Sheridan v. iheartMedia, Inc.
255 F. Supp. 3d 767
N.D. Ill.2017Background
- Arthur and Barbara Sheridan own many pre-1972 master sound recordings and sold/licensed copies commercially for decades.
- iHeartMedia (iHeartRadio) broadcasts and streams radio programming nationwide that includes the Sheridans’ pre-1972 recordings and did not obtain licenses from the Sheridans.
- Pre-1972 sound recordings are governed by state law (17 U.S.C. § 301(c)); Illinois has no statutory sound-recording copyright.
- The Sheridans brought a putative class action under Illinois law asserting common-law copyright, IUDTPA misappropriation, conversion, and unjust enrichment.
- iHeartMedia moved to dismiss for failure to state a claim; the court treated the suit under diversity (CAFA) and applied Illinois law.
- The court dismissed all counts with prejudice, concluding Illinois law does not recognize the asserted rights/remedies for published pre-1972 recordings as pleaded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Illinois common-law copyright protects published pre-1972 sound recordings (right to exclude public performance) | Sheridans: sale to public did not constitute publication that destroyed common-law protection; performances/recordings are a special category | iHeart: sales to the public constituted publication/dedication and extinguished any common-law right to control public performance | Dismissed: sale/public distribution destroyed common-law copyright; no right to bar broadcasts of published recordings |
| Whether IUDTPA/deceptive trade practice or misappropriation covers broadcasting of published pre-1972 recordings | Sheridans: broadcasting these recordings without authorization is deceptive/misappropriation and unfair | iHeart: IUDTPA exempts broadcasters; longstanding industry practice shows no deceptive character to broadcasting published recordings | Dismissed: broadcaster exemption and longstanding legal/industry expectations foreclose the claim; courts/legislature, not this court, should change law |
| Whether conversion claim applies to unauthorized public performance/digital files | Sheridans: iHeart duplicated/used digital recordings, so tangible or tangible-connected property was taken | iHeart: conversion requires tangible property or recognized Illinois rule; Illinois does not recognize conversion of pure intangible rights and recent appellate law rejects digital-file tangibility | Dismissed: no property right to exclude performance; Illinois law bars conversion of intangible rights and digital-file tangibility is rejected by controlling authority |
| Whether unjust enrichment survives if underlying claims fail | Sheridans: iHeart retained benefits from use of recordings; unjust enrichment is appropriate | iHeart: unjust enrichment is derivative and cannot stand if substantive claims fail | Dismissed: unjust enrichment is not independent and falls with the substantive claims |
Key Cases Cited
- Frohman v. Ferris, 238 Ill. 430 (Ill. 1909) (public performance of unpublished work does not necessarily constitute publication at common law)
- Rees v. Peltzer, 75 Ill. 475 (Ill. 1874) (publication extinguishes common-law copyright)
- Capitol Records v. Spies, 130 Ill. App. 2d 429 (Ill. App. Ct. 1970) (distinguishing piracy/copying from broadcasting; sale/public distribution defeats common-law copyright)
- Data Cash Sys. v. JS&A Grp., Inc., 628 F.2d 1038 (7th Cir. 1980) (sales to the public can constitute publication)
- Flo & Eddie, Inc. v. Sirius XM Radio, Inc., 28 N.Y.3d 583 (N.Y. 2016) (New York common-law copyright does not recognize a public-performance right for pre-1972 recordings)
- Board of Trade of Chicago v. Dow Jones & Co., 108 Ill. App. 3d 681 (Ill. App. Ct. 1982) (misappropriation inquiry focuses on whether commercial practice is fair or unfair)
- Van Diest Supply Co. v. Shelby County State Bank, 425 F.3d 437 (7th Cir. 2005) (elements required to plead conversion)
- Am. Nat'l Ins. Co. v. Citibank, 543 F.3d 907 (7th Cir. 2008) (Illinois does not recognize conversion of intangible rights)