The Pitch newsletter is a monthly update of legal issues and news affecting or related to the music, film and television, fine arts, media, professional athletics, eSports, and gaming industries. The Pitch features a diverse cross-section of published articles, compelling news and stories, and original content curated and/or created by Arnall Golden Gregory LLP’s Entertainment & Sports industry team.
“Art enables us to find ourselves and lose ourselves at the same time.” – Thomas Merton
AGG News
Registration Blues: What New Federal Beneficial Ownership Reporting Requirements Mean for Music Professionals and Beyond
In both music and the music business, structure matters. An F major chord will be an F major chord, regardless of its inversion. But not every construction of an F major chord will work equally well in all situations, and root position and first inversion constructions are commonly preferred. Similarly, a band will be a band regardless of whether it operates as a sole proprietorship, partnership, a corporation, or a limited liability company. But these choices are not equal, and corporations and limited liability companies are often selected by touring and recording artists as the preferred structures for professional activities, holding assets, and loanout functions. Beginning January 1, 2024, the Corporate Transparency Act (the “CTA”), a new federal law, will require every such operating and loanout company to comply with new reporting requirements or face substantial penalties.
(Source: Arnall Golden Gregory LLP, November 28, 2023)
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Industry News
Daryl Hall Gets Restraining Order Against John Oates in Hall & Oates Legal Battle
Hall & Oates are embroiled in a confidential legal battle that has led to Daryl Hall getting a restraining order against his former music partner John Oates. Little information about the lawsuit is publicly available, as the court documents are sealed, but based on court records, Hall filed an undisclosed complaint against Oates on Nov. 16, as well as a motion for a temporary restraining order, as reported by Philadelphia magazine.
(Source: Variety, November 22, 2023)
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Former CU Football Player Files Lawsuit Against NCAA Seeking Television Revenue Split for Players
Former CU running back Alex Fontenot has filed a class-action federal lawsuit against the NCAA and the Power Five conferences, seeking part of the television revenue earned by networks be split among college football players. Fontenot claims that television networks enjoy "ever-increasing" revenue from college football and basketball broadcasts, but that the athletes are entitled to receive a substantial portion of the revenue, given that it is brought in by the athletes' labor. Fontenot played for the Buffs between 2017 and 2022.
(Source: CBS News, November 21, 2023)
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Spotify Plans to Pay 80% Less for Rain Sounds and White Noise
Functional content — think rain noises, whale sounds, recordings of wind rustling the leaves and the like — will be significantly devalued under Spotify‘s new royalty system: Plays of this audio will generate one fifth of the royalties generated by a play of a musical track, according to a source with knowledge of the streaming service’s new policy.
(Source: Billboard, November 21, 2023) [Subscription may be required]
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BMI Sold to New Mountain Capital
BMI’s transition to a for-profit model took the next logical step forward Tuesday as a New Mountain Capital-led shareholder group announced a majority growth investment in the organization. Along with ASCAP, which remains not-for-profit, BMI is one of the two largest performing rights organizations in the U.S.; the deal is expected to close by the end of the first quarter of 2024. Mike O’Neill, BMI’s president & CEO, will continue to lead the company, along with his leadership team, following the closing, according to the announcement. New Mountain will acquire the company from the shareholders who own currently own it; those shareholders must approve the sale.
(Source: Variety, November 21, 2023)
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Sarah Silverman Hits Stumbling Block in AI Copyright Infringement Lawsuit Against Meta
A federal judge has dismissed most of Sarah Silverman‘s lawsuit against Meta over the unauthorized use of authors’ copyrighted books to train its generative artificial intelligence model, marking the second ruling from a court siding with AI firms on novel intellectual property questions presented in the legal battle. U.S. District Judge Vince Chhabria on Monday offered a full-throated denial of one of the authors’ core theories that Meta’s AI system is itself an infringing derivative work made possible only by information extracted from copyrighted material. “This is nonsensical,” he wrote in the order. “There is no way to understand the LLaMA models themselves as a recasting or adaptation of any of the plaintiffs’ books.”
(Source: The Hollywood Reporter, November 21, 2023)
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Spotify Plans to Leave Uruguay Over Change to Copyright Laws
After Uruguay’s parliament passed a bill that changes the country’s copyright laws, Spotify issued a statement on Monday (Nov. 20) saying that it “will unfortunately begin to phase out its service in Uruguay effective January 1, 2024, and fully cease service by February.” The Uruguayan bill asks for “equitable remuneration” for artists. However, it did not say whether those additional royalties would come from a streaming service like Spotify or from the money that Spotify already pays out to rightsholders.
(Source: Billboard, November 20, 2023) [Subscription may be required]
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YouTube Creators Can Now Use AI to Imitate Pop Stars
YouTube is launching an experimental feature that will create artificial intelligence-generated voices of well-known artists for use in clips on YouTube shorts. The initial selection of acts participating in the program includes Charlie Puth, John Legend, Sia, T-Pain, Demi Lovato, Troye Sivan, Charli XCX, Alec Benjamin and Papoose. YouTube’s feature, called Dream Track, creates pieces of music — voice along with musical accompaniment — based on text prompts that are up to 30 seconds in length. For now, around 100 U.S.-based creators will have Dream Track access. “At this initial phase, the experiment is designed to help explore how the technology could be used to create deeper connections between artists and creators, and ultimately, their fans,” according to a blog post from Lyor Cohen, global head of music, and Toni Reid, vp of emerging experiences and community.
(Source: Billboard, November 16, 2023) [Subscription may be required]
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Bootleggers Beware: Rod Wave Is Coming for Your Fake Concert Merch
If you were thinking about selling unauthorized Rod Wave merch outside one of his concerts, you might want to think again. The “Rags2Riches” rapper won a federal court order empowering law enforcement to seize bootleg merchandise sold outside his Charlotte concert on Wednesday, regardless of who was selling it. Wave is the latest artist to turn to the courts to fight fake merch. Metallica‘s authorized vendor filed a similar case in October to quash bootleggers at two St. Louis shows, and SZA won a similar seizure ruling ahead of a September show at TD Garden in Boston. Post Malone, Cher, Beyonce, Jay-Z, Bruno Mars, Motley Crue, Def Leppard, Jimmy Buffet, Aerosmith, Dead & Co. and many others have filed similar cases, which argue that such unauthorized gear violates artists’ trademarks as well as their likeness rights.
(Source: Billboard, November 16, 2023) [Subscription may be required]
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'South Park’ Streaming Rights Standoff: Judge Rules Against Warners on Some Claims in Licensing Battle
A New York judge has trimmed Warner Bros. Discovery‘s lawsuit looking to enforce the company’s exclusive streaming rights to South Park on HBO Max. Justice Margaret Chan found that Paramount didn’t violate any state consumer protection laws because the complaint revolves around a “private contract dispute” that allegedly caused WBD to overpay for certain rights in the $500 million deal and “not conduct that has caused harm to consumers.” She concluded that Paramount didn’t engage in what WBD called a “campaign of verbal trickery” that muddled understanding of who held the exclusive rights to the series when it debuted South Park: Post Covid and South Park: The Streaming Wars on Paramount+.
(Source: The Hollywood Reporter, November 15, 2023)
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Second Circuit Asked to Decide if Barstool Sports’ Trash Talk About Michael Rapaport Was Defamatory
Actor Michael Rapaport urged an appeals panel on November 15 to revive his civil defamation claims against the popular sports and pop culture website Barstool Sports, which had briefly hired him as a podcast host. The 53-year-old actor and comedian claimed in a 2019 amended complaint that Barstool defamed him in public statements and in a diss song video that portrayed him as having herpes and having physically abused his ex-girlfriend. The defamation claims were added to a 2018 contract action filed by Rapaport after his eight-month stint at Barstool ended with his firing for making a rude comment toward their fan base, known as "Stoolies."
(Source: Courthouse News, November 15, 2023)
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YouTube to Crack Down on AI-Generated Deepfakes and Sound-Alikes, As It Sets Guardrails on Tech
As the video platform YouTube is rolling out generative AI technology to its creators, it is also placing new guardrails on the technology’s use. The company set new rules on content created with the help of generative AI, including rules that crack down on videos that use someone else’s likeness, and giving music labels the ability to remove videos that feature the voice or a well-known musician or performer created without their permission.
(Source: The Hollywood Reporter, November 14, 2023)
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Spotify Plans to Charge for Fraud: How It Works & Who It Affects the Most
Under Spotify’s new royalties model, the platform will financially penalize labels or distributors when it finds that more than 90% of streams on a song are fraudulent, charging 10 euros per offending track, according to several music distribution executives. The service’s current remedies will also remain in effect — removing fake streams from the system so they don’t impact payouts or charts, pulling the track off editorial playlists, and possibly striking them from the platform altogether. The fees racked up by labels or distributors will be charged against future royalties.
(Source: Billboard, November 14, 2023) [Subscription may be required]
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Guns N’ Roses Face Copyright Infringement Suit, Manager Accused of Sexual Harassment
Former Guns N' Roses photographer Katarina Benzova has filed a lawsuit against Guns N' Roses and their management claiming copyright infringement and sexual harassment by the band's manager Fernando Lebeis. The band has since responded to the lawsuit in a statement provided to Loudwire, noting that they initially filed a counter claim against her back in October. Benzova's lawsuit was filed in California on Nov. 11. According to the suit, Benzova worked with Guns N' Roses as an independent contractor from 2010 until 2022, for a total of 364 concerts.
(Source: Loudwire, November 14, 2023)
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As Hollywood Starts Back Up, So Too Do Music Supervision & the Synch Business
Now that the Hollywood actors’ strike is over, music supervisor Justin Kamps can afford to keep his 3-year-old daughter in daycare. “Things were getting a little bit scary these last couple months,” says Kamps, who picks songs for Bridgerton, Grey’s Anatomy and other hit TV shows. “We were going through the financials and cutting back whatever we can.” SAG-AFTRA’s 60,000 members voted to approve a deal with studios last Friday, after halting work for nearly four months, following a screenwriters’ strike that lasted from early May to late September — both of which were devastating not just to Hollywood but the $2 billion music-synch industry. “That’s been quite a dark thing,” Stephanie Diaz Matos, head of music supervision for writer-actress Issa Rae‘s music company Raedio, told Billboard in July.
(Source: Billboard, November 14, 2023) [Subscription may be required]
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Live Nation’s Michael Rapino Lays Out the Argument for Why Concerts – Not Streaming – Are the Future of the Music Biz
In the world of music today, artists have become “direct [to] consumer brands” that build their own audiences, while entertainment and ticketing company Live Nation “delivers the scarcity”. What does “delivering the scarcity” mean? It’s Rapino’s way of describing the fact that there is far more demand for tickets to live music events than there is supply. This is how live music has become “the center of the wheel” for artists’ incomes, according to Rapino.
(Source: Music Business Worldwide, November 13, 2023)
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Lawsuit Filed Against Live Nation Alleging Mishandling of Taylor Swift Ticket Sales
Live Nation Entertainment and members of its board were hit with a shareholder derivative lawsuit on Nov. 10 in California Central District Court stemming from a U.S. Department of Justice investigation of the company’s mishandling of ticket sales for Taylor Swift’s highly anticipated concert tour. The lawsuit contends that the media attention highlighted Live Nation’s anticompetitive conduct, including entering into extended restrictive contracts with artists and venues, charging high fees for ticketing services and retaliating against venues for working with alternative promoters or services.
(Source: Law.com, November 10, 2023)
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Judge Rules Young Thug’s Lyrics Can Be Used in YSL RICO Case: ‘The First Amendment Is Not on Trial’
An Atlanta judge ruled Thursday that he would allow many of Young Thug’s rap lyrics to be used as evidence against him and other alleged gang members in their upcoming criminal trial, rejecting arguments that doing so would violate the First Amendment. The ruling came a day after Fulton County Superior Court Judge Ural Glanville held a hotly-anticipated hearing about the use of lyrics as evidence – a controversial practice that has drawn backlash from the music industry and efforts by lawmakers to stop it.
(Source: Billboard, November 9, 2023) [Subscription may be required]
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An Ex-Braves Player Allegedly Shattered a Fan’s Eye Socket During a World Series Game. But Will Plaintiff See Her Day in Court?
A Georgia baseball fan represented by Susan Shaw who sued the Atlanta Braves and their former outfielder Jorge Soler after the player hit her in the eye with a baseball during the 2021 World Series may find that her case has a high hurdle to jump before getting to a jury. The ball shattered the woman’s eye socket in multiple places, resulting in permanent injuries and disfigurement. Now, Shaw’s client, Mayra Norris, is seeking to recoup $60,000 in medical bills and additional damages, but she has one major obstacle as she pursues her day in court in Cobb County.
(Source: Daily Report, November 9, 2023) [Subscription may be required]
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US Judge Trims AI Copyright Lawsuit Against Meta
A California federal judge said on Thursday that he would dismiss, for now, part of a copyright lawsuit brought by comedian Sarah Silverman and other authors against Meta Platforms over its artificial-intelligence system Llama. U.S. District Judge Vince Chhabria said at a hearing that he would grant Meta's motion to dismiss the authors' allegations that text generated by Llama infringes their copyrights. Chhabria also indicated that he would give the authors permission to amend most of their claims.
(Source: Reuters, November 9, 2023)
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Broadcaster Sues HBO for Use of Catchphrase in “Perry Mason” Reboot
Broadcaster David Johnson filed a trademark infringement lawsuit on Nov. 6 in New York Southern District Court targeting HBO, Warner Bros. Discovery and Team Downey over Johnson's catchphrase 'And down the stretch they come,' associated with horseracing. The court action, brought by attorney Andrew J. Mollica on behalf of Johnson, centers on the fourth episode of the second season of HBO's reboot of the popular show 'Perry Mason.' Johnson argues that a character utters his trademarked phrase in Johnson's characteristic style without permission.
(Source: Law.com, November 6, 2023)
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Ninth Circuit Revives Choreographer’s Lawsuit Against Epic Games Over Fortnite ‘Emote’
The Ninth Circuit on Wednesday revived a lawsuit filed by celebrity choreographer Kyle Hanagami against Epic Games, alleging that their popular game Fortnite Battle Royale copied his registered dance moves. Hanagami, who has worked with such artists as Justin Bieber, Jennifer Lopez and Olivia Rodrigo, copyrighted the five-minute choreography he first created for the 2017 Charli Puth music video "How Long."
(Source: Courthouse News, November 1, 2023)
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Kobalt Partners With Morgan Stanley to Invest $700 Million in Music Rights
Independent rights management and publisher Kobalt Music announced a new partnership with a Morgan Stanley-managed investment fund with plans to invest more than $700 million to acquire music copyrights.
(Source: CelebrityAccess, November 1, 2023)
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Scarlett Johansson Takes Legal Action Against AI App That Ripped Off Her Likeness in Advertisement
Scarlett Johansson has taken legal action against an AI app that used her name and likeness in an online advertisement without permission. Johansson appeared in a 22-second ad posted on X/Twitter by an artificial intelligence image-generating app called Lisa AI: 90s Yearbook & Avatar. Representatives for the actor confirmed to Variety that Johansson is not a spokesperson for the app, and her attorney, Kevin Yorn, handled the situation in a legal capacity. The advertisement was spotted on Oct. 28 and appears to have since vanished from the internet.
(Source: Variety, November 1, 2023)
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Netflix, Pushing Into AVOD Fray, Plans New Ad Formats, ‘Crown’ Sponsorship Deals
Netflix is ready to use “The Crown,” “Squid Game” and other signature series to take ad dollars from rival streamers. The company says it will start to offer so-called “title sponsorships” to advertisers ready to align with the new reality series “Squid Game: The Challenge” and the final season of “The Crown” as part of its bid to accelerate the utility of its ad-supported tier. “We want to shape the future of advertising on Netflix and help marketers tap into the amazing fandom generated by our must-watch shows and movies,” says Amy Reinhard, newly installed as president of advertising at Netflix, in a prepared statement.
(Source: Variety, November 1, 2023)
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Is the Music Industry Losing Money to Sped-Up Remixes?
In the TikTok era, homemade remixes of songs — typically single tracks that have been sped up or slowed down, or two tracks mashed together — have become ever more popular. Increasingly, they are driving viral trends on the platform and garnering streams off of it. Just how popular? In April, Larry Mills, senior vp of sales at the digital rights tech company Pex, wrote that Pex’s tech found “hundreds of millions of modified audio tracks distributed from July 2021 to March 2023,” which appeared on TikTok, SoundCloud, Audiomack, YouTube, Instagram and more. Mills shared the results of a new Pex analysis — expanded to include streaming services like Spotify, Apple Music, Deezer, and Tidal — estimating that “at least 1% of all songs on [streaming platforms] are modified audio.”
(Source: Billboard, November 1, 2023) [Subscription may be required]
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Labels Want to Prevent ‘Taylor’s Version’-Like Re-Recordings From Ever Happening Again
The major labels, Universal Music Group, Sony Music Entertainment and Warner Music Group, have recently overhauled contracts for new signees, according to top music attorneys, some demanding artists wait an unprecedented 10, 15 or even 30 years to re-record releases after departing their record companies.
(Source: Billboard, October 30, 2023) [Subscription may be required]
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Artists Lose First Round of Copyright Infringement Case Against AI Art Generators
Artists suing generative artificial intelligence art generators have hit a stumbling block in a first-of-its-kind lawsuit over the uncompensated and unauthorized use of billions of images downloaded from the internet to train AI systems, with a federal judge’s dismissal of most claims.
(Source: The Hollywood Reporter, October 30, 2023)
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Judge Dismisses Brett Favre’s Defamation Lawsuit Against Shannon Sharpe
A federal judge on Monday dismissed a defamation lawsuit filed by former NFL quarterback Brett Favre against ex-NFL tight end and current ESPN personality Shannon Sharpe related to Favre's alleged involvement in an ongoing welfare fraud case in Mississippi.
(Source: ESPN, October 30, 2023)
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'Guess Who' Founders Sue Ex-Bandmates in LA for Alleged Trademark Infringement
“The Guess Who” founding members Burton Cummings and Randy Bachman Monday sued two former bandmates, alleging in Los Angeles federal court that the pair is illegally using the band’s name to trick fans into thinking the original lineup is currently touring. The lawsuit further alleges that Jim Kale, a bass player who left The Guess Who in 1972, and Garry Peterson, the drummer who played with the Canadian group until it disbanded in 1975, have been using photos that include Cummings and Bachman to create the false impression that they are playing in the original Guess Who.
(Source: MyNewsLA.com, October 30, 2023)
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Lizzo Tells Court Ex-Dancers’ Sexual Harassment Lawsuit Must Be Tossed Out: ‘Fabricated Sob Story’
In their motion, Lizzo’s lawyers argued that the case should be dismissed immediately under California’s so-called anti-SLAPP statute — a special type of law enacted in states around the country that makes it easier to quickly end meritless lawsuits that threaten free speech. It’s unusual to see an anti-SLAPP motion aimed at dismissing a sexual harassment lawsuit filed by former employees against their employer. Such motions are more common in defamation cases, where a defendant argues that a powerful plaintiff is abusing the court system to silence them from speaking out. But in their motion, Lizzo’s lawyers argued that the anti-SLAPP law could also apply to the current case because of the creative nature of the work in question.
(Source: Billboard, October 27, 2023) [Subscription may be required]
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Spotify Is Changing Its Royalty Model to Crush Streaming Fraud and Introduce a Minimum Payment Threshold. Its Plan? To Shift $1 Billion in Payouts Towards ‘Working Artists’ Over the Next 5 Years
MBW has confirmed that Spotify is planning to make significant changes to its royalty payout model in Q1 2024 – with the intent to move USD $1 billion in royalty payments over the next five years to ‘legitimate’ artists and rightsholders. Spotify has been discussing details of its blueprint for the new royalty model with various music rightsholders in recent weeks. Sources involved in those talks have now confirmed to MBW that, although Spotify will continue with its pro-rata royalty system (aka ‘Streamshare’), it plans to make three specific major changes to its model.
(Source: Music Business Worldwide, October 24, 2023)
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Widow of Rock Band KISS Tour Guitar Tech Sues Over Husband's COVID Death
The widow of a guitar technician who traveled with the rock band KISS is suing the group after her husband contracted COVID-19 and died while on tour. For 21 years, Fran Stueber toured the world with KISS. He served as frontman Paul Stanley's guitar tech. A lawsuit has been filed in Los Angeles superior court against band manager Doc McGhee, Live Nation and band members Gene Simmons and Paul Stanley. The lawsuit alleges Stueber's death was preventable.
(Source: ABC 7 Chicago, October 19, 2023)
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Universal Music Files $75M Lawsuit Against Amazon-Backed AI Firm for Ripping Off Rolling Stones, Beyonce Lyrics
A trio of major music publishers are stepping into the legal battle against generative artificial intelligence to stop the use of their copyrighted material to train AI systems, this time in a lawsuit against Anthropic. Universal Music Group, Concord Music Group and ABKCO sued the company in Tennessee federal court, accusing it of “systematic and widespread infringement” by copying and distributing lyrics from at least 500 songs from artists such as Katy Perry, the Rolling Stones and Beyoncé.
(Source: The Hollywood Reporter, October 18, 2023)
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Hip-Hop Star Seeks New Trial Over Lawyer’s Alleged Use of Artificial Intelligence to Draft Closing Argument
Prakazrel “Pras” Michel, a member of the hip-hop group Fugees, has said he is entitled to a new trial partly because his former lawyer used an experimental artificial intelligence program to draft an inadequate closing argument. A new-trial motion filed by Michel’s new lawyers said the closing included “frivolous arguments,” misunderstood the required elements of the crimes, and “failed to highlight key weaknesses in the government’s case.”
(Source: ABA Journal, October 18, 2023)
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A true artist is not one who is inspired, but one who inspires others.
—
Salvador Dali
