Case: 5:18-cv-00215-DCR-MAS Doc #: 41 Filed: 03/12/19 Page: 1 of 12 - Page ID#: 450
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`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF KENTUCKY
`CENTRAL DIVISION
`(at Lexington)
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`Civil Action No. 5: 18-215-DCR
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`MEMORANDUM OPINION
`AND ORDER
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`)))))))))
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`BROADCAST MUSIC, INC., et al.,
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`V.
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`MARY KATHERINE LOCKHART, et al.,
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`Plaintiffs,
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`Defendants.
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`*** *** *** ***
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`This is a copyright infringement action brought against the owner and manager of the
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`Blue Moon in Richmond, Kentucky. Plaintiffs Broadcast Music, Inc.(“BMI”), Del Sound
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`Music, House of Cash, Inc., Warner-Tamerlane Publishing Corp., Eleksylum Music, Inc., No
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`Surrender Music, Muscle Shoals Sound Publishing Co., Peermusic III, Ltd., and ARC Music
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`Corp. have filed a motion for summary judgment, asserting that Defendants Mary Katherine
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`Lockhart and Prentice Richardson knowingly and intentionally infringed upon four copyrights
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`licensed by the plaintiffs. [Record No. 36] The plaintiffs request statutory damages, attorney’s
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`fees, and a permanent injunction.
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`I.
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`
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`BMI is a non-profit performing rights organization that licenses the right to perform
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`copyrighted music on behalf of the owners of the copyrights. [Record No. 36-4] BMI has
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`non-exclusive performance rights that have been acquired from copyright owners, including
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`publishing companies and independent composers. [Record No. 36-4] The other plaintiffs in
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`this lawsuit are copyright owners of the various compositions at issue in this lawsuit. [Record
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`Case: 5:18-cv-00215-DCR-MAS Doc #: 41 Filed: 03/12/19 Page: 2 of 12 - Page ID#: 451
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`No. 1] After acquiring public performance rights from composers, BMI grants music users
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`such as restaurants and nightclubs the right to publicly perform the copyrighted music.
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`[Record No. 1]
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`Defendant Lockhart is the sole proprietor of Blue Moon. Her son, Defendant
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`Richardson, helps manage the establishment. [Record No. 36-2, p. 6] Blue Moon is located
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`at 525 East Irvine Street in Richmond, Kentucky. [Record No. 36-2, p. 3] Blue Moon regularly
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`features live and recorded music. [Record No. 36-2, p. 3]
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`BMI learned that Blue Moon was offering live music without a license and without
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`obtaining permission from the copyright owners prior to September 2014. [Record No. 36-4,
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`p. 3] It repeatedly sent letters and called the defendants to explain that they needed to obtain
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`permission for public performances of the copyrighted music from September 2014 to March
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`2017. [Record No. 36-5, p. 5] BMI offered to enter into a license agreement with the
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`defendants, but the defendants rejected the offer. [Record No. 36-5, p. 5] The defendants
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`previously held a license from BMI for Blue Moon that expired at the end of 2005. [Record
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`No. 1, p. 3]
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`BMI notified the defendants on April 9, 2015, that they needed to cease public
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`performances of music licensed by BMI. [Record No. 36-5, p. 5] It then sent follow-up letters
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`on April 11, 2015, October 12, 2016, October 25, 2016, March 3, 2017, and March 6, 2017.
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`[Record No. 36-5, pp. 3-4] However, public performances continued at Blue Moon. [Record
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`No. 36-5, p. 4] A BMI investigator attended a public performance at Blue Moon on April 15,
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`2017. [Record No. 36-4] The investigator noted that three songs performed were in BMI’s
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`repertoire. [Record No. 36-5, p. 4] After, the investigator generated a report, an employee of
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`BMI confirmed those three songs and a fourth composition were in its repertoire. [Record No.
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`36-5, pp. 4-5] Those four compositions are the subject of this action.
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`II.
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`Summary judgment is appropriate if there are no genuine disputes regarding any
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`material facts and the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a);
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`see Celotex Corp. v. Catrett, 477 U.S. 317, 322–23 (1986); Chao v. Hall Holding Co., 285
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`F.3d 415, 424 (6th Cir. 2002). A dispute over a material fact is not “genuine” unless a
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`reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby,
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`Inc., 477 U.S. 242, 247-48 (1986). The determination must be “whether the evidence presents
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`a sufficient disagreement to require submission to a jury or whether it is so one-sided that one
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`party must prevail as a matter of law.” Anderson, 477 U.S. at 251–52; see Harrison v. Ash,
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`539 F.3d 510, 516 (6th Cir. 2008).
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`Once the moving party has met its burden of production, “its opponent must do more
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`than simply show that there is some metaphysical doubt as to the material facts.” Keeneland
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`Ass’n, Inc. v. Earnes, 830 F. Supp. 974, 984 (E.D. Ky. 1993) (citing Matsushita Elec. Indus.
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`Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)). The nonmoving party cannot rely on
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`the assertions in its pleadings; rather, it must come forward with probative evidence to support
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`its claims. Celotex, 477 U.S. at 324. In deciding whether to grant summary judgment, the
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`Court views all the facts and inferences drawn from the evidence in the light most favorable
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`to the nonmoving party. Matsushita Elec. Indus. Co., 475 U.S. at 58.
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`III.
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`a. The defendants violated the Copyright Act by publicly performing four
`unauthorized works.
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`Case: 5:18-cv-00215-DCR-MAS Doc #: 41 Filed: 03/12/19 Page: 4 of 12 - Page ID#: 453
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`The Copyright Act grants the owner of a copyright the exclusive right to perform or
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`authorize a performance of the copyrighted work. 17 U.S.C. § 106(4). “Anyone who violates
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`any of the exclusive rights of the copyright owner . . . is an infringer of the copyright . . . .” 17
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`U.S.C. § 501(a). To establish a claim of copyright infringement, the plaintiffs must
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`demonstrate “(1) the originality and authorship of a composition; (2) a valid copyright under
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`the formalities of the Copyright Act; (3) claimant’s ownership of the copyright at issue; (4)
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`defendant’s public performance of the composition; and (5) defendant’s failure to obtain
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`permission from the claimant for such performance.” Broadcast Music, Inc. v. Rooster’s, Inc.,
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`2006 U.S. Dist. LEXIS 5535 *1, *9 (E.D. Ky. Feb. 14, 2006); see also Jobete Music Co., Inc.
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`v. Johnson Communications, Inc., 285 F. Supp. 2d 1077, 1082 (S.D. Ohio 2003).
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` The plaintiffs allege that the first three elements of a claim of copyright infringement
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`are satisfied by the Ellwood Declaration. [Record No. 36-1, p. 7] The Ellwood Declaration
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`and corresponding attachments include the names and performers of the works performed, the
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`date of the copyrights, the registration certificates, and documents relating to the chain of
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`ownership of the songs. [Record No. 36-4] “A copyright certificate is prima facie evidence
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`of the first three elements of an infringement claim.” Broadcast Music, Inc. v. Rooster’s, Inc.,
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`2006 U.S. Dist. LEXIS 5535 *1, *10 (E.D. Ky. Feb. 14, 2006). Copyright registration
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`certificates are included in the attachments to the Ellwood Declaration. [See, e.g., Record No.
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`36-4, p. 36.]
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` The plaintiffs also include a Certified Infringement Report of Paul Young in support
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`of the fourth element of copyright infringement, public performance. [Record No. 36-5, pp.
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`7-13] Young was hired to visit Blue Moon and develop a written report of the musical works
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`that were performed. [Record No. 36-5, pp. 4-5] He visited Blue Moon on April 15, 2017,
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`and made a digital recording of the performance. [Record No. 36-5, p. 13] The defendants
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`explicitly admitted that one of the songs at issue was performed at Blue Moon on April 15,
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`2017. [Record No. 36-3, p. 4] The defendants also admit that they have no evidence
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`controverting that all of the compositions at issue were performed. [Record No. 36-3, pp. 4-
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`5]
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`The defendants did not have a BMI license agreement or have the performances
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`authorized. [Record No. 36-5, p. 3] BMI repeatedly offered to enter into a license agreement
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`with the defendants, but the defendants chose not to enter into an agreement and continued to
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`perform the copyrighted music. [See, e.g., Record No. 36-5, p. 29.] The defendants admitted
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`that they were contacted repeatedly by BMI offering to grant Blue Moon a license for public
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`performances. [Record No. 32-2, p. 19] The evidence provided by the plaintiffs demonstrates
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`that the performance was not authorized.
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`The defendants offer no evidence to dispute the fact that the plaintiffs have satisfied all
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`five elements of copyright infringement. Thus, the plaintiffs have established that no genuine
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`issue of material fact exists regarding the establishment of the five elements of a copyright
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`infringement claim.
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`i.
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`The defendants are not exempt from the Copyright Act under 17 U.S.C.
`§ 110(4).
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`The defendants argue that 17 U.S.C. § 110(4) provides an exemption from the licensing
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`requirements. Title 17 of the United States Code, section 110(4) provides:
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`(4) performance of a nondramatic literary or musical work otherwise than in a
`transmission to the public, without any purpose of direct or indirect commercial
`advantage and without payment of any fee or other compensation for the
`performance to any of its performers, promoters, or organizers, if--
`(A) there is no direct or indirect admission charge; or
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`(B) the proceeds, after deducting the reasonable costs of producing the
`performance, are used exclusively for educational, religious, or
`charitable purposes and not for private financial gain, except where the
`copyright owner has served notice of objection to the performance under
`the following conditions:
`(i) the notice shall be in writing and signed by the copyright
`owner or such owner's duly authorized agent; and
`(ii) the notice shall be served on the person responsible for the
`performance at least seven days before the date of the
`performance, and shall state the reasons for the objection; and
`(iii) the notice shall comply, in form, content, and manner of service,
`with requirements that the Register of Copyrights shall prescribe by
`regulation.
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` “Whether the use of copyrighted material is in fact a financial success is not the
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`deciding factor in determining the exemption under § 110(4). The language of § 110(4)
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`requires that to be exempt the performance must be without any purpose of direct or indirect
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`commercial advantage.” Bourne Co. v. Speeks, 670 F. Supp. 777, 779 (E.D. Tenn. 1987)
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`(internal citations and quotations omitted) (holding that the defendant was not entitled to the
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`exemption under § 110(4) because even though the theatre did not make a profit it operated
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`hoping to make a profit). “A profit-making enterprise which publicly performs copyrighted
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`music is deemed to do so for profit . . . such an enterprise is considered profit-making even if
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`it never actually yields a profit.” Broadcast Music, Inc. v. Meadowlake, Ltd., 2013 U.S. Dist.
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`LEXIS 105850 *1, *15 (N.D. Ohio July 29, 2013) (quoting Major Bob Music v. Stubbs, 851
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`F. Supp. 475, 480 (S.D. Georgia 1994)), aff’d by Broadcast Music. Inc. v. Meadlowlake, Ltd.,
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`754 F.3d 353 (6th Cir. 2014); see also Herbert v. Shanley Co., 242 U.S. 591, 595 (1917). As
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`long as there is some nexus between the performances and the general business of the bar, then
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`the “for-profit” requirement is satisfied. Broad. Music, Inc. v. JJ Squared Corp., 2013 U.S.
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`Dist. LEXIS 180516 *1, *15 (E.D.N.Y. Dec. 26, 2013).
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`Richardson provides an affidavit explaining that there is no cover charge or entrance
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`fee when the band plays, the band receives no compensation, there is no cash flow as a result
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`of the performance, and the band members play for their own enjoyment, not for money.
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`[Record No. 39-1, pp. 2-3] However, Richardson notes that the defendants make money on
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`the Juke Box and commission on KENO sales. [Record No. 39-1, p. 2]
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`Blue Moon is a profit-making enterprise, even though it breaks even on cash flow. See,
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`e.g., Major Bob Music, 851 F. Supp. at 480 (explaining a local “watering-hole,” the Buck and
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`Doe Corral, is a “profit-making enterprise); U.S. Songs, Inc. v. Downside Lenox, Inc., 771 F.
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`Supp. 1220, 1226 (N.D. Ga. 1991) (noting the restaurant and bar at issue was “considered to
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`be a profit-making enterprise even if it never actually makes a profit”). Therefore, the
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`exception under 17 U.S.C. § 110(4) does not apply in this case.
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`ii.
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`The defendants are vicariously liable for the unauthorized performance.
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`The plaintiffs argue that the defendants are vicariously liable for the unauthorized
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`public performance. “[T]he Copyright Act does not expressly render anyone liable for
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`infringement committed by another . . . [But] vicarious liability is imposed in virtually all areas
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`of the law.” Sony Corp. of Am. v. Universal City Studios, Inc., 464 U.S. 417, 434-35 (1984).
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`A party is jointly and severally liable if “he [or she] has the right and ability to supervise
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`the infringing activity and also has a direct financial interest in such activities.” Gershwin
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`Pub. Corp. v. Columbia Artists Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971). “A proprietor
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`is liable under the Copyright Act for the copyright infringement of musicians whom the
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`proprietor allows to perform in [her] establishment, even if the proprietor tells the musicians
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`not to play protected works, or is unaware that the songs performed were copyrighted.” Broad.
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`Music, Inc. v. 315 West 44th St., 1995 U.S. Dist. LEXIS 9575 *1, *4 (S.D.N.Y July 11, 1995)
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`(citations omitted); see also Broad. Music, Inc. v. JJ Squared Corp., 2013 U.S. Dist. LEXIS
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`180516 at *15.
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`The Blue Moon is a sole proprietorship, so the plaintiffs seek to impose vicarious
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`liability through the tort theory of respondeat superior. The defendants admit that they had the
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`right and ability to direct and control activities at the Blue Moon and that they operated and
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`maintained the Blue Moon. [Record No. 36-2, pp. 14-15] Further, Lockhart had a direct
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`financial interest in Blue Moon. [Record No. 36-2, p. 15] Additionally, Richardson was a
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`performer of the unauthorized performance. There is no genuine issue of material fact that
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`Lockhart is vicariously liable for the unauthorized performance on April 15, 2017.
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`b. The plaintiffs are entitled to attorney’s fees and costs.
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`Section 505 allows the Court to award full costs, including reasonable attorney’s fees.
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`17 U.S.C. § 505. Courts routinely award reasonable attorneys fees in these actions. See, e.g.,
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`Coleman v. Payne, 698 F. Supp. 704, 707-08 (W.D. Mich. 1988). The Court retains discretion
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`in deciding whether to grant attorney’s fees. 17 U.S.C. § 505; Fogerty v. Fantasy, Inc., 510
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`U.S. 517, 534 (1994). The plaintiffs state that they will tender a declaration of counsel for
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`attorney’s fees and costs if the Court grants the present motion. The Court finds that the
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`plaintiffs are entitled to attorney’s fees and costs, but will reserve determining the appropriate
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`amount of attorney’s fees until after the plaintiffs tender the appropriate information in support.
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`c. The defendants will be enjoined from performing music within BMI’s
`repertoire, unless and until they get a proper license.
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`The Copyright Act allows the Court to grant “final injunctions on such terms as it may
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`deem reasonable to prevent or restrain infringement of a copyright.” 17 U.S.C. § 502(a).
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`“While the issuance of an injunction is in the discretion of the court, courts have traditionally
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`granted permanent injunctions if liability is established and a continuing threat to a copyright
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`exists.” Bridgeport Music, Inc. v. Justin Combs Publ’g, 507 F.3d 470, 492 (6th Cir. 2007);
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`Superhype Pub’l, Inc. v. Vasiliou, 838 F. Supp. 1220, 1226 (S.D. Ohio 1993) (“A showing of
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`past infringement and a substantial likelihood of future infringement entitles a copyright owner
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`to permanent injunction.”). The Court may issue a permanent injunction without an
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`evidentiary hearing if there are no triable issues of fact involved. United States v. McGee, 714
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`F.2d 607, 613 (6th Cir. 1983). Further, the Court may grant injunctive relief even if the
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`defendants have secured licenses after the time of infringement. See Milene Music v. Gotauco,
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`551 F. Supp. 1288, 1295 (D.R.I. 1982).
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`Because the defendants continued to hold live performances after receiving multiple
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`letters and phones calls from BMI, there is a strong likelihood that copyright infringement may
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`occur in the future at Blue Moon, thus, injunctive relief is appropriate. The defendants will be
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`enjoined from performing any of the songs within the BMI repertoire unless and until they
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`receive the proper license.
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`d. The plaintiffs are entitled to $14,000.00 in statutory damages.
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`Section 504(c)(1) provides for statutory damages for each act of infringement between
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`$750 and $30,000. 17 U.S.C. § 504(c)(1). However, if the copyright owner establishes willful
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`infringement, a Court can increase statutory damages up to $150,000. The Court may also
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`grant less than $750 if the Court finds that the infringement was innocent. The Court has
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`discretion in awarding damages within the statutorily prescribed range. See Fitzgerald Pub.
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`Co. v. Baylor Pub. Co., 807 F.2d 1110, 1116 (2d Cir. 1986).
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`In determining the amount of damages to be awarded, courts generally consider:
`(1) the infringer’s blameworthiness, i.e., whether the infringement was willful,
`knowing, or innocent; (2) the expenses saved and the profits reaped by the
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`defendants in connection with the infringement; (3) the revenues lost by the
`plaintiffs due to the defendants’ conduct; and (4) the goal of deterring wrongful
`conduct. As a starting point, some courts also consider the amount of money it
`would have cost the infringer to properly obtain a license.
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`Broad. Music, Inc. v. Rooster’s, Inc., 2006 U.S. Dist. LEXIS 36616 *1, *7 (E.D. Ky. Mar. 29,
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`2006) (internal citations and quotations omitted).
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`The plaintiffs seek statutory damages in the amount of $7,000 per infringement, totaling
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`$28,000 for the four infringements. The plaintiffs note that “[c]ourts have consistently held
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`that a statutory damages award between three to five times the amount that the plaintiffs would
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`have received in licensing fees is appropriate under § 504(c).” See, e.g., Broadcast Music, Inc.
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`v. Pub Dayton, LLC, No. 3:11-cv-58, 2011 U.S. Dist. LEXIS 57211 (S.D. Ohio May 27, 2011).
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`They argue that the defendants willfully violated the Copyright Act and continued to
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`violate the Act even though they had been explicitly told not to. BMI sent numerous letters,
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`called the establishment, and finally visited the Blue Moon to offer the defendants the chance
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`to enter into a license agreement. The defendants knowingly and continually violated the
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`Copyright Act. Further, the plaintiffs explain that the estimated license fees from September
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`2014 to January 30, 2019, would be approximately $5,108.40. [Record No. 36-4, p. 6]
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`However, one factor to consider in awarding statutory damages is the profits reaped by the
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`defendants in connection with the infringement. The defendants’ interrogatories and affidavit
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`illustrate that the Blue Moon does not turn a profit, does not charge a cover for performances,
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`and the band does not get paid. [Record Nos. 39-1, pp. 2-3; 36-2, p. 6]
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`This Court will impose statutory damages of $3,500.00 per infringement, for a total of
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`$14,000.00. This amount is sufficient to compensate the plaintiffs and serves the goal of
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`deterring wrongful conduct.
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`IV.
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`The plaintiffs have put forth evidence demonstrating that the defendants publicly
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`performed four copyrighted works without authorization. The defendants did not provide any
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`evidence creating a genuine issue of material fact. Thus, the plaintiffs are entitled to summary
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`judgment as a matter of law. Accordingly, it is hereby
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`ORDERED as follows:
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`1.
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` Plaintiffs BMI, Del Sound Music, House of Cash, Inc., Warner-Tamerlane
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`Publishing Corp., Eleksylum Music, Inc., No Surrender Music, Muscle Shoals Sound
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`Publishing Co., Peermusic III, Ltd., and ARC Music Corp.’s Motion for Summary Judgment
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`[Record No. 36] is GRANTED.
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`2.
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`The defendants are permanently enjoined from performing any work in the BMI
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`repertoire at Blue Moon, unless and until a proper license granting such right is obtained.
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`3.
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`The defendants shall pay to plaintiffs’ statutory damages in the amount of
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`$3,500.00 per infringement for a total of $14,000.00, for which the defendants shall be jointly
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`and severally liable.
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`4.
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`The plaintiffs are entitled to attorney’s fees and costs. The plaintiffs shall submit
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`evidence of their attorney’s fees within fourteen (14) days of the entry of this Memorandum
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`Opinion and Order. Thereafter, the defendants shall have fourteen (14) days to file any
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`objections to the plaintiffs’ submission.
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`Case: 5:18-cv-00215-DCR-MAS Doc #: 41 Filed: 03/12/19 Page: 12 of 12 - Page ID#: 461
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`Dated: March 12, 2019.
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