The Turtles' fight for public performance fees in pre-1972 recordings

There's a bitter irony that 1960s pop band The Turtles' biggest hit record, "Happy Together," was born of a group that in its few years of making records drifted through personnel changes, producers and multiple managers, ultimately disbanding due to fatigue and financial stress.

If you enter "Turtles managers" on YouTube you will be treated to a comedic exegesis of The Turtles' tales of woe, being bilked by a revolving door of managers and ultimately ending up with their original manager, though much the poorer. After disbanding, two of The Turtles' principal members, Mark Volman and Howard "Eddie" Kaylan, carried on touring, apparently happy together but, because they did not own it, unable to use their former band name, The Turtles. Undeterred, they did the logical thing, in a post-psychedelic acid trip sort of way, calling themselves Flo and Eddie.

These days Flo and Eddie are making more noise in the courts than on stage, waging war against satellite broadcasters' use of The Turtles' music and trying to upend a 120-year-old industry and copyright law scheme weighted against owners of sound recordings. To understand our story, a look back in time at the brief history of recorded music and the law governing it is in order.

In 1897 Congress amended federal copyright law to grant copyright owners a right in public performances of their songs. That means if you wanted to perform a song publicly, you now had to pay to do so. Sound recordings at that time were in their nascent stage of development - single songs etched in a wax cylinder about the size of a Coke can played on a device that was wound by hand and mechanically (not electronically) reproduced the sound. As a result, public performance rights entailed principally live performances. Sound recordings not being a common medium of public performance of songs, public performance rights were granted to the writer of the song, not to performers.

With the emergence of radio in the 1920s, the technological landscape changed, but copyright law did not. Radio broadcasts became - and remain - a large source of revenue of public performance royalties for songwriters. Perforce, where there is money, there are busy beavers devising ways to collect it, so public performance rights organizations were born (the two principal ones in the U.S. being ASCAP (the American Society of Composers, Authors and Publishers) and BMI (Broadcast Music, Inc.). Though some musicians fancy themselves as gods and goddesses, even they really cannot be everywhere at all times, so they contract with ASCAP or BMI to collect their public performance royalties from every radio and television station, backwater nightclub or saloon in every charted or off-the-road outpost from Chicken, Alaska to Loafers Glory, North Carolina.

Through historical happenstance, then, the American system of paying for public performance rights was limited to reimbursing the songwriter, not the performer whose record you're singing along with on the car radio. The next time you're stuck in traffic belting out Marvin Gaye's "I Heard it through the Grapevine," think of Norman Whitfield and Barrett Strong. They're the guys getting paid for the radio station playing that song.

For decades, record companies pressured Congress to grant public performance license fees to the performers (and hence to the record companies who owned the recordings), but Congress resisted. In the mid-20th century the record industry exploded, record sales increasing exponentially. The conventional wisdom and knock against granting public performance royalties to performers and record companies was that radio play effectively constituted free advertising for the record companies so the companies were making truckloads of money through record sales as a result of that free publicity. Radio and television stations, located in every congressional district in the country, fiercely opposed expansion of the fees they were required to pay. By contrast, the record industry, based in large part in New York, Los Angeles and Nashville, did not enlist broad sympathy in Congress; thus, the law remained unchanged.

Not only were performers not entitled to public performance royalties when their records were played on the radio, until 1971, when Congress passed the Sound Recording Act, U.S. copyright law gave no protection to sound recordings. Think of it: the last Beatles record (of all new recordings) was released in 1970. Does that mean you could bootleg to your heart's desire with impunity back then? No. Rather than devising a national scheme to protect records, enforcement was protected by a hodgepodge of state copyright and anti-piracy laws.

The protection Congress enacted with the Sound Recording Act was merely against physical piracy of the recordings, to clean up the confusing mess of having to litigate the issue under 50 different states' laws; the law still did not grant owners of sound recordings an exclusive right to perform their recordings publicly. The Sound Recording Act became effective as of Feb. 15, 1972, giving birth to the term "pre-1972 recordings," meaning recordings made before federal copyright law protected them.

In 1976, Congress overhauled U.S. copyright law but, because of certain changes to be included in the revised law, the recording industry pressed Congress to exempt pre-1972 recordings from the new law, which Congress did, recognizing that pre-1972 recordings would remain protected under state law but would lapse into the public domain in 2067.

Then the internet happened. Seeing an opportunity to make an old argument new again, the recording industry lobbied to receive public performance royalties for digital broadcasts of their recordings. Convincing Congress that digital broadcasts of recorded music would allow listeners to make perfect copies of digitally broadcast music, displacing record sales, they were successful. In 1995, Congress passed the Digital Performance in Sound Recordings Act, granting owners of sound recordings an exclusive right to perform a copyrighted work publicly by "digital audio transmission." For purposes of our tale, that brings us back to Flo and Eddie.

Since the most current iteration of U.S. copyright law specifically left enforcement of copyright issues (other than physical piracy) in pre-1972 recordings to the states, and because no state had ever required someone to pay a public performance fee to the owner of a sound recording, companies such as Pandora and SiriusXM, under the new law, did not pay for their digital broadcasts of pre-1972 recordings. Pre-1972 recordings comprise approximately 5 percent of Pandora's song plays and about 15 percent of Sirius's broadcasts, and each music service pays hundreds of millions of dollars annually for all other - post Feb. 14, 1972 - recordings each plays, so tens of millions of dollars are at issue.

Figuring they'd been bilked and bamboozled enough in their youth by the music business, Flo and Eddie decided it was time to exact retribution in their dotage. And did they. Commencing actions against SiriusXM in California, New York and Florida, Flo and Eddie argued that the laws of each of those respective states required Sirius to pay them for broadcasting their pre-1972 Turtles' recordings.

In the initial round, Flo and Eddie won in California and New York but lost in Florida. The Florida decision was appealed to the 11th Circuit Court of Appeals, which certified the state law questions central to the decision to the Florida's highest court. The Second Circuit did the same to the New York Court of Appeals. The New York Court of Appeals five months ago, however, issued an unfavorable opinion, holding that New York law does not grant an exclusive right of public performance to owners of pre-1972 sound recordings. The Florida case was argued four weeks ago; a decision is pending. But all was not lost. Flo and Eddie settled their California action (two weeks before the New York Court of Appeals ruled against them in their New York action), so they exacted a pound of flesh.

The oddity of Flo and Eddie's case is that they're suing a digital broadcaster, but the scope of their case - based on state law - seemingly should not be limited to digital broadcasts. If Flo and Eddie prevail in any way in their cases it really means that all users, from bars and restaurants to television and radio stations, would have to pay the owners of pre-1972 sound recordings to play those recordings. For fear of stating the obvious, if anyone over the past 100 years thought there was an exclusive right granted to the owners of sound recordings, it would seem that someone would have asserted that right long before now. And given the record industry's relentless efforts over the decades to obtain public performance rights for sound recordings, you would think that any state legislation attempting to do that would have gotten a little bit of attention.

Nevertheless, Flo and Eddie are having fun again or, perhaps, for once and for all. To further drive home the point, Flo and Eddie embark on their summer of "Happy Together Tour 2017" with a posse of 1960s anodyne pop-bands such as The Box Tops, The Association, The Cowsills and The Archies. (If you grew up listening to music on AM radio and know that P.F. Flyers will make you "run faster and jump higher," you'll be familiar with these bands.) So, as their long and bumpy road of stardom enters its closing laps, it seems Flo and Eddie once again are happy together, albeit with different people.

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Mark Costello is a partner at Boylan Code LLP, practicing litigation and entertainment law, and has been a terrible singer for over 50 years.

Published: Tue, May 30, 2017

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