Larrikin Music Publishing had claimed a flute riff in Men at Work’s “Down Under” contained a two-bar copy of “Kookaburra”, and that the refrain was “an integral part” of Down Under and we are not being recompensed for that song.”  Larrikin sought compensation from Men at Work songwriters Colin Hay and Ron Strykert in addition to compensation from Sony BMG, Sony DADC, and EMI Australia.

“Kookaburra” is an Australian nursery rhyme written by music teacher Marion Sinclair in 1934 for a Girl Guides Association of Victoria competition. Following Sinclair’s death in 1988, Larrikin purchased the rights to the song; nine years prior, Men at Work released “Down Under”.

Sony BMG/ EMI Australia originally fought Larrikin’s copyright infringement claims, on the grounds that the Girl Guides were the rightful owners of the copyright, not Larrikin. In 1987, Marion Sinclair signed her rights to “Kookaburra” over to the Libraries Board of South Australia. Larrikin later bought the copyright, though Sony BMG/ EMI Australia argue it was never Sinclair’s copyright to sell. The original competition entry form notes, “All material entered will become the property of the Guides Association”.

Justice Peter Jacobson made a preliminary ruling in July of last year confirming Larrikin as the rightful owners of “Kookaburra”, but did not address the infringement claim until the following February. Larrikin had petitioned for 40-60% of the royalties earned, dating back to 1981.

Earlier this month, Justice Jacobson awarded damages based on violations of the Trade Practices Act of 1974, under Australia Law. By receiving their full share of royalties, Men at Work gave misrepresentations to the Australasian Performing Right Association and the Australasian Mechanical Copyright Owners Society.

In determining the damages, Justice Jacobson considered the difficulty in detecting the similarity between the flute riff in “Down Under” and the two bars in “Kookaburra”, and the overall qualitative and quantitative consideration of Kookaburra’s contribution to “Down Under”, concluding that the flute riff only made up 5.8% of “Down Under”. As such, Larrikin was only entitled to 5% of royalties earned dating back to 2002, as well as future earnings. Justice Jacobson further noted: “In my opinion the figures put forward by Larrikin are over-reaching, excessive and in my view unrealistic.” Total payment is estimated to be under $1 million.

Men at Work contended from the beginning that the flute riff in “Down Under” was unintentional. While the song was originally written by Colin Hay in 1978, the flute riff did not appear until two years later, added by new band member, Greg Ham. Despite intentions or motives, the court maintained that the group was still in violation of copyright. This claim of “unintentional plagiarism” is not new to the courts: George Harrison’s “My Sweet Lord” being an example. As this case has emphasized, whether copying is done knowingly or not, it is still copying in the eyes of the court.

Crumpton Law LLC is a Columbus Small Business Law Firm, with attorney Matthew Crumpton serving as managing member and lead attorney.

Earlier this month ASCAP sent members an email seeking contributions for ASCAP’s Legislative Fund for the Arts (ALFA) in an attempt to stop the “mobilizing” of groups seeking to “undermine our ‘Copyright.’” The email warned, “They say they are advocates of consumer rights, but the truth is these groups simply do not want to pay for the use of our music. Their mission is to spread the word that our music should be free.” ASCAP also made quite clear the consequences that would be faced with the growth of free culture: “the music will dry up, and the ultimate loser will be the music consumer.”

While both Electronic Frontier Foundation and Public Knowledge have advocated for more liberal copyright laws, many will certainly view ASCAP’s attack on Creative Commons as odd.

Creative Commons is a nonprofit organization that provides optional licensing options for artists. The company is “dedicated to making it easier for people to share and build upon the work of others, consistent with the rules of copyright…so others can share, remix, use commercially, or any combination thereof.” Nine Inch Nails, Beastie Boys, Wikipedia, and the White House are just a small sample of the range of users utilizing Creative Commons licensing options. In an ironic twist, Creative Commons noted that they were first alerted to ASCAP’s “smear campaign” through current ASCAP members who also held licenses from Creative Commons.

Lawrence Lessig, founding board member of both Creative Commons and Electronic Frontier Foundation has rebutted ASCAP’s claims that both organizations seek to undermine copyright. The licenses for Creative Commons specifically, “depend upon a firm and reliable system of copyright for them to work…[Creative Commons] only aims to strengthen the objectives of copyright, by giving the creators a simpler way to exercise their rights.”

Lessig, meanwhile, has extended a challenge to ASCAP President Paul Williams for an open debate to address their differences.

Crumpton Law LLC is a Columbus Small Business Law Firm, with attorney Matthew Crumpton serving as managing member and lead attorney.

CBIZ provides business services to small companies throughout the US.  In 1997, CBIZ bought an accounting firm, where Bryant worked. Bryant became an executive employee at the new CBIZ-owned accounting firm, SR Business Services (“SRB”), which did not, itself, provide attest services. (Attest services provide a report or assertion about subject matter that is the responsibility of another party.  For example, a company that has concerns about possible misstatements of financial information provided by various divisions would want to request attest services for all of those divisions.)  When the merger was completed, Bryant signed an agreement with a non-compete clause.

The non-compete clause prohibited Bryant from engaging in any business in competition with SRB during a two year period following employment with CBIZ.  Less than two years after his resignation from SRB, Bryant formed a competing business and solicited CBIZ customers to move their businesses from CBIZ to his new business.

Bryant admits to soliciting customers, specifically Security Properties, Inc., to leave CBIZ and to doing their attest work after his resignation.  Bryant also admits that he convinced his fellow employee, Christine Allen, to leave SRB with him and then had her do the labor on the attest engagements for Security Properties, Inc.

It didn’t matter that Bryant provided services that were different from the services that he provided with his former employer.  The fact that he was competing at all was enough to violate the non-compete agreement, which was broadly written. The court ordered Bryant to pay $1,339,457 to his former employer.

While many non-compete agreements may not be enforceable – because they are too broad in geographic scope or length or time, or because they do not protect a legitimate business interest –  this particular agreement was enforceable because a legitimate business interest existed for the former employer to protect. Bryant interfered with the employer’s established business relationship with a customer.  The mistake on the part of Bryant, the former employee, was in blatantly disregarding the non-compete agreement by interfering with the business relationship.

This case provides an important lesson for executive employees – even if you think you might be able to get around your non-compete agreement, know that in doing so you are taking a very expensive risk.  In some cases, you may be able to avoid the non-compete, or it may not be enforceable against you.  It is best to consult with a non-compete attorney to review your non-compete agreement to determine whether it is enforceable.

Crumpton Law LLC is a Columbus Small Business Law Firm, practicing Ohio non-compete law. LLC and corporate formation, and entertainment law, with attorney Matthew Crumpton serving as managing member and lead attorney.

“Wavin’ Flag” was originally written by Somali-born K’Naan, and is used by Coca-Cola for their 2010 FIFA World Cup marketing campaign. Coca-Cola released an English version of the song, as well as numerous country-specific and bilingual versions. Among these variations, is a Spanish language mix put together by Rafael “Rafa” Vergara Hermosilla, a Miami-based songwriter, singer and producer, at the request of Universal Music Latin America.

Vergara translated the lyrics into Spanish, demoed his own vocals, and finally mixed and produced a vocal track by artist David Bisbal. The resulting composition was Coca-Cola’s “Spanish Celebration Mix”, and according to Universal Music, the completion of the song marked the end of the contractual agreement with Vergara. José Puig, Vice President of Marketing for Universal Music Latin America has stated that the two agreed over a phone conversation that Vergara’s work would be a work-for-hire, and he would receive a flat fee of $6,000 for the project. Vergara vehemently denied that this was a work-for-hire agreement, stating he never would have agreed to do the song without the possibility of “soliciting a percentage” for his adaptation.

In an email sent to Puig, Vergaras requested his credits  “are respected as producer and adapter of the Spanish version (that every time the name of any composer of this version appears, my name appears as adapter), and obviously, the credits for the production”.

When Vergara’s request was not granted, he filed a motion to prevent Coca-Cola from using his version in their campaign. U.S. District Judge Michael Moore granted part of “unduly burdensome” preliminary injunction, requiring Coca-Cola to credit Vergaras whenever his Spanish lyrics are used, in addition to crediting K’Naan.

In a press release issued earlier last month, Vergara defended his actions stating, “I filed litigation in the Federal District Court in Miami only as a last resort. The Coca-Cola Company was specifically and directly informed that it did not have the authorization to use or exploit the song. Despite this knowledge, Coca-Cola has made it clear that it intends to continue to use my work and to exploit the song even without my consent.”

Vergara was denied his request for attorney fees and costs, and he is granted no additional money from the use of his song.

Crumpton Law LLC is a Columbus Small Business Law Firm, with attorney Matthew Crumpton serving as managing member and lead attorney.

The United States Government Accountability Office (GAO) recently weighed in on the issue of the Performance Rights Act, which would make terrestrial radio stations subject to paying royalties to the sound recording copyright owners. For a discussion of the difference between a composition and sound recording, see http://crumpton-law.com/composition-vs-sound-recording-copyright.

Though broadcast stations already pay a royalty to songwriters, they do not pay a royalty to the performers, unlike their satellite, Internet and cable radio counterparts. Royalty amount would follow a tiered structure, based on a station’s revenue and its status as either a commercial or non-commercial station. The PRA also allows for an exemption for some uses of music, such as music in broadcasts of religious services and the incidental use of music by non-music stations.

Looking at the both ends of the tier system, commercial stations with revenue in excess of $1.25 million would have a royalty rate to be negotiated between broadcast radio stations and copyright holders, or determined by copyright royalty judges. Non-commercial stations with annual revenue above $100,000 have a proposed flat fee of $1,000 per year. In contrast, both commercial and non-commercial stations with revenue less than $100,000 would be looking at a proposed flat fee of $500 per year.

Revenue from the statutory royalty would be divided with 50 percent being paid to the copyright holder, 45 percent being paid to the featured performer or musician, 2.5 percent being paid to background musicians, and the remaining 2.5 percent going to background performers and vocalists.

Based on all of their review, the GAO found that:
• Both recording and broadcast radio industries are facing an economic challenge.
• Both industries benefit from their current relationship.
• Broadcast radio stations unable to adjust to the new additional costs, including both performance royalties and new administrative costs, might have to make a decision to “reduce staffing levels; change from music to nonmusic programming, such as news, talk, or sports; or discontinue operations”.
• Record companies, musicians and performers would benefit from additional revenue. Recording industry stakeholders claimed “record companies could use the additional revenue to invest more heavily in the creative process of music”.

The debate over a performance royalty for broadcast radio has been a long ongoing one, with heated arguments from both sides. Besides issues of potential revenue increases for the recording industry and additional costs for broadcast radio, an argument of “fairness” has been raised in regards to Internet and satellite stations that already pay for a performance right.

The Obama administration has pledged strong support for the current bill, citing broadcast radio’s exemption as “an historical anomaly that does not have a strong policy justification.”

A more detailed economic analysis from the GAO is forthcoming.

Crumpton Law LLC is a Columbus Small Business Law Firm, with attorney Matthew Crumpton serving as managing member and lead attorney.

Mr. Bustle was hired at Mitchell’s, a high-end beauty salon in the greater Cincinnati area, soon after graduating from cosmetology school.  At the time he was hired, he had no clients of his own.  Upon being hired, Bustle signed an agreement prohibiting him for one year after the end of his employment with Mitchell’s from rendering any hair care treatment, hair care styling, or related services to any persons who are or were customers of Mitchell’s and with whom Bustle had personal contact during the time of his employment.

On August 10, 2007, after 12.5 years of employment with Mitchell’s, Bustle resigned from Mitchell’s and opened his own hairstyling business in Montgomery, Ohio.

After finding that Bustle had violated the non-compete agreement, the trial court granted an injunction enforcing the agreement and prohibiting him from providing beauty services to any person with whom he had previously provided services while employed at Mitchell’s.

Mitchell’s and Bustle then reached a settlement requiring Bustle to follow the non-compete agreement and to send letters to Bustle’s former clients informing them he could no longer provide hairstyling services for them and recommending another stylist at Mitchell’s.

Even after the court’s ruling and the settlement, Bustle continued to violate both the court’s order and the agreement.  As a result, the court ordered Bustle to pay attorney fees, investigative fees and lost profits to Mitchell’s equaling $139,521.

While many non-compete agreements may not be enforceable, this particular agreement was enforceable because a legitimate business interest existed for the former employer to protect.  The clear error on the part of the former employee was in violating the court’s order.

Finally, although this case did not focus on the usual aspects of evaluating non-compete agreements – whether the agreement was reasonable in the amount of time and in geographic scope – it is important to note that agreements that are unreasonable for either of these reasons can be challenged.

Employees who sign non-compete agreements are not left without any options, but as long as the non-compete agreement is reasonable, it is important to comply.  Of course, if you have questions about whether a non-compete is enforceable, you should consult with an attorney knowledgeable in non-compete law.

Crumpton Law LLC is a Columbus Small Business Law Firm, with attorney Matthew Crumpton serving as managing member and lead attorney.

RIAA’s expert witness, Dr. Richard Waterman, had testified that based on random samples of files, “98.8 percent of the files requested for download through LimeWire are copyright protected or highly likely copyright protected, and thus not authorized for free distribution.”

In addition, the court had stated multiple factors including Lime Wire’s awareness of substantial infringement by users, Lime Wire’s efforts to attract infringing users through their Adwords keyword advertising campaign, and Lime Wire’s failure to mitigate infringing activities, all worked to establish that Lime Wire intended to encourage infringement through distribution of LimeWire.

While the judge did acknowledge Lime Wire’s user agreement against copyright infringement in its terms of service, the notice did not “constitute meaningful efforts to mitigate infringement.”

A hearing is scheduled in June to discuss outstanding issues in the case, including damages. The RIAA is seeking maximum statutory damages of $150,000 for each registered work that was infringed, a number that will likely run in the millions.

According to a company executive, Lime Wire is now hoping to make the shift into a for-pay music download service.

Crumpton Law LLC is a Columbus Small Business Law Firm, with attorney Matthew Crumpton serving as managing member and lead attorney.

Google’s complaint follows from an initial lawsuit brought by Florida-based Blues Destiny Records in December 2009. Microsoft and Rapidshare were also named as defendants in the original case.

Blues Destiny Records performed an Internet search for some of the label’s artists in 2009, both through Google and Microsoft’s Bing, yielding multiple relevant links. Among the most relevant for all the artists, were links to Rapidshare, where users could illegally download the artists’ copyrighted recordings. Blues Destiny Records had argued that “this infringement of Plaintiff’s copyrights would not occur, but for defendant Rapidshare’s hosting of the illegal content and defendant Google and Microsoft’s enablement and direction to the illegal content”, and in addition, “Google’s consistent and prominent ranking of links to illegal ‘free’ downloads of Plaintiff’s copyrighted Recordings has devastated Plaintiff’s business”. The label claimed to have sent multiple requests and demands to block or remove the links, acknowledging that Microsoft had in fact complied with the request prior to the lawsuit.

On March 24, 2010, Blues Destiny Records voluntarily withdrew their lawsuit, but when asked by Google to waive their right to pursue its copyright allegations at a future time, the label refused, preserving its option to re-file its claims.

In Google’s most recent filing for declaratory judgment, the company is claiming “safe harbor” under the Digital Millennium Copyright Act, stating that they “responded expeditiously to [Blues Destiny Records'] DMCA-compliant notifications of claimed infringement by removing, or disabling access to, links leading to webpages allegedly containing material infringing BDR’s copyrights”.

Crumpton Law LLC is a Columbus Small Business Law Firm, with attorney Matthew Crumpton serving as managing member and lead attorney.

No Doubt first filed a lawsuit against Activision following the release of their game Band Hero in November of last year, citing improper use of the band members’ likeness, through game avatars. No Doubt stated that the contract with Activision limited performances to three No Doubt songs, but an avatar “unlocking” feature allowed users to use the avatars on over 60 songs within the game, “many of which include lyrics, in iconic songs, which are not appropriate for No Doubt and have not been and would not have been chosen by No Doubt for recordings or public performances”. In addition, a Character Manipulation Feature allowed users to alter the vocal range of the avatars in various songs.

No Doubt sought unspecified actual and punitive damages, a temporary restraining order, a preliminary injunction and a permanent injunction against distribution of the game and for Activision to recall existing copies.

Activision followed with a counterclaim in December, denying any wrongdoing on their part. The unlocking feature in Band Hero was a “publicly known” feature present in the company’s music games since 2005. Additionally, Activision stated No Doubt breached the contract with their refusal to perform promotional services previously agreed upon. Furthermore, No Doubt had been “unjustly enriched by its wrongful conduct against Activision, including by retaining money paid to the band for services it then refused to provide”.

Activision’s efforts to move the case to federal court, framing it as a copyright issue, were also rejected by the court on Thursday. A spokesman for Activision has stated that the company does not expect to appeal the ruling.

Crumpton Law LLC is a Columbus Small Business Law Firm, with attorney Matthew Crumpton serving as managing member and lead attorney.

I heard a lot about how the music scene in Pittsburgh is not that great. It made me really appreciate the scene in Columbus. We have great studios like Central City Recording, local music venues like Rumba and Skullys, and a scene that supports one another (Columbus Music Co-op). I wanted to tell the people in Pittsburgh who asked me how to build a scene: Come to Columbus and observe. It is good to get out of town every now and then to get some appreciation for what we have here.

I’m headed out to speak to the Central Ohio Songwriter’s Association tonight. More talk of publishing and licensing is expected.