Musicians Alliance Sues Ford and GM

     WASHINGTON (CN) - General Motors, Ford and others owe the Alliance of Artists and Recording Companies a lot of money for importing "in-vehicle CD-copying devices" that violate copyright law, the Alliance claims in a federal class action.
     Lead plaintiff AARC sued General Motors, Ford Motor Co., Denso International America, and Clarion Corp. of America, on July 25 in Federal Court.
     The AARC is based in Alexandria, Va. It seeks actual damages, statutory damages of $2,500 for each illegal device manufactured, imported or distributed for the previous three years, plus another 50 percent of actual damages, to be paid to the Register of Copyrights.
     The AARC sued under the Audio Home Recording Act of 1992, 17 U.S.C. §§ 1001 et seq., a section of U.S. copyright law. The AARC was established after the Act was passed, to defend the rights of artists, as home copying of music became possible and popular.
     "Congress enacted the AHRA to ensure both that consumers would have access to digital audio copying technology and that artists and other copyright owners would be fairly compensated for the copying of their works," AARC says in the lawsuit.
     It continues: "Defendants are multibillion-dollar companies that manufacture, import, and/or distribute hundreds of thousands of products in the United States every year. Defendants are also beneficiaries of the AHRA, which shields them from liability for copyright infringement for manufacturing, importing, and/or distributing certain recording devices as long as they (a) incorporate certain copying control technology and (b) pay a modest royalty per device that is then distributed to musical artists and music copyright owners. Nonetheless, defendants have refused to comply with the AHRA and refused to pay the royalties that Congress has determined they owe for the recording devices they manufacture, import, and/or distribute - notwithstanding intensive efforts by the AARC going back at least two years to persuade defendants to live up to their statutory obligations. Defendants' intransigence has left the AARC with no choice but to file this lawsuit."
     The AARC claims the defendants violate copyright law by manufacturing or importing and distributing digital audio recording devices without complying with the AHRA.
     "Defendants distribute these devices either pre-installed in vehicles or intended for use in vehicles. Defendants designed these devices for the express purpose of copying music CDs and other digital musical recordings to a hard drive on the devices, and they market these devices emphasizing that copying function. By doing so, defendants violate the AHRA because defendants (a) have not registered these devices with the U.S. Copyright Office; (b) have not paid royalties for these devices; and (c) have not incorporated the Serial Copy Management System or its functional equivalent in these devices, all of which are required by the AHRA."
     The AARC claims that other manufacturers of in-vehicle CD-copying devices comply with the law, and pay the required royalties through the Copyright Office.
     Denso is a Delaware corporation based in Southfield, Mich.
     Clarion Corp. in a California corporation based in Cypress, Calif.
     Under the Audio Home Recording Act, digital audio recording devices (DARD) are not supposed to be able to copy a copy of a CD. The DARD therefore must be able to distinguish an original from a copy, and "must never allow a user to copy a 'copy,'" according to the complaint. The device that performs these functions is the Serial Copy Management System.
     The AARC claims that General Motors offers what it calls a "Hard Drive Device" in a slew of models, including Cadillacs, which allow illegal copying. Denso supplies it with the devices, according to the complaint.
     Ford does the same thing, in its Ford and Lincoln brands, and gets the devices from Clarion, the AARC says. Ford calls it a "Jukebox."
     The AARC seeks declaratory judgment, an injunction, damages and costs.
     It is represented by Dustin Cho, with Covington & Burling.