Abs Entertainment, Inc. v. CBS Corp.

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ABS ENTERTAINMENT, INC., an No. 16-55917

Arkansas corporation; BARNABY

RECORDS, INC., a New York D.C. No.

corporation; BRUNSWICK RECORD 2:15-cv-06257-

CORPORATION, a New York PA-AGR

corporation; MALACO INC., a

Mississippi corporation, each

individually and on behalf of all OPINION

others similarly situated.,

Plaintiffs-Appellants,

v.

CBS CORPORATION, a Delaware

corporation; CBS RADIO, INC., a

Delaware corporation; DOES, 1

through 10,

Defendants-Appellees.

Appeal from the United States District Court

for the Central District of California

Percy Anderson, District Judge, Presiding

Argued and Submitted November 9, 2017

Pasadena, California

Filed August 20, 2018

2 ABS ENTERTAINMENT V. CBS CORPORATION

Before: Richard Linn, * Marsha S. Berzon,

and Paul J. Watford, Circuit Judges.

Opinion by Judge Linn

SUMMARY **

Copyright

The panel reversed the district court’s grant of summary

judgment in favor of the defendants on claims of violation of

state law copyrights possessed by the plaintiffs in sound

recordings originally fixed before 1972.

Under the Sound Recording Act, sound recordings fixed

after February 15, 1972, are subject to a compulsory license

regime for performance via digital transmission and are

excused from infringement for performance via terrestrial

radio. Congress reserved governance of sound recordings

fixed before 1972 to state statutory and common law and

excluded such sound recordings from federal copyright

protection until 2067.

The plaintiffs owned sound recordings embodying

musical performances initially fixed in analog format prior

to February 15, 1972. They remastered these pre-1972

sound recordings onto digital formats.

*

The Honorable Richard Linn, United States Circuit Judge for the

U.S. Court of Appeals for the Federal Circuit, sitting by designation.

**

This summary constitutes no part of the opinion of the court. It

has been prepared by court staff for the convenience of the reader.

ABS ENTERTAINMENT V. CBS CORPORATION 3

The panel held that the district court erred in finding a

lack of a genuine issue of material fact about the copyright

eligibility of remastered sound recordings distributed by the

defendants. The panel concluded that a derivative sound

recording distinctly identifiable solely by the changes in

medium generally does not exhibit the minimum level of

originality to be copyrightable.

The panel held that the district court erred in concluding

that plaintiffs’ state copyright interest in the pre-1972 sound

recordings embodied in the remastered sound recordings

was preempted by federal copyright law. The panel held that

the creation of an authorized digital remastering of pre-1972

analog sound recordings that qualify as copyrightable

derivative works does not bring the remastered sound

recordings exclusively under the ambit of federal law.

The panel held that the district court abused its discretion

by excluding the testimony of plaintiffs’ expert, excluding

certain reports as evidence of defendants’ performance of

plaintiffs’ sound recordings in California, and granting

partial summary judgment of no infringement with respect

to the samples contained in those reports.

The panel concluded that the district court’s strict

application of its local rules with respect to the timeliness of

plaintiffs’ motion for class action certification was

inconsistent with the Federal Rules of Civil Procedure and

was thus an abuse of discretion.

The panel reversed the grant of summary judgment and

the striking of class certification and remanded for further

proceedings.

4 ABS ENTERTAINMENT V. CBS CORPORATION

COUNSEL

Robert Edward Allen (argued), Alan P. Block, Roderick G.

Dorman, and Lawrence M. Hadley, McKool Smith

Hennigan P.C., Los Angeles, California; Kathleen E.

Boychuck, Andrew Szot, and Marvin A. Miller, Miller Law

LLC, Chicago, Illinois; for Plaintiffs-Appellants.

Robert M. Schwartz (argued), Amit Q. Gressel, Andrew J.

Strabone, and Victor Jih, Irell & Manella LLP, Los Angeles,

California, for Defendants-Appellees.

Richard S. Mandel, Cown Liebowitz & Latman P.C., New

York, New York; George M. Borowsky, Recording Industry

Association of America Inc., Washington, D.C.; for Amicus

Curiae Recording Industry Association of America Inc.

Morgan E. Pietz, Gerard Fox Law P.C., Los Angeles,

California; Katrina Novak, Lowe & Associates P.C., Los

Angeles, California; for Amicus Curiae California Society

of Entertainment Lawyers.

Steven G. Sklaver, Kalpana Srinivasan, and Stephen E.

Morrissey, Susman Godfrey LLP, Los Angeles, California;

Daniel B. Lifschitz, Maryann R. Marzano, and Henry

Gradstein, Gradstein & Marzano P.C., Los Angeles,

California; for Amicus Curiae Flo & Eddie Inc.

Andrew M. Gass and Elizabeth H. Yandell, Latham &

Watkins LLP, San Francisco, California; Roman Martinez,

Latham & Watkins, Washington, D.C.; for Amicus Curiae

iHeartMedia Inc.

ABS ENTERTAINMENT V. CBS CORPORATION 5

Stephen B. Kinnard, Paul Hastings LLP, Washington, D.C.;

Emmy Parsons, Garrett Levin, and Rick Kaplan, National

Association of Broadcasters, Washington, D.C.; for Amicus

Curiae National Association of Broadcasters.

OPINION

LINN, Circuit Judge:

Appellants ABS Entertainment, Inc., Barnaby Records,

Inc., Brunswick Record Corp. and Malaco, Inc.

(collectively, “ABS”) appeal from the grant of summary

judgment by the Central District of California in favor of

CBS Corporation and CBS Radio, Inc. (collectively,

“CBS”), holding that CBS did not violate any state law

copyrights possessed by ABS in sound recordings originally

fixed before 1972. ABS also appeals from the district

court’s striking of its class action certification, and certain

evidentiary rulings.

We conclude that the district court erred in finding a lack

of a genuine issue of material fact about the copyright

eligibility of remastered sound recordings distributed by

CBS and improperly concluded that ABS’s state copyright

interest in pre-1972 sound recordings embodied in the

remastered sound recordings was preempted. We also

conclude that the district court abused its discretion by

excluding the testimony of ABS’s expert Paul Geluso,

excluding the Triton Reports as evidence of CBS’s

performance of ABS’s sound recordings in California, and

granting partial summary judgment of no infringement with

respect to the samples contained in those reports. Finally,

we conclude that the district court’s strict application of its

local rules with respect to the timeliness of ABS’s motion

6 ABS ENTERTAINMENT V. CBS CORPORATION

for class action certification was inconsistent with the

Federal Rules of Civil Procedure and was thus an abuse of

discretion.

For the reasons set forth below, we reverse the grant of

summary judgment and the striking of class certification,

and remand for further proceedings consistent with this

opinion.

I

In 1971, Congress passed the Sound Recording Act.

This Act for the first time created federal copyright

protection for certain sound recordings. Under that law,

sound recordings fixed after February 15, 1972 were made

subject to a compulsory license regime for performance via

digital transmission and were excused from infringement for

performance via terrestrial radio. 17 U.S.C. §§ 114, 301(c).

Congress reserved governance of sound recordings fixed

before 1972 to state statutory law and common law and

excluded such sound recordings from federal copyright

protection until 2067. 17 U.S.C. § 301(c) (“With respect to

sound recordings fixed before February 15, 1972, any rights

or remedies under the common law or statutes of any State

shall not be annulled or limited by this title until February

15, 2067 . . . . [N]o sound recording fixed before February

15, 1972, shall be subject to copyright under this title before,

on, or after February 15, 2067.”).

ABS owns sound recordings embodying musical

performances initially fixed in analog format prior to

ABS ENTERTAINMENT V. CBS CORPORATION 7

February 15, 1972 (“pre-1972 sound recordings”). 1 As

digital formats replaced analog ones, ABS hired remastering

engineers to remaster the pre-1972 sound recordings onto

digital formats (“remastered sound recordings”). In doing

so, ABS determined to optimize the recordings for the new

digital format using standard, technical processes to create

accurate reproductions of its original pre-1972 analog

recordings and did not set out to create any new and different

sound recordings. ABS contends that this resulted in a

change in quality but not a substantial difference in the

identity or essential character of the sound recordings

themselves. ABS argues that injecting a substantial

difference in the digital remasters from their analog originals

would have diminished the value of the remastered sound

recordings, contrary to ABS’s objective in seeking to fully

exploit its intellectual property in those sound recordings.

ABS did not enter copies of the contracts between ABS

and the remastering engineers into the record, but both

parties agree that ABS authorized the creation of the

remastered sound recordings at issue here. 2 There is no

dispute that the remastered sound recordings contain only

the sounds (i.e. the vocals and instruments) originally

performed and fixed in the studio before 1972 and contained

in the pre-1972 sound recordings, and that no sounds were

removed or rearranged from the original fixed version. ABS

1

For purposes of this appeal, the sound recordings at issue are

defined by a series of 174 “representative samples” by artists including

Al Green, the Everly Brothers, Jackie Wilson, King Floyd, and other

artists.

2

The parties vigorously dispute whether the authorization to create

the remastered sound recordings also authorizes the creation of

derivative works, and which party bears the burden of proving such

authorization (or lack thereof).

8 ABS ENTERTAINMENT V. CBS CORPORATION

agrees that the remastered sound recordings are not identical

to the pre-1972 sound recordings, but contends that any

differences were trivial and of no copyrightable

consequence.

CBS delivers music content through terrestrial radio and

digital streaming, including 18 music stations in California

that are themselves streamed over the internet in

“simulcast.” CBS’s Radio 2.0 system logs “all sound

recordings it digitally transmits over the Internet,” and a

third party, Triton, tracks CBS’s simulcasts. CBS does not

use any analog sound recordings; it exclusively relies on

digitally mastered or remastered sound recordings for the

content it delivers to its customers. For all the broadcast

content, CBS paid a royalty to the owner of the underlying

musical composition. For the digitally streamed content,

CBS paid the compulsory license fee under the Sound

Recording Act to Sound Exchange. For content delivered by

terrestrial radio, CBS does not pay a license fee pursuant, as

permitted, to the Sound Recording Act’s safe haven for

terrestrial radio performance. See 17 U.S.C. § 114(d).

II

On August 17, 2015, ABS filed a putative class action

against CBS in the Central District of California, alleging

that CBS’s transmission and distribution of the remastered

sound recordings violated California state law—specifically,

California Civil Code § 980(a)(2) (protecting the property

rights of an author of a sound recording fixed prior to

February 15, 1972); misappropriation and conversion; and

unfair competition, under California Business and

Professions Code § 17200.

On November 17, 2015, the district court denied a joint

stipulation to extend the 90-day deadline for filing a motion

ABS ENTERTAINMENT V. CBS CORPORATION 9

for class action certification to allow for class certification

discovery, explaining that there was “no show of cause, let

alone good cause.” On November 19, 2015, the expiration

date of the local rule’s 90-day deadline for filing of class

certification, the court denied without explanation another

joint stipulation to extend the filing date. That same day,

ABS timely filed a motion for class certification. On

November 25, 2015, the district court struck the motion for

class certification because it set a hearing date for the motion

beyond the 35-day period after service of process as required

by the court’s standing orders and it did not include a

statement pursuant to Local Rule 7-3 that a “conference of

counsel” took place prior to the filing of the motion. The

court then struck ABS’s class allegations as untimely filed

under Local Rule 23-3.

CBS thereafter filed a motion for summary judgment,

arguing that there was no genuine issue of material fact that

the remastered sound recordings were authorized original

derivative works, subject only to federal copyright law. In

support of its motion, CBS submitted declarations from

music engineers, including from Durand R. Begault,

attesting that the remastering process involved originality

and aesthetic judgment. In response, ABS submitted expert

declarations of its own, including from Paul Geluso, who

testified that the pre-1972 and remastered recordings

“embodied” the same performance based on waveform,

spectral, and critical listening analysis.

The district court decided two important evidentiary

issues and granted summary judgment to CBS. The district

court excluded Geluso’s testimony under Federal Rule of

Evidence 702 and Daubert v. Merrell Dow Pharms., Inc.,

509 U.S. 579, 589–90 (1993) as “unscientific” and

“unnecessary to aid a fact finder capable of listening to the

10 ABS ENTERTAINMENT V. CBS CORPORATION

sound recordings on his or her own,” and, “[a]lternatively”

because Geluso’s testimony was “irrelevant.” The court

reasoned that Geluso limited his forensic analysis to only the

first five seconds of each sound recording, which was

“clearly inadequate to rule out the possibility that non-trivial

differences exist between the [pre-1972 and remastered

sound recordings].” The court also rejected Geluso’s

reliance on “critical listening” as undefined and unscientific,

and objected to Geluso’s failure to include in his report the

results of his phase inversion testing, which the court

categorized as “adverse to Plaintiffs’ position.”

Considering only Begault’s expert testimony, the district

court then held that there was no genuine issue of material

fact that the remastering created original derivative works

protected by federal copyright law. The district court

explained that “during the remastering process, at least some

perceptible changes were made to Plaintiff’s Pre-1972

Sound Recordings,” and that these changes were not merely

“mechanical” or “trivial” changes, but rather “reflect

multiple kinds of creative authorship, such as adjustments of

equalization, sound editing, and channel assignment.” The

court thus concluded that as to the 57 works reviewed by

both parties’ experts, the remastered sound recordings were

entitled to federal copyright protection as original derivative

works.

Next, the district court concluded that ABS authorized

the creation of the remastered sound recordings, because

ABS had failed to meet its burden to show that its

authorization to create the remastered sound recordings did

not extend to the creation of a derivative work, and because,

in any event, “the right to claim copyright in a non-infringing

derivative work arises by operation of law, not through

authority from the copyright owner of the underlying work.”

ABS ENTERTAINMENT V. CBS CORPORATION 11

The district court also concluded that, because the

remastered sound recordings, created after 1972, were

original and authorized, the remastered sound recordings

were exclusively governed by federal copyright law.

Therefore, the district court held, CBS had the right to

perform the remastered sound recordings by complying with

the statutory compulsory license obligations and taking

advantage of the terrestrial radio performance safe harbor

under 17 U.S.C. § 114. The district court assumed that

because the right to perform the remastered sound recordings

had been secured, CBS’s performance of the remastered

sound recordings could not infringe the pre-1972 sound

recordings.

The district court also held, in the alternative, that CBS

was entitled to partial summary judgment of non-

infringement with respect to 126 of the 174 representative

remastered sound recordings because ABS failed to provide

evidence of CBS’s performance of those sound recordings.

The evidence presented with respect to the 174 samples

breaks down as follows. Sixty samples were contained in

CBS’s internal digital audio library, Radio 2.0, which tracks

broadcast or transmission via CBS’s internet-only radio

stations. The parties agree that for 48 of these, ABS

presented evidence of CBS’s broadcast or transmission of

sound recordings embodying the same performances as

ABS’s pre-1972 sound recordings. The parties also agree

that nine sound recordings were not infringing because

CBS’s records show that it broadcast versions based on

different performances than the pre-1972 sound recordings.

Three of these sound recordings were not reviewed by the

parties’ experts. An additional 40 samples were contained

exclusively in the Triton Reports, which are created by a

third-party company to track “simulcasts”—live internet

streams—of CBS’s radio broadcasts across the United

12 ABS ENTERTAINMENT V. CBS CORPORATION

States. The parties do not discuss on appeal the evidence

available with respect to the remaining 74 sound recordings.

The district court concluded that the Triton Reports were

hearsay and did not fall within the business records

exception because “Plaintiffs have failed to establish any one

of the requirements necessary for them to be admitted under

the business records exceptions.” The district court thus

concluded that ABS had failed to raise a genuine issue of

material fact as to CBS’s transmission or broadcast in

California of all but the 48 samples both parties agree CBS

transmitted.

ABS appealed each of the adverse rulings.

III

We review the district court’s grant of summary

judgment de novo, asking whether the moving party has met

its burden to prove the absence of genuine issues of material

fact. U.S. Auto Parts Net., Inc. v. Parts Geek, LLC, 692 F.3d

1009, 1014 (9th Cir. 2012). A genuine issue of material fact

exists if, drawing all inferences in favor of the non-moving

party, a reasonable jury could find in favor of the non-

moving party. Id. Whether a work is protected by copyright

law is a mixed question of law and fact, which we review de

novo. Ets-Hokin v. Skyy Spirits, Inc., 225 F.3d 1068, 1073

(9th Cir. 2000). We review the district court’s evidentiary

rulings for an abuse of discretion. Fonseca v. Sysco Food

Servs. Of Ariz., Inc., 374 F.3d 840, 845 (9th Cir. 2004).

IV

We begin with the district court’s determination that

“there is no genuine dispute of material fact that CBS

performed a post-1972 version of Plaintiffs’ pre-1972 Sound

ABS ENTERTAINMENT V. CBS CORPORATION 13

Recordings which contained federally-copyrightable

original expression added during the remastering process.”

A

The constitutional purpose of copyright law is “to

promote the Progress of Science and the useful Arts” by

securing to “authors the right to their original expression, but

encourage[ing] others to build freely upon the ideas and

information conveyed by a work.” Feist Pubs., Inc. v. Rural

Tel. Serv. Co., 499 U.S. 340, 349–50 (1991). “The sine qua

non of copyright is originality.” Id. at 345. “Original, as the

term is used in copyright, means only that the work was

independently created by the author (as opposed to copied

from other works), and that it possesses at least some

minimal degree of creativity.” Id. A product of independent

creation is distinguished from a copy in that it contains

something which “owes its origin” to the independent

creator. Burrow-Giles Lithographic Co. v. Sarony, 111 U.S.

53, 58 (1884). A copy, on the other hand, is not a separate

work, but a mere representation or duplication of a prior

creative expression. 3

A “derivative work” is defined in the Copyright Act as a

work “based upon one or more preexisting works” that

3

The Copyright Act defines “Copies” as “material objects, other

than phonorecords, in which a work is fixed by any method now known

or later developed, and from which the work can be perceived,

reproduced, or otherwise communicated, either directly or with the aid

of a machine or device. The term ‘copies’ includes the material object,

other than a phonorecord, in which the work is first fixed.” 17 U.S.C.

§ 101. “Phonorecords” are “material objects in which sounds, other than

those accompanying a motion picture or other audiovisual work, are

fixed by any method now known or later developed, and from which the

sounds can be perceived, reproduced, or otherwise communicated, either

directly or with the aid of a machine or device.” Id.

14 ABS ENTERTAINMENT V. CBS CORPORATION

“recast[s], transform[s], or adapt[s]” a preexisting work and

“consist[s] of editorial revisions, annotations, elaborations,

or other modifications which, as a whole, represent an

original work of authorship.” 17 U.S.C. § 101. A derivative

work is copyrightable when it meets two criteria: (1) “the

original aspects of a derivative work must be more than

trivial,” and (2) “the original aspects of a derivative work

must reflect the degree to which it relies on preexisting

material and must not in any way affect the scope of any

copyright protection in that preexisting material.” U.S. Auto

Parts, 692 F.3d at 1016 (citing Durham Indus. v. Tomy

Corp., 630 F.2d 905, 909 (2d Cir. 1980)). This is known as

the Durham test. Both prongs arise out of Copyright’s basic

focus on originality. The first prong asks “whether the

derivative work is original to the author and non-trivial” and

the second prong ensures that the derivative work author

does not hinder the original copyright owner’s ability to

exercise all of its rights. Id. at 1017.

Because derivative works do not start from scratch,

courts have endeavored to determine the kinds of

contributions in the derivative work that qualify as original.

In most circumstances, derivative works contain obvious

creative contributions and so are easily recognizable as

distinct from the underlying work. The casting, lighting,

cinematography, props, editing, acting, and directing

required to craft a movie from a screenplay, for example,

easily render the movie distinct from the screenplay.

Likewise, the authors of most sound recordings that use a

sample of another sound recording to create distinct

derivative works do so by adding new vocals, instruments,

and edits to the underlying sample. Where the alleged

derivative work, however, is intended as, and is in fact, a

direct representation of the original work, the contributions

of the derivative work author are harder to identify.

ABS ENTERTAINMENT V. CBS CORPORATION 15

This court applied the two-part Durham test in

Entertainment Research Group, Inc. v. Genesis Creative

Group, Inc., 122 F.3d 1211 (9th Cir. 1997). In that case,

Entertainment Research Group (“ERG”) made three-

dimensional inflatable costumes based on copyrighted

characters like “Toucan Sam” and “Cap’n Crunch.” Id. at

1217–18. In relevant part, the court, in applying the

originality prong, concluded that the costume-maker’s

contributions—including the change in format from 2D to

3D; changes in the proportion of textures, facial features and

facial expressions; and the changes attendant to the

functional addition of movement—were insufficient to

render the costumes copyright eligible as derivative works.

Id. at 1223.

The court first discounted the changes occasioned by

technical, functional, and utilitarian concerns, such as the

differences in proportion (necessitated by the requirement

that a human body must fit within the costume) and texture

(necessitated by the material choice), because copyright in a

sculptural work is limited to its form and cannot extend to its

mechanical or utilitarian aspects under 17 U.S.C. § 101. Id.

at 1221. The remaining changes in the facial expressions

were also deemed insufficient to support a derivative work

copyright, because “no reasonable trier of fact would see

anything but a direct replica of the underlying characters.”

Id. at 1224. “Viewing the three-dimensional costumes and

the two-dimensional drawings upon which they are based, it

is immediately apparent that the costumes are not exact

replicas of the two-dimensional drawings.” Id. at 1223.

These identifiable changes “themselves reflect[] no

independent creation, no distinguishable variation from

preexisting works, nothing recognizably the author’s own

contribution that sets [ERG’s costumes] apart from the

prototypical [characters]” the costumes represented. Id. at

16 ABS ENTERTAINMENT V. CBS CORPORATION

1223 (quoting Durham, 630 F.2d at 910). In other words,

the costumes did not constitute new works, despite the

independent decision-making involved in their creation. Id.

at 1224 (holding that the different facial expressions,

proportions, and functional capabilities were “clearly not the

defining aspect[s] of the costumes” when viewed “in the

context of the overall costume” and, thus, were not

considered distinguishable variations capable of supporting

independent copyright protection). The court then went on

to apply the second prong of Durham, noting that because of

the similarity between ERG’s costumes and the underlying

characters, granting a derivative work copyright in the

costumes would improperly give ERG “a de facto monopoly

on all inflatable costumes depicting the copyrighted

characters also in ERG’s costumes.” Id.

The Tenth Circuit similarly held that a digital work must

be more than a copy of an underlying analog work to support

copyright as a derivative work. In Meshwerks, Inc. v. Toyota

Motor Sales U.S.A., 528 F.3d 1258 (10th Cir. 2008), the

Tenth Circuit considered the copyright eligibility of

Meshwerks’ digital wire frame models used as skeletons for

the interactive display of Toyota’s vehicle designs online

and in advertising. Id. at 1260. Meshwerks measured

Toyota’s vehicles with an articulated arm tethered to a

computer and mapped the results onto a computerized grid

using modeling software; connected the measured points to

create a wire frame; and manually adjusted about ninety-

percent of the data points to make the models more closely

resemble the vehicles. Id. at 1260–61. The Tenth Circuit

drew a sharp distinction between copies and original works,

explaining that copies cannot qualify for copyright

protection “since obviously a copier is not a creator, much

less an ‘independent’ creator.” Id. at 1267 (citing Patry on

Copyright § 3:28). The wire frames were copies, according

ABS ENTERTAINMENT V. CBS CORPORATION 17

to the court, because they “depict nothing more than

unadorned Toyota vehicles—the car as car,” the visual

designs of “which do not owe their origins to Meshwerks.”

Id. at 1265, 1268.

Meshwerks relied on three important doctrines in coming

to that conclusion. First, as in Entertainment Research

Group, the mere act of translating the derivative work into a

different medium did not confer a distinct identity on the

derivative work. Id. at 1267 (“[T]he fact that a work in one

medium has been copied from a work in another medium

does not render it any the less a ‘copy.’” (citing 2 Nimmer

on Copyright § 8.01[B])); id. (noting that although the wire

models did not “recreate Toyota vehicles outright—steel,

rubber, and all,” “what Meshwerks accomplished was a

peculiar kind of copying”). Second, the court analyzed

originality by comparing the start and end products—the

underlying vehicle designs and the wire models—not the

process used to get from one to the other. Id. at 1268 (“[I]n

assessing the originality of a work for which copyright

protection is sought, we look only at the final product, not

the process, and the fact that intensive, skillful, and even

creative labor is invested in the process of creating a product

does not guarantee its copyrightability.”). Finally, the court

considered Toyota’s intent in authorizing Meshwerks to

create an accurate representation of Toyota’s vehicles, not

something new and different: “If an artist affirmatively sets

out to be unoriginal—to make a copy of someone else’s

creation, rather than to create an original work—it is far

more likely that the resultant product will, in fact, be

unoriginal.” Id.

The Second Circuit considered the originality needed to

justify copyright protection for a derivative work in L. Batlin

& Son, Inc. v. Snyder. 536 F.2d 486 (2d Cir. 1976). In that

18 ABS ENTERTAINMENT V. CBS CORPORATION

case, appellant Snyder obtained a copyright registration for

a plastic version of a cast metal Uncle Sam bank that had

previously entered the public domain. 4 Snyder made several

changes in the plastic version: he made it shorter “in order to

fit into the required price range and quality and quantity of

material to be used;” changed the proportions of Uncle

Sam’s face, bag, hat, and eagle; changed the textures of

several components; created a single-piece mold

incorporating the umbrella instead of the two-piece mold of

the metal bank; and replaced the arrows in the eagle’s talons

with leaves, because “the arrows did not reproduce well in

plastic on a smaller size.” Id. at 488–89.

Even though the plastic bank was not identical to the

metal original, the Second Circuit held that the changes did

not amount to a distinguishable variation in the identity or

essential character of the original work. Id. at 491. The

transfer of the expression from the underlying cast iron

Uncle Sam to a plastic version, despite overcoming technical

challenges and, arguably, improving the original in terms of

lowering the price, did not result in a copyrightable

derivative work, because the changes did not constitute the

“substantial variation” necessary to support copyright.

Instead, they were merely the “trivial” results of the

“translation to a different medium.” Id. The plastic bank

4

The public domain metal bank comprised: “Uncle Sam, dressed in

his usual stove pipe hat, blue full dress coat, starred vest and red and

white striped trousers, and leaning on his umbrella, stands on a four- or

five-inch wide base, on which sits his carpetbag. A coin may be placed

in Uncle Sam's extended hand. When a lever is pressed, the arm lowers,

and the coin falls into the bag, while Uncle Sam's whiskers move up and

down. The base has an embossed American eagle on it with the words

‘Uncle Sam’ on streamers above it, as well as the word ‘Bank’ on each

side.” 536 F.2d at 488.

ABS ENTERTAINMENT V. CBS CORPORATION 19

was not a new work—it did not embody “the author’s

tangible expression of his ideas,” id. at 492 (quoting Mazer

v. Stein, 347 U.S. 201, 214 (1954)), and was thus a mere

copy of the underlying work.

The Copyright Office guidance provided in Circular 56

reflects that a similar analysis applies specifically to

derivative sound recordings. 5 In relevant part, Circular 56

explains the following about derivative sound recordings:

A derivative sound recording is an audio

recording that incorporates preexisting

sounds, such as sounds that were previously

registered or published or sounds that were

fixed before February 15, 1972. The

preexisting recorded sounds must be

rearranged, remixed, or otherwise altered in

sequence or character, or the recording must

contain additional new sounds. The new or

revised sounds must contain at least a

minimum amount of original sound recording

authorship.

Examples of derivative sound recordings

include:

• A mashup comprising tracks and sounds

from multiple sources.

5

Circulars provide Copyright Office guidance on various issues.

We may rely on them as persuasive but not binding authority. See

Kitchens of Sara Lee, Inc. v. Nifty Foods Corp., 266 F.2d 541, 544 (2d

Cir. 1959) (citing Copyright Office publication); In re World Aux. Power

Co., 303 F.3d 1120, 1131 n.73 (9th Cir. 2002) (citing Circular 4).

20 ABS ENTERTAINMENT V. CBS CORPORATION

• Additional tracks added to a previously

published album.

Mechanical changes or processes, such as a

change in format, declicking, or noise

reduction, generally do not contain enough

original authorship to warrant registration

United States Copyright Office’s Circular No. 56, Copyright

Registration for Sound Recordings, Revised Sept. 2017

(“Circular 56”), available at <https://www.copyright.gov/

circs/circ56.pdf>. 6 In common with the cases noted above,

Circular 56 identifies original authorship as the touchstone

of a copyright eligible derivative work and calls for either

“additional new sounds” or some other minimum amount of

original sound recording authorship, such as the

rearrangement, remixing, or alteration of sounds in sequence

or character. Id. According to the Circular, changes to

format, declicking and noise reduction, even if perceptible,

do not amount to the minimal amount of original sound

recording authorship necessary under the law and do not

warrant separate copyright protection.

From the foregoing, it should be evident that a

remastered sound recording is not eligible for independent

copyright protection as a derivative work unless its essential

character and identity reflect a level of independent sound

recording authorship that makes it a variation

6

The district court discussed an earlier version of Copyright Office

Circular 56 and cited a key example therein of a derivative sound

recording: “a remastering that involves multiple kinds of creative

authorship, such as adjustments of equalization, sound editing, and

channel assignment.” This example has since been removed from the

updated version of Circular 56.

ABS ENTERTAINMENT V. CBS CORPORATION 21

distinguishable from the underlying work. The essential

character and identity of a sound recording include, inter

alia, the aggregate of the “emphasis or the shading of a

musical note, the tone of voice, the inflection, the timing of

a vocal rendition, musical or spoken,” 1 Nimmer on

Copyright § 2.10 (2018); the choice of instrumental, vocal

and percussion components; and the subtleties of dynamics

and other performance characteristics that together result in

“something irreducible, which is one [band’s] alone.” See

Bleistein v. Donaldson Lithographing Co., 188 U.S. 239,

250 (1903) (Holmes, J.). Such factors distinguish an original

vocal rendition of a song from the vocal rendition of the

same song by another singer and are not present when an

original vocal rendition is merely remastered. A

remastering, for example, of Tony Bennett’s “I Left My

Heart in San Francisco” recording from its original analog

format into digital format, even with declicking, noise

reduction and small changes in volume or emphasis, is no

less Bennett’s “I Left My Heart in San Francisco”

recording—it retains the same essential character and

identity as the underlying original sound recording,

notwithstanding the presence of trivial, minor or

insignificant changes from the original. That is so even if

the digital version would be perceived by a listener to be a

brighter or cleaner rendition.

If an allegedly derivative sound recording does not add

or remove any sounds from the underlying sound recording,

does not change the sequence of the sounds, and does not

remix or otherwise alter the sounds in sequence or character,

the recording is likely to be nothing more than a copy of the

underlying sound recording and is presumptively devoid of

the original sound recording authorship required for

copyright protection. Such a work lacks originality. This

presumption may, of course, be overcome, by showing that

22 ABS ENTERTAINMENT V. CBS CORPORATION

the work contains independent creative content,

recognizable contributions of sound recording authorship or

variations in defining aspects that give a derivative sound

recording a new and different essential character and

identity.

A number of practical considerations, including but not

limited to the considerations that follow, inform a

determination of the essential character and identity of a

remastered sound recording. First, the mere translation of a

work from an analog to a digital medium to take advantage

of technological improvements does not itself transform the

essential character and identity of the underlying work. See

Meshwerks, 528 F.3d at 1267 (“[W]e hold, as many before

us have already suggested, that standing alone, ‘[t]he fact

that a work in one medium has been copied from a work in

another medium does not render it any the less a ‘copy’’”

(citing 2 Nimmer on Copyright § 8.01[B])); L. Batlin,

536 F.2d at 489 (holding that changes in the plastic bank,

such as the “functional one of making a more suitable (and

probably less expensive) figure in the plastic medium” and

the aesthetic decision to replace the arrows with feathers

because arrows did not reproduce well in plastic, were not

original); Entm’t Res. Grp., 122 F.3d at 1221, 1223 (with

respect to sculptural works, explaining that “any aspects of

ERG’s costumes that are purely functional, utilitarian or

mechanical will not be given any copyright protection” and

agreeing “with the district court's conclusion that the

differences in form, texture and proportionality that ERG

points to as nontrivial differences all stemmed from

functional considerations”). See also Durham, 630 F.2d at

913 (“[C]opyright protection extends only to the artistic

aspects, but not the mechanical or utilitarian features, of a

protected work.”). Such functionally driven decision-

ABS ENTERTAINMENT V. CBS CORPORATION 23

making does not demonstrate the kind of originality with

which copyright is exclusively concerned.

Second, a remastering engineer’s objective “to make a

copy of someone else’s creation, rather than to create an

original work,” Meshwerks, 528 F.3d at 1268, even if that

task seeks to improve quality, brightness or crispness of

sound, is persuasive evidence that the final product likely

contains little more than a trivial contribution and does not,

in fact, result in an original work. See Entm’t Res. Grp.,

122 F.3d at 1223 (“ERG’s customers—the companies—

wanted costumes replicating their characters. Thus, because

ERG followed detailed instructions from its customers

regarding exactly how they wanted the costumes to appear,

it cannot be said that ERG’s artistic contributions were more

than merely trivial contributions.”).

Finally, the process used to create the derivative work is

seldom informative of originality in the copyright sense.

Meshwerks, 528 F.3d at 1268. The remastering engineer’s

application of “intensive, skillful, and even creative labor . . .

does not guarantee its copyrightability.” Id.; see also L.

Batlin, 536 F.2d at 491 (“Nor can the requirement of

originality be satisfied simply by the demonstration of

‘physical skill’ or ‘special training.’”). In Meshwerks, the

exercise of independent technical and aesthetic judgment in

adjusting the wire-frames did not result in a copyright

eligible work, as those efforts were directed wholly to more

effectively representing the underlying works, not to

changing or adding to those works. 528 F.3d at 1268.

B

In this case, the district court determined that “at least

some perceptible changes were made to Plaintiff’s Pre-1972

Sound Recordings” and that these changes were not merely

24 ABS ENTERTAINMENT V. CBS CORPORATION

“mechanical” or “trivial.” Therefore, the district court held,

there was no genuine dispute of material fact that the

remastered works performed by CBS were “sufficient[ly]

original[].” Id. at 12. This conclusion was legal error.

In Entertainment Research Group, for example, the

costumes were clearly distinguishable from the underlying

characters. We nevertheless held that the costume-makers’

contributions were not original because the costumes would

not be identified as distinguishable variations; i.e., the

essential character and identity of each were not changed.

Entm’t Res. Grp., 122 F.3d at 1223–24 (“Viewing the three-

dimensional costumes and the two-dimensional drawings

upon which they are based, it is immediately apparent that

the costumes are not exact replicas of the two-dimensional

drawings,” but there was no originality because “no

reasonable trier of fact would see anything but a direct

replica of the underlying characters.”); see also Meshwerks,

528 F.3d at 1267 (holding that the derivative digital wire

frame models were “a peculiar kind of copy” of Toyota

vehicles, although the wire models did not “recreate Toyota

vehicles outright—steel, rubber, and all”); Durham,

630 F.2d at 909 (“The three Tomy figures are instantly

identifiable as embodiments of the Disney characters in yet

another form: Mickey, Donald and Pluto are now

represented as small, plastic, wind-up toys,” although the

underlying Disney characters did not include the wind-up

mechanism in the derivative toys.).

Here, there is no dispute that all of the sounds contained

in the remastered sound recordings—the vocals,

instruments, inflection, dynamics, rhythms, and

sequences—were initially fixed in a studio before 1972.

There is also no dispute that the remastering engineers did

not add or remove any sounds and did not edit or resequence

ABS ENTERTAINMENT V. CBS CORPORATION 25

the fixed performances. For these reasons, the remasters

presumptively lacked the originality necessary to support

copyright protection as derivative works.

The district court, in ruling otherwise and concluding

that no genuine issues of material fact exist on the originality

of the digital remasters, applied an incorrect test. In doing

so, the district court placed critical reliance on the testimony

of CBS’s expert, Begault. Begault explained that the

digitally perceptible changes to “timbre, spatial imagery,

sound balance, and loudness range” that he identified in the

remastered sound recordings were measures of sound

quality. 7 Such technical improvements associated with the

translation of the analog pre-1972 sound recordings into a

digital medium, however, do not support a finding of

originality. See L. Batlin, 536 F.2d at 489 (rejecting changes

made for the “functional” purpose “of making a more

suitable (and probably less expensive) figure in the plastic

medium”); Entm’t Res. Grp., 122 F.3d at 1223 (discounting

differences in form, texture and proportionality arising out

of the need to create space for a human to fit into a 3-D

costume); Meshwerks, 528 F.3d at 1267 (holding that the

technical adjustments of data points to more accurately

reflect Toyota vehicles in a digital medium did not constitute

the kind of contribution to qualify for copyright).

7

Title 17, Section 114(b) explains that the exclusive right of a

copyright holder in a sound recording “is limited to the right to prepare

a derivative work in which the actual sounds fixed in the sound recording

are rearranged, remixed, or otherwise altered in sequence or quality.”

(emphasis added). We read “quality” in § 114 to be referring to character

and identity rather than a measure of improvement. See Quality, Miriam-

Webster (July 19, 2018), https://www.merriam-webster.com/

dictionary/quality.

26 ABS ENTERTAINMENT V. CBS CORPORATION

The purpose and effect of the remastering here was

similarly a technical improvement. In its brief to this court,

CBS explained that the reason for the remastering was to

overcome the technical limitations of vinyl using the “nearly

unlimited” sound range that CDs could reproduce. William

Inglot, a remastering engineer responsible for some of the

remastered sound recordings here and one of CBS’s

witnesses, testified that his goal was to do a “good job,” to

“do a better version of maybe what the production process

was at that time because you have a little more control than

maybe they had,” by “taking advantage of the technology.”

Begault analyzed the differences between the pre-1972

sound recordings and the remastered sound recordings using

sensitive digital analysis and concluded that the remastered

sound recordings would be different if there was any

difference in any of the four analyzed characteristics. But

Begault nowhere analyzed whether the changes he identified

reflected any original sound recording authorship that might

have changed the essential character and identity of the

resulting sound recordings. The technical changes as

measured by sensitive digital analysis does not necessarily

result in a change in the essential character and identity of

the work in question. ABS’s expert, Geluso, aptly explained

this shortcoming of Begault’s analysis: “I believe that two

sound recordings would have to be nearly identical to pass

all four of [Begault’s] tests. For example, Begault set a

standard of 1 dB of loudness differential for two recordings

as his passing mark. This is unreasonably extreme. In my

experience, 1dB of dynamic range compression is barely

audible and will most likely go undetected by a listener.”

Geluso also explained that the spectral balance of a sound

recording can be adjusted on most consumer listening

equipment, and the loudness can be adjusted on most

consumer software used to create and edit music. It is

ABS ENTERTAINMENT V. CBS CORPORATION 27

unlikely that such changes—even if made with more

technical expertise by a remastering engineer and fixed in a

sound recording—would amount to a change in the essential

character and identity of the sound recording.

The district court excluded several paragraphs of

Geluso’s declaration as unscientific, based on unreliable

methodology, lacking adequate foundation as expert

testimony, unnecessary and irrelevant. The district court

found Geluso’s critical listening methods to be unscientific,

and “unexplained in Mr. Geluso’s declaration.” But in his

declaration, Geluso cited an FBI report on forensic sound

recording analysis that held out critical listening as an

essential component of forensic audio analysis. Also,

despite Geluso’s testimony that he critically listened to all of

the recordings he examined, the district court found fatally

deficient the fact that Geluso limited his waveform and

spectral analysis to the first five seconds of each recording.

While the shortness of the technical analysis impacts the

weight of that testimony, there is no reason to question the

science behind or the methodology of such testing for

whatever it may show. And the district court failed to

explain why five seconds of waveform analysis was

insufficient to determine whether the pre-1972 and

remastered sound recordings embodied the same

performances. Moreover, Geluso’s testimony, offered in

rebuttal to the testimony of CBS’s expert, Begualt, addressed

the nature and extent of the differences between the original

analog recordings and the digitally remastered sound

recordings and was thus directly relevant to the issue of

originality before the court. The district court also found

deficient the fact that Geluso excluded from his report a

phase inversion test from the first test he attempted. But that

is not an adequate basis to exclude Geluso’s testimony. That

test merely identifies the fact of difference—something that

28 ABS ENTERTAINMENT V. CBS CORPORATION

ABS and Geluso do not contest exists between the pre-1972

and remastered sound recordings. The district court’s

exclusion of Geluso’s testimony was an abuse of discretion,

and his testimony should be considered in full by the district

court on remand.

The district court also erred in failing to consider ABS’s

objective in creating the digital remasters. ABS hired

recording engineers to create digitally remastered sound

recordings of the pre-1972 sound recordings in order to

allow for digital distribution and compilation albums and to

take advantage of the improvements enabled by digital

technology, not to introduce any substantive changes. As

one ABS representative explained: “we understood as the

technology increased, as things went from LP and cassette

to CD [that the recordings would be re-mastered] . . . in such

a way that they could be CD’s made out of them. They had

to go digital. We knew they were going to have to be

converted analog to digital.” Plaintiff Brunswick’s

representative agreed, stating that “in order to release

recordings in a digital format that they would in fact be

remastered.” And Inglot testified that his goal was to “do a

better version of maybe what the production process was at

that time because you have a little more control than maybe

they had” by “taking advantage of the technology.” Another

declaration submitted by Plaintiffs averred that they “never

would have permitted a Licensee to make any substantial or

non-trivial changes to the sound of the Recordings when

creating a remastered copy.” Nothing in the record suggests

that ABS set out to make any substantive changes or

distinguishable variations that would give the digital

remasters a different essential character or identity, to add

any original sound recording authorship or to do anything

other than make accurate copies in digital format of the

original analog sound recordings.

ABS ENTERTAINMENT V. CBS CORPORATION 29

Notwithstanding the above, CBS argues that all that is

needed to support copyright is “more than a merely trivial

variation,” Schrock v. Learning Curve Int’l, Inc., 586 F.3d

513, 521 (7th Cir. 2009), and that this is the test mandated

by U.S. Auto Parts and properly adopted by the district court.

CBS argues that it met its burden when it pointed out

deficiencies in ABS’s claims, and that ABS failed to provide

significant probative evidence that the differences between

the pre-1972 and the remastered sound recordings were

mechanical, trivial, or insufficiently original.

CBS is correct that the threshold of creativity for

copyright eligibility often is characterized as minimal, and

that the courts police the amount of creativity only within the

“narrowest and most obvious limits.” Bleistein, 188 U.S. at

251; 1 Nimmer on Copyright § 2.01[B][1] (2018). But that

relatively low bar does not eliminate the fundamental

requirement of originality that is the touchstone of copyright

protection. Here, the district court’s identification of

“perceptible changes” between the recordings in

characteristics relating to “quality” did not ensure that the

remastered versions contained anything of consequence

owing its origin to the remastering engineers. As discussed

above, a derivative sound recording that merely exhibits

perceptible changes does not necessarily exhibit a change to

the essential character and identity of the work or reflect the

addition of even a minimal amount of sound recording

authorship or originality. See also 1 Nimmer on Copyright

§ 3.03 (2018) (“Any variation will not suffice, but one that

is sufficient to render the derivative work distinguishable

from its prior work in any meaningful manner will be

sufficient.”).

CBS also argues that “copyrightability is [] purpose-

agnostic,” and that the creation of a derivative work for “the

30 ABS ENTERTAINMENT V. CBS CORPORATION

purpose of migrating expression from one format to another”

is a proper copyrightable purpose, relying on New York

Times Co. v. Tasini, 533 U.S. 483 (2001). CBS is incorrect.

In Tasini, freelance article authors authorized the inclusion

of their articles into a newspaper, a collective work. The

authors sued when their articles were included in an

electronic database of newspapers in a form excised from the

newspaper of which they were a part. Id. at 491. The

Supreme Court concluded that the authors maintained their

copyright in the articles, and that the electronic database

infringed the authors’ copyright in their articles. Id. at 503–

04. Tasini does not say that a mere migration of a work into

a new medium justifies an independent copyright.

Finally, CBS argues that the district court was correct to

rely on Maljack Prods., Inc. v. UAV Corp., 964 F. Supp.

1416 (C.D. Cal. 1997), aff'd sub nom. Batjac Prods. Inc. v.

GoodTimes Home Video Corp., 160 F.3d 1223 (9th Cir.

1998) to support its understanding that changes in

equalization and quality in a sound recording support a

derivative work copyright. In Maljack, the derivative work

was a “panned and scanned” adaptation of a movie and its

soundtrack. 964 F. Supp. at 1418. The enhancements to the

public domain soundtrack there included “edit[ing] the

motion picture’s monoaural soundtrack by remixing,

resequencing, sweetening, equalizing, balancing, and

stereoizing it, and also add[ing] entirely new sound

material.” Id. Here the remastering process did not include

remixing or stereoizing. The changes in the soundtrack in

Maljack accompanied and had to track the changes to the

visual changes resulting from the pan-and-scan film

reformatting, which resulted in a cut of 44% of the film. Id.

at 1427. Also, the soundtrack accompanying the pan-and-

scan version was independently registered by the copyright

office as a derivative work, creating a presumption of

ABS ENTERTAINMENT V. CBS CORPORATION 31

copyright validity that the court found was not overcome. Id.

at 1428. None of these circumstances are present here. To

the extent that Maljack held that the “noticeable

improvement [in quality] over the public domain version”

could create copyright eligibility, we do not consider that

aspect of Maljack persuasive. See id.

We therefore conclude that a derivative sound recording

distinctly identifiable solely by the changes incident to the

change in medium generally does not exhibit the minimum

level of originality to be copyrightable. In this case, the

district court did not analyze whether the changes in quality

identified by Begault were anything other than merely

incidental to the transfer from the analog to the digital

medium.

Nothing in this opinion should be construed to question

or limit the creative contributions of the recording engineers

and/or record producers responsible for the recording

session that led to the initial fixation of the sound recording.

The initial producer/engineer’s role is often to work in

collaboration with the performing artists to make many of

the creative decisions that define the overall sound of the

recording as fixed, including such things as microphone

choice, microphone placement, setting sound levels,

equipment used, processing filters employed, tapes selected,

session structure, and other similar decisions analogous to

the creative choices of photographers that courts have

consistently held to be original. See United States Copyright

Office and Sound Recordings as Works Made for Hire:

Hearing Before the Subcomm. on Courts and Intellectual

Property of the H. Comm. on the Judiciary, 106th Cong. 2nd

Sess. (2000) (statement of Marybeth Peters, Register of

Copyrights) (“The copyrightable elements in a sound

recording will usually, though not always, involve

32 ABS ENTERTAINMENT V. CBS CORPORATION

‘authorship’ both on the part of the performers whose

performance is captured and on the part of the record

producer responsible for setting up the recording session,

capturing and electronically processing the sounds, and

compiling and editing them to make the final sound

recording.”); cf. Burrow-Giles, 111 U.S. at 60 (holding that

photographs are copyrightable to the extent of the

photographer’s decisions with respect to costume,

accessories, pose of subjects, light and shade and evoking

the desired expression).

The role of remastering engineers, however is usually

very different from the role of the studio engineers. Studio

engineers’ decisions almost always contribute to the

essential character and identity contained in the original

sound recording. By contrast, the remastering engineer’s

role is ordinarily to preserve and protect the essential

character and identity of the original sound recording, and to

present that original sound recording in the best light

possible by taking advantage of technological

improvements. For example, Inglot testified that his goal

was to “do a better version of maybe what the production

process was at that time because you have a little more

control than maybe they had” by “taking advantage of the

technology.” Although we do not hold that a remastered

sound recording cannot be eligible for a derivative work

copyright, a digitally remastered sound recording made as a

copy of the original analog sound recording will rarely

exhibit the necessary originality to qualify for independent

copyright protection.

C

The second prong of the U.S. Auto Parts/Durham test

requires that a copyright-eligible derivative work must

“reflect the degree to which it relies on preexisting material

ABS ENTERTAINMENT V. CBS CORPORATION 33

and must not in any way affect the scope of any copyright

protection in that preexisting material.” U.S. Auto Parts,

692 F.3d at 1016. This prong ensures that a derivative work

author—even one who contributes the requisite amount of

creative authorship under the first prong—does not “prevent

the owner of the preexisting work from exercising some of

its rights under copyright law.” Id. at 1017. This prong

protects the author’s right to authorize later derivative works

without concern for aggressive enforcement against those

later derivative works by the earlier derivative work

copyright holder. In Entertainment Research Group, for

example, we explained that “if ERG had copyrights for its

costumes, any future licensee who was hired to manufacture

costumes depicting these characters would likely face a

strong copyright infringement suit from ERG.” 122 F.3d at

1224; see also U.S. Auto Parts, 692 F.3d at 1020 (applying

the second prong of the Durham test and concluding in that

case, copyright in a derivative work would not circumscribe

rights of the copyright holder in the underlying work).

The district court’s failure to fully consider this second

prong here was legal error. See Entm’t Res. Grp., 122 F.3d

at 1219 (adopting the Durham test over the previously

applicable Doran test that looked only at substantial

difference between the derivative and underlying work,

“because the Doran test completely fails to take into account

the rights of the holder of the copyright for the underlying

work,” and therefore “should not be applied to determine the

copyrightability of a derivative work that is based on a

preexisting work that is itself copyrighted.”). Moreover,

applying that prong, there is at least a genuine issue of

material fact whether granting copyright protection for the

remastered sound recordings here would undermine ABS’s

rights in the pre-1972 sound recordings to authorize

additional derivative works. Were ABS intent on granting

34 ABS ENTERTAINMENT V. CBS CORPORATION

an authorization to create an intentionally derivative work,

for example by authorizing use of the underlying works as

samples or remixes, those authorized works would be at high

risk of infringement suits from the remastered sound

recording copyright holders. This risk would, in effect, grant

the remastered sound recording copyright holder a “de facto

monopoly” on derivative works. See id. at 1224. Indeed, in

this case, where the underlying and derivative works are both

sound recordings with few, if any, readily discernable

differences, and the derivative work is the only one available

in the vastly more accessible and marketable digital medium,

the danger that the copyright holder of the derivative work

could bring suit against a potential licensee of the underlying

work is particularly acute.

If, on remand, the factfinder concludes that any or all of

the remastered sound recordings here do manifest a change

sufficient to create a derivative, copyrightable work, the

factfinder should also consider the effect of recognizing a

copyright in the remastered sound recording on ABS’s

ability to exercise whatever copyrights it may possess in the

pre-1972 sound recording.

For the above reasons, we conclude that the district court

erred in holding that there were no genuine issues of material

fact that the remastered sound recordings used by CBS were

independently copyright eligible. We therefore reverse the

grant of summary judgment to CBS as to that issue.

D

The parties here dispute whether ABS authorized the

remastering engineer to create derivative works, whether

such permission was necessary, and which party bears the

burden to show such authorization (or lack thereof). This

issue arises, of course, only if the remastered recordings

ABS ENTERTAINMENT V. CBS CORPORATION 35

were derivative works. As we have determined that CBS was

not entitled to summary judgment on that question, we

address the authorization issue for guidance on remand.

The owner of a copyright has the exclusive right to

prepare derivative works, 17 U.S.C. § 106(2), and to grant

or withhold authorization to create such derivative works.

Schrock, 586 F.3d at 522–23. In Schrock, photographer

Schrock was hired by Learning Curve to photograph Thomas

the Tank Engine. Id. at 515. Learning Curve and HIT

Entertainment, the Thomas the Tank Engine copyright

holder, used Schrock’s photographs for several years. Id.

When Learning Curve stopped hiring Schrock as a

photographer, he registered his photographs and sued

Learning Curve and HIT for infringement. Id. Like here, it

was undisputed that Schrock had permission to make the

photographs. But Learning Curve argued that the

photographer also needed Learning Curve’s permission to

copyright the photographs. Id. The district court granted

summary judgment to Learning Curve, concluding that the

photographs were derivative works, and that although

Schrock had permission to make the photographs, he did not

have permission to copyright them. Id. The Seventh Circuit

reversed, stating: “As long as he was authorized to make the

photos (he was), he owned the copyright in the photos to the

extent of their incremental original expression.” Id. We

agree with that holding. The Seventh Circuit also explained

that although this was the default rule, parties could alter this

rule by contract. Id. at 523–24. Because the license

agreements among the parties were not entered into the

record, the Seventh Circuit remanded to the district court to

determine whether the parties altered the default rule by

contract. Id. at 525.

36 ABS ENTERTAINMENT V. CBS CORPORATION

It is undisputed here that the remastering engineers were

authorized to do exactly what they did. On remand, if the

authorization issue is raised in a further summary judgment

motion or at trial, the district court should give ABS the

opportunity to produce copies of its license agreements and

should determine whether any such agreements altered the

default rule on authorization.

V

The district court, in granting summary judgment also

held that ABS’s state law claims to copyright in the pre-1972

sound recordings, as embodied in the remastered sound

recordings, were preempted by federal copyright law. This

holding was error. This issue arises only if the remastered

recordings are ultimately determined to be authorized

derivative works. Again, we decide the issue for guidance

as the case proceeds.

Prior to 1971, sound recordings were protected solely

under state copyright laws. In 1971, Congress enacted the

1971 Sound Recording Act, which, for the first time, created

federal rights in sound recordings distinct from the rights in

the musical compositions embodied therein and from state

rights in sound recordings. That Act reserved to state law

the protection of sound recordings “fixed before February

15, 1972.” 17 U.S.C. § 301(c). We here address another

issue of first impression: whether the creation of an

authorized digital remastering of pre-1972 analog sound

recordings that qualify as copyrightable derivative works

brings the remastered sound recording exclusively under the

ambit of federal law.

ABS argues that its state law copyrights in the pre-1972

sound recordings survived intact in the remastered sound

recordings because they are distinct rights from whatever

ABS ENTERTAINMENT V. CBS CORPORATION 37

rights inhere in the remaster, and because 17 U.S.C.

§§ 301(c) and 103(b) preclude Federal preemption or

interference in the state law copyrights. CBS has a

dramatically different view. CBS argues that by authorizing

the creation of the remastered sound recordings, ABS

brought its rights in the pre-1972 sound recordings embodied

therein wholly within the gamut of the comprehensive

Federal Copyright scheme, which does not tolerate the

reservation of any State law rights in works governed by

federal copyright law.

CBS’s position is directly contrary to both established

precedent and the statutory scheme. Under long-standing

principles of copyright law, rights in an underlying work and

derivative work are distinct, and the holder of a copyright in

an underlying work retains that right in the content of the

derivative work sourced from the underlying work. Stewart

v. Abend, 495 U.S. 207, 223 (1990) (“[T]he element [of a

derivative work] drawn from the pre-existing work remains

on grant from the owner of a pre-existing work. So long as

the pre-existing work remains out of the public domain, its

use is infringing if one who employs the work does not have

a valid license or assignment for use of the pre-existing

work.” (internal citations omitted)); Russell v. Price,

612 F.2d 1123, 1128 (9th Cir. 1979) (“[E]stablished doctrine

prevents unauthorized copying or other infringing use of the

underlying work or any part of the work contained in the

derivative product so long as the underlying work itself

remains copyrighted.”); Gilliam v. American Broadcasting

Co., 538 F.2d 14, 20 (2nd Cir. 1976) (“[C]opyright in the

underlying script survives intact despite the incorporation of

that work into a derivative work.”). Section 103(b) makes

38 ABS ENTERTAINMENT V. CBS CORPORATION

this principle explicit. 8 Stewart, 495 U.S. at 224 (explaining

that 17 U.S.C. § 103(b) “made explicit” that the “full force

of the copyright in the preexisting work is preserved despite

incorporation into the derivative work”).

CBS is incorrect that “the only sound recordings CBS

broadcast were the remastered sound recordings, which were

created long after 1972.” The broadcast of the remastered

sound recording also broadcast the pre-1972 sound

recording therein embodied, just as it also broadcast the

underlying musical composition. Regardless of the

remastering engineers’ alterations, the sounds fixed in the

remastered sound recording include those performed and

fixed before 1972. See 17 U.S.C. § 101 (“‘Sound

recordings’ are works that result from the fixation of a series

of musical, spoken or other sounds.”).

CBS argues that Stewart is inapposite because that case

stands solely for the proposition that authorization is

required for the derivative work author to retain control over

the entire work, and its holding is limited to the unique

situation where the authorization to use the underlying work

in the derivative work was withdrawn. Stewart is not so

limited. Although the case arose under the particular

circumstance of a reversion of the renewal interest to the

copyright in the underlying work, Stewart was unequivocal

that “the element [of the derivative work] drawn from the

pre-existing work remains on grant from the owner of the

8

17 U.S.C. § 103(b) states: “The copyright in a compilation or

derivative work extends only to the material contributed by the author of

such work, as distinguished from the preexisting material employed in

the work, and does not imply any exclusive right in the preexisting

material. The copyright in such work is independent of, and does not

affect or enlarge the scope, duration, ownership, or subsistence of, any

copyright protection in the preexisting material.”

ABS ENTERTAINMENT V. CBS CORPORATION 39

pre-existing work” and that “[s]o long as the pre-existing

work remains out of the public domain, its use is infringing

if one who employs the work does not have a valid license

or assignment for use of the pre-existing work.” 495 U.S. at

223. Whether the derivative work author has a valid license

or assignment does not impact whether distribution, for

example, of the derivative work requires a license from the

underlying sound recording author—it does. 9 Thus, it is

well-established that, where the underlying work remains

protected by copyright, copying of the derivative work

remains an infringement of the underlying work. See Stewart

v. Abend, 495 U.S. at 223–24 (explaining that 17 U.S.C.

§ 103(b) “made explicit” that the “full force of the copyright

in the preexisting work is preserved despite incorporation

into the derivative work” (citing 17 U.S.C. § 7 (1976))); DC

Comics v. Towle, 802 F.3d 1012, 1023 (9th Cir. 2015);

Gilliam, 538 F.2d at 20; Russell, 612 F.2d at 1128.

Therefore, if the remastered sound recordings are ultimately

determined to be authorized derivative works, federal law

would govern only the additional expression in the

remastered sound recordings. Adopting CBS’s view to the

contrary would have the unmistakable effect of restricting

ABS’s rights in the pre-1972 sound recordings, because

ABS would no longer have the exclusive right to authorize:

the reproduction of remastered sound recording works in

phonorecords, the preparation of further derivative works

(from the remastered sound recording), the distribution of

phonorecords of the remastered sound recording, or the

public performance by digital audio transmission of the

remastered sound recordings. See 17 U.S.C. § 106.

9

Unless, of course, the license from the original owner includes a

right to license the underlying work.

40 ABS ENTERTAINMENT V. CBS CORPORATION

Moreover, under CBS’s theory, a pre-1972 sound

recording authorized for inclusion in a compilation album,

would be wholly governed by federal copyright law.

Presumably, an authorization to distribute from the

compilation author would satisfy a distributor’s obligations

wholly, without regard to the state law copyright in the

individual songs. That result cannot be correct.

Neither CBS nor amici point to any authority for the

proposition that the grant of an authorization to create a

derivative work is indivisible from the grant of other rights

and thus necessarily also grants the derivative work author

sole and complete control over the exclusive rights of the

derivative work. Authors of distinct components of a

derivative work regularly maintain their exclusive rights

independently; for example, both the author of a musical

composition and a sound recording author maintain their

exclusive rights in their components of the sound recording.

CBS insists that if the author of a work protected only

under state law authorizes its inclusion into a federally

copyrighted work, then federal law must govern the entire

work via preemption, and that state law rights in the

derivative work are thereby extinguished. In support of its

position, CBS points to a series of cases in which courts have

held that state law rights were preempted by federal law

governance of authorized derivative works. See James v.

Delilah Films, Inc. (“Delilah Films”), 544 N.Y.S.2d 447,

450 (Sup. Ct. 1989) (finding preemption for state law claims

for using pre-1972 film clips with pre-recorded lip-synched

sounds in a documentary film); Spear Mktg., Inc. v.

BancorpSouth Bank, 791 F.3d 586, 597 (5th Cir. 2015)

(finding preemption of state law claims to ideas fixed in a

software program); Shoptalk. Ltd. v. Concorde-New

Horizons Corp., 168 F.3d 586, 591 (2d Cir. 1999) (finding

ABS ENTERTAINMENT V. CBS CORPORATION 41

preemption of state law rights in a movie derived from an

unpublished screenplay protected by state law); Laws v.

Sony Music Entm’t, Inc., 448 F.3d 1134, 1145 (9th Cir.

2006) (finding preemption of a state law right of publicity

claim in an authorized derivative work); Maloney v.

T3Media, Inc., 853 F.3d 1004, 1011 (9th Cir. 2017) (finding

preemption of state law right of publicity claims in an

authorized photograph); Fleet v. CBS, Inc., 50 Cal. App. 4th

1911, 1919 (1996) (finding preemption of a movie actor’s

state law right of publicity claims in an authorized movie).

The Copyright Act includes an express preemption

provision: “On and after January 1, 1978, all legal or

equitable rights that are equivalent to any of the exclusive

rights within the general scope of copyright as specified by

section 106 in works of authorship . . . are governed

exclusively by this title.” 17 U.S.C. § 301(a). The rights

asserted by ABS in the remastered sound recordings

unquestionably meet the criteria of § 301(a). However, that

provision is subject to an express exclusion for state law

rights inhering in a pre-1972 sound recording:

With respect to sound recordings fixed before

February 15, 1972, any rights or remedies

under the common law or statutes of any

State shall not be annulled or limited by this

title until February 15, 2067. The preemptive

provisions of subsection (a) shall apply to any

such rights and remedies pertaining to any

cause of action arising from undertakings

commenced on and after February 15, 2067.

Notwithstanding the provisions of section

303, no sound recording fixed before

February 15, 1972, shall be subject to

42 ABS ENTERTAINMENT V. CBS CORPORATION

copyright under this title before, on, or after

February 15, 2067.

17 U.S.C. § 301(c). This provision explicitly precludes

federal preemption of state law rights in pre-1972 sound

recordings like those at issue here. Absent federal copyright

protection for the remastered sound recordings, distributors

like CBS would still require ABS’s authorization to

distribute any remastered derivative sound recordings under

whatever state law copyrights ABS might possess in the

underlying recordings. Under CBS’s understanding of the

federal copyright law, it would not need ABS’s

authorization, because it is enough to have the authorization

via compulsory license from the author of the remastered

sound recording; under CBS’s understanding, at least one of

the rights or remedies under the common law or statutes of

California are annulled or limited by the copyright law. 10

Thus, CBS’s reading of the law cannot be correct.

None of the cases CBS cites implicate the preemption

exclusion in § 301(c), because the underlying works in those

cases were not pre-1972 sound recordings. The only case to

even address that exemption is James v. Delilah Films, Inc.

(“Delilah Films”), 544 N.Y.S.2d 447 (Sup. Ct. 1989).

There, plaintiffs, a “girl group,” asserted various state law

claims against documentary film makers who used video

clips showing Plaintiffs, using a lip-synched soundtrack

recorded before 1972. Id. at 449. The New York Superior

Court held that the underlying works were audio-visual

works because the sounds could not be “separated from the

10

Whether California copyright law or common law protects the

public performance right of sound recordings is currently an open

question we previously certified to the California Supreme Court. Flo &

Eddie, Inc. v. Pandora Media, Inc., 851 F.3d 950, 957 (9th Cir. 2017).

ABS ENTERTAINMENT V. CBS CORPORATION 43

visual portion, merely to accommodate plaintiffs’ assertion

that they are entitled to an exemption based on 17 U.S.C.

§ 301(c).” Id. at 449–50; see also id. at 450 (explaining that

the nature of plaintiffs’ actions was “to recover for the

performance, distribution or display of plaintiffs’

performances” (internal quotation marks omitted)).

Therefore, the court held, plaintiffs’ claims were preempted

under § 301(a). The work here, by contrast, falls squarely

within the exception in § 301(c).

CBS also cites to the broad statement in Shoptalk that “a

single work cannot be protected from copying under both

federal and state law at the same time.” 168 F.3d at 591

(quoting Roy Export Co. Establishment of Vaduz,

Liechtenstein v. Columbia Broadcasting Sys., Inc., 672 F.2d

1095, 1101 n. 13 (2d Cir. 1982)). Shoptalk and Roy Export

were both discussing the incompatibility of protecting

“published” works under federal copyright law and

“unpublished” works under state law, which are generally

mutually exclusive categories (except for allowable

alternatives to publication, such as registration and deposit,

Roy Export, 672 F.2d at 1101 n.13). Although there are only

rare situations in which a work would be protected by both

federal and state law, nothing prevents this from occurring.

Thus, in Lone Ranger Television v. Program Radio Corp.,

we held that an unauthorized copy of a sound recording of a

radio play infringed both the federal copyright law in the

underlying script and state conversion law. 740 F.2d 718,

721 (9th Cir. 1984).

CBS next argues that maintaining state sound recording

copyright in derivative works would frustrate the goal of the

safe harbor provision, 17 U.S.C. § 114(f)(4)(B): “Any

person who wishes to perform a sound recording publicly by

means of a transmission eligible for statutory licensing . . .

44 ABS ENTERTAINMENT V. CBS CORPORATION

may do so without infringing the exclusive right of the

copyright owner of the sound recording [by paying a set

royalty fee].” CBS argues that § 114 was intended to make

post-1972 sound recordings subject to a compulsory license,

and that maintaining state copyrights in the underlying pre-

1972 sound recordings would require parties to individually

negotiate with pre-1972 copyright holders for the right to

play post-1972 sound recordings. In other words, the § 114

“safe harbor” would not be safe anymore. CBS draws a

comparison between the § 114 safe harbor and the Digital

Millennium Copyright Act’s (“DMCA”) safe harbor

provision, 17 U.S.C. § 512, which absolves digital service

providers from liability for copyright infringement under

certain conditions, and, according to the Second Circuit, also

covers pre-1972 sound recordings. Capitol Records, LLC v.

Vimeo, LLC, (“Vimeo”), 826 F.3d 78, 90 (2d Cir. 2016)

(holding that § 512 provided a safe harbor from infringement

for digital service providers even as to pre-1972 sound-

recordings, because a contrary ruling—limiting the

functioning of the safe harbor only to federally protected

content—would “defeat the very purpose Congress sought

to achieve in passing the statute.”).

The DMCA safe harbor provision provides that “[a]

service provider shall not be liable for monetary relief . . .

for infringement of copyright.” 17 U.S.C. § 512(c). That

language, unlike § 114, does not limit the safe harbor to

infringements of federal copyright. See Vimeo, 826 F.3d at

89 (“A literal and natural reading of the text of § 512(c) leads

to the conclusion that its use of the phrase “infringement of

copyright” does include infringement of state laws of

copyright.”). By contrast, § 114 offers only a safe harbor for

infringement of federal copyright law. Id. (distinguishing

§ 512(c) safe harbor from § 114 safe harbor on this basis);

17 U.S.C. § 114(d)(1) (“The performance of a sound

ABS ENTERTAINMENT V. CBS CORPORATION 45

recording publicly by means of a digital audio transmission,

other than as a part of an interactive service, is not an

infringement of section 106(6)” (emphasis added)).

Moreover, policy favors the distinction between the DMCA

safe harbor and § 114. Section 512 is directed to the

protection of internet service providers who would otherwise

be liable for infringing material of which they are unaware,

and who would otherwise suffer enormous liability. See

Vimeo, 826 F.3d at 92. Here, broadcasters who would be

taking advantage of the § 114 safe harbor are aware of the

particular songs they are broadcasting and must already

ensure that they pay the proper royalties for any original

post-1972 sound recording material and any musical

compositions incorporated therein. The additional expense

of tracking down incorporated pre-1972 sound recordings,

particularly in a case where the alleged derivative works are

mere remasters of the underlying pre-1972 sound recordings,

is not similarly burdensome. Finally, the DMCA safe harbor

only limits the liability of internet service providers; it does

not exclude liability for infringing acts by the party posting

the content. CBS’s theory here, in contrast, would render the

authors of pre-1972 sound recordings embodied in

remastered sound recordings that qualify as derivative works

uncompensated and without control of distribution of their

creative product.

VI

We next address whether the district court abused its

discretion in excluding the Triton Reports as evidence under

the business records exception. Business records may be

admitted under Fed. R. Evidence 803(6) when:

(A) the record was made at or near the time

by—or from information transmitted by—

someone with knowledge;

46 ABS ENTERTAINMENT V. CBS CORPORATION

(B) the record was kept in the course of a

regularly conducted activity of a business. . .

(C) making the record was a regular practice

of that activity;

(D) all these conditions are shown by the

testimony of the custodian or another

qualified witness, . . . and

(E) the opponent does not show that the

source of information or the method or

circumstances of preparation indicate a lack

of trustworthiness.

Fed. R. Evidence 803(6).

ABS argues that the district court abused its discretion in

rejecting the Triton Reports because those reports fit

squarely within the business records hearsay exception.

CBS argues that Mr. Neiman, a CBS employee relied upon

by ABS to provide the foundation for the business records

exception, did not know how the Triton Reports were made

or maintained, see NLRB v. First Termite Control Co.,

646 F.2d 424, 427 (9th Cir. 1981), and was not a Triton

employee.

We conclude that Mr. Neiman was qualified to establish

the foundation for the business records exception, and that

the district court abused its discretion in excluding the Triton

Reports. The business records exception only requires

“someone with knowledge” about the record-keeping, not

necessarily an employee of the business or someone with

knowledge of how the reports were made or maintained. See

FDIC v. Staudinger, 797 F.2d 908, 910 (10th Cir. 1986). Mr.

ABS ENTERTAINMENT V. CBS CORPORATION 47

Neiman testified that Triton was hired by CBS to create the

reports, and that CBS sent those reports to Sound Exchange

to determine artist royalties.

We agree with ABS that First Termite Control is

inapposite here. First Termite Control held that business

records, to be admissible under the business records

exception, must be supported by testimony of a witness

knowledgeable about the creation and maintenance of those

records. 646 F.2d at 417. But in that case, the accuracy of

the records was contested. Here, CBS itself relied on the

reports to establish its royalty payments to Sound Exchange

in the ordinary course of business. The accuracy of the

records is not in question. In a similar situation, we have

held that third party reports of this kind fall within the

business records exception. See United States v. Childs,

5 F.3d 1328, 1334 and n.3 (9th Cir. 1993) (distinguishing

First Termite Control due to reliance on third party reports

by company challenging their admissibility). CBS has

presented no evidence or argument showing that the Triton

Reports were unreliable or inaccurate.

The district court also held that, if it were to consider the

Triton Reports, it would nevertheless conclude that the

listing of a name and song title in the Triton Reports was

legally insufficient to create a genuine issue of material fact

“[a]bsent the comparative analysis” to show that the

performed sound recordings were not different recordings.

We conclude that the district court here erroneously

decided a genuine issue of material fact at summary

judgment. We agree with ABS that the Triton Reports

contain an album title, and sometimes the company label,

and so would be sufficient for a jury to infer that the records

CBS performed were the versions captured in Plaintiffs’ pre-

1972 sound recordings. The Triton Reports were used by

48 ABS ENTERTAINMENT V. CBS CORPORATION

CBS to govern the royalties paid to recording artists via

Sound Exchange; CBS has failed to present evidence that

these same reports were not sufficient to identify the

recording artists or the versions performed. The district

court erred in finding the absence of a genuine issue of

material fact with respect to the samples listed in the Triton

Reports.

VII

Finally, we address the district court’s dismissal of

ABS’s class certification motion.

Central District of California Local Rule 23-3 requires

Plaintiffs to file a motion for class certification within ninety

days after service of the complaint. The parties here twice

stipulated to extend the deadline, explaining in the second

stipulation that ABS needed more time for class action-

focused discovery. The district court denied the first

stipulation for failure to show good cause, and denied the

second without explanation. The district court did not

address the asserted need for pre-certification discovery.

Despite the district court’s rulings, ABS timely filed its

motion for class certification on November 19, 2015. The

district court struck the motion because of two technical

deficiencies: (1) noticing the hearing outside the thirty-five-

day period required by the Judge’s Standing Order and

(2) not including in the notice of motion a statement that the

parties had met and conferred and the date on which such a

conference took place, as required by Local Rule 7-3.

Having thus stricken the timely motion, the district court

then dismissed the motion for class certification for failure

to file a timely motion for class certification under Local

Rule 23-3.

ABS ENTERTAINMENT V. CBS CORPORATION 49

ABS argues that the district court abused its discretion in

striking the timely filed motion as a sanction for what it

categorizes as “trivial” omissions in the notice.

Central District of California Local Rule 23-3 sets a strict

90-day time frame from the filing of a complaint to the

motion for class action certification. This bright line rule is

in direct contrast to the flexibility of the Federal Rule, which

calls for a determination on class certification “[a]t an early

practicable time after a person sues or is sued as a class

representative.” Fed. R. Civ. P. 23(c)(1)(A). That flexible

approach makes sense. The class action determination can

only be decided after the district court undertakes a “rigorous

analysis” of the prerequisites for certification. Wal-Mart

Stores, Inc. v. Dukes, 564 U.S. 338, 350–51 (2011) (quoting

Gen. Tele. Co. of SW v. Falcon, 457 U.S. 147, 161 (1982)).

To undertake that analysis may require discovery. Kamm v.

Cal. City Dev. Co., 509 F.2d 205, 210 (9th Cir.1975) (“The

propriety of a class action cannot be determined in some

cases without discovery;” “To deny discovery in [such

cases] would be an abuse of discretion.”).

The district court’s actions here demonstrate the

impracticability of the 90-day limit, particularly in

combination with the district court’s summary and

unexplained denial of the parties’ joint stipulation to extend

the 90-day deadline based on the need for pre-certification

discovery. See Barbara J. Rothstein & Thomas E. Willging,

Federal Judicial Center, Managing Class Action Litigation:

A Pocket Guide for Judges 9 (3d ed. 2010) (“Considering

[Fed. R. Civ. P. 23(c)(1)], you should feel free to ignore local

rules calling for specific time limits; such local rules appear

to be inconsistent with the federal rules and, as such,

obsolete.”); Federal Judicial Center, Manual for Complex

Litigation, Fourth § 21.133 (“Some local rules specify a

50 ABS ENTERTAINMENT V. CBS CORPORATION

short period within which the plaintiff must file a motion to

certify a class action. Such rules, however, may be

inconsistent with Rule 23(c)(1)(A)’s emphasis on the

parties’ obligation to present the court with sufficient

information to support an informed decision on certification.

Parties need sufficient time to develop an adequate record.”).

Although the district court’s application and

interpretation of its Local Rules is entitled to “a large

measure of discretion,” Lance, Inc. v. Dewco Servs., Inc.,

422 F.2d 778, 784 (9th Cir. 1970), Local Rules cannot be

incompatible with Federal Rules. Fed. R. Civ. P. 83(a)(1).

We conclude that the bright-line of Local Rule 23-3 is

incompatible with Federal Rule of Civil Procedure 23.

We therefore reverse the district court’s striking of

ABS’s certification motion, and remand for consideration of

the class action motion on the merits, including

reconsideration of whether pre-certification discovery is

warranted.

VIII

For the reasons discussed above, we REVERSE the

district court’s grant of summary judgment. We also

REVERSE the district court’s striking of ABS’s class action

motion as untimely, and the exclusion of Geluso’s

testimony. We REMAND for further proceedings

consistent with this opinion. The district court should

consider ABS’s request for continuance of pre-certification

discovery, and, if appropriate, the merits of ABS’s class

action motion, at an early practicable time.