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Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 1 of 13
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
`---------------------------------------------------------------x
`:
`
`FREEPLAY MUSIC, INC.,
`
`::
`
`:
`:
`:
`:
`:
`:
`:
`:
`
`Plaintiff,
`
`v.
`
`COX RADIO, INC., CUMULUS MEDIA, INC.,
`ENTERCOM COMMUNICATIONS CORP.,
`BEASLEY BROADCAST GROUP, INC.,
`CITADEL BROADCASTING CORP.,
`and VIACOM INC.,
`
`
`Defendants.
`
`
`
`
`
`04 Civ. 5238 (GEL)
`
`
` OPINION AND ORDER
`
`::
`
`::
`
`---------------------------------------------------------------x
`
`Gabriel Fischbarg, Toptani Law Offices,
`New York, New York, for Plaintiff.
`
`Michael E. Salzman, Hughes Hubbard & Reed LLP,
`New York, New York (Jason C. Benton, of counsel),
`for Defendants Cox Radio, Inc., Cumulus Media, Inc.,
`Entercom Communications Corp., Citadel Broadcasting
`Corp., and Viacom Inc.
`
`GERARD E. LYNCH, District Judge:
`
`Plaintiff Freeplay Music, Inc. (“Freeplay”) holds copyrights in certain musical
`
`compositions and sound recordings. In this action for copyright infringement, as explained in
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`the Court’s prior opinion denying defendants’ motion to dismiss, plaintiff contends that
`
`defendants, owners of certain radio stations (“Broadcasters”), violated its “synchronization
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`rights” by producing and broadcasting commercials or other programming that reproduced
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`Freeplay’s copyrighted materials on a single recording with other materials. See Freeplay
`
`Music, Inc. v. Cox Radio, Inc., No. 04 Civ. 5238 (GEL), 2005 WL 1500898 (S.D.N.Y. June 23,
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 2 of 13
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`2005).
`
`In the earlier opinion, the Court declined to dismiss the complaint, holding that although
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`the complaint was less than clear, it appeared that “[a]t a minimum, Freeplay’s complaint can be
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`construed as asserting that the Broadcasters did not merely broadcast programming supplied by
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`an outside producer that violated its synchronization rights, but actually produced infringing
`
`materials themselves, an accusation that would state a claim for violation of copyright.” Id. at
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`*3. The parties have now filed cross-motions for partial summary judgment that pose the
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`question whether Freeplay can prevail on a claim that the Broadcasters violated its copyrights
`
`simply by broadcasting allegedly infringing materials created and supplied by others. Since it
`
`may not, defendants’ motion will be granted, and plaintiff’s denied.
`
`BACKGROUND
`
`I.
`
`Procedural History
`
`Freeplay filed its complaint on July 2, 2004. As noted in the Court’s prior opinion, the
`
`complaint itself appeared to allege only that the Broadcasters had infringed Freeplay’s
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`copyrights by “broadcasting Freeplay’s copyrighted sound recordings and compositions over the
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`radio as part of their regular programming.” Id. at *1. In fact, however, it emerged from the
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`briefing of defendants’ initial motion to dismiss that Freeplay’s claim was a quite different, and
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`more complex, allegation that the Broadcasters had violated its “synchronization rights” by
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`broadcasting or creating recordings that incorporated Freeplay’s musical compositions into a
`
`larger whole, for example, by using Freeplay’s compositions as background music during a
`
`commercial or promotional spot in which a product or service is advertised. The Court denied
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`the motion, holding that the complaint stated a copyright cause of action, at the very least to the
`
`2
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 3 of 13
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`extent that it asserted that the Broadcasters had themselves created such recordings. Id. at *3.
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`The Broadcasters proceeded to answer the complaint, asserting among other responses
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`the affirmative defense that they were licensed to broadcast Freeplay’s compositions. Freeplay
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`then moved for partial summary judgment striking that defense, and the Broadcasters cross-
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`moved for summary judgment dismissing any claims based on their broadcasting allegedly
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`infringing material created by others, arguing that its license defense was dispositive of such
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`claims.1
`
`II.
`
`Factual Background
`
`Discovery has not been completed, and the factual record is sparse. It is undisputed that
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`Freeplay holds copyrights both in certain musical compositions and in sound recordings
`
`embodying those compositions. Freeplay asserts, and for purposes of this motion it will be
`
`assumed to be the case, that the Broadcasters have broadcast recordings that illegally incorporate
`
`its compositions. The exact nature and origin of the material broadcast has not been established,
`
` After filing its own motion for summary judgment, Freeplay filed an Amended
`1
`Complaint. In opposing the Broadcasters’ motion, Freeplay argues that defendants’ motion is
`procedurally barred, because it was filed before defendants answered the Amended Complaint.
`This is mere gamesmanship. In the first place, since the Broadcasters had already answered
`Freeplay’s original complaint, an Amended Complaint may only be filed “by leave of court or by
`written consent of the adverse party.” Fed. R. Civ. P. 15(a). Freeplay has secured neither the
`defendants’ consent nor the Court’s leave to file. While such leave “shall be freely given when
`justice so requires,” id., justice manifestly does not require allowing filing of an amended
`complaint in order to abort the briefing of an issue whose prompt resolution will expedite
`resolution of the case, particularly where the party seeking to amend itself invited resolution of
`that very issue by filing its own motion. Freeplay’s position in this regard is totally incoherent:
`although it argues that the Broadcasters’ motion addresses an outdated complaint, Freeplay’s
`own motion, which it has not withdrawn, seeks to strike a portion of the Broadcasters’ answer to
`that very complaint. Accordingly, leave to file Freeplay’s purported Amended Complaint is
`denied, and the Broadcasters’ motion to strike the Amended Complaint is granted, without
`prejudice to Freeplay’s seeking leave to file an Amended Complaint at some future time.
`
`3
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 4 of 13
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`but it appears to be assumed by the parties that some or all of the allegedly infringing material
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`consists of recordings made and supplied to the Broadcasters by third parties, such as
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`commercial advertisements. It follows that resolution of the legal issue posed by this motion
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`will significantly affect the scope of this action and the extent of defendants’ potential liability.
`
`The Broadcasters’ exposure will apparently be significantly greater if Freeplay can assert a claim
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`for damages based not only on any use defendants have themselves made of its compositions,
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`but also on their broadcasting recordings made by others that incorporate those compositions.
`
`The Broadcasters’ license defense is based on licenses they have obtained from
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`Broadcast Music, Inc. (“BMI”). BMI, which is not a party to this lawsuit, is a non-profit
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`organization that enters agreements with songwriters, composers, and music publishers. Under
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`these agreements, the artists grant BMI a (non-exclusive) right to license public performance of
`
`their copyrighted musical works. Freeplay has entered such an affiliation agreement with BMI.
`
`BMI in turn issues licenses to customers, including the Broadcasters, permitting them to publicly
`
`perform all of its affiliated artists’ copyrighted musical works. BMI collects fees from its
`
`licensees, and in turn pays royalties to the artists according to the terms of its agreements. It is
`
`undisputed that Freeplay’s musical compositions are covered by BMI licenses issued to the
`
`Broadcasters. The Broadcasters claim that these licenses defeat any claim against them for
`
`broadcasting programming created by others that incorporates Freeplay’s compositions, even if
`
`such programming was created in violation of Freeplay’s “synchronization rights.” Freeplay
`
`argues that it does not.
`
`4
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 5 of 13
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`DISCUSSION
`
`Copyright is commonly conceived as “a bundle of discrete exclusive rights” each of
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`which may be transferred or retained separately by the copyright owner. N.Y. Times Co. v.
`
`Tasini, 533 U.S. 483, 495-96 (2001) (internal quotation marks omitted). See 17 U.S.C. §
`
`201(d)(2) (“Any of the exclusive rights comprised in a copyright, including any subdivision of
`
`any of the rights specified by section 106, may be transferred . . . and owned separately.”).
`
`Freeplay’s claim concerns one specific right included within a copyright for a musical
`
`composition or sound recording, the so-called “synchronization right.”
`
`The Copyright Act does not explicitly define or confer any separately-labeled
`
`“synchronization” right. It does, however, give the copyright holder the exclusive right (among
`
`others) “to reproduce the copyrighted work in copies or phonorecords.” 17 U.S.C. § 106(1). As
`
`the Second Circuit has described it, “the so-called synchronization right, or ‘synch’ right . . . [is]
`
`the right to reproduce the music onto the soundtrack of a film or a videotape in synchronization
`
`with the action. The ‘synch’ right is a form of the reproduction right also created by statute as
`
`one of the exclusive rights enjoyed by the copyright owner.” Buffalo Broad. Co., Inc. v. Am.
`
`Soc’y of Composers, Authors & Publishers, 744 F.2d 917, 920 (2d Cir. 1984). The Court went
`
`on to note, “When [a] producer wishes to use outside music in a film or videotape program, it
`
`must obtain from the copyright proprietor the ‘synch’ right in order to record the music on the
`
`soundtrack of the film or tape.” Id. at 921. Such a license is necessary because “incorporating a
`
`copyrighted sound recording into the soundtrack of a taped commercial television production
`
`infringes the copyright owner’s exclusive right of reproduction.” Agee v. Paramount Commc’ns,
`
`Inc., 59 F.3d 317, 319 (2d Cir. 1995).
`
`5
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 6 of 13
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`The exclusive right to reproduce a copyrighted composition or recording, of which the
`
`synchronization right is an aspect or subdivision, is distinct from the right, separately granted to
`
`a copyright holder by 17 U.S.C. § 106(4), to perform a copyrighted musical work publicly. The
`
`distinction, at least in its most common applications, is straightforward: performing a
`
`copyrighted musical composition (say, singing Bob Dylan’s song “Blowin’ in the Wind”) on a
`
`radio show constitutes a performance of the work; incorporating a tape of a copyrighted
`
`recording into a television commercial or the soundtrack of a movie (say, copying the recording
`
`of Mr. Dylan singing “Blowin’ in the Wind” onto the soundtrack of a commercial for a store
`
`selling kites or a fiction film about hang-gliders) constitutes a reproduction of the work
`
`(specifically, in the form of synchronization).
`
`Rights to perform and reproduce copyrighted works are separately granted and may be
`
`separately licensed. For example, both musical compositions such as songs, 17 U.S.C. §
`
`102(a)(2), and particular sound recordings embodying versions of those compositions, id. §
`
`102(a)(7), may be copyrighted, but different rights attach to each. Thus, any copyright confers
`
`on its owner the exclusive right to reproduce the copyrighted work. Id. § 106(1). However,
`
`while a copyright in a musical work confers the exclusive right to perform the copyrighted work
`
`publicly, id. § 106(4), a copyright in a sound recording does not. Id. §§ 106(4), 114(a).
`
`Although the owner of a copyright in the musical composition holds the exclusive right both to
`
`reproduce and to perform the composition, he or she may license, or decline to license, either
`
`right separately.
`
`It is common ground between the parties that BMI licenses cover the public performance
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`of Freeplay’s compositions, and therefore authorize the Broadcasters to play recordings of
`
`6
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 7 of 13
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`Freeplay’s music on the air during their radio programs. The BMI licenses do not purport to
`
`authorize licensees to reproduce works of its affiliated copyright owners, however. Thus,
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`holding a BMI blanket license would not authorize a licensee to engage in synchronization.
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`More specifically, the BMI license would not authorize the Broadcasters to create promotional
`
`audiotape that used Freeplay’s recordings as a background to a commercial urging listeners to
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`“tune in to WXYZ radio.” The question that divides the parties is whether the licenses
`2
`
`authorize the Broadcasters to play recordings that incorporate Freeplay’s compositions, the
`
`making of which infringed Freeplay’s reproduction rights.3
`
`The Second Circuit’s decision in Agee addressed a closely connected issue, in a way that
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`the Broadcasters contend is dispositive of the issue. Agee owned the copyright in two sound
`
`recordings (but not in the underlying musical compositions). Without obtaining a license from
`
`Agee, Paramount, a producer of television programs, used the recordings on the soundtrack of a
`
`television program (apparently to humorous effect) to accompany visual images of a pair of
`
` The Broadcasters have disputed this proposition, arguing that “synchronization” is
`2
`specifically defined in the leading cases as including a musical work on the soundtrack of an
`audiovisual work, “synchronized” to the action on the video recording. The Court rejected that
`argument, noting among other things that the reason such “synchronization” is the exclusive
`right of the copyright holder is that it constitutes the “reproduction” of the musical work. See
`Freeplay, 2005 WL 1500898, at *2 n.1. Such reproduction by another need not be synchronized
`with visual images to constitute an infringement. See Agee, 59 F.3d at 322 (“[C]ommercial
`entities . . . may not reproduce sound recordings on soundtracks of audiovisual works, whether
`or not the reproduction involves synchronization.”). Unlicensed reproduction of the work
`infringes the copyright whether the medium of the reproduction is a film soundtrack, a
`videotape, or an audiotape.
`
` This opinion addresses only the scope of the BMI license. Whether the Broadcasters
`3
`have acquired a license to synchronize Freeplay’s copyrighted works in some other manner is
`not before the Court, and the Court expresses no opinion about any claim of license from any
`source other than the BMI license.
`
`7
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 8 of 13
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`bumbling burglars. The program was then sold to television stations which broadcast it as part
`
`of their programming. Agee sued both Paramount and the TV stations.
`
`The Court of Appeals held that Paramount’s actions violated Agee’s reproduction rights,
`
`which were held to be “broad enough to include a synch right, which would require a producer to
`
`obtain authorization from the owner of a sound recording before reproducing that recording in
`
`the soundtrack of an audiovisual work.” Agee, 59 F.3d at 322. The result was different for the
`
`TV stations, however. The Court rejected the argument that the TV stations infringed Agee’s
`
`copyright by broadcasting the infringing program. In essence, the Court held that the TV
`
`stations’ broadcast of the offending program constituted a performance of Agee’s recordings, not
`
`a reproduction or distribution of them. “Because [the owner of a copyright in a sound
`4
`
`recording] has no exclusive performance rights, see 17 U.S.C. § 114(a), the TV stations were
`
`entitled to broadcast [the recording] without [Agee’s] consent.” Id. at 326. Even broadcasting
`
`an infringing copy of the recording, whether made by Paramount or by the stations themselves,
`
`“would still constitute a ‘performance,’” and thus be within the TV stations’ rights. Id. So
`
`would the performance (broadcasting) of a derivative work illegally created by Paramount. Id.
`
`To accept Agee’s theory would have granted the holders of copyrights in sound recordings a
`
`performance right that the statute specifically declined to confer.
`
` The TV stations did make a copy of the program, but the Court held that this limited
`4
`reproduction fell within the statutory “ephemeral recording exemption,” 17 U.S.C. § 112(a),
`applicable to “transmitting organizations” such as broadcasters, because they made only a single
`copy of the program, used it solely for their own transmission of the program, and were
`contractually obligated either to return the copy to Paramount or to destroy it. Agee, 59 F.3d at
`326.
`
`8
`
`

`
`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 9 of 13
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`Freeplay argues that Agee is distinguishable because it, unlike Agee, owns copyrights not
`
`only in its sound recordings but also in the underlying musical compositions. That is true, as far
`
`as it goes. Had Agee owned the copyright in compositions, and had the TV stations, without
`
`license from Agee, broadcast the offending program, the Second Circuit’s reasoning would not
`
`have applied, and the TV stations would presumably have been liable. Here, however, the
`
`Broadcasters have a performance license from Freeplay, via BMI. The logic of Agee is that
`
`regardless of any violation of reproduction rights that may have occurred in the creation of a
`
`piece of programming, a party who has the right to perform the copyrighted work can perform it
`
`without itself becoming liable for the underlying infringement. It makes no difference whether
`
`the broadcaster has the right to perform the work because no exclusive performance right existed
`
`in the first place (as with the sound recording in Agee), or because the performance right existed
`
`but had been licensed to the broadcaster (as with Freeplay’s musical compositions here). Either
`
`way, the point is the same: the broadcaster has the right to perform the work, and the fact that
`
`the “program was ‘tainted’ by [the producer’s] unauthorized use of [the] work” does not defeat
`
`that right. Id. at 326.
`
`Nor is Freeplay assisted by its argument that although its works themselves are part of
`
`the “BMI Repertoire” licensed to the Broadcasters for performance, “if an advertiser illegally
`
`synchronizes a musical composition with other music, words and/or other sounds to create a
`
`radio commercial, then that radio commercial constitutes a ‘derivative work’ and is a new
`
`composition which is not in the BMI Repertoire.” (P. Mem. 9; emphasis in original.) The Agee
`
`Court left open whether Paramount’s television program constituted a derivative work, since
`
`Paramount’s violation of Agee’s reproduction right formed a sufficient basis for Paramount’s
`
`9
`
`

`
`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 10 of 13
`
`liability. 59 F.3d at 324. It held, however, that even assuming that it did, “[t]he TV stations also
`
`would have been entitled to perform a derivative work that Paramount had created using Agee’s
`
`sound recording.” Id. at 326 (emphasis in original). The Copyright Act only gives copyright
`
`holders (of sound recordings or musical compositions) the exclusive right “to prepare derivative
`
`works based upon the copyrighted work. ” 17 U.S.C. § 106(2) (emphasis added). “[I]t says
`
`nothing about the right to perform such [derivative] works.” Agee, 59 F.3d at 326 (emphasis in
`
`original).
`
`Put another way, assuming arguendo that radio commercials using Freeplay’s music
`
`would qualify as derivative works, the statute makes the creation of the derivative work an
`5
`
`infringement of Freeplay’s copyright; it does not automatically confer on Freeplay a copyright in
`
`the commercial. Freeplay argues that the BMI licenses cannot cover such commercials, because
`
`such a commercial “is not a musical composition ‘in which publisher [Freeplay] owns or
`
`controls performing rights’ which BMI has licensed from [Freeplay].” (P. Mem. 11, quoting
`
`BMI license, Schreer Decl. Ex. A). But this argument is self-defeating: the reason the
`
`commercials are not covered by the license is precisely because Freeplay does not control any
`
`copyright in them. In any event, the Broadcasters do not claim that the BMI license authorizes
`
`them to perform the commercials – presumably they have a license to do that from the
`
` It is not clear that Freeplay has pled an infringement of its exclusive right to prepare
`5
`derivative works. Moreover, as the Second Circuit pointed out in Agee, it is not clear that the
`creation of a commercial of the sort hypothesized here, which simply uses copyrighted music as
`background, without alteration, constitutes creation of a derivative work (as opposed to a simple
`violation of the copyright owner’s reproduction right). A derivative work must effect some
`transformation of the original, as by rearranging, remixing or otherwise altering it in sequence or
`quality. Agee, 59 F.3d at 324, citing 17 U.S.C. 114(b). The record is insufficient to resolve
`such questions, and doing so is unnecessary to this Court’s resolution of the motions before it.
`
`10
`
`

`
`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 11 of 13
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`advertisers, and if they don’t, Freeplay has no standing to complain – rather, the Broadcasters
`
`argue that the licenses give them the right to perform Freeplay’s compositions. By broadcasting
`
`a putative derivative work created by a third-party advertiser, the Broadcasters did not prepare a
`
`derivative work, any more than did the TV stations in Agee. They thus did not infringe
`
`Freeplay’s right to control the creation of derivative works as granted by § 106(2). Thus, any
`
`infringement of Freeplay’s copyrights by a third-party producer of radio commercials, whether
`
`conceived as a violation of Freeplay’s reproduction (synchronization) right or of its right to
`
`prepare derivative works, cannot enlarge Freeplay’s rights in its own compositions or revive an
`
`exclusive right that has been fully licensed to the Broadcasters.
`
`Freeplay argues, finally, that BMI does not collect information from its licensees about
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`performances of musical compositions incorporated in commercials of the sort hypothesized
`
`here, and therefore pays no royalties to Freeplay for such performances. (P. Mem. 13-14.) If
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`that is so, it is a matter between BMI and Freeplay, and does not affect the resolution of the
`
`copyright issues before the Court. Whether BMI is obligated to collect such information and pay
`
`such royalties depends on an interpretation of BMI’s agreement with Freeplay. If BMI is so
`
`obligated, and is in breach of its obligations, Freeplay’s cause of action lies against BMI, not the
`
`Broadcasters. If BMI is not so obligated, then Freeplay can seek to renegotiate its agreement
`
`with BMI.6
`
` The only case cited by either side that appears to be directly on point is Jackson v. Stone
`6
`& Simon Adver., Inc., 188 U.S.P.Q. 564 (E.D. Mich. 1974). In Jackson, a copyright holder
`claimed that the broadcast of its copyrighted composition as part of a television advertisement
`prepared by a third party violated its copyright. The court held that the television stations’
`broadcast of a commercial that made unlicensed use of a copyrighted work was authorized by the
`stations’ BMI licenses to perform the work, and that “the contract between BMI and [the
`copyright holder] . . . constitutes a complete bar to any action against the television stations.” Id.
`
`11
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 12 of 13
`Case l:04—cv—O5238—GEL Document 96 Filed 12/13/05 Page 12 of 13
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`12
`12
`
`

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`Case 1:04-cv-05238-GEL Document 96 Filed 12/13/05 Page 13 of 13
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`
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`Case 1:O4—cv—O5238—GEL Document 96 Filed 12/13/05 Page 13 of 13
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`CONCLUSION
`
`Accordingly, plaintiffs motion for partial summary judgment striking defendants’
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`affirmative defense predicated on the BMI licenses is denied. Defendants’ motion for partial
`
`summary judgment is granted, to the extent that any claim by plaintiff for copyright infringement
`
`based on the broadcast of material infringing plaintiffs synchronization rights produced by
`
`third-parties is dismissed. Since plaintiffs complaint alleges that at least some of the challenged
`
`material was prepared by defendants themselves, the complaint remains viable, and discovery
`
`may continue with respect to that claim. Defendants’ motion to strike plaintiffs Amended
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`Complaint is granted, without prejudice to any future motion by plaintiff to amend its
`
`complaint.7

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