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Seven of the US’ largest book publishing companies sued Audible, Inc. for copyright infringement in anticipation of Audible’s rollout of a new captions feature to their audiobooks.  The complaint, filed in federal court in the Southern District of New York on 23 August 2019 alleges that Audible’s planned inclusion of the text of a book in the distribution of an audiobook violates their copyrights in the books.  The publishers say that while Audible has the right to distribute the audiobooks, Audible does not have the right to include the text with the audiobook.

“Audible is a distributor of Publishers’ audiobooks and no more has the right to create and offer Distributed Text than a physical book store selling physical books would have the right to make and sell eBooks,” stated the complaint.

The plaintiffs, all member companies of the Association of American Publishers, asked the court for a preliminary and permanent injunction barring Audible’s planned rollout of the caption feature in their audiobooks on 10 September 2019.

CDA 230 Does Not Protect Online Businesses From Product Liability Claims Related to 3rd-Party Vendors

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The 3rd Circuit Court of Appeals has decided to review en banc a controversial panel decision issued last month over the liability of online marketplaces for the goods they sell.  The 3rd Circuit panel’s order in Oberdorf v. Amazon, (930 F.3d 136, 2019 WL 2849153 (3d Cir. July 3, 2019)) represented the first time a federal appeals court found an online marketplace strictly liable for the products sold on its platform by third-parties.

Amazon’s Marketplace allows third-party vendors to sell goods to Amazon customers via its website.  Ms. Oberdorf purchased a defective dog collar from a third-party vendor, Furry Gang, via Marketplace.  The collar subsequently broke, causing a retractable leash to recoil back and permanently blind Oberdorf in one eye.  Furry Gang could not be located by either Oberdorf or Amazon; Oberdorf sued Amazon for strict products liability and negligence under Pennsylvania state law for selling the defective dog collar.  Amazon’s position is that it is not a “seller” as defined under Pennsylvania products liability law because it merely provides an online marketplace for products sold by third-party vendors.

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Politicians on both sides of the aisle in the US face mounting pressure to curtail the limitations on liability for online activity provided by Section 230 of the 1997 Communications Decency Act (DCA).  47 US Code Section 230 is the primary law that allows online companies like Facebook, Twitter, Amazon, Google, YouTube, Instagram, VRBO, and thousands of other businesses to provide online services to consumers without fear of liability for the postings of their customers or other third-parties.

In other words, CDA 230 is critical to technological innovation and the development of tools that enable a robust public dialogue.  As described in Reason:

“…practically the entire suite of products we think of as the internet—search engines, social media, online publications with comments sections, Wikis, private message boards, matchmaking apps, job search sites, consumer review tools, digital marketplaces, Airbnb, cloud storage companies, podcast distributors, app stores, GIF clearinghouses, crowdsourced funding platforms, chat tools, email newsletters, online classifieds, video sharing venues, and the vast majority of what makes up our day-to-day digital experience—have benefited from the protections offered by Section 230.

Trent Reznor has rocked the music world once again. The long-time front man for Nine-Inch-Nails is convinced the current music business infrastructure is broken since it requires artists to rely on labels. Reznor is looking for a new model.

Last year NIN broke free from its major label and decided to go independent, look to its fans for support, and experiment with new business models made possible by the Internet.

So far, I’d say its working for Reznor and NIN. Within 36 hours of releasing the band’s latest album online with a variety of payment options, including free, it sold-out the 2,500 $300 Limited Edition Ultra-Deluxe Packages, grossing the ARTISTS $750,000 on the album’s first 2 days available, from that option alone.

If you are also a ballet geek, you may find the Basic Agreement between the San Francisco Ballet and the American Guild of Musical Artists fascinating.

I wrote an article highlighting some of the more interesting terms in this collective bargaining agreement that is signed by every ballet dancer (and choreographer) who works with the San Francisco Ballet.

However the Basic Agreement contains only *minimum* commitments to artists. Dancers and choreographers also sign an “Individual Artist’s Agreement” with the company that can include higher salaries and other negotiated perks. The dancers and choreographers pay AGMA dues of 2% of their gross compensation under the Basic Agreement. Read the full article for the details:

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Jazz Music Education for the Masses

My client, the legendary Monterey Jazz Festival (MJF) has launched an exciting new project, the Digital Music Education Project (DMEP) that uses the power of the Internet to bring jazz music education to the masses.

Besides hosting the hottest jazz concert each year, the Monterey Jazz Festival is a nonprofit organization that invests its resources in jazz music education programs, especially in the local public schools. But now thanks to MJF’s Digital Music Education Project, those educational opportunities are captured, digitized, and made available for free download by anyone in the world. Listen to today’s top jazz artists give advice to students or discuss their own musical influences from the DMEP website. “Master classes” taught by renowned jazz experts can be accessible by anyone via the Internet.

The Internet has created exciting new opportunities for artists to distribute their music to the world, but cyberspace is not without its share of hucksters ready to trick artists into signing away all ownership rights to their music for a song.

A musician recently came to me to review a recording contract that had been offered to him from an independent record company. Although the artist had already recorded the CD of his original compositions, he wanted a record label to distribute his CD.

He thought he was signing a distribution deal. But buried in the back of the contract was a clause requiring the artist to assign all of his publishing copyrights in the music to the record label. Although the contract was labeled as a “Exclusive Recording Agreement”, it was in fact, also a Publishing Agreement, and this distinction is worth everything to an artist.

Many artists wonder if it worth the trouble to register their creative works with the US Copyright Office. The answer to any artist who hopes to distribute their works to the public is YES!

Registration is not a condition for copyright protection to attach. A work is protected by copyright when it “fixed in a tangible medium”, which basically means when it is written down, or otherwise recorded. Copyright law creates a number of important advantages to induce copyright holders to register their works. Some advantages of registration include:

  • Registration of works are necessary before a lawsuit for infringement can be filed.
  • Statutory damages and attorneys fees are available to copyright owners in court actions if registration is made prior to the infringement or within 3 months of the work’s publication. For non-registered works, only actual damages and profits are available to copyright owners in successful infringement actions.
  • Registration establishes a public record of the copyright claim.
  • Registration will establish prima facie evidence in court of the validity of the copyright and of the facts stated on the certificate (if registration is made before or within 5 years of publication).
  • Registration permits the copyright owner to record the registration with the US Customs Service for protection against importation of infringing copies.

A creative work can be registered at any time during the life of the copyright, and if created in 2007, the copyright carries a term of 70-years after the life of the author.

Registration is a simple process and the fee is low ($45 for basic), so artists are encouraged to register their copyrights on their music, video and other works.

Innovative new media companies like San Francisco-based SNOCAP and UK-based 7Digital offer independent musicians tools to distribute their music digitally at their own price and on their own terms. The content-delivery services allow artists to sell their music on their own website, Myspace page, blog, or from 7Digital’s “IndieStore”. The music is distributed in a variety of formats, including the popular DRM-free MP3 format.

SNOCAP was created by Napster founder Shawn Fanning, Jordan Mendelson, and Ron Conway in 2002. SNOCAP provides artists with tools to create online stores and distribute their music using P2P file-sharing software. Artists upload their music and album information to SNOCAP’s Digital Registry and SNOCAP keeps .39 cents for each song downloaded.

With 7Digital’s do-it-yourself-digital-download-store, artists have an instant world-wide selling point and keep up to 80% of the profits from their music sales (with monthly accounting). The service takes PayPal and other click and buy payment methods to keep it simple.

Independent video producers who haven’t had access to major distribution channels in the past are in for some luck. iTunes has begun distributing video. And its not only the established label video that iTunes is pushing through its network, its also distributing independent video, such as action sports and documentary video.

As more online services like iTunes Video and YouTube.com become common, artists and video producers have more choices and opportunity than ever before to distribute their creativity to the public.

The action snowboarding video “That” sells on iTunes TV for $1.99. According to this article in Variety, Apple held-out until the video’s owner agreed to lower the price to $1.99 for the half-hour video. As with negotiations over major-label music on iTunes, Apple was able to use its market power to force the content producer to lower the price.

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