Flo & Eddie, Inc. v. Sirius XM Radio, Inc.: New York State’s Highest Court Finds No Public Performance Right for Pre-1972 Sound Recordings at Common Law


n a case of first impression, New York’s highest court ruled that New York common law does not include a right to control public performances of pre-1972 sound recordings.

The ruling arises from a years-long legal battle between The Turtles, the 1960s rock band most famous for the hit song “Happy Together,” and Sirius XM, the nation’s largest digital satellite radio service.  In 2013, members of The Turtles (through their company, Flo & Eddie, Inc.) brought a class action lawsuit against Sirius XM in the United States District Court for the Southern District of New York, alleging that Sirius XM violated New York’s common law right of public performance by broadcasting and streaming copyrighted pre-1972 sound recordings, including The Turtles’ songs, without a license.  Sirius XM admittedly broadcasts pre-1972 sound recordings to its paying subscribers without a license, but contends that no license is required – raising a legal question that has been the subject of much dispute in recent years:  whether, and to what extent, copyright law protects the public performance of these decades-old sound recordings.

The status of copyright protection afforded to sound recordings is a highly complex issue, especially for recordings fixed before February 15, 1972.  The Copyright Act has long protected musical compositions (i.e., the underlying written music and lyrics of a song), but it was not until 1971 that the Copyright Act extended protection to sound recordings – the actual physical embodiments of the musical composition – and, even then, the protection was limited.  It did not extend protection to sound recordings fixed before February 15, 1972 nor did it include a public performance right for sound recordings.  A public performance right was later granted to sound recording owners in connection with certain digital transmissions, but the right is so riddled with exemptions that sound recording owners remain powerless over the transmission of their songs by non-subscription analogue broadcasts such as AM/FM radio stations.  Simply put, the Copyright Act provides no protection for pre-1972 sound recordings outside of these narrow exceptions, leaving such rights to be governed by state law, either by statute or at common law.

In New York, areas of copyright not covered by federal statutes, including pre-1972 sound recordings, are subject to the state’s common law.  As such, the underlying question in The Turtles’ case is whether New York common law recognizes a right of public performance for pre-1972 sound recordings.  The district court held that it did, signaling an imminent victory for The Turtles.  However, on appeal, the Second Circuit Court of Appeals determined that the case presented “a significant and unresolved issue of New York copyright law,” and called on New York State’s highest court for guidance.  To this end, the Second Circuit certified the following question to the New York Court of Appeals:  “Is there a right of public performance for creators of sound recordings under New York law and, if so, what is the nature and scope of that right?”

In its 4-2 decision handed down on December 20, 2016, the New York Court of Appeals answered the Second Circuit’s certified question with a “no.”  Following an in-depth examination of cases dating back to the 1870s, the Court stated that New York’s common law copyright has “never recognized” a right of public performance for sound recordings.  The body of relevant case law concerned the right of reproduction, not public performance, and did not disturb the premise that New York “common-law copyright protection prevents only the unauthorized reproduction of the copyrighted work, but permits a purchaser to use copies of sound recordings for their intended purpose, namely, to play them.”  As for societal expectations, the court made much of the copyright holders’ inaction over the past four decades; that is, if they had the right to control the public performance of their copyrighted sound recordings, wouldn’t they have sought to enforce it earlier?  The court reasoned that “it would be illogical to conclude that the right of public performance would have existed for decades without the courts recognizing such a right as a matter of state common law, and in the absence of any artist or record company attempting to enforce that right in this state until now.”

Further, the court declined to create a right of public performance for pre-1972 sound recordings for the first time in New York, as the consequences of doing so could be “extensive and far-reaching.”  Indeed, the court repeatedly emphasized that only “the legislature has the ability to step in and make drastic changes to the law,” suggesting that the court’s resounding “no” to the Second Circuit’s certified question speaks less to the validity and substance of a public performance right for pre-1972 sound recordings than it does to the notion that such a right should not be court-created.

Nonetheless, the court’s decision is a devastating blow to The Turtles and the class of recording artists and record labels it sought to represent.  The district court’s decision would have entitled The Turtles to recover millions of dollars in royalties from Sirius XM and, on a larger scale, would have opened the door to an untapped revenue stream for owners of pre-1972 sound recordings.  The New York Court of Appeals’ decision closed that door, at least in New York, leaving the law’s long history of differential treatment for recording artists and record companies, as opposed to composers and publishing companies, intact.  For now, The Turtles and similarly situated owners of pre-1972 recordings are left only to pursue “other potential avenues of recovery” in New York, and to hope for different results in the parallel case still pending in Florida.

Filed in: Legal Blog

February 1, 2017