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Failure to Follow Procedure Results in a Loss of 21 Copyright Infringement Claims

Rulebreakers proceed with caution: Latin American Music Company recently lost its case on appeal because of its failure to comply with various legal procedure rules for its copyright infringement claims for 21 songs.  Latin American Music Company (“LAMCO”) and Asociación de Compositores y Editores de Música Latinoamericana (“ACEMLA”) filed suit against Media Power Group, Inc. (“MPG”) and its president Eduardo Rivero Albino for copyright infringement of 21 songs.  The District Court of Puerto Rico granted MPG’s summary judgment motion for 12 of the songs.  The remaining 9 songs went to a jury trial, and the jury returned a verdict for MPG.  LAMCO challenged the summary judgment and the jury verdict.  However, the First Circuit Court of Appeals affirmed.  Latin American Music Co., Inc. v. Media Power Group, Inc., Case No. 11-2108 (1st Circuit, January 15, 2013)(available here).

MPG is the owner of several radio stations called “Radio Isla” in Puerto Rico.  In 2005, LAMCO notified MPG that Radio Isla was playing songs without a license, thereby infringing on LAMCO’s copyrights.  When negotiations failed, LAMCO sued, asserting that it owned the copyrights to the songs by assignment.  The trial court granted summary judgment for MPG for 12 songs, “concluding that LAMCO: (1) was collaterally estopped from litigating ownership of valid copyrights in four songs; (2) failed to show compliance with the registration requirement of 17 U.S.C. § 411(a) with respect to four other songs; (3) failed to establish an infringing use as to three songs; and (4) lacked ownership in one song.”  LAMCO, Slip Op. p. 3.  The remaining 9 songs went to jury trial, and the jury sided with MPG.

LAMCO raised four issues on appeal: (1) LAMCO challenged the jury verdict on sufficiency-of-the-evidence grounds; (2) LAMCO argues that the issue of ownership should not have gone to the jury, and therefore violates the law of the case doctrine; (3) LAMCO asserts that the District Court erred in ruling that LAMCO was collaterally estopped from litigating its claims to the four songs; and (4) LAMCO challenges the dismissal of its claims for the 4 songs for failure to show compliance with the registration requirement.

The Appeals Court rejected LAMCO’s first issue because LAMCO failed to raise the issue at trial before raising it on appeal, as required by case law (a motion for directed verdict or judgment as a matter of law (JMOL)).

LAMCO also argued that the trial court had determined on summary judgment that there was no genuine issue as to LAMCO’s ownership of the songs, and therefore the question of ownership should not have been presented to the jury.  However, the trial court flat out denied LAMCO’s motion for summary judgment for some of those songs on other grounds.  As a result, it was “unclear whether the district court considered the fact of ownership undisputed for purposes of the [summary judgment] motion only… or treated the fact as established in the case…”  LAMCO, Slip Op. p. 7.  The Appeals Court noted that at the trial, the parties treated ownership as if it was a “live issue” to be presented to the jury.  “Not only did LAMCO fail to object to jury instructions on the issue of ownership, but its own proposed instructions stated that LAMCO had the burden of proving ownership of each song as an element of the claim. LAMCO even objected to the defendants’ Rule 50(a) motion for judgment as a matter of law by arguing that it was for the jury to determine whether LAMCO owned the songs.”  LAMCO, Slip Op. p. 7.

According to the law of the case doctrine, “unless corrected by an appellate tribunal, a legal decision made at one stage of a civil or criminal case constitutes the law of the case throughout the pendency of the litigation.” Flibotte v. Pa. Truck Lines, Inc., 131 F.3d 21, 25 (1st Cir. 1997).  The Appeals Court noted that the doctrine did not apply because the trial court’s interlocutory summary judgment order did not constitute the law of the case, and as a result there was no abuse of discretion by the lower court.  LAMCO, Slip Op. p. 9.  “Given the parties’ treatment of the ownership issue at trial [at the opening and closing arguments, and in the jury instructions], the better view of the record is that the issue had not been decided.”  LAMCO, Slip Op. p. 11.

As for LAMCO’s third issue on appeal, the Appeals Court cited a 2007 case which affirmed the dismissal of LAMCO’s claims of copyright infringement for 11 songs because LAMCO failed to establish a prima facie case of ownership by providing the certificate of recordation.  See Brown v. Latin American Music Co., 498 F.3d 18 (1st Cir. 2007).  LAMCO’s suit against MPG includes 4 of the songs in the Brown case.  As a result, the trial court dismissed the claims on collateral estoppel grounds.  Collateral estoppel applies when “(1) the issue sought to be precluded in the later action is the same as that involved in the earlier action; (2) the issue was actually litigated; (3) the issue was determined by a valid and binding final judgment; and (4) the determination of the issue was essential to the judgment.” Mercado-Salinas v. Bart Enters. Int’l, Ltd., 671 F.3d 12, 21-22 (1st Cir. 2011).

With respect to LAMCO’s final issue on appeal, the Appeals Court analyzed whether the trial court’s dismissal of four songs, on the ground that LAMCO failed to produce evidence of registration, was correct.  Copyright law requires registration prior to filing a copyright infringement claim. Airframe Sys., Inc. v. L-3 Commc’ns Corp., 658 F.3d 100, 105 (1st Cir. 2011) (citing 17 U.S.C. § 411).  LAMCO argued that it did not have a duty to produce the registration because the defendants did not properly raise the issue in their summary judgment motion.  However, the trial court, in dismissing the four songs, relied on a Magistrate Judge’s recommendation to dismiss on this same ground, and LAMCO did not object to the recommendation.  As a result, LAMCO could not raise this issue for the first time on appeal.  See Phinney v. Wentworth Douglas Hosp., 199 F.3d 1, 4 (1st Cir. 1999) (“an objection to a magistrate
judge’s order must apprise the district court of all the objector’s claims of error, and new claims of error on the part of the magistrate judge cannot thereafter be raised in this court”).
“LAMCO did not produce any other evidence of registration [for 2 of the songs] and thus claims as to those songs were properly disposed of by summary judgment.”  LAMCO, Slip Op. p. 16.  For the third song, LAMCO presented a registration document for a work by the same composer and argued, without any additional evidence, that the two works were the same.  The trial court determined that LAMCO’s claim was unsupported, and the Appeals Court agreed.  For the fourth song, LAMCO presented  printouts from the Copyright Office’s online catalogue, which showed that the song was registered in 1989 by its composer and later transferred to LAMCO.  These printouts were not admissible evidence as per the Magistrate Judge.  Again, because LAMCO failed to present the issue to the trial court before raising it on appeal.

LAMCO’s failure to preserve multiple issues on appeal and voluntarily presenting the ownership issue to the jury doomed its copyright case.

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