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Mixed Summary Judgment Ruling in Ringtones Litigation
Record labels have taken a lot of heat for being slow learners when it comes to profiting from Internet-era trends like downloads of mobile ringtones, but the labels haven't been shy in one area: copyright litigation against online purveyors of their artists' music. Musicians, meanwhile, have targeted the labels for allegedly stiffing them on royalties when customers pay for their music online.
UMG Recordings has been smack in the middle of both trends. In 2008, UMG joined more than a dozen other labels in a copyright infringement suit against the ringtone download site, Myxer, which allegedly allowed users to download clips of more than 700 copyrighted songs. Arista Records LLC v. Myxer Inc., 2:08cv3935 (C.D.Calif.). Then, in 2010, the U.S. Court of Appeals for the Ninth Circuit ruled against UMG in the landmark licensing fee suit over Eminem's early recordings, finding that royalty contracts predating the online music era extended to digital downloads. F.B.T. Productions, LLC v. Aftermath Records, 621 F.3d 958 (9th Cir. 2010).
Last month, UMG suffered a double whammy in the ringtone wars: It lost a motion for summary judgment in the Myxer case and got hit with a class action suit for allegedly continuing to underpay its artists for online music sales, in defiance of the Ninth Circuit's Eminem ruling. (In the latter case, a trust representing the musical estate of funk legend Rick James alleges in a class action complaint in San Francisco federal district court that the record company underpays its artists for music and ringtone downloads. James v. UMG Recordings Inc., 11-1613. The James trust is represented by David Given of San Francisco's Phillips Erlewine & Given.)
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