Alliance of Artists & Recording Companies v. General Motors Co.

162 F. Supp. 3d 8, 118 U.S.P.Q. 2d (BNA) 1134, 2016 U.S. Dist. LEXIS 20244, 2016 WL 695983
CourtDistrict Court, District of Columbia
DecidedFebruary 19, 2016
DocketCivil Action No. 14-cv-1271 (KBJ)
StatusPublished
Cited by22 cases

This text of 162 F. Supp. 3d 8 (Alliance of Artists & Recording Companies v. General Motors Co.) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Alliance of Artists & Recording Companies v. General Motors Co., 162 F. Supp. 3d 8, 118 U.S.P.Q. 2d (BNA) 1134, 2016 U.S. Dist. LEXIS 20244, 2016 WL 695983 (D.D.C. 2016).

Opinion

MEMORANDUM OPINION

KETANJI BROWN JACKSON, United States District Judge

The Audio Home Recording Act of 1992 (“AHRA”), 17 U.S.C. §§ 1001 et seq., re[9]*9quires manufacturers, importers, and dis-tributers of “digital audio recording devices” (“DARDs”) to incorporate certain copying control technology into their devices and pay a set royalty amount for each device. The AHRA is part of federal copyright law, and a non-profit organization called the Alliance of Artists and Recording Companies (“AARC”) assists the U.S. Copyright Office in enforcing the AHRA’s provisions by, among other things, collecting AHRA royalties and distributing them to featured recording artists and sound recording copyright owners. (See Compl. (“GM Compl.”), ECF No. 1, ¶ 8); see also Justin M. Jacobson, What Is the AARC?, 56 J. Copyright Soc’y U.S.A. 213, 215 (2008). In the instant action, the AARC contends that automobile suppliers DENSO International America, Clarion Corporation of America, and Mitsubishi Electric Automotive America have developed certain audio technology that car manufacturers General Motors Company, Inc., Ford Motor Company, and FCA US (collectively, “Defendants”) have been installing in certain car models since 2008.1 The AARC believes these audio devices qualify as DARDs for AHRA purposes; its five-count complaint seeks an injunction, a declaratory judgment, and monetary damages, claiming that Defendants should be paying royalties and implementing copying control technology when vehicles equipped with these devices are made and marketed, and that Defendants have violated the AHRA because they have done no such thing to date. (See GM Compl. ¶¶ 52-70; FCA Compl. ¶¶ 53-70.)2

Before this Court at present are a motion to dismiss that Ford and Clarion have filed jointly under Federal Rule of Civil Procedure 12(b)(6), and a motion for judgment on the pleadings that General Motors has submitted pursuant to Rule 12(c). (See ECF Nos. 30, 48.) Both dispositive motions make essentially the same argument: that none of the devices at issue, as described in the complaint, satisfies the AHRA’s multifaceted DARD definition, and thus the statute’s mandated royalty payments and technology limits do not apply. This Court largely agrees with these defendants’ interpretation of the statute for the reasons explained below, but it also concludes that the allegations that the AARC makes regarding the devices at issue are sufficient to survive the Rule 12 motions. Accordingly, and as set forth in the separate order that accompanies this Memorandum Opinion, these motions will be DENIED.

1. BACKGROUND

A. The Audio Home Recording Act Of 1992

In the 1980s, the music industry faced a growing problem in the form of emerging digital technology that allowed users to create multi-generation copies of sound recordings without losing sound quality. This was a new issue for the industry because, with older analog technology, each successive copy of the same sound recording [10]*10sounded worse; consequently, consumers always had an incentive to purchase the original recording from its manufacturer. See Recording Indus. Ass’n of Am. v. Diamond Multimedia Sys., Inc., 180 F.3d 1072, 1073 (9th Cir.1999). By contrast, Digital Audio Tape (“DAT”) machines and other new digital recording technology could produce a copy of an original audio recording, then copy that copy of the original, then copy the copy of the copy of the original, and so forth and so on, and the copies sounded just as good as the original recording, leading the music industry to fear that it could lose significant revenue. See H.R. Rep. No. 102-873, pt. 1, at 18 (1992).3 At the same time, the high-tech manufacturers and users of DAT machines and other digital audio recording technology were becoming increasingly concerned that the production and use of devices that could produce such high-quality copies of protected material would expose them to liability for copyright infringement on a massive scale. See Jacobson, supra, at 213. These various concerns led to protracted negotiations in Congress, which ultimately culminated in the Audio Home Recording Act of 1992 (“AHRA”), 17 U.S.C. § 1001 et seq.

It is well-established that the AHRA was a “grand compromise” between the stakeholders insofar as the statute was designed to address both the serial copying problem that concerned the music industry and the high-tech industry’s fear of widespread copyright infringement liability. Lee A. Hollaar, Legal Protection of Digital Information 150 (2002); see also The Audio Home Recording Act of 1991: Hearing on S. 1623 Before the S. Suh-comm. on Patents, Copyrights & Trademarks' of the S. Comm, on the Judiciary, 102d Cong. 1 (1991) [hereinafter 1991 Senate Hearing] (statement of Sen. Dennis DeConcini) (“[This bill] represents a historical compromise among opposing segments of the entertainment and electronic industries. As in all such compromises, all parties had to give a little to gain a little.”). Significantly for present purposes, one byproduct of the extensive negotiations is the particular and carefully defined scope of the statute: rather than “prohibit[ing] digital serial copying of copyright protected audio recordings” altogether, “the Act [instead] places restrictions only upon a specific type of recording device[,]” Diamond, 180 F.3d at 1075, and it provides immunity from copyright infringement lawsuits if the manufacturers of those particular devices comply with the statutory restrictions.

To this end, the AHRA contains a lengthy “Definitions” section that prescribes the statute’s reach by laying out the intended meaning of a “digital audio recording device” (a.k.a. DARD), which is the only type of recording device to which the statutory requirements pertain. See 17 U.S.C. § 1001. Then, on the restrictions side of the AHRA balance, the statute imposes two limitations on electronics manufacturers and distributers with respect to the production of DARDs. First, it requires that DARDs be manufactured to “conform to the Serial Copy Management System [or] a system that has the same functional characteristics^]” 17 U.S.C. § 1002(a)(l)-(2); that is, DARDs must contain technology that “allows the making of [11]*11unlimited copies from an original digital recording but prevents any copies being made from those copies.” Hollaar, supra, at 151.4 Second, every manufacturer or importer of a DARD is required to pay a royalty fee for the manufacture, importation or distribution of each device. See 17 U.S.C. §§ 1003, 1004.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
162 F. Supp. 3d 8, 118 U.S.P.Q. 2d (BNA) 1134, 2016 U.S. Dist. LEXIS 20244, 2016 WL 695983, Counsel Stack Legal Research, https://law.counselstack.com/opinion/alliance-of-artists-recording-companies-v-general-motors-co-dcd-2016.