Monday, January 22, 2007

XM, RIAA, 1008

There are few cases involving the interpretation of Section 1008 of title 17, added in the 1992 Audio Home Recording Act, RIAA v. Diamond Mutimedia Systems, Inc., 180 F.3d 1072 (9th Cir. 1999) being the most important. Section 1008 was intended to provide, finally, a statutory exemption for home copying of musical works, but that isn't how it has worked out. Section 1008 received another look on January 19th by Judge Deborah Batts of the SDNY in Atlantic Recording Corp. et al v. XM Satellite Radio, Inc. You can get the decision on Cathy Kirkman's Silicon Valley Media Blog.

The case was an RIAA case, brought on behalf of ten labels against XM's "XM+MP3" players (inno, Helix, and NeXus). The players have a number of features besides permitting listeners to hear broadcasts. The players permit listeners to instantly record songs being broadcast (even if they have started, through use of a buffered copy). Additionally, XM provides playlists of individual tracks disaggregated from blocks of radio programming and a search function facilitated by "ArtistSelect" and "TuneSelect" utilities. Listeners can request alerts for particular artists or songs and XM will notify listeners when a song is being brodcast. Up to 50 hours of music can be stored for unlimited playback, but when the subscription ends so too does access to the songs.

XM's position was clear, although in the court's opinion, extreme: Section 1008 immunized its conduct completely, and such that a 12(b)(6) motion should be granted. The label's position was less clear from the opinion, other than that XM was wrong. The labels certainly asserted that XM, while not liable for mere broadcasting, was acting without authorization by delivering permanent digital copies. But the copies weren't permanent, they were, as the court put it leased, for the duration of the subscription, not that the distinction matters. The court also stated that the labels were not claiming "XM is infringing on their copyrights by distributing a [digital audio recording device]." Section 1008 exempts such distribution so certainly the labels would not want to make such a claim, but to me, at least, an important issue is whether the XM players are a digital audio recording device, a defined term. What I find baffling about the court's opinion is that it doesn't address that issue except in passing (fn.4) , even though I thought that was the basis for XM's motion. Instead, the court analyzed whether XM had exceeded its license under Section 114, presumably as an independent ground for liability not covered by Section 1008, but it would have been nice to have a real discussion of Section 1008.


Joseph Gratz said...

The court's only analysis of the DARD question comes in Footnote 4, and it's given short shrift -- though the district court finds, at least for purposes of this motion, that the XM/MP3 devices *are* DARDs.

William Patry said...

Here is footnote 4:

The parties to this case are in dispute over whether XM + MP3 players qualify as “digital audio recording devices” under the AHRA. The dispute turns principally on whether XM + MP3 players meet the statutory definition of such
a device as that definition has been interpreted by the Ninth Circuit in Recording Industry Association of America, et
al. v. Diamond Multimedia Systems, Inc., 180 F.3d 1072 (9th Cir. 1999).

The Ninth Circuit case dealt with a device, the Rio, that could not transmit and could not record without the use
of a computer, which is exempted under 17 U.S.C. 1001(5)(B). Therefore the facts are totally different from the
facts here. XM + MP3 players do receive from transmission and permit copying without an external computer or
computer hard drive. The fact that it can be connected to a computer to get non-XM music on the computer hard
drive does not bring it within the ambit of the limitations of the Rio. According to Diamond, “a device falls within
the [AHRA’s] provisions if it can indirectly copy a digital music recording by making a copy from a transmission of
that recording. Because the Rio cannot make copies from transmissions, but instead, can only make copies from a
computer hard drive, it is not a digital audio recording device.” Diamond, 180 F.3d at 1081. Accordingly, at this
stage of the proceeding, relying on plain meaning statutory interpretation and the definition of a DARD contained in
Diamond, until proven otherwise by means of discovery, the Court treats the inno, Helix and NeXus as DARDs

Anonymous said...

Does anyone understand the logic of the court's analysis? A) The broadcasts were apparently licensed under 114. B) The devices were DARDs so no claim could be made against XM for selling the device under 1008. C) The users were immunized from infringement claims by 1008.

The court said "What the Complaint does allege is that, in providing services specific to users of XM + MP3 players, XM is acting outside the scope of its license for broadcast service – XM’s only source of permission to use their recordings."

However, the "services" seem to be notifying users of the timing of broadcasts with artists/songs of interest and allowing the user to automatically record the broadcast by using a feature built into the DARD. There doesn't seem to be any transmission of the songs other than in the course of their regular licensed broadcasts.

Would a 3rd party be infringing if they set up a notification "service" about upcoming broadcasts? Would they infringe if they automated this service, perhaps by selling an add-on device that pressed buttons on the XM receiver?

Matt said...

It looks to me like XM was saying that its players *were* DARDs, and therefore it was immune under section 1008. The plaintiffs said that XM players were *not* DARDs, so therefore 1008 would be irrelevant. The court weirdly addressed the issue only in footnote 4.

So the plaintiffs lost that one, but they won the bigger battle. The court said that 1008 didn't apply at all, because XM was being sued for acting outside the scope of its license.