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Artists and Record Companies Step Up Campaign To Be Paid For Recordings Made Before 1972

April 17, 2014
Lawsuit Against Pandora Filed In New York Today, Follows SiriusXM Case In California
Steve Cropper, Widow of Buddy Holly, Sam Moore, Dionne Warwick Lend Support

NEW YORK/WASHINGTON D.C. -- As part of a growing campaign by the music community to be paid for the use of recordings made before 1972, a coalition of major and independent record companies today filed a lawsuit against Pandora Media Inc. in New York state court.  The case follows a similar lawsuit brought last fall in California against SiriusXM.  These multi-billion dollar digital music firms, both hugely successful and publicly traded on Wall Street, refuse to pay artists and rights holders for the use of these classic recordings in their programming just because they were created before 1972.  


Through a quirk of history, federal copyright law did not protect sound recordings until 1972.  Recordings made before 1972 -- staples of digital music services like Pandora -- are protected by laws in New York and other states.  These so-called “pre-1972” recordings - songs of the 60's and Woodstock generation -- are some of the most popular on Pandora, extensively featured in stations such as “50s Rock 'n' Roll,” “60s Oldies,” “Motown,” Doo-Wop,” “Classic Soul,” along with countless others.  Yet the company refuses to compensate artists and record labels for the use of those iconic recordings.  SoundExchange estimates that the failure of these services to pay for their use of pre-1972 recordings deprives artists and labels of tens of millions of dollars every year - a number that will only increase as these services become more popular.


According to the complaint filed today:


Pandora's refusal to pay Plaintiffs for its use of [Pre-72] recordings is fundamentally unfair. Pandora's conduct also is unfair to the recording artists and musicians whose performances are embodied in Pre-72 Recordings, but who do not get paid for Pandora's exploitation of Pre-72 Recordings. It is also unfair to other businesses that compete with Pandora but obtain licenses and pay for the right to stream Plaintiffs' Pre-72 Recordings to the public, while Pandora does not. As a result, Pandora deprives Plaintiffs and their artists of compensation, while profiting enormously from and gaining an unfair advantage over others who do pay to copy and publicly perform Plaintiffs' Pre-72 Recordings.


Additional background on the case and quotes from several artists follows.


Steve Cropper (guitarist, songwriter, and member of Rock & Roll Hall of Fame group Booker T. & the MG's) comment:  “I don't understand any business that refuses to pay for the products it sells.  Early rockers like me and my peers had some great hits before 1972 - songs that help these digital music outlets succeed with their popular oldies channels.  Why would they not want compensate me for my work?  It's an injustice that boggles the mind.  Just like the programmers who deserve to be paid for their work, I deserve to be paid for mine.”


Maria Elena Holly, widow of Buddy Holly, comment:  “Many artists from the 1950s are retired and struggling to support themselves or have families or heirs who are trying to make ends meet.  That's why royalties from all platforms and services that play their music are so important. Rock and Roll pioneers like my husband have made substantial cultural contributions and their profound influences can even be heard in today's contemporary music.  Digital music companies like Pandora and SiriusXM know people love the music from the '50s, '60s and early '70s with entire channels devoted to songs from this era, including my husband's “Words of Love” (1957) and “Everyday” (1958).  So how can it be that they don't pay the artists who created these popular hits?  Do Buddy's fans that pay for these digital music services realize that not a penny will go to the artists or their families?  Just because Buddy and the other 50s musicians recorded songs before 1972 doesn't mean their songs have no value.  These companies' failure to pay the Rock and Roll pioneers is an injustice and it needs to change.”


Sam Moore (“The Legendary Soul Man”) comment:  “I'm a big fan of Sirius XM and Pandora but I just can't understand why both companies are intentionally refusing to compensate artists like me. It's a historic injustice that there exists a deliberate refusal to compensate artists such as myself and all of my peers who made recordings before 1972 because of a quirk in the U.S. copyright laws. Because I have been fortunate enough in my career to have recorded after February, 1972 I do get compensation from both networks so I know first-hand what the value of and the life changing impact those payments mean to myself and my post '72 peers. That acknowledged, I have and will continue to raise my voice -- the same voice that I used when I recorded my Grammy winning song in 1967 "Soul Man" that I'm not being compensated for -- to make the public, the fans, aware and ask them to let the bosses at Sirius and Pandora know they support us artists getting paid for airplay -- just like the artists, including myself, who recorded after February 1972!”


Dionne Warwick comment:  “Classic tracks recorded before 1972 are an important part of American culture, and an important part of Pandora's programming.  The great artists from the '40s to the '70s should be treated with respect and properly compensated as Pandora is required to do, so I am asking Pandora not to "Walk On By" and do the Right Thing!!”

 
Additional background on the case and excerpts of complaint


According to the complaint filed today by the record companies:


Despite the substantial revenues Pandora receives and the users it attracts as a result of
performing Plaintiffs' Pre-72 Recordings, it refuses to obtain required licenses or pay for its commercial and profitable exploitation of Plaintiffs' valuable property.


Because of its refusal to pay artists and record labels, the company gains “an unfair advantage over others who pay to copy and publicly perform” pre-1972 recordings while “profiting enormously,” the brief says.
Pandora's conduct in “copying and/or publicly performing” pre-1972 recordings is a violation of New York law, the record companies' filing states.  “For more than 100 years, the courts repeatedly have affirmed the policy of this State that the unique performances embodied in sound recordings are intangible property interests protected from unauthorized use and exploitation.”
The plaintiffs in the case are Capitol Records, Sony Music Entertainment, UMG recordings, Warner Music Group and ABKCO Music & Records.  


For a copy of the complaint, please email Jonathan Lamy at jlamy@riaa.com or Cara Duckworth Weiblinger at cduckworth@riaa.com.

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The Recording Industry Association of America (RIAA) is the trade organization that supports and promotes the creative and financial vitality of the major music companies. Its members are the music labels that comprise the most vibrant record industry in the world. RIAA® members create, manufacture and/or distribute approximately 85% of all legitimate recorded music produced and sold in the United States.

In support of this mission, the RIAA works to protect the intellectual property and First Amendment rights of artists and music labels; conduct consumer, industry and technical research; and monitor and review state and federal laws, regulations and policies. The RIAA® also certifies Gold®, Platinum®, Multi- Platinum™ and Diamond sales awards as well as Los Premios De Oro y Platino™, an award celebrating Latin music sales.

Contact:
Jonathan Lamy
Cara Duckworth
Liz Kennedy
202/775-0101


Record Labels Sue Megaupload For Massive Copyright Theft

April 10, 2014
A federal indictment is appropriate, but so is holding Megaupload and its operators accountable for the blatant harm caused to the music community, says RIAA

ALEXANDRIA, VA – On behalf of the major music labels, the Recording Industry Association of America (RIAA) today filed a civil lawsuit against Megaupload.com and its main operators for engaging in massive copyright infringement of sound recordings.

In its complaint, filed in the Eastern District of Virginia, RIAA stated that that Megaupload founder Kim Dotcom, Chief Technical Operator and co-founder Mathias Ortmann, majority shareholder Vestor Limited, and head programmer and Uploader Rewards program manager Bram van der Kolk all willfully engaged in, actively encouraged, and handsomely profited from massive copyright infringement of music on the Megaupload service before they were indicted by the U.S. Department of Justice (DOJ) on criminal charges.

According to the DOJ indictment, the defendants have generated more than $175 million in illicit profits from this theft while causing more than half a billion dollars in harm to copyright owners.

According to RIAA’s filing:

Megaupload Limited played an active role in ensuring that it had the most popular content on its servers, that the URL links to those infringing content files were widely disseminated on the Internet, and that the links were advertised and promoted by pirate linking sites, so that the maximum number of Megaupload users would access the infringing content...It further exercised active control over the process of providing that content by regulating the volume and speed of transmissions to users who had not yet purchased “premium” subscriptions.

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Megaupload made money in two ways: premium subscriptions and online advertising.  Megaupload charged “premium” users subscription fees ranging from a few dollars per day up to approximately $260 for a lifetime subscription.  In exchange for payment, premium users would receive faster access to infringing files, including Plaintiffs’ copyrighted works, on Defendants’ computer servers.  Premium users of the site were able to download and upload files with few, if any, limitations…With respect to online advertising, the infringement-driven traffic on Megaupload and its associated websites increased the volume of online advertising impressions and transactions, leading to higher revenues.  Online advertising on Megaupload and its associated websites, which was heavily dependent on the popularity of copyright infringing content to attract website visits, yielded more than $25 million for Defendants.

Further evidence shows that the shutdown of Megaupload in January 2012 had a profoundly positive impact on the digital music marketplace. According to an analysis by the RIAA of third party-provided data, millions of U.S. users of Megaupload.com and similar sites shifted away from those unauthorized services after Megaupload was shut down.  In a comparison between Q4 2011 and Q4 2012, 50 percent of the users who had visited Megaupload (or similar sites that shut down around the same time) were no longer using any of the unauthorized music sites monitored in the study.  The same dynamic occurred after the shutdown of LimeWire, which spurred the growth of legal downloads, according to various analyses. 

In 2011, the Office of the U.S. Trade Representative (USTR) named Megaupload as a “notorious market” in an official government report, stating that the site allowed for “the unauthorized distribution of protected content through subscriptions and reward schemes to popular uploaders.”

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The Recording Industry Association of America (RIAA) is the trade organization that supports and promotes the creative and financial vitality of the major music companies. Its members are the music labels that comprise the most vibrant record industry in the world. RIAA® members create, manufacture and/or distribute approximately 85% of all legitimate recorded music produced and sold in the United States.

In support of this mission, the RIAA works to protect the intellectual property and First Amendment rights of artists and music labels; conduct consumer, industry and technical research; and monitor and review state and federal laws, regulations and policies. The RIAA® also certifies Gold®, Platinum®, Multi- Platinum™ and Diamond sales awards as well as Los Premios De Oro y Platino™, an award celebrating Latin music sales.

Contact:
Jonathan Lamy
Cara Duckworth
Liz Kennedy
202/775-0101