[pp.int.general] [NEWS] Payment pending; Canadian recording industry set for six billion penalties?
Brian McNeil
brian.mcneil at wikinewsie.org
Wed Dec 16 13:43:50 CET 2009
On Wed, 2009-12-16 at 10:49 +0000, Brian McNeil wrote:
> On Mon, 2009-12-07 at 20:49 +0000, Philip Hunt wrote:
> > The music industry has been hit with $60 billion copyright
> > infringement lawsuit. Apparaently they've been infringing musicians
> > copyrights for decades:
> >
> > http://www.pirateparty.org.uk/blog/2009/dec/7/music-industry-faces-60-billion-copyright-infringe/
> >
> > May I suggest people republish this as widely as possible.
>
> Well, I thought it better to delve into this somewhat:
>
> http://en.wikinews.org/wiki/Payment_pending;_Canadian_recording_industry_set_for_six_billion_penalties%3F
And, for those to lazy to click the link, or those so cautious they
avoid the web, ...
Most images are stripped, if you do see images I suggest altering the
security settings on your mail client to not retrieve inline HTML links
to anything.
Following text licensed under CC-BY-2.5 © Wikinews
Payment pending; Canadian recording industry set for six billion
penalties?
From Wikinews, the free news source you can write!
Wednesday, December 16, 2009
A report published last week in the Toronto Star by Professor Michael
Geist of Canada's University of Ottawa claims a copyright case under the
Class Proceedings Act of 1992 may see the country's largest players in
the music industry facing upwards of C$6 billion in penalties.
The case is being led by the family and estate of the late jazz musician
Chet Baker; moving to take legal action against four major labels in the
country, and their parent companies. The suit was initially filed in
August last year, but amended and reissued on October 6, two months
later. At that point both the Canadian Musical Reproduction Rights
Agency (CMRRA) and Society for Reproduction Rights of Authors (SODRAC)
were also named defendants.
For publishers, performers, and rightsholders
January this year SODRAC and CMRRA switch sides, joining Baker et al. as
plaintiffs against Sony BMG Music, EMI Music Canada, Universal Music
Canada and Warner Music Canada. David A. Basskin, President and CEO of
CMRRA, with a professional law background, stated in a sworn affidavit
that his organisation made numerous attempts over the last 20 years to
reduce what is known as the "pending list", a list of works not
correctly licensed for reproduction; a list of copyright infringements
in the eyes of the Baker legal team.
The theoretical principle of the list is to allow timely commercial
release while rights and apportionment of monies due are resolved.
Basskin complains that it is "economically infeasible to implement the
systems that would be needed to resolve the issues internally". And,
"[...] for their part, the record labels have generally been unwilling
to take the steps that, in the view of CMRRA, would help to resolve the
problem."
The Baker action demands that the four named major labels pay for and
submit to an independent audit of their books, "including the contents
of the 'Pending Lists'". Seeking an assessment of gains made by the
record companies in "failure or refusal to compensate the class members
for their musical works", additional demands are for either damages and
profits per the law applicable in a class action, or statutory damages
per the Copyright Act for copyright infringement.
This forms the basis for Professor Geist's six billion dollar
calculation along with Basskin's sworn testimony that the pending lists
cover over 300,000 items; with each item counted as an infringement, the
minimum statutory damages are CA$500, the maximum $20,000.
CMRRA
Basskin's affidavit on behalf of CMRRA goes into detail on the history
leading up to the current situation and class action lawsuit; a previous
compulsory license scheme, with poor recordkeeping requirements, and
which, had a decline in real terms to one of the lowest fees in the
world, was eventually abolished and the mechanical license system
introduced. The CMRRA went on to become a significant representative of
music publishers and copyright holders, and the pending list an
instrument to deal with situations where mechanical rights were as-yet
not completely negotiated. Basskin's affidavit claiming the list grew
and circumstances worsened as time progressed.
The Mechanical Licensing Agreement (MLA) between the "majors'" industry
body, an attached exhibit to the affidavit, is set to expire December
31, 2012; this is between CMRRA and the Canadian Recording Industry
Association (CRIA). With the original MLA expiring at end September
1990, CMRRA negotiated more detailed terms and a "code of conduct".
Subsequent agreements were drawn up in 1998, 2004, 2006, and 2008.
Basskin asserts that the named record company defendants are the "major"
labels in Canada and states they "are also responsible for creating,
maintaining and administering the so-called "Pending Lists" that are the
subject of the current litigation"; that, specific to publishing,
divisions of the four represent the "'major' music publishers active in
Canada". Yet the number of music publishers they represent has decreased
over time due to consolidation and defection from the CRIA.
Geist summarizes the record company strategy as "exploit now, pay later
if at all". This despite the CMRRA and SODRAC being required to give
lists of all collections they represented to record labels, and for
record labels to supply copies of material being released to permit
assessment of content that either group may represent interested parties
for. Where actual Mechanical License Agreements are in place, Basskin
implies their terms are particularly broad and preclude any party
exercising their legal right to decline to license.
Specific to the current Mechanical Licensing Agreement (MLA) between the
CMRRA and the CRIA; a "label is required to provide an updated
cumulative Pending List to CMRRA with each quarterly payment of
royalties under the MLA." The CMRRA is required to review the list and
collect where appropriate royalties and interest due. Basskin describes
his first encounter with pending lists, having never heard of them
before 1989 thus:
Cquote1.svg
[...I]n the early years
of my tenure, CRMMA
received Pending Lists
from the record labels
in the form of paper
printouts of
information. The
information contained on
these lists varied from
record label to record
label, [... i]n fact,
within a few days after
my arrival at CMRRA, I
recall my predecessor,
Paul Berry, directing my
attention to a large
stack of paper, about
two feet high. and
informing me that it was
PolyGram's most recent
Pending List. Prior to
that introduction I had
never heard of Pending
Lists.
Cquote2.svg
SODRAC
Alain Lauzon, General Manager of Canada's Society for Reproduction
Rights of Authors, Composers and Publishers (SODRAC) submitted his
followup affidavit January 28, 2009 to be attached to the case and
identify the society as a plaintiff. As such, he up-front states, "I
have knowledge of the matters set out herein." Lauzon, a qualified
Chartered Accountant with an IT specialisation, joined SODRAC in 2002
with "over 20 years of business experience." He is responsible for
"negotiation and administration of industry-wide agreements for the
licensing of music reproduction and distribution"; licensing of radio
and online music services use is within his remit.
Lauzon makes it clear that Baker's estate, other rightsholders enjoined
to the case, SODRAC, and CMRRA, have reached an agreed settlement; they
wish to move forward with a class proceeding against the four main
members of the CRIA. He requests that the court recognise this in
relation to the initially accepted case from August 2008.
The preamble of the affidavit continues to express strong agreement with
that of David Basskin from CMRRA. Lauzon concurs regarding growing use
of "pending lists" and that "[...] record labels have generally been
unwilling to take the steps that would help to resolve the Pending List
problem."
With his background as an authority, Lauzon states with confidence that
SODRAC represents "approximately 10 to 15% of all musical works that are
reproduced on sound recordings sold in Canada." For Quebec the figure is
more than 50%.
Lauzon agrees that the four named record company defendants are the
"major" labels in Canada, and that smaller independent labels will
usually work with them or an independent distribution company; and
Basskin's statement that "[t]he responsibility to obtain mechanical
licenses for recordings manufactured and/or released in Canada falls
with the Canadian labels by law, by industry custom, and by contractual
agreement."
The industry's side: lobbyists?
Wikinews attempted to contact people at the four named defendant
CRIA-member record labels. The recipient of an email that Wikinews sent
to Warner Brothers Canada forwarded our initial correspondence to
Hogarth PR; the other three majors failed to respond in a timely
fashion. Don Hogarth responded to Wikinewsie Brian McNeil, and, without
addressing any of the submitted questions, recommended a blog entry by
Barry Sookman as, what he claimed is, a more accurate representation of
the facts of the case.
Cquote1.svg
I am aware of another
viewpoint that provides
a reasonably deep
explanation of the
facts, at
www.barrysookman.com. If
you check the bio on his
site, you’ll see that he
is very qualified to
speak on these issues.
This may answer some of
your questions. I hope
that helps.
Cquote2.svg
Sookman is a lobbyist at the Canadian Parliament who works in the employ
of the the Canadian Recording Industry Association (CRIA). Hogarth gave
no indication or disclosure of this; his direction to the blog is to a
posting with numerous factual inaccuracies, misdirecting statements, or
possibly even lies; if not lies, Sookman is undoubtedly not careful or
"very qualified" in the way he speaks on the issue.
Sookman's blog post opens with a blast at Professor Geist: "his attacks
use exaggeration, misleading information and half truths to achieve his
obvious ends". Sookman attempts to dismiss any newsworthiness in Geist's
article;
Cquote1.svg
[... A]s if something
new has happened with
the case. In fact, the
case was started in
August 2008 (not October
2008 as asserted by
Prof. Geist). It also
hasn’t only been going
on “for the past year”,
as he claims. Chet Baker
isn’t “about to add a
new claim to fame”.
Despite having started
over a year and a half
ago, the class action
case hasn’t even been
certified yet. So why
the fervour to publicise
the case now?
Cquote2.svg
HAVE YOUR SAY
Wikinews commentary.svg
Should the court use admitted unpaid
amounts, or maximum statutory
damages – as the record industry
normally seeks against filesharers?
Add comment
As the extracted [see right] stamp, date, and signature, shows, the
court accepted amendments to the case and its submission, as Professor
Geist asserts, on October 6. The previously mentioned submissions by the
heads of CMRRA and SODRAC were indeed actions within the past year; that
of SODRAC's Alain Louzon being January 28 this year.
Sookman continues his attack on Professor Geist, omitting that the
reverse appears the case; analysis of his blog's sitemap reveals he
wrote a 44-page attack on Professor Geist in February 2008, accusing him
of manipulating the media and using influence on Facebook to oppose
copyright reform favourable to the CRIA. In the more current post he
states:
Cquote1.svg
Prof. Geist tries to
taint the recording
industry as blatant
copyright infringers,
without ever delving
into the industry wide
accepted custom for
clearing mechanical
rights. The pending list
system, which has been
around for decades,
represents an agreed
upon industry wide
consensus that
songwriters, music
publishers (who
represent songwriters)
and the recording
industry use and rely on
to ensure that music
gets released and to the
market efficiently and
the proper copyright
owners get compensated.
Cquote2.svg
This characterisation of the pending list only matches court records in
that it "has been around for decades". CMRRA's Basskin, a lawyer and
industry insider, goes into great detail on the major labels resisting
twenty years of collective societies fighting, and failing, to negotiate
a situation where the labels take adequate measures to mechanically
license works and pay due fees, royalties, and accrued interest.
Comparison of increasing pending list value quarter on quarter
What Sookman clearly overlooks is that, without factoring in any
interest amounts, the dollar value of the pending list is increasing, as
shown with the following two tables for mid-2008.
Second quarter 2008 pending lists data
Image: Basskin's affidavit on behalf of CMRRA.
Third quarter 2008 pending lists data
Image: Basskin's affidavit on behalf of CMRRA.
As is clear, there is an increase of C$1,101,987.83 in a three-month
period. Should this rate of increase in the value of the pending list
continue and Sony's unvalued pending list be factored in, the CRIA's
four major labels will have an outstanding debt of at least C$73 million
by end-2012 when the association's Mechanical Licensing Agreement runs
out.
--
Brian McNeil <brian.mcneil at wikinewsie.org>|http://en.wikinews.org/wiki/Brian_McNeil
Content of this message in no way represents the opinions or official position
of the Wikimedia Foundation or any of its projects.
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.pirateweb.net/pipermail/pp.international.general/attachments/20091216/a6eb3361/attachment-0001.htm>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: not available
Type: application/pgp-signature
Size: 835 bytes
Desc: This is a digitally signed message part
URL: <http://lists.pirateweb.net/pipermail/pp.international.general/attachments/20091216/a6eb3361/attachment-0001.pgp>
More information about the pp.international.general
mailing list