Songwriter Giuseppe "Beppe" Canterelli has filed a class-action lawsuit against EMI Music Publishing, alleging that the company engages in unfair business practices by failing to promptly pay out uncl

Breaking News

Songwriter Sues EMI Pub For Withholding Royalties

By Brian Garrity

NEW YORK -- Songwriter Giuseppe "Beppe" Canterelli has filed a class-action lawsuit against EMI Music Publishing, alleging that the company engages in unfair business practices by failing to promptly pay out unclaimed royalties it holds in a so-called suspense account.

The suit, filed July 9 in Los Angeles Superior Court, seeks unspecified damages. It charges that EMI Music Publishing "does not make reasonable efforts" to track down songwriters or estates that are owed money. It further alleges that the company ultimately keeps "significant portions" of the unclaimed money it keeps in suspense for itself.

An EMI spokesperson declined comment.

Canterelli's attorney, Anthony Kornarens of Spellberg & Kornarens, could not be reached for comment by press time. Canterelli, described as a California-based songwriter whose compositions have been administered by EMI for 10 years, is the only party currently listed in the suit.

The suit comes in the wake of a settlement with the New York State Attorney General's office earlier this year in which the five major labels and the Harry Fox Agency agreed to pay $50 million in unclaimed recording and publishing royalties to thousands of artists and songwriters.

The labels have already disbursed more than $25 million to artists and songwriters; an additional $25 million is expected to be distributed. Individual payouts to artists have ranged from hundreds of dollars to more than $200,000.

Eliot SpitzerThe settlement was the result of a two-year investigation by State Attorney General Eliot Spitzer that found that many artists and writers were not being paid royalties because the record companies and Harry Fox had failed to maintain contact with the artists or their estates and had stopped making required payments.

The problem was characterized primarily as one of not maintaining accurate contact information.

Under terms of the deal with the New York State Attorney General's office, the majors and Harry Fox have agreed to list the names of artists and songwriters owed royalty payments on company Web sites and to post advertisements in music-industry publications explaining procedures for claiming the royalties.

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Judge Allows Napster Suit To Move Forward

By Scott Banerjee

Napster LogoSAN FRANCISCO -- As Napster 2.0 plugs ahead in the digital music marketplace, the original Napster's investors are stuck in court.

A federal judge in San Francisco's U.S. District Court on July 14 denied motions from Napster's former investors, Bertelsmann AG and venture-capital firm Hummer Winblad, to dismiss ongoing lawsuits brought by music publishers, songwriters and record labels.

The allegations state that the defendants' investments allowed Napster to run longer than it would have otherwise, a move that facilitated widespread piracy and cost the music industry $17 billion in sales.

Bertelsmann and Hummer Winblad's investments in Napster were $90 million and $15 million, respectively.

Judge Marilyn Patel, who issued an injunction against the original Napster in 2000, permitted the case to proceed through its discovery phase.

A spokeswoman for EMI, a plaintiff in the suit against Hummer Winblad, applauded the judge's decision, saying the record company has a "strong case."

However, Tony Berman, copyright attorney with Idell, Berman and Seitel in San Francisco, feels the lawsuits could have a "chilling effect" on investment in music-related technology.

"This could put fear into hearts of VCs. Firms want to invest in innovation, not litigation," he says.

Bruce Rich, a lawyer for Bertelsmann, says his client will continue to seek a dismissal of the litigation.

Napster went bankrupt in 2002 and was then bought by Roxio Inc., which launched Napster 2.0 in 2003.

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Canadian Biz Files Arguments Vs. Ruling On ISPs

By Larry LeBlanc

TORONTO -- The Canadian Recording Industry Assn. (CRIA) on July 12 filed arguments in its appeal over the March 31 ruling that Internet service providers could not be forced to reveal the identities of subscribers. CRIA had sought the information as part of an attempt to begin suing individuals who make music available online.

CRIA filed the appeal April 13 with the Federal Court of Appeal in Ottawa. It is expected that the court will hear the case in the fall.

The new CRIA brief contends that the court should have let the group pursue the file swappers' identities, and that the act of uploading copyrighted files without permission does constitute illegal distribution of the works.

"This appeal is significant for virtually all Canadian intellectual property owners," says CRIA president Brian Robertson.

The Federal Court ruled that the ISPs -- Bell/Sympatico, Rogers Communications Inc., Shaw Communications Inc. and Telus Corp. -- could not be forced to reveal the names and addresses of 29 people who allegedly shared a "high volume" of songs via the Internet in November and December 2003. CRIA had filed motions with the court in February to require ISPs to disclose the identities of subscribers alleged to be large-scale distributors of digital music files.

In his 28-page March ruling, Justice Konrad von Finckenstein said CRIA did not prove there was copyright infringement by the alleged uploaders. He further ruled that downloading or uploading music files does not constitute copyright infringement under current Canadian law.

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Michael Moore Pushes For Dismissal Of Libel Suit

Michael MooreDETROIT (AP) -- A lawyer for Michael Moore on July 15 asked a federal judge to dismiss a libel lawsuit against the documentary filmmaker filed by the brother of Oklahoma City bombing conspirator Terry Nichols.

James Nichols claims Moore tricked him into appearing in "Bowling for Columbine," the Oscar-winning 2002 documentary that studied guns and violence in American culture. Nichols also contends Moore libeled him in the film by linking him to the 1995 bombing that killed 168 people.

Neither Moore nor Nichols attended the July 15 hearing, and the judge did not indicate when he would issue a ruling.

Nichols accuses Moore of libel, defamation of character, invasion of privacy and intentional infliction of emotional distress. He is seeking a jury trial and damages ranging from $10 million to $20 million on each of nine counts.

Moore's recently released "Fahrenheit 9/11" has eclipsed "Bowling for Columbine" as the top-grossing non-concert documentary ever.

Moore's attorney, Herschel Fink, said his client's assertions in "Bowling for Columbine" -- including implying that Nichols "slipped away" from authorities investigating the Oklahoma City bombing -- are protected as free speech.

"It's a bit of hyperbole, but ... hyperbole is also a Supreme Court-protected form of speech," Fink said.

Wednesday's hearing focused primarily on whether the one-year statute of limitations for libel claims had expired by the time Nichols filed suit on Oct. 27, 2003.

Fink said "Bowling for Columbine" opened in New York and Los Angeles on Oct. 11, 2002, more than a year before the lawsuit was filed. The film opened in widespread release in the United States on Oct. 25, 2002, he said.

Nichols' attorney, Stefani Godsey, said the film opened on Oct. 28 in the area of Michigan where he lived. Nichols was not aware of the movie's existence until a newspaper called him for comment the next day.

Terry Nichols is serving life in prison for his role in the bombing.

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Deal Will Allow Limited DVD Copying

SAN FRANCISCO (Reuters) -- A group of media and technology companies including Microsoft Corp. and Walt Disney Co. have agreed in principle to allow consumers to make legal backup copies of next-generation videodiscs and share their content on portable devices.

The group, which also includes International Business Machines Corp., Intel Corp., Matsushita Electric Industrial Co. Ltd. and Time Warner Inc.'s Warner Bros., will not have any technology to license until the end of the year. But the announcement, released July 13, marks a shift in the way the movie industry has reacted to the threat of online piracy of its films.

Current DVDs are protected by a system called CSS, for content scrambling system, which prevents copying. The computer and consumer-electronics industries have pushed to allow less-encumbered sharing of media between TVs, computers, and portable players. The new alliance has named its yet-to-be-developed content protection technology "Advanced Access Content System." The system will be available to be licensed later this year.

Next-generation DVDs are expected to deliver superior video and audio, although technology and media companies have yet to reach a consensus on which of the competing DVD formats will prevail as the industry standard.

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RIAA Warns House Of Content Dangers From Digital Radio

By Bill Holland

Steven MarksWASHINGTON -- The top legal official of the RIAA has warned a House panel that as interactive digital radio hits the marketplace, the record industry could face near-obliteration if content protections aren't increased under the copyright law.

Appearing July 15 before the House Subcommittee on Courts, the Internet and Intellectual Property, RIAA general counsel Steven M. Marks cited the dangers of new-generation digital radio receiver/recorders that can "cherry-pick" and redistribute music tracks.

He asked Congress to shore up content protections granted in the Digital Performance Right Act of 1995. At that time, noninteractive services like Webcasts and broadcasts did not pose dangers of automated copying. The new receiver/recorders about to be rolled out can change all that, he said.

"The unrestricted copying, disaggregation and redistribution of digital transmission programs threatens to turn noninteractive services, like Webcasts and broadcasts, into the equivalent of on-demand interactive services," Marks told lawmakers.

"As broadcasters switch to digital broadcasting," he testified, "we fear that we are on the verge of devastation to the industry that will dwarf the harm wrought by the peer-to-peer piracy problems of the last several years."

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Biafra Drops Lawsuit Vs. Ex-Bandmates

Jello Biafra (AP) Former Dead Kennedys lead singer Jello Biafra has dropped his remaining lawsuit against members of his band.

In May 2000, a jury convicted Biafra and his record label of breach of contract and fraud. In June 2003, a state appeals court upheld that decision and ordered Biafra to pay $220,000 in back royalties and other damages.

It also decided the band's creative output, including songs "Holiday in Cambodia" and "Kill the Poor," belongs to a partnership formed among the four band members.

But the panel reversed the lower court's decision to break up the partnership, remanding the case back to the trial court to determine whether a partnership among the band members should be dissolved and its assets sold.

On June 30, Biafra agreed"the partnership's assets would be substantially diminished" by breaking it up.

A call to Biafra's publicist was not immediately returned.

"Personally and professionally, I just want to put this entire chapter behind us and concentrate on making music again," bassist Klaus Flouride said.

The San Francisco-based punk band performed together from 1978 to 1986. The band re-formed without Biafra and has been playing as the Dead Kennedys, according to its publicist, Josh Mills.

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Washington Report

Controversial Induce Act Headed For Hearing

By Bill Holland

Mitch BainwolWASHINGTON -- The Senate Judiciary Committee has planned a hearing for July 22 to debate the so-called Induce Act. Meanwhile, RIAA chairman/CEO Mitch Bainwol on July 13 sent a letter of support for the legislation to every member of the Senate.

In this election year, Congress has less than 30 days to complete its agenda before adjourning.

The "Inducing Infringement of Copyrights Act," S. 2560 -- introduced by Sen. Orrin G. Hatch, R-Utah, and co-sponsored by top Republican and Democrat leadership -- states that whoever "intentionally induces," or "intentionally aids, abets, counsels or procures" any violation of copyright "shall be liable as an infringer." The bill, introduced in the Senate on June 22 , would allow artists and labels to sue peer-to-peer companies on the grounds that they profit from encouraging minors and others to commit copyright infringement.

The legislation has set off a firestorm of opposition, with record companies and artists on one side and consumer-electronics firms, Internet companies and high-tech communities on the other.

Opponents say the bill's broad language will stifle creation of new technologies and products. They are also fearful that under the legislation, the "safe harbor" standard set by the Supreme Court in the 1984 Sony-Betamax case may be overturned, thereby subjecting the makers and distributors of consumer products to liability.

On July 9, a coalition of 43 groups opposing the measure wrote a letter to Hatch, the outgoing chairman of the Senate Judiciary Committee, and committee members. It said:

"By combining (1) a new and separate cause of action for 'intentional inducement,' (2) a lower civil, rather than higher criminal, standard of liability, and (3) a circumstantially 'reasonable' test', S. 2560 would seem to ensure that massive and intrusive discovery proceedings and a jury trial, would await any innovator or investor who introduces to the market a product that some copyright owner, someplace, believes will 'induce' infringement."

The groups also maintain that the law would drive investment in technology and accompanying jobs overseas.

The letter's signers include the Electronic Freedom Foundation, Verizon, TiVo, Intel, Google, the Consumer Electronics Assn. and Public Knowledge.

P2P United, the lobbying group representing file-sharer favorites Grokster, Blubster, Morpheus and others, also sent a letter to Hatch and the committee, denying that such services induce piracy.

"The astonishing claim that the kind of wholly decentralized peer-to-peer software developed by the members of P2P United 'functions like Earth Station 5's piracy machine' is utterly inaccurate and indefensible," the lobbying group said.

In his letter, Bainwol -- making his first written public-policy request to Congress since taking the reins of the RIAA in July 2003 -- says that none of the groups opposing the measure dispute the core issue: that copyright infringers should be penalized.

"Those who accept the core purpose of the bill ought to come forth with constructive and concrete suggestions, not hypothetical and peripheral concerns," Bainwol writes in the letter. "Why? The men and women of the music community and their families -- and other content creators -- deserve action."

"Ironically," he adds, "these P2P operators who hide behind the protective cover of 'technology' resist deploying existing technological answers to solve this problem. They resist modernization because it undercuts their business model. There's a price to going legitimate. But you can make it harder for them to resist doing the right thing -- without imposing a mandate. And that's by raising the price for not going legitimate."

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International Section

French Gov't Takes Lead In Fight Against Online Piracy

By Emmanuel Legrand

Nicolas SarkozyPARIS -- The French government is pushing the music industry and Internet service providers to adopt a charter that will regulate the relationship between the two parties in matters of online piracy.

French minister of economy, finance and industry Nicolas Sarkozy made the call July 15 at an inaugural gathering in Paris that brought together the government and the creative industries, telecom operators, ISPs and representatives of consumer groups.

The meeting was called by Sarkozy, who was surrounded by his colleagues Renaud Donnedieu de Vabres and Patrick Devedjian, ministers of culture and communication and of industry, respectively.

Sarkozy has been at the forefront of the French government's work in the fight against piracy.

Sarkozy said the anti-piracy actions of the government and the creative industries should center on three points: education of consumers on intellectual-property issues, enhanced legal action when the law is infringed, and the development and promotion of legal alternatives to access online music.

One request from the music industry, expressed by trade body SNEP, is that ISPs accept the placement of a "filter" on peer-to-peer services that favor sharing of unauthorized music files. This way, parents would be able to restrict which services their kids can access.

SNEP president Gilles Bressand cited a study by computer systems specialists Cap Gemini that concluded that it is technically possible to filter access to P2P services at a low cost.

SNEP proposes that ISPs offer the filter as an optional free service, starting in 2005.

"It is possible to prevent access to sites like KaZaA or eDonkey," says SNEP legal counsel Frédéric Goldsmith. "By preventing access to some services, parents could then avoid being dragged into potentially hazardous legal situations if their kids were to be sued for illegal file sharing."

Another meeting between the industry and ISPs, under the aegis of the government, is planned before the end of July. Sarkozy has asked the parties to come quickly to an agreement on the charter.

Sarkozy also renewed the commitment of the French government to obtain from Brussels a reduction on the value-added tax rate on recorded music sold in Europe.

"We had the feeling after the meeting that there is a real political will from the government to act on the issue of piracy," says Goldsmith. "Sarkozy expressed publicly his support of legal action against copyright infringers, and that is positive."

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Quebec's CHOI Loses Radio License

By Larry LeBlanc

CRTC LogoTORONTO -- Broadcasting regulator the Canadian Radio-television and Telecommunications Commission (CRTC) on July 13 denied an application by Montreal-based Genex Communications for the renewal of its licence for the French-language commercial rock radio station CHOI-FM in Quebec City.

In a separate public notice issued the same day, the CRTC called for applications for broadcasting licenses for a new French-language FM station in Quebec City.

In its ruling, the CRTC says comments made by CHOI's announcers were likely to expose individuals or groups of individuals to hatred or contempt "on the basis of mental disability, race, ethnic origin, religion, color or sex." The CRTC also maintained that the station's announcers were relentless in their use of the public airways to insult and ridicule people.

The regulator says Genex's programming has failed to meet the objectives set out in the Broadcasting Act of Canada. The regulator said that on numerous occasions, Genex had failed to comply with Canadian radio regulations.

Since Genex acquired CHOI in 1997, the station's programming has been under fire. The station has been the subject of numerous complaints with respect to the conduct of its hosts and alleged offensive comments, personal attacks and harassment.

In 2002, the CRTC restricted CHOI to a two-year license (rather than the customary five or seven years). The CRTC warned Genex that if the station committed further breaches, the regulator would call a public hearing to show cause why it should not issue a mandatory order or apply enforcement measures, including the suspension or revocation of CHOI's license.

The decision this week has signficiant implications for Canadian commercial radio. The CRTC has previously revoked licenses only for such matters as failure to meet music content regulations.

Genex Communications says it will appeal the CRTC ruling to the Federal Court of Appeal.

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U.K.'s PPL Forms New Government Relations Role

By Emmanuel Legrand

Dominic McGonigalLONDON -- British collecting society PPL has created a new position, director of government relations, who will coordinate the organization's lobbying efforts. Dominic McGonigal, who has been PPL's director of strategy and business development for the past three years, has been named to the new role, effective immediately.

McGonigal reports to PPL chairman/CEO Fran Nevrkla.

Nevrkla says it is "vital for PPL to have good working relationships" with the British Parliament and government headquarters Whitehall. He adds, "We have made tremendous progress in this area over the last three years, but the complexity of today's copyright and political environments calls for an even greater focus and emphasis."

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IFPI Plans Report On Global Music Piracy

By Emmanuel Legrand

LONDON -- Music industry trade body the IFPI will this week unveil its latest statistics on the trade in illegal music.

The organization will present an update on the multi-billion-dollar pirate business, and the responsive efforts from the industry. The IFPI will also name its new list of top 10 priority countries.

It is anticipated that the IFPI will use the platform to renew its plea for greater involvement from worldwide governments in the fight against piracy.

Speaking at the July 22 presentation in London will be IFPI chairman/CEO Jay Berman, EMI Music chairman/CEO Alain Levy and IFPI head of enforcement Iain Grant.

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Conference To Tackle Piracy In South Africa

By Diane Coetzer

Moshito LogoJOHANNESBURG -- The fight against music piracy will be one of the topics discussed next week at the first conference for the various sectors of the South African music industry.

Moshito '04 -- named after a Sepedi word from the province of Northern Sotho meaning "beat" or "rhythm" -- will bring together for the first time all music-related organizations in the country, as well as the Department of Arts and Culture. They will take part in a public/private initiative to tackle pressing issues facing the domestic music industry.

The conference is set for July 21-23 at the Sandton Convention Centre in Johannesburg. It is organized by Moshito Music Conference and Exhibition, a non-profit company established to stage the planned annual event.

Nick Motsatse, chairperson of Moshito, describes the conference as "the first step toward achieving unity on a number of challenges facing the music industry. These include ways of penetrating the global music market, perhaps through an Export Council; the urgent need for social welfare for musicians; and of course, unifying the industry in the ever-increasing fight against music piracy."

Among the organizations on the board of Moshito Music Conference and Exhibition are the Recording Industry of South Africa, the Southern African Music Rights Organization, the South African Recording Rights Assn., the South African Music Promoters Assn., the National Organisation for Reproduction Rights in Music in Southern Africa, the South African Roadies Assn. and the Musicians Union of South Africa.

Key speaker at the event will be Dr. Pallo Jordan, the newly appointed Minister of Arts and Culture, who is expected to address the role the music industry will play during his five-year tenure. In a statement, Jordan expresses his support for Moshito, which he describes as an "important initiative which will, as a public/private partnership, assist in shaping the South African music industry to the benefit of all stakeholders."

Other speakers will include Keith Donald of Irish performing-rights societies IMRO and MCPSI; Jean- Franois Michel, secretary general of the European Music Office in Brussels and director of Bureau Export de la Musique Française and Jeremy Fabini of the International Confederation of Societies of Authors and Composers.

National speakers will include Justice Albie Sachs of the South African Constitutional Court and kwaito musician Kabelo Mabelane.

Organizers say the intention of Moshito '04 is to come up with action plans to be implemented before the 2005 conference.

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Italian Biz Calls For Web Laws, Warns Of Child Porn Via P2P Sites

By Mark Worden

Tiziano FerroMILAN -- More than 60 Italian artists -- including Andrea Bocelli, Eros Ramazzotti, Elisa and Tiziano Ferro -- have signed a petition calling on the government to step up its regulation of the online music market.

The petition was presented to the Italian Senate and the Ministry of Culture on July 14. Industry body FIMI helped to gather the signatures.

In the petition, the artists declare that they support legal music sales on the Internet and the private use of downloaded material, but are opposed to music theft.

They are also critical of what they refer to as the current "demagoguery" concerning free music. This is a reference to the protest by Internet users after the passing of what is known as the "Urbani decree" on illegal file-sharing.

The Italian Senate -- in a motion initiated by culture minister Giuliano Urbani -- voted May 18 for tough measures, including prison sentences, for serial file-sharers. But after hackers temporarily shut down the Web sites of collecting society SIAE and some government ministries, the government announced that the measure would be softened.

FIMI, which accused the government of "giving in to blackmail by pirates," hopes that it will now reconsider its position.

In other news, Italian anti-piracy organization FPM is reaching out to parents in a campaign on the dangers of peer-to-peer piracy that will emphasize the risks of encountering child pornography, which is increasingly being distributed through file-sharing platforms.

The initiative follows a recent investigation by members of Italy's "Carabinieri" law-enforcement agency, who discovered that several hundred users were exchanging pornographic material via WinMix, E-Mule, KaZaA and IMesh.

In recent months, members of the fiscal police (Guardia di Finanza) have reported 160 individuals for distributing child pornography via KaZaA.

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Dream Makers & Deal Breakers

This Week's Dream Makers & Deal Breakers:

Jodi Levinson- Warner Bros. Pictures has promoted Jodi Levinson to senior VP of business affairs. She will continue to be responsible for negotiating agreements with filmmakers and talent, among other duties.

Levinson was most recently VP of business affairs, a role she has held since 1998. She joined the company in 1994; prior to that, she was senior attorney for the motion picture group at Paramount Pictures.

Based in Burbank, Calif., Levinson reports to Warner Bros. Pictures executive VP of business affairs Patti Connolly.

In her time at the company, Levinson has worked on such films as the "Harry Potter" series, "Starsky and Hutch," "Scooby Doo" and the upcoming "Charlie and the Chocolate Factory."

- Attorney Dave Stein has become of counsel to the firm of Carroll, Guido & Groffman, which works primarily with music and new-media clients.

In his private practice, New York-based Stein works with emerging rock acts such as Taking Back Sunday, the Starting Line and Jamison Parker, and with labels such as Equal Vision Records (Coheed and Cambria) and Doghouse Records (All American Rejects).

Carroll, Guido & Groffman, which has offices in New York and Los Angeles, represents such acts as Dave Matthews Band, Jay-Z, Outkast, Patti Smith, Harry Connick Jr., the Strokes, Godsmack, Method Man and Velvet Revolver; labels that include ATO Records, Beggars Banquet Group, Aware Records and Latin rock label Surco Records; and e-commerce services Musictoday and Savage Beast.

Andrew Darrow- Internet marketing company MECA Communications, which promotes its clients primarily through instant-messaging, has named Andrew Darrow as chief strategy officer. He will oversee strategic planning, sales, marketing and business development.

Los Angeles-based Darrow, an attorney and entertainment-industry veteran, was most recently VP of Broadway Video Enterprises, where he directed strategic planning for domestic exploitation of "Saturday Night Live." Prior to that, he held key strategy/licensing/creative positions at NBC Enterprises Inc. and Simitar Entertainment. He has also held executive posts in A&R at MCA Records and in artist management at Overland Productions. He began his career in 1982 as a concert agent at ICM.

Darrow's articles have appeared in the New York Law Journal and Entertainment Law & Finance.

MECA's clients include Vivendi Universal, Time Warner, RealNetworks, Electronic Arts and Marvel.

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