UMG May Face Trial on Bob Marley Tracks

     PASADENA, Calif. (CN) – A small record label’s claims that Universal Music Group is bullying it for the exclusive rights to a Bob Marley album may have struck a chord with the 9th Circuit.
     In a 2008 lawsuit, Rock River Communications said it had obtained consent from the Bob Marley estate to release “Roots, Rocks, Remixed,” but that UMG was abusing its dominant market position to crush the album.
     Rock River claimed that Bob Marley and the Wailers recorded these tracks between 1969 and 1972, before signing with Island Records – now owned by UMG.
     U.S. District Judge Christina Snyder concluded, however, that Rock River had no case since its arguments hinged on a supposed oral agreement that she deemed inadmissible as hearsay. After whittling down Rock River’s claims to a single accusation of economic interference, Snyder handed UMG summary judgment in 2011.
     At an appellate hearing last week, But Rock River’s attorney, Donald Falk, said Snyder’s decision ignored its claim that Rock River’s predecessor “licensed the tracks, added something new to them and got additional copyrights – and the tracks have been out for 30 years without interference.”
     “The reason UMG did nothing for 30 years is because of the tangled and confusing record of overlapping grants of licenses,” added Falk, of the firm Mayer Brown. “Universal knew that proving an exclusive right – enough to exclude somebody else – just wasn’t there.”
     Falk told the panel that the lower court had exonerated UMG’s bully tactics. The record giant sent cease-and-desist letters in 2007 to music distributors and retailers who were selling Rock River’s album, including Apple’s iTunes service, Amazon, Barnes & Noble, Borders and Virgin.
     “What this case is about is whether Universal may use commercial muscle to get what it could not get and knew it could not get without proving exclusive rights in an infringement action,” Falk said. “We’re not saying we’re entitled to judgment as a matter of law. But there are triable issues of fact on the record that should be pursued and make the summary judgment inappropriate.”
     UMG’s lawyer, Kelly Klaus, meanwhile, urged the panel to affirm the lower court’s judgment, which properly excluded the hearsay oral agreement between San Juan Records – Rock River’s predecessor – and Marley producer Lee “Scratch” Perry.
     “Perry gave numerous affidavits, but never mentions the three tracks at issue,” Klaus, of the firm Munger Tolles & Olson, told the panel. “There is also no proof that Rock River ever paid Perry a single dime for the tracks. There is no evidence that Perry is even the producer of the three new Rock River tracks.”
     Klaus continued: “What this ultimately came down to, and forms the basis of Judge Snyder’s ruling, was that the only thing in the record to establish that San Juan had a license was the testimony of San Juan chairman Chernow – and not that he had a conversation with Perry, but that his father had a conversation with Perry. That was properly excluded as hearsay. The idea that this is somehow relevant to San Juan’s state of mind – state of mind doesn’t create a right to disseminate the work.”
     Seizing on this point, Judge Raymond Fisher asked why Rock River’s economic interference claims failed along with its claim to owning the album rights.
     “Where does it say that the person claiming interference with a business expectation has to prove they have a legal right to claim,” Fisher said. “Give me California case that says that.”
     Citing several non-California cases that bolstered his argument, Klaus said, “We think that it should be an element of their case.”
     Fisher countered, however, that “UMG has to have a superior right that bars Rock River from going out with its remix – you didn’t prove it.”
     “I’m not satisfied with the posture of this case,” the judge added. “”The district court found a triable issue as to whether UMG’s claim is a sham or legitimate. But Universal still says it can shut down Rock River, when it hasn’t established a clear title on the exclusive license. Unless you do that, what difference does it make whether Rock River can show that it has clear title to three tracks out of the 12? If UMG has no superior right and can’t prove it has that superior right, what’s to stop Rock River from going out and making money off the tracks?”
     Klaus chimed in: “One who distributes without proper authorization is committing an illegal act.”
     But this did not carry weight with Fisher. “And that’s your best case,” he said. “I still haven’t heard anything that’s persuasive.”
     U.S. District Judge Wiley Daniel, sitting on the panel by designation from Denver, said summary judgment seemed inappropriate, given a lack of clarity over the rights to Marley’s music.
     “As a trial court judge, I read the summary judgment and I scratched my head,” he said. “I’m thinking the better course of action would have been to allow a trial on the merits, and then all of that would have been fleshed out in a way that’s fair to everyone.”
     Judge Harry Pregerson, the third member of the panel, agreed.
     “You can’t go around with cases like this, with all this history and competing claims that have been out there for years and years and get rid of them with summary judgment,” Pregerson.
     In recent years, UMG has faced a flurry of litigation over Marley’s music – including a 2011 action by the Marley family that accused the label of withholding royalties for digital downloads on pre-1978 tracks.
     In that case, Marley’s widow, their nine children and their company 56 Hope Road sought to end UMG’s stranglehold on Marley’s music made before 1978, arguing that the copyrights had expired. The Marley family also accused UMG of refusing to consult with them on licensing decisions as contractually required.

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