exhibit A (Affidavit of Kerri Howland-Kruse), at ¶ 3.
`3
`The Copyright Act refers to organizations like BMI as “performing rights societies,” which the Act
`defines as “an association, corporation, or other entity that licenses the public performance of
`nondramatic musical works on behalf of copyright owners of such works, such as the American
`Society of Composers, Authors and Publishers (ASCAP), Broadcast Music, Inc. (BMI), and SESAC,
`Inc.” 17 U.S.C. § 101.
`Howland-Kruse Affidavit, at ¶ 2.
`4
`Id. at ¶ 3.
`Id. at ¶ 4. Copies of the registration certificates for each of the ten copyrighted musical
`6
`compositions at issue, as well as documentation of the chain of ownership of each of the
`compositions, are attached to the Affidavit of Kerri Howland-Kruse as Exhibit A.
`Id. at ¶ 2.
`7
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`5
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`4
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 5 of 30
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`each plaintiff has granted BMI the right to maintain actions for infringement of the
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`public performance rights in their musical compositions and to seek damages for such
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`infringement. 8
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`Defendant Jerry Cochran (“Cochran”) owns a corporation named “Jerry
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`Cochran, Inc.,” which operates an establishment called “Side Pockets Lounge,”9
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`located at 1816 Darby Drive in Florence, Alabama.
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`10
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` Jerry Cochran, Inc. has the right
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`and ability to direct and control all the activities of Side Pockets Lounge. Jerry
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`Cochran, in his capacity as an employee of Jerry Cochran, Inc., operates, maintains,
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`and controls the day-to-day activities of Side Pockets Lounge.
`11
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` Side Pockets Lounge
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`primarily is a billiards hall, but recorded music also is regularly played there, and live
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`music occasionally is performed on a stage in the rear of the building. Jerry Cochran
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`
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`is responsible for hiring the bands that play live music at Side Pockets Lounge. 12
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`BMI has sent repeated notices to Jerry Cochran at Side Pockets Lounge,
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`advising him of his obligation to purchase a license for any copyrighted musical
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`compositions that might be played at the establishment. First, on March 1, 2007,
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`8
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`Id. at ¶ 5.
`The parties dispute whether the establishment is called “Side Pocket Lounge” or “Side
`9
`Pockets Lounge,” but the distinction is not material to the issues addressed in this opinion.
`Defendants’ evidentiary submission, Exhibit 1 (Affidavit of Jerry Cochran), at ¶ 1.
`10
`See Howland-Kruse Affidavit, Exhibit B (Defendants’ Response to Plaintiffs’ First Request
`11
`for Admission), at 2-3 (Responses to Requests for Admission Nos. 3-7).
`Cochran Affidavit, at ¶ 2.
`12
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`5
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 6 of 30
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`BMI sent a letter to the Lounge, advising that a license was required, and enclosing
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`an informational brochure, a BMI license agreement, and a license fee schedule.
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`Cochran did not respond, either individually or on behalf of Jerry Cochran, Inc. or
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`Side Pockets Lounte.
`13
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` BMI sent similar letters on April 9, May 7, June 6, July 26,
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`August 2, September 28, and November 5, 2007.
`14
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` On November 6, 2007, BMI sent
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`Jerry Cochran a letter at Side Pockets Lounge, enclosing “information regarding
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`music licensing that [he] requested for [his] attorney’s review.” BMI once again
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`explained the licensing process, and requested that Cochran sign and return a license
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`agreement.
`15
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` Cochran still did not comply, and BMI continued to send follow-up
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`letters. On December 17, 2007, Cochran received a letter at Side Pockets Lounge
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`from an in-house BMI attorney. That letter stated:
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`If BMI does not receive a completed license agreement from you,
`or a response to this letter indicating that you have otherwise licensed
`the BMI music used in your business, this letter serves as notice that you
`must discontinue the public performance of any BMI-affiliated music.
`The public performance of BMI-affiliated music without the proper
`authorization constitutes copyright infringement and may result in
`substantial damages under the Federal Copyright Law.16
`
`In its May 7, November 6, and December 17, 2007 letters to Cochran at Side
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`Plaintiffs’ evidentiary submission, Exhibit B (Affidavit of Lawrence E. Stevens), at ¶ 3.
`13
`The court could not locate a copy of the March 1, 2007 letter in the record.
`Stevens Affidavit, at ¶ 5 and Exhibit 1.
`14
`Id.
`Id.
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`15
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`16
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`6
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 7 of 30
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`Pockets Lounge , BMI enclosed copies of a brochure entitled “The Legal Aspects of
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`Performing Copyrighted Music: Questions Most Often Asked About Music
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`Licensing.” The question-and-answer section of that brochure contained the
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`following:
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`1. Is the owner of an establishment legally responsible for
`seeing that music is licensed if it is performed by independent
`contractors?
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`Yes. Even if the persons who actually perform the music on the
`proprietor’s premises are
`independent contractors, rather
`than
`employees, the owner of the premises is legally responsible if the music
`performed is unlicensed. Whether or not the proprietor knows what
`music the performers are playing, and whether or not he or she has any
`knowledge as to the existence or ownership of the copyrights in the
`music performed, he is still obligated by the copyright law to see to it
`that the performance of music played on his premises is authorized.
`
`Liability for unlicensed performances also rests with the owner of
`an establishment that is leased, when the proprietor knows that music is
`likely to be played at the event and has any financial interest in the event
`for which the establishment was leased. This holds true even if the
`musicians are hired by the lessee.
`
`2. Is a stockholder or officer of a corporation which owns an
`establishment personally liable?
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`Yes. A corporate officer with a direct financial interest in the
`corporation and the right or ability to supervise the operation of an
`establishment where music is performed, even if he doesn’t exercise that
`right, is jointly and severally liable with the corporate entity for
`infringement.
`
`There is no question that a corporate director, officer or
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`7
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 8 of 30
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`stockholder who actually participates in the infringement is liable along
`with the corporation. It is equally clear that an officer and principal
`stockholder who controls or has the right and ability to control and set
`aside for the corporation is personally liable.
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`. . . .
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`5. If the proprietor tells the musicians not to play music in the
`BMI repertoire, is he responsible if they nevertheless do so without
`his permission?
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`Yes. Cases have held that proprietors of premises where
`performances occur without permission are liable even if the musicians
`violate specific instructions not to play the music.
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`The law is clear that if the proprietor of an establishment knew
`that permission or a license was needed to have music performed on his
`premises, he cannot claim he was an “innocent infringer.”
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`Moreover, BMI advises proprietors of the need to obtain a license
`to perform music licensed by BMI. If they ignore that need, a court
`must award BMI damages of between $750 and $30,000 per song, plus
`attorney’s fees and costs. In most cases, an injunction against further
`unauthorized use of BMI’s music will be issued as well. Courts have
`held that the damages awarded should be substantially greater than the
`license fees that would have been paid by the music user.
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`6. If the business where the music is performed is operating
`at a loss or for charitable purposes, is the proprietor exempt from
`the responsibility of obtaining a license?
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`No. The need to obtain permission to perform music publicly is
`not contingent upon the profitability of the proprietor’s business. A
`court will take into account many factors, including the defendant’s
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`regular use of music. 17
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`Doc. no. 25 (Supplemental Affidavit of Lawrence E. Stevens), at ¶¶ 13-14 and Exhibit 4,
`17
`at 4-7 (footnotes omitted). BMI also sent defendants another brochure, entitled “BMI Music Use
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`8
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 9 of 30
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`On April 25, 2008, BMI sent Cochran a “cease and desist” letter, stating:
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`Dear Mr. Cochran:
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`As you have not responded to our correspondence and in the
`absence of a licensing agreement with BMI, this shall serve as formal
`notice to you that effective this date, you must cease all use of BMI
`licensed music in your business or organization. The continued use of
`music in the BMI repertoire without an authorization will result in
`copyright infringement. Copyright infringement is a violation of federal
`law. Copyright infringement may subject you to substantial damages.
`BMI is prepared to take whatever action may be necessary to protect the
`rights of its composers and publishers. Refer any questions regarding
`this matter to (888) 689-5264.18
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`Cochran still did not obtain a license from BMI, and BMI subsequently sent
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`him reminder letters on June 24, August 1, August 25, October 22, and December 22,
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`2008, as well as on January 12, February 19, and April 22, 2009. Some of those
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`letters contained the following advisory language: “Violations of the copyright law
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`are expensive. Damages for infringement of at least $750 per song, which can be
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`significantly increased by the courts, are set forth in Title 17 of the United Sates Code
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`(Copyright Law).” 19
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`BMI sent an investigator to Side Pockets Lounge on the evening of April 4,
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`in Eating and Drinking Establishments Q & A Brochure,” along with its March 1 and April 9, 2007
`letters. See Supplemental Stevens Affidavit, at ¶¶ 11-12 and Exhibit 3. A copy of the brochure is
`in the record, and defendants do not deny receiving it. Even so, the court cannot locate the provision
`of the brochure on which plaintiffs rely.
`See Stevens Affidavit, at ¶ 6 and Exhibit 2.
`18
`Id.
`
`19
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`9
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 10 of 30
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`2009 and the early morning hours of April 5, 2009, to determine if any of the songs
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`in BMI’s repertoire were being played without a license. The investigator observed
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`a band called “Gone Arye” performing covers of the ten copyrighted songs that are
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`the subject of this action: i.e., “Ain’t No Sunshine”; “Crossfire”; “Hey Joe Where You
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`Gonna Go a/k/a Hey Joe”; “Keep Your Hands to Yourself”; “Open Up Your Eyes”;
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`“Cumbersome”; “Blue on Black”; “Hash Pipe”; “Dani California”; and “Landing in
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`London.” Jerry Cochran, acting on behalf of Jerry Cochran, Inc., hired the band
`20
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`
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`Gone Arye to perform at Side Pockets Lounge on April 4 and 5, 2009. 21
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`On May 29, 2009, BMI sent a letter to “Mr. Jerry Cochran, President, Jerry
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`Cochran, Inc., Side Pocket Lounge, 1816 Darby Dr., Florence, AL 35630,” informing
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`Mr. Cochran that a BMI Music Researcher had been to Side Pockets Lounge and
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`observed “infringement of BMI-licensed music.” BMI also explained that Mr.
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`Cochran and Jerry Cochran, Inc. owed $13,327.20 in unpaid licenses fees for the
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`three-year time period between March 1, 2007 and February 28, 2010, plus $419.09
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`in investigation expenses, for a total amount of $13,746.29. Finally, BMI informed
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`Mr. Cochran that he and Jerry Cochran, Inc. had five days to pay all past and present
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`license fees owing to BMI, and to sign a licensing agreement, or the matter would be
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`20
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`21
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`See Stevens Affidavit, at ¶ 10 and Exhibit 3.
`Cochran Affidavit, at ¶ 4.
`
`10
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 11 of 30
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`referred to BMI’s attorneys “for whatever action they deem necessary.”22
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`Jerry Cochran testified that Side Pockets Lounge had a policy that each band
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`or individual musician who played music at Side Pockets Lounge was responsible for
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`his, her, or its own song list. If a performer played any song that was not its own
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`composition, Cochran placed the responsibility on the performer for complying with
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`any licensing obligations. To inform others of this policy, Cochran posted a sign at
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`Side Pockets Lounge that read:
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`ATTENTION PERFORMING ARTISTS !!!
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`Side Pocket Lounge and Jerry Cochran Inc. require all bands that
`perform on the premises to be responsible for the music that they
`perform in regards to licensed music from artists signed with ASCAP,
`BMI, SESAC, etc. Side Pocket Lounge and Jerry Cochran Inc. will not
`be held responsible for copyright infringement or monetary payment to
`the above mentioned companies due to music that is performed from
`bands on the premises. Bands will be held responsible.23
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`Jerry Cochran does not know whether the band Gone Arye was licensed to
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`perform the musical compositions they chose on April 4 and 5, 2009.
`24
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` BMI has no
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`record of Gone Arye ever obtaining a license to perform any of the musical
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`compositions in its repertoire.
`25
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` More specifically, BMI also has no record of Gone
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`22
`
`23
`
`24
`
`25
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`See Stevens Affidavit, at ¶ 5 and Exhibit 1.
`See Cochran Affidavit, at ¶¶ 3-4 and Exhibit C (emphasis in original).
`Cochran Affidavit, at ¶ 5.
`Supplemental Stevens Affidavit, at ¶ 9.
`
`11
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 12 of 30
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`Arye ever obtaining a license directly from any of the composers or publishers of the
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`musical compositions that are the subject of his lawsuit.26
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`III. DISCUSSION
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`A.
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`Defendants’ Liability for Copyright Infringement
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`The Copyright Act grants a copyright owner the exclusive right to perform, or
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`authorize others to perform, a copyrighted musical work. 17 U.S.C. § 106(4). Any
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`person or entity who violates this exclusive right is an infringer of the copyright, and
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`is subject to an action for infringement. 17 U.S.C. § 501(a) & (b).
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`“To establish a prima-facie copyright infringement case for a
`musical composition, a plaintiff may prove (1) ownership of a valid
`copyright and (2) ‘public performance’ of the copyrighted work without
`authorization.” Simpleville Music v. Mizell, 451 F. Supp. 2d 1293, 1295
`(M.D. Ala. 2006) (Thompson, J.) (citing 17 U.S.C. § 106(4) (subject to
`specific exclusions outlined in the Copyright Act, “the owner of
`copyright ... has the exclusive rights ... in the case of ... musical ... works
`to perform the copyrighted work publicly”)); cf. Feist Publications, Inc.
`v. Rural Telephone Service Co., Inc. 499 U.S. 340, 361, 111 S. Ct. 1282,
`113 L. Ed. 2d 358 (1991) (“To establish infringement, two elements
`must be proven: (1) ownership of a valid copyright, and (2) copying of
`constituent elements of the work that are original.”).
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`Joelsongs v. Shelley Broadcasting Co., Inc., 491 F. Supp. 2d 1080, 1084 (M.D. Ala.
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`2007).
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`Defendants do not dispute that plaintiffs own valid copyrights (or, with regard
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`BMI’s Affiliate Agreements allow composers and publishers affiliated with BMI to issue
`26
`a license directly to a performer, but require any direct licenses to be reported to BMI within ten
`days. See Supplemental Stevens Affidavit, at ¶¶ 4-7 and Exhibits 1-2.
`
`12
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 13 of 30
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`to BMI, non-exclusive performance rights and the right to pursue infringement) in the
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`ten musical compositions that are the subject of this action, or that those musical
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`compositions were performed at Side Pockets Lounge on April 4, 2009. Thus, the
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`only remaining element is whether the performances were unauthorized.
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`Defendants acknowledge that neither of them obtained a license — either from
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`BMI or from the composers and/or publishers themselves — for copyrighted musical
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`works in BMI’s repertoire to be performed at Side Pockets Lounge. Even so,
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`defendants argue that they are not liable for copyright infringement because they did
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`not perform the copyrighted musical works themselves, and because they cannot be
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`held vicariously liable for the band Gone Arye’s performance of those works.
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`None of defendants’ arguments has any merit. “Where a copyright
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`infringement case involves live performances by musicians or disc jockeys, the owner
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`of the establishment may be subject to vicarious liability for the infringement if it has
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`‘the right and ability to supervise the infringing activity and also has a direct financial
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`interest in such activities.’” New World Music Co. v. Tampa Bay Downs, No. 8:07-
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`cv-398-T-33TBM, 2009 WL 35184, at *4 (M.D. Fla. Jan. 6, 2009) (quoting Gershwin
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`Publishing Corp. v. Columbia Artists Management, Inc., 443 F.2d 1159, 1162 (2d
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`Cir. 1971)). See also M.L.E. Music Sony/ATV Tunes, LLC v. Julie Ann’s, Inc., No.
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`8:06-cv-1902-T-17-EAJ, 2008 WL 2358979 (M.D. Fla. June 9, 2008) (“Even if a
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 14 of 30
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`proprietor is unaware of the violation, he is generally liable if his entertainers or
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`employees perform copyrighted works.”) (citing International Konvin Corp. v.
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`Kowalczyk, 855 F.2d 375, 378 (7th Cir. 1988)); Broadcast Music, Inc. v. Niro’s
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`Palace, Inc., 619 F. Supp. 958, 961 (N.D. Ill. 1985) (“[N]ot only is the performer
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`liable for infringement, but so is anyone who sponsors the performance.”) (citing
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`Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 157 (1975)).
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`Jerry Cochran, Inc., as owner of Side Pockets Lounge, clearly had the right and
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`ability to supervise the playing of music at the establishment and — as the entity that
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`paid the band and received the any income generated as a result of their music — had
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`a direct financial interest in the playing of music at the establishment. Accordingly,
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`Jerry Cochran, Inc., can be held vicariously liable for Gone Arye’s performance of
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`any copyrighted musical works.
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`The person named Jerry Cochran also can be held individually liable.
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`A person, “including a corporate officer, who has the ability to supervise
`infringing activity and has a financial interest in that activity, or who
`personally participates in that activity is personally liable for the
`infringement.” Southern Bell. Tel. & Tel. Co. v. Associated Tel.
`Directory Publishers, 756 F.2d 801, 811 (11th Cir. 1985) (citation
`omitted). Similarly, “under the Copyright Act, an individual who is the
`dominant influence in a corporation, and through his position can
`control the acts of that corporation, may be held jointly and severally
`liable with the corporate entity for copyright infringements, even in the
`absence of the individual’s actual knowledge of the infringements.”
`Simpleville Music, 451 F. Supp.2d at 1299 (quoting Quartet Music v.
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 15 of 30
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`Kissimmee Broadcasting, Inc., 795 F. Supp. 1100, 1103 (M.D. Fla.
`1992)) (Kellam, J.).
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`Joelsongs, 491 F. Supp. 2d at 1084. Jerry Cochran is not a mere employee of Jerry
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`Cochran, Inc. Quite the contrary, he is the President and sole shareholder of the
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`corporation, and he manages the day-to-day operations of Side Pockets Lounge.
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`Even more importantly, he is the individual responsible for hiring musicians to
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`perform at Side Pocket Lounge. Thus, Jerry Cochran is the “dominant force” behind
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`Jerry Cochran, Inc., and he can be held jointly and severally liable with the
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`corporation for any acts of copyright infringement occurring at Side Pockets Lounge.
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`Defendants’ final argument is that they cannot be held vicariously liable for
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`any copyright infringement committed by the band Gone Arye, because there is no
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`evidence that Gone Arye did not have a license to perform the musical works it
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`performed at Side Pickets Lounge on April 4, 2009. Defendants are correct that, as
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`a general rule, “secondary [or vicarious] liability cannot be imposed without first
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`establishing direct infringement by the performer.’” New World Music Co., 2009 WL
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`35184, at *4 (citing UMG Recordings, Inc. v. Sinnott, 300 F. Supp. 2d 993, 997 (E.D.
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`Cal. 2004) (in turn citing A & M Records, Inc. v. Napster, Inc., 239 F.3d 1004, 1013
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`n.2 (9th Cir. 2001))). Defendants are not correct, however, about where the burden
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`of establishing the performer’s direct infringement lies. Defendants suggest that
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 16 of 30
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`plaintiffs bear the burden of proving that Gone Arye was unlicensed, but most courts
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`within this Circuit hold — and this court is persuaded that the better reasoned rule is
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`— that “[d]efendants bear the burden of establishing authorization of the direct
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`infringer in a case involving vicarious liability.” New World Music Co., 2009 WL
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`35184, at *5. Courts consider the argument that the performer was authorized to
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`perform the works at issue to be similar to an affirmative defense, which must be
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`raised and supported by the defendant. As the district court stated in M.L.E. Music
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`Sony/ ATV Tunes, LLC v. Julie Ann’s, Inc., No. 8:06-cv-1902-T-17-EAJ, 2008 WL
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`2358979 (M.D. Fla. June 9, 2008):
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`In response to Plaintiffs’ request for admissions, Defendants admitted
`that it [sic] did not have permission by ASCAP to publicly perform for
`profit any of the songs. In addition, Defendants failed to bring forth
`evidence that the karaoke operator had a license to perform Plaintiffs’
`copyrighted songs. The non-moving party “may not rest upon its mere
`allegations,” Fed. R. Civ. P. 56(e); Celotex, 477 U.S. at 324, but must
`[27]
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`27
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`The relevant portion of the revised Rule 56 reads as follows:
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`A party asserting that a fact cannot be or is genuinely disputed must support
`the assertion by:
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`(A) citing to particular parts of materials in the record, including depositions,
`documents, electronically stored information, affidavits or declarations,
`stipulations (including those made for purposes of the motion only),
`admissions, interrogatory answers, or other materials; or
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`(B) showing that the materials cited do not establish the absence or presence
`of a genuine dispute, or that an adverse party cannot produce admissible
`evidence to support the fact.
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`Fed. R. Civ. P. 56(c)(1).
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 17 of 30
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`present “‘significant probative evidence’” that shows there is more than
`“‘some metaphysical doubt as to the material facts.’” [Broadcast Music,
`Inc. V. H.S.I., Inc., No. C2-06-482, 2007 WL 4207901, at *3 (S.D. Ohio
`Nov. 26, 2007) (quoting Moore v. Philip Morris Cos., 8 F.3d 335,
`339-40 (6th Cir. 1993)). Defendants’ mere assertion that the karaoke
`operator could have obtained authorization to play Plaintiffs’ musical
`works is insufficient to preclude summary judgment. Defendants had
`ample time to investigate whether or not the karaoke operator operated
`under a license or was granted permission to play the songs prior to
`filing their answer. Defendants have the burden of proving the existence
`of authorized use, [I.A.E. v.] Shaver, 74 F.3d [768, ]775 [(7th Cir. 1996)]
`and should have asserted the affirmative defense at the time they filed
`their answer. Summary judgment should be granted where Defendants
`merely allege, without providing evidence, that their agent obtained a
`license to play Plaintiffs’ copyrighted songs. Thus, Plaintiffs’ [sic] met
`their initial burden of proof in showing that Defendants’ public
`performance of its [sic] copyrighted musical works was unauthorized.
`When questions are raised concerning facts material to a defendant’s
`liability under the copyright law, a motion for summary judgment is
`defeated. [Broadcast Music, Inc. v. Coco’s Development Corp., No. 79-
`cv-391, 1981 WL 1364 at *1 (N.D. N.Y. Apr. 9, 1981)]. Defendants,
`however, failed to show that a genuine issue of material fact exists with
`regard to their liability. Plaintiffs met their initial burden in showing the
`absence of a genuine issue of material fact. Where, as here, material
`facts are not in dispute, Plaintiffs are entitled to summary judgment.
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`M.L.E. Music, 2008 WL 2358979, at *4.
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`In the present case, plaintiffs not only alleged that Gone Arye did not have a
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`license to perform any of the works it selected on April 4, 2009; they also presented
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`affidavits stating that BMI had no record of ever granting a license to Gone Arye, or
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`of Gone Arye ever being granted a license directly from any of the original composers
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`and/or publishers of the works. In response, defendants presented only the testimony
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 18 of 30
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`of Jerry Cochran that he did not know whether Gone Arye had a license. That is not
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`sufficient to satisfy defendants’ burden, as the non-moving party, of producing
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`evidence to demonstrate a genuine fact dispute with regard to Gone Arye’s
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`authorization to perform plaintiffs’ copyrighted works.
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`The sole case defendants rely upon to support their argument, Polygram
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`International Publishing, Inc. v. Nevada/TIG, Inc., 855 F. Supp. 1314 (D. Mass.
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`1994), does not mandate a contrary result. The facts in Polygram were similar to
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`those of the case at bar: i.e., several copyright holders in musical compositions sued
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`the organizers of a trade show for copyright infringement when their compositions
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`were performed at the trade show without permission. Id. at 1317. The defendants
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`argued that they could not be held liable for copyright infringement because the
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`musical works actually were performed by a disc jockey and the proprietors of trade
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`booths, not by the show’s organizers themselves. Id. at 1317-18. There was no
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`evidence as to whether the disc jockey or the booth proprietors were licensed to
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`perform the copyrighted works, and the parties disputed whether that lack of evidence
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`prevented the plaintiffs from establishing a prima facie case of copyright
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`infringement. Id. at 1319-20. The Massachusetts court concluded
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`that the plaintiff has the burden of proof on the issue of authorization.
`It may nevertheless be true, however, that after some kind of showing
`by a plaintiff, a defendant may bear a burden of production.
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`Case 3:09-cv-01779-CLS Document 26 Filed 12/22/10 Page 19 of 30
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`. . . .
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`In the case of copyright infringements by itinerant musicians or
`other, transient performers, it may very well be that a defendant who
`hires the musicians is in a better position than the copyright holder to
`establish whether the musicians are authorized to perform, and that once
`a plaintiff makes an initial showing of a prima facie case (at least if
`plaintiff offers an evidentiary showing, perhaps based only on a good
`faith statement of information and belief), a burden of production should
`shift to the defendant. I conclude, however, that even if a court adopts
`a rule of procedural law that shifts to the defendant a burden of
`production, the plaintiff cannot invoke that rule without at least making
`a statement, under the pains and penalties of perjury, that the plaint