Flo & Eddie, Inc. v. Sirius XM Radio, Inc.
62 F. Supp. 3d 325
S.D.N.Y.2014Background
- Flo & Eddie (owners of pre-1972 Turtles master sound recordings) sued Sirius XM for common-law copyright infringement and unfair competition under New York law, alleging Sirius reproduced and publicly performed the recordings without licenses or royalties.
- Sirius stores music across multiple databases, transfers copies to third parties (e.g., Omnifone, Akamai), and creates temporary and permanent copies (play-out servers, regional caches, 5-hour "Start Now" caches, tips-and-tails, device buffers) when broadcasting or streaming content.
- Sirius acknowledges performing pre-1972 recordings (including Turtles tracks) via satellite and internet streaming but did not license most pre-1972 recordings or pay royalties.
- Procedurally: Sirius moved for summary judgment; the court denied the motion and found no material disputes on liability, ordering Sirius to show cause why liability-only summary judgment should not be entered.
- Legal context: federal law does not protect pre-1972 sound recordings (17 U.S.C. § 301(c)); states, including New York, have common-law copyright protection for such recordings. The core question was whether New York common law includes an exclusive public-performance right for pre-1972 sound recordings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does New York common-law copyright for pre-1972 sound recordings include an exclusive public-performance right? | New York common law grants the full bundle of copyright rights, including exclusive public-performance rights for sound recordings. | No such New York authority exists; performing recordings is not a protected exclusive right under state common law. | Court predicts NY Court of Appeals would recognize an exclusive public-performance right for pre-1972 sound recordings. |
| Did Sirius reproduce and publicly perform Flo & Eddie's recordings without authorization? | Sirius made permanent and temporary full copies (databases, play-out servers, caches) and publicly performed them without licenses. | Some copies are ephemeral or non-infringing; Sirius argued distribution is required and some copying is fair use. | Court held Sirius reproduced and performed recordings without authorization; many copies qualify as infringing reproductions. |
| Is Sirius’s copying/follow-on performance protected by fair use? | N/A (Flo & Eddie argued infringement). | Sirius contended fair use applies to its copying and streaming. | Court applied the four-factor test and held Sirius’s commercial, nontransformative, wholesale copying/performances do not qualify as fair use. |
| Does application of New York common-law rights violate the Dormant Commerce Clause? | N/A (Flo & Eddie argued §301(c) shields state regulation). | Sirius argued state-law protection would impermissibly regulate interstate commerce and that §301(c) authorizes states to do so. | Court rejected a §301(c) Commerce Clause exemption and held recognizing state common-law copyright is not a state "regulation" of interstate commerce that triggers Dormant Commerce Clause invalidation. |
| Is the suit barred by laches? | N/A | Sirius raised laches as defense. | Court held laches is unavailable because the action is at law within applicable statutes of limitations. |
Key Cases Cited
- Capitol Records, Inc. v. Naxos of Am., Inc., 4 N.Y.3d 540 (N.Y. 2005) (New York recognizes common-law copyright in pre-1972 sound recordings)
- Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569 (U.S. 1994) (fair use: transformative inquiry and four-factor framework)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (U.S. 1986) (summary judgment standard)
- Celotex Corp. v. Catrett, 477 U.S. 317 (U.S. 1986) (summary judgment burden-shifting)
- Cartoon Network LP v. CSC Holdings, Inc., 536 F.3d 121 (2d Cir. 2008) (buffering/ephemeral copying under copyright law)
- Roy Export Co. v. CBS, Inc., 672 F.2d 1095 (2d Cir. 1982) (New York law recognizing public-performance/distribution concepts in unfair competition context)
- New England Power Co. v. New Hampshire, 455 U.S. 331 (U.S. 1982) (statute limiting preemption does not necessarily authorize state regulation that would otherwise violate Dormant Commerce Clause)
- Healy v. Beer Inst., Inc., 491 U.S. 324 (U.S. 1989) (Dormant Commerce Clause principles)
- Wyoming v. Oklahoma, 502 U.S. 437 (U.S. 1992) (requiring unambiguous congressional authorization to exempt state law from Commerce Clause scrutiny)