This is a podcast that I did recently in which I discuss a key issue associated with the intersection of technology and the law: electronic contracting. Click the link below to listen.
For many of us, This is Spinal Tap remains the benchmark (if not the first great example) of the so-called “Mockumentary” genre of film. Since its first release in 1984 (it had a subsequent theatrical release thereafter) to critical acclaim and commercial success, it has become one of those films that its fans watch over and over—each time gleaning some new subtlety missed during the first dozen viewings. The film, about a fictitious British rock band named Spinal Tap, starred Michael McKean, Harry Shearer and Christopher Guest, who would later become the “King” of Mockumentaries with his films Waiting for Guffman, Best in Show and A Mighty Wind. It was co-written by Messrs. McKean, Shearer and Guest, along with the film’s Director, Rob Reiner. Not only did the film contain inspired comedic bits, it included an album’s-worth of original songs, co-written by McKean, Shearer and Guest.
Filmed on a shoestring budget of approximately $2.25 million, it is considered an “important film” by those who decide such things including the National Film Registry of the Library of Congress and The New York Times, as a culturally, historically and aesthetically significant film. As for me, I just think it is funny as hell.
Not only has the film had two theatrical releases, but it was also released in a wide variety of home video formats and editions and has spawned merchandise sales. In fact, the photo that accompanies this blawg post is a Tap action figure from my own personal collection of the three figure set.
The four co-creators, individually or through personal loan-out corporations, formed an entity called Spinal Tap Productions (“STP”). In 1982, STP signed an agreement with Embassy Pictures for producing, financing and distributing the film. In return, STP was to receive fixed, deferred and contingent compensation for their services, as well as a 40% profit participation based on all sources of revenue from the film, including merchandise and music. Through a series of sales of rights, the current owner of the rights to the film, and the party now responsible for making payments to STP, is the large Italian media conglomerate, Vivendi.
Last week, Shearer filed a lawsuit against Vivendi and one of its operatives, Ron Halpern, alleging that they have engaged in fraud and have committed breach of contract. The suit also alleges that Vivendi did not properly protect the trademark “SPINAL TAP” (even allowing a beer company to trademark the name for use in connection with beer without any opposition from Vivendi). Apparently, Shearer’s patience did not “go to 11,” and he has had enough. While Tap has been a huge hit and has spawned all sorts of merchandise since its original release, Vivendi claims that it has not made money. According to Vivendi, the four creators’ share of total worldwide merchandising income between 1984 and 2006 was roughly $81. Between 1989 and 2006 total income from music sales was $98 (ninety-eight) dollars. Over the past two years, Vivendi has failed to provide accounting statements at all. Shearer’s response was to file the lawsuit, seeking $125,000,000 in compensatory and punitive damages.
Shearer’s suit alleges that Vivendi’s accounting practices have been used to offset revenues from the film with losses from other films with which it has been “bundled” (among other nefarious practices). For example, if a distributor were to approach Vivendi about purchasing $1,000,000 worth of Tap home video units, Vivendi could bundle 19 other films (all of which are money losers) with it and offer the entire twenty film package for $1,000,001. That way, it can continue to claim that it has not generated $1,000,000 of revenue for Tap, but rather 1/20 of that. Other losses could be allocated to it and—voila—there are no profits to show. The suit also alleges that merchandising and music sales profits similarly have been cross-collateralized against other losses. The net result–$81 in merchandise and $98 in music sales.
Shearer’s Complaint in the lawsuit also states that Shearer is “concurrently filing notices of copyright termination for publishing and recording rights in Spinal Tap songs he co-wrote and co-recorded, as well as the film itself.” Under Section 203 of the U.S. Copyright Act, the exclusive or nonexclusive grant of an assignment or license of all or any portion of a right under copyright may be terminated at any time during the period of five years beginning at the end of the thirty-fifth year from the date of the execution of such assignment or license. Assuming the agreements in question were executed in 1982, that five year period would begin in 2017. However, it should be noted that this “termination right” does NOT apply in the case of “works made for hire.” Under the Copyright Act, a “work made for hire” consists of 1) works created by employees within the scope of their employment; or 2) works created by non-employees that are specially ordered or commissioned for use as a contribution to certain kinds of works (these include motion pictures), but only if there is a written agreement to that effect. In this case, since the original contracts with Embassy Pictures have not been made available, I am not sure if the rights were merely licensed to Embassy Pictures or, instead were treated in the agreement as “works made for hire.” This point will be critical to Shearer’s stated goal of getting his copyrights back.
I will post a follow up to this blawg post as the case progresses.
From time to time, I run across an excellent article that attempts to explain the complex economics of the entertainment business.
This article discusses the economics of creating a new hit television program: http://priceonomics.com/the-economics-of-a-hit-tv-show.
As I reported in a recent blawg post [http://www.gurwinskeyboard.com/star-trek-fan-film-will-it-boldly-go/], a Federal court in Los Angeles was set to decide just how far the Star Trek universe’s copyright reach extends. In the case of Paramount Pictures Corporation v. Axanar Productions, Inc., studio giant Paramount and CBS Studios alleged that a small independent film entitled Star Trek: Axanar infringes upon “thousands of copyrights” owned by Paramount and CBS to the various Star Trek movies and television shows, and that Axanar Productions is “using innumerable copyrighted elements of Star Trek, including its settings, characters, species, and themes.”
In the past, the studio has tolerated previous Star Trek fan films, as long as they were done strictly as homages and not for profit. None of those films, however, had the level of funding of Star Trek: Axanar. I’m not sure that the studio anticipated the level of blowback it would receive as a result of the lawsuit.
The fan film community, and especially the Star Trek fan film community, was up in arms (or is that phasers?) over that case. Amicus briefs (so-called “Friend of the Court” briefs) even were filed on behalf of Axanar. In one, an organization called the Language Creation Society filed a brief arguing that the Klingon “language” is not copyrightable.
Well, rest easy, Trekkies. At a recent Star Trek fan event, Star Trek Beyond Executive Producer J. J. Abrams announced that the lawsuit was “going away.” Apparently, Paramount realized that, not only was the lawsuit engendering very bad feelings with its audience and fan base for the studio Star Trek films, but that the lawsuit could prove to be a logistical and procedural nightmare for the studio. After the lukewarm fan response to the studio’s last Star Trek film, Star Trek Into Darkness, Paramount felt that it could not afford to alienate its fan base. All of this added up to a case of Paramount rethinking its position. Axanar (the defendant in the case) is now working with Paramount towards dismissing the lawsuit fully. Of course, things could change during those discussions between legal counsel, but all indications now are that the lawsuit will be dismissed and the production of Axanar will move forward.
Last year, I wrote a post about a case that was about to be filed challenging the authorship of Led Zeppelin’s rock classic, “Stairway to Heaven.” [http://www.gurwinskeyboard.com/long-ago-far-away-copyright-infringement-claims-raging-bull-stairway-heaven/]. Two weeks after that post, a lawsuit was filed in Los Angeles Federal District Court in which the successor-in-interest to the rights of the estate of musician Randy Craig Wolfe, known professionally as “Randy California,” of the band Spirit, sued Led Zeppelin and its members, alleging that the iconic opening passages in “Stairway to Heaven” were lifted from a song called “Taurus” that was previously written and performed by Spirit. Spirit had toured with Led Zeppelin, and the lawsuit alleges that members of Led Zep heard the tune, liked it and incorporated a material portion of it as the beginning of “Stairway.”
The U.S. Supreme Court, in the case discussed in that prior blawg post, stated that the statute of limitations for copyright cases is a “rolling” three-year term. In other words, each act of infringement would start a new three-year statute of limitations. A reissue of “Led Zeppelin IV” was released last year. Significantly, the re-reIease contained newly released studio takes and live tracks, including a remastered track for “Stairway to Heaven.” As a result, the rolling three-year period has not expired, and the Court is allowing this suit to proceed, even though the original composition was written in 1969.
The defendants in the case, entitled Michael Skidmore v. Led Zeppelin, et al., previously filed a Motion for Summary Judgment, seeking to have the case dismissed as a matter of law. For those of you who are not lawyers, a “Motion for Summary Judgment” is a motion seeking the court to rule that, as a matter of law, there is no legal basis for a claim. However, this assumes that there are no genuine issues of material facts in dispute. The Court granted the defendants summary judgment on certain of the claims, but it denied the motion on the key claim of copyright infringement. Under copyright law, to win an infringement suit, a copyright plaintiff must prove: 1) that it owns the copyrights in question; and 2) that the defendant copied protected elements of the plaintiff’s work. Since direct copying often cannot be proven, such copying can be inferred if the plaintiff can prove that the defendant had access to the copyrighted work at the time of the alleged infringement and that the two works are “substantially similar.”
Each side brought in their own musicologists to dissect the pertinent musical passages and to opine on whether the two works were substantially similar. Not unexpectedly, each side’s “expert” came to a different conclusion as to the substantial similarity between the two works. As a result, the Court decided that there is a genuine dispute as to the issue of substantial similarity.
There is also another interesting, but less reported, issue in the case. Led Zeppelin claims that Randy California waived his rights to the song “Taurus.” Defendants allege that in 1991, California was interviewed in connection with a new album of Spirit recordings entitled “Time Circle.” In the interview, California was asked about the possibility that Led Zeppelin had copied the opening of “Taurus” for its song “Stairway.” California responded that members of Led Zeppelin “used to come up and sit in the front row of all of [Spirit’s] shows and became friends, and if they wanted to use [“Taurus”], that’s fine.” Later in that same interview, California stated more directly: “I’ll let [Led Zeppelin] have the beginning of “Taurus” for their song without a lawsuit.” The defendants have submitted the original article, audio recordings of that interview and a deposition from the journalist who conducted the interview as evidence in support of their Motion for Summary Judgment, arguing that California’s public statements demonstrate his abandonment of any rights to that passage from “Taurus.”
So, on the one hand, Jimmy Paige and Robert Plant are disputing that there is any substantial similarity between the two songs. On the other hand, they appear to be admitting that they ripped it off but claim that they were “authorized” to do so by Randy California. The case will proceed on these issues. It will be interesting to see whether the outcome impacts the reputations of Messrs. Paige and Plant.