Amicus Curiae Brief — Broadcast Music, Inc. v. Edison Bros. Stores, Inc.

Supreme Court brief1992

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Text

No. 91-1438

art, U.S.

- she & UD

; APR 7 1992

IN THE

Supreme Court of the United Ses nal

OCTOBER TERM, 1991

BROADCAST MUSIC, INC.,

Petitioner,

—vV, ——

EDISON BROTHERS STORES, INC.,

Respondent.

ON PETITION FOR WRIT OF CERTIORARI FROM THE UNITED

STATES COURT OF APPEALS FOR THE EIGHTH CIRCUIT

BRIEF AMICUS CURIAE OF GROUPEMENT

EUROPEEN DES SOCIETES D’AUTEURS

ET COMPOSITEURS IN SUPPORT OF PETITION

Stanley Rothenberg

Counsel of Record

David Rabinowitz

Helene Godin

Attorney for Amicus Curiae

Groupement Europeen des

Societes d’Auteurs et

Compositeurs

MOSES & SINGER

1271 Avenue of the Americas

New York, New York 10020

(212) 246-3700

TABLE OF CONTENTS

PEP TTTTUTT TTT TTT Te Tree Te

THE DECISION BELOW IMPROPERLY INTERFERES

WITH THE TREATY-MAKING POWERS OF THE LEGIS-

LATIVE AND EXECUTIVE BRANCHES...............

The Decision Below Contravenes The Berne

ee ee a hakee eee’ s

The Decision Below Contravenes The Berne

Convention Implementation Act.............

. The Case Law Preceding The Decision Below

Represents Congress’ Intent And Policy Under

We SEE Achebe ded ha bate cbse kaeeescecees

1. Gap Stores And United States Shoe Were

The Established Law Under Section 110(5)

At The Time The BCIA Was Enacted....

2. The Decision Below Improperly Diminishes

Rights That Congress Intended To Pre-

Congress Knew Of And Relied On Gap Stores

And United States Shoe In Adhering To The

i Cr: cc ve ck eat cnet hen csese bas

The Decision Below Improperly Puts United

States Law At Odds With That Of Other

Berne Convention Member Nations, Contrary

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TABLE OF AUTHORITIES

Cases: PAGE

Air France v. Saks, 470 U.S. 392 (1985) ...... yee 16

Benjamins v. British European Airways, 572 F.2d 913

(2d Cir. 1978), cert. denied, 439 U.S. 1114 (1979).. 16

Broadcast Music, Inc. v. Claire’s Boutiques, Inc., 949

F.2d 1482 (7th Cir. 1991), petition for cert. filed,

No. 91-1437 (U.S. March 10, 1992)............... 4

Broadcast Music, Inc. v. United States Shoe Corp., 678

F.28 826 Geb Cie. Be vccetsau eves 0, 11, 13, 14, 15

Cannon v. University of Chicago, 441 U.S. 677 (1979) 14

CAPAC, Ltd. v. CTV Television Network, Ltd.,

Peo Rok Ae Pee hs See 17

Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691 (1984) 10

Chae Chan Ping v. United States, 130 U.S. 581 (1889) 19

Community for Creative Non-Violence v. Reid, 490

U.S. Fae CRUG 066 kenkcan bees eee eaceeces 12

Crabshaw Music v. K-Bob’s of El Paso, Inc., 744 F.

Supe. 763 CWED. Cah. Bee sakeceuescwassesseds 12

Director, Office of Workers’ Gompensation Programs

v. Perini North River Assocs:, 459 U.S. 297 (1983) 14

Dumas v. Gommerman, 865 F.2d 1093 (9th Cir. 1989) 12

Edison Bros. Stores, Inc. v. Broadcast Music, Inc., 21

U.S.P.Q.2d (BNA) 1440 (8th Cir. 1992), petition for

cert. filed (U.S. March 10, 1992)....... 4, 54, 10, 14, 19

Finzer v. Barry, 798 F.2d 1450 (D.C. Cir. 1986), aff’d

in part, rev’d in part sub nom., Boos v. Barry, 485

U.S. 333 COGS os 6 acceeshyeesne ee eee 13

ill

PAGE

Goodyear Atomic Corp. v. Miller, 486 U.S. 174 (1988) 14

Harper & Row, Publishers, Inc. v. Nation Enters., 471

U.S, SID CIGES) oon cs wcccccccccccccccvncsccscescs 10

Hickory Grove Music v. Andrews, 749 F. Supp. 1031

(D. Mont. 1990) ....... ee eeeeeee reece eee eceecees 12

Kolovrat v. Oregon, 366 U.S. 187 (1961)......-..++- 19

Lamminations Music v. P & X Markets, Inc., 1985

Merrill v. Bill Miller’s Bar-B-Q Enters., Inc., 688 F.

Supp. 172 (W.D. Tex. 1988) ......---eeeeeeeeeees 11

Merrill v. County Stores, Inc., 669 F. Supp. 1164

(D.N.H. 1987) ...... eee cece cere eee eee ec eccceess 11

National Football League v. McBee & Bruno’s, Inc.,

792 F.2d 726 (8th Cir. 1986) ........-. eee ee eeeees 10

Rickless v. United Artists Corp. [1987] F.S.R. 362... 17

Sailor Music v. The Gap Stores, Inc., 516 F. Supp. 923

(S.D.N.Y.), aff’d per curiam, 668 F.2d 84 (2d Cir.

1981), cert. denied, 456 U.S. 945 (1982) ...... aay Ee

14, 15

Sony Corp. of America v. Universal. City Studios, Inc.,

464 U.S. 417, reh’g denied, 465“U.S. 1112 (1984) .. 10

Stewart v. Abend, 495 U.S. 207 (1990). .......-++5+- 10

Sumitomo Shoji America, Inc. v. Avagliano, 457 U.S.

. C). >. nen ooo 19

Twentieth Century Music Corp. v. Aiken, 422 U.S. 151

CIDTG). cnc csccccwecvscessecccccnssvenesess 9, ll, 12, 13

United States v. Elder, 601 F. Supp. 1574 (S.D. Tex.

PAGE

United States v. Muench, 694 F.2d 28 (2d Cir. 1982),

cert. denied, 461 U.S. SOB (I9BS) .. wc cccccccves 13

Treaties:

Berne Convention for the Protection of Literary and

Artistic Works, Oct. 31, 1988, S. Treaty Doc. No.

99-27, 99th Cong., 2d Sess. (1986), 828 U.N.T.S.

EPPO PTT eee Tore Peer Tee TE Ere T Pee TTT TT Terr re passim

Statutes:

eS ee | PP ee Tee Pr Ty rrr re Ts 5

BF Weis: F SPREE we tescuavennedess 3, ty Me Om Ob, te, 15

eR Ee ft ee ee Pee TTT Te Te rer Tye rer rr 7

Berne Convention Implementation Act of 1988, Pub L.

BOO-SGB, EGE TURE. ZESS CUBE) cc vccccccnnccccuace passim

The Law of Copyright of March 1957 art. 41.1. (Fr.) 18

Congressional Reports:

H.R. Rep. No. 100-609, 100th Cong., 2d Sess.

ft. PPP PeT EET eee TT oT TT eee TT Ere 5, 6, 15, 16, 19

H.R. Rep. No. 94-1476, 94th Cong., 2d Sess. (1976),

peprinted G2 1976 UGA AM. FOSe v6 kc cvecivess 10, 12

S. Rep. No. 100-352, 100th Cong., 2d Sess. (1988),

reprinted in 1988 U.S.C.C.A.N. 3706 ............. 19, 20

Books and Articles:

Paul E. Geller, Copyright Protection in the Berne

Union: Analyzing the Issues, 13 Colum.-VLA J.L. &

eC 6 5 Ka Wane 6 4o Gn ceca dee a Keeese 17

PAGE

Antony Jennings, Cables and Satellites, 11 Colum.-

VLA J.L. & Arts 129 (1986) ........- cece eee eeee 7

Melville B. Nimmer & Paul E. Geller, /nternational

Ralph Oman, The United States and the Berne Union:

An Extended Courtship, 3 J.L. & Tech. 71 (1988) . 5

Sam Ricketson, The Berne Convention for the Protec-

tion of Literary and Artistic Works: 1886-1986

(UGB) on ave svccnevccccssncssorcssswsesvcvceseses 6, 7

Barbara Ringer, The Role of the United States in Inter-

national Copyright—Past and Future, 56 Geo. | EF

1050 (1968) ....cccccvcces VL cuckekaeeaecagenaneees 20

Stanley Rothenberg, Copyright and Public Perform-

ance of Music (1954) ........ee eee ee eee ee eeeeeees 2

Other Authorities:

Property Organization, Jan. 1992......++++++++++: 3

Final Report of the Ad Hoc Working Group on U.S.

Adherence to the Berne Convention, reprinted in 10

Colum.-VLA J.L. & Arts 513 (1986).........+---- 15

World Intellectual Property Organization, Guide to the

Berne Convention for the Protection of Literary and

Artistic Works (Paris Act 1971) (1978) ........++-- 7

IN THE

Supreme Court of the United States

OCTOBER TERM, 1991

No. 91-1438

BROADCAST MUSIC, INC.,

Petitioner,

—_—V.—

EDISON BROTHERS STORES, INC.,

Respondent.

ON PETITION FOR WRIT OF CERTIORARI FROM THE UNITED

STATES COURT OF APPEALS FOR THE EIGHTH CIRCUIT

BRIEF AMICUS CURIAE OF GROUPEMENT

EUROPEEN DES SOCIETES D’AUTEURS

ET COMPOSITEURS IN SUPPORT OF PETITION

INTEREST OF “AMICUS

Groupement Europeen des Societes d’Auteurs et Composi-

teurs (the European Group of Authors and Composers Soci-

eties) (hereinafter ‘‘GESAC*’) was founded in 1990 by

authors societies of the European Community on the initia-

tive of Mr. Jean-Loup Tournier, President of the Board of

Directors of Societe des Auteurs, Compositeurs et Editeurs de

Musique (the Society of Authors, Composers and Music Pub-

lishers) (hereinafter ‘‘SACEM”’’), the association of lyricists,

composers and music publishers for France.’ The principal

objective of GESAC is to collaborate with the authorities of

the European Economic Community for the implementation

of legislation assuring the highest level of protection possible

in respect of the intellectual property rights administered by

GESAC’s seventeen member societies, including SACEM,

Gesellschaft fur Musikalische Auffuhrungs und Mechanische

(‘‘“GEMA’’, Germany), Sociedad General de Autores de

Espana (‘‘SGAE’’, Spain), and The Performing Right Society

Ltd. (hereinafter ‘‘PRS’’).2 PRS’ interest in the decision

below is representative of the interest of each of the members

of GESAC.

PRS, a non-profit company founded in 1914, is the associ-

ation of lyricists, composers and music publishers for the

United Kingdom and the Republic of Ireland, as well as cer-

tain Commonwealth territories. Its purpose is to administer,

on behalf of its members, certain rights under copyright legis-

lation. Specifically, PRS licenses, throughout the world, the

1 SACEM was founded in 1851 to grant licenses and collect royalties

for the public performance of its members’ (composers, lyricists and

music publishers) works. SACEM served as a model for performing

rights societies throughout the world, including the United States.

Stanley Rothenberg, Copyright and Public Performance of Music 27-

28 (1954).

2 GESAC’s other members include: Societe des Auteurs dans les

Graphiques et Plastiques (‘‘ADAGP’’, France), Societe Hellenique

pour la Protection de la Propriete Intellectuelle (‘‘AEP!’’, Greece),

Het Bureau voor Muziek Auteursrecht (‘‘BUMA’’, The Netherlands),

Selskabet til Farvaltning af Internationale Komponistrettighederi i

Danmark (‘‘KODA’’, Denmark), Mechanical Copyright Protection

Society Limited (‘‘MCPS’’, United Kingdom), Societe representant la

Scandinavia (‘‘NCB’’, Denmark), Societe Belge des Auteurs, Compo-

siteurs et Editeurs (“‘SABAM’’, Belgium), Societe Civile des Auteurs

Multimedia (‘‘SCAM’’, France), Societe pour l’Administration du

Droit de Reproduction Mechanique des Auteurs, Compositeurs et Edi-

teurs (‘‘SSDRM’’, France), Societa Italiana Degli Autori ed Editori

(‘‘SIAE’”’, Italy), Sociedade Portuguesa de Autores (‘‘SPA’’, Portu-

gal), Stichting tot ultoefening en handhaving van mechanische repro-

duktierechten der auteurs (‘‘SSTERMA’’, The Netherlands), Museo

Espanol de Arte Contemporaneo (‘‘VISUAL’’, Spain).

public performance of the copyrighted musical works of its

members, collecting due payment for such performances—

directly in the United Kingdom and through affiliates and

agents elsewhere. That income, less overhead, is then distrib-

uted to its members.

Membership in PRS currently totals over 24,000, including

about 20,500 living composers and lyricists and nearly 2,500

publishers. Its writer-members have composed many of the

world’s best loved and most often performed works, includ-

ing pop songs and television and motion picture themes, as

well as serious music. Such works include, for example,

‘Yesterday’? (John Lennon/Paul McCartney), ‘“‘As Long As

He Needs Me’’ (Lionel Bart) (from the score of Oliver),

‘‘The First Time Ever 1 Saw Your Face’’ (Ewan MacColl),

and ‘(I Can’t Get No) Satisfaction’? (Mick Jagger/Keith

Richards). PRS music is consistently performed on American

radio and television. Through its affiliation with similar orga-

nizations overseas, including Broadcast Music, Inc. (herein-

after ‘‘BMI’’) and the American Society of Composers,

Authors and Publishers (hereinafter ‘‘ASCAP’’) in the

United States, PRS represents more than 750,000 copyright

owners world-wide.

The United Kingdom has been an adherent to the Berne

Convention for the Protection of Literary and Artistic Works

(hereinafter ‘‘Berne Convention’’) since 1887. Representatives

of PRS have participated in one capacity or another at virtu-

ally all of the major international copyright conferences lead-

ing up to the 1971 Paris text of the Berne Convention. The

other member societies of GESAC are also located in coun-

tries with a long affiliation with Berne.” GESAC has a great

interest in the preservation of harmony between United States

law and the law of other nations adhering to the Berne Con-

vention to assure the continued uniformly strong protection

of its members’ rights under copyright.

3 For example, France, Germany and Spain were founding members

of Berne. See Copyright: Monthly Review of The World Intellectual

Property Organization, Jan. 1992, at 6, 8.

That harmony is jeopardized by the decision below. For

example, currently in the United Kingdom, United States

composers receive remuneration for the public performance

of their works from establishments such as the ones at issue

here. If the decision below is allowed to remain in effect,

writers from the United Kingdom, indeed, writers from all

Berne Convention member nations, will be denied those com-

pensatory benefits in the United States which are consistently

conferred on their United States counterparts throughout the

Berne Convention member nations.

SUMMARY OF ARGUMENT

The Eighth Circuit rendered a decision which (i) creates a

conflict between United States law and the treaty obligations

of the United States under the Berne Convention for the Pro-

tection of Literary and Artistic Works, Oct. 31, 1988, S.

Treaty Doc. No. 99-27, 99th Cong., 2d Sess. (1986), 828

U.N.T.S. 221 and (ii) is in direct conflict with the Berne Con-

vention Implementation Act of 1988, Pub. L. 100-568, 102

Stat. 2853 (1988) (hereinafter ‘‘BCIA’’), the legislation

enacted by the United States Congress (hereinafter ‘‘Con-

gress’’) to ensure United States compliance with the terms of

the Berne Convention. Edison Bros. Stores, Inc. v. Broadcast

Music, Inc., 21 U.S.P.Q.2d (BNA) 1440 (8th Cir. 1992), peti-

tion for cert. filed (U.S. March 10, 1992).* In so doing, the

Eighth Circuit has deprived GESAC’s societies’ members,

including PRS’ members, of revenue in contravention of

United States obligations under the Berne Convention and

has jeopardized the position of the United States in the inter-

national intellectual property community, thereby harming

the United States in the context of its international trade

policy.

4 The Seventh Circuit reached a similar result in Broadcast Music, Inc.

v. Claire’s Boutiques, Inc., 949 F.2d 1482 (7th Cir. 1991), petition for

cert. filed, No. 91-1437 (U.S. March 10, 1992).

———a—————————— i

REASONS FOR GRANTING THE WRIT

INTRODUCTION

Section 110(5) provides a very narrow exemption to the

under section 106(4) of the 1976 Copyright Act. The Eighth

Circuit incorrectly expanded that exemption at the great

expense of music copyright owners throughout the Berne

Convention member countries. Jd. In light of the recent

adherence of the United States to the Berne Convention, “‘the

world’s premier multilateral copyright treaty’’, H.R. Rep.

No. 100-609, 100th Cong., 2d Sess. 7 (1988), such a split has

serious international consequences. The United States, the

world’s largest exporter of intellectual property, see Ralph

Oman, The United States and the Berne Union: An Extended

Courtship, 3 J.L. & Tech. 71, 110 (1988), is not in conform-

ity with the Berne Convention, less than three years after

becoming a signatory.

THE DECISION BELOW IMPROPERLY INTERFERES

WITH THE TREATY-MAKING POWERS OF THE

LEGISLATIVE AND EXECUTIVE BRANCHES

The decision below conflicts with both the Berne Conven-

tion and the BCIA. The Berne Convention gives authors the

exclusive right to authorize the public performance of their

works ‘‘by loudspeaker or any other analogous instrument.”’

Berne Convention, Oct. 31, 1988, art. 11 dis (1)Giii), S.

Treaty Doc. No. 99-27, 99th Cong., 2d Sess. 44, 828

U.N.T.S. at 243. Before enacting the BCIA, Congress deter-

mined that the exclusive right of public performance under

the 1976 Copyright Act, which at that time was subject only

to a narrow ‘‘small business’? exemption, was in conformity

with the Berne Convention. The Eighth Circuit unjustifiably

expanded that exemption to include a nationwide business

with annual revenues of a billion dollars from its 2,000 retail

stores, each with its own unlicensed radio. See Edison Bros.,

21 U.S.P.Q.2d at 1441. It is therefore imperative that certio-

rari be granted in this case.

A. The Decision Below Contravenes The Berne Convention

Article 11 bis (1)(iii) of the 1971 Paris text’ of the Berne

Convention provides that ‘‘[aJuthors of literary and artistic

works shall enjoy the exclusive right of authorizing . . . the

public communication by loudspeaker or any other analogous

instrument transmitting, by signs, sounds or images, the

broadcast of the work.’’ Berne Convention, Oct. 31, 1988,

art. 11 dis (1)(iii), S. Treaty Doc. No. 99-27, 99th Cong., 2d

Sess. 44, 828 U.N.T.S. at 243. Article 11 bis (1)(iii) first

appeared in the 1948 Brussels text, at a time when broadcast-

ing had become increasingly important, and had received a

far-from-uniform approach under national laws. Sam Ricket-

son, The Berne Convention for the Protection of Literary

and Artistic Works: 1886-1986 452 (1987) [hereinafter Ricket-

son].° While the broadcast of works in places such as cin-

emas, restaurants and tearooms was discussed, the drafters

were most concerned with the broadcast of works in places

‘twhere people worked and conducted their business, such as

factories, shops and offices.’’ Jd. at 453. Similar concerns

still exist today. The World Intellectual Property Organiza-

tion, the secretariat to the Berne Convention, addresses these

concerns by offering the following interpretation of Article

11 bis (1)(iii):

[T]he third case dealt with in this paragraph is that in

which the work which has been broadcast is publicly

communicated e.g., by loudspeaker or otherwise, to the

5 The Berne Convention was drafted at an international conference in

Berne, Switzerland in 1885. It was signed by eight nations the follow-

ing year. Since then, the Convention has been revised five times. With

each successive text, the Convention has increased the rights accorded

authors and copyright proprietors. The Paris text was drafted in 1971.

It is the only version of the Convention now open to accession. H.R.

Rep. No. 100-609, 100th Cong., 2d Sess. 12-13 (1988).

6 Professor Ricketson is the Sir Keith Aickin Professor of Company

Law at Monash University in Melbourne, Australia.

public. The case is becoming more common. In places

where people gather (cafes, restaurants, tearooms,

hotels, large shops, trains, aircraft, etc.) the practice is

growing of providing broadcast programmes. . - . The

question is whether the license given by the author to the

broadcasting station covers, in addition, all the use

made of the broadcast, which may or may not be for

commercial ends.

The Convention’s answer is ‘‘no.”’

World Intellectual Property Organization, Guide to the Berne

Convention for the Protection of Literary and Artistic Works

(Paris Act 1971) 68 (1978).

Article 11 bis (2) of the Berne Convention states that the

national laws which regulate the ‘‘conditions’’ under which

the provisions set forth in paragraph (1) may be exercised

may not be prejudicial to the right of the author ‘‘to obtain

equitable remuneration which, in the absence of agreement,

shall be fixed by competent authority.’’ Berne Convention,

Oct. 31, 1988, art. 11 bis (2), S. Treaty Doc. No. 99-27, 99th

Cong., 2d Sess. 44, 828 U.N.T.S. at 243. According to Rick-

etson, the power to impose ‘‘conditions’’ on the exercise of

rights does not carry with it the power to deny those rights.

Ricketson at 525. In fact, the reference to ‘‘conditions’’ is

usually taken to refer to the imposition of compulsory

licenses,’ with the form of those licenses determined by

national legislation. Jd. However, whatever form the compul-

sory license takes, the license ‘‘is not to be prejudicial to the

right of the author to obtain equitable remuneration.’”’ Jd. at

527; see also Antony Jennings, Cables and Satellites, 11

Colum.-VLA J.L. & Arts 129, 137 (1986). In clear violation

of Article 11 bis (2), the Eighth Circuit has expanded the sec-

tion 110(5) exemption to force the author to, in effect, grant

7 Compulsory licensing refers to uses authorized by statute, rather

than by the copyright owner, subject to compensation to the copyright

owner at a fee fixed by the legislature. See, e.g., 17 U.S.C. § 115 (com-

pulsory license under the 1976 Copyright Act for making and distribut-

ing phonorecords).

a gratuitous license rather than a compulsory license for some

fixed compensation.

Article 11 bis (2) is applicable whenever the public com-

munication is by loudspeaker or any other analogous instru-

ment. Respondent’s use of radio receivers in over 2,000 stores

is such a communication. Such use is clearly beyond that

which is authorized by Article 11 bis (1)(iii), and therefore

requires equitable remuneration under Article 11 bis (2).

B. The Decision Below Contravenes The Berne Convention

Implementation Act

The United States became a signatory to the Berne Con-

vention on March 1, 1989. In October of 1988, Congress

enacted the BCIA, which amends the 1976 Copyright Act to

implement United States adherence to the Berne Convention.

In section 2(3) of that Act, Congress expressly declared that

[t]he amendments made by [the BCIA], together with

the law as it exists on the date of the enactment of this

Act, satisfy the obligations of the United States in

adhering to the Berne Convention and no further rights

or interests shall be recognized or created for that pur-

pose.

Berne Convention Implementation Act of 1988, § 2(3), Pub.

L. 100-568, 102 Stat. 2853 (1988) (amending 17 U.S.C.

§§ 101-810) (emphasis added).

Congress thereby established that the law of the United

States under the 1976 Copyright Act (as amended by the

BCIA) satisfied the United States obligations under the Berne

Convention. Until the decision below, the laws of the United

States, both statutes and case law, conformed to and did not

contradict the exclusive right under Article 11 bis (1)(iii) to

authorize public communication through a loudspeaker. The

decision below violates the policy declared by Congress as it

fails to follow United States case law ante-dating the BCIA

and complying with the Berne Convention.

C. The Case Law Preceding The Decision Below Represents

Congress’ Intent And Policy Under The BCIA

Section 110(5) of the 1976 Copyright Act provides a nar-

row exemption to the author’s exclusive right of public com-

munication. That section states that the following kind of

public communication is not an infringement of copyright:

communication of a transmission embodying a perform-

ance or display of a work by the public reception of the

transmission on a single receiving apparatus of a kind

commonly used in private homes, unless—

(A) a direct charge is made to see or hear the transmis-

sion; or

(B) the transmission thus received is further transmitted

to the public[.]

17 U.S.C. § 110(5).

Section 110(5) represents the legislative response to this

Court’s decision in Twentieth Century Music Corp. v. Aiken,

422 U.S. 151 (1975). In that case, the defendant owned and

operated a small fast-food restaurant. The restaurant had a

radio which the defendant played throughout the business

day through four speakers in the ceiling. Lacking any per-

forming rights license, the restaurant was sued for copyright

infringement by two members of ASCAP. The defendant lost

in the district court, won a reversal in the Third Circuit

Court of Appeals, and prevailed in this Court by a margin of

seven to two. That result in Aiken was embodied as a narrow

exception to the exclusive performance right in the 1976

(enacted one year after Aiken) states:

[T]he Committee considers [the Aiken] fact situation to

represent the outer limit of the exemption, and believes

that the line should be drawn at that point. Thus, the

clause would exempt small commercial establishments

whose proprietors merely bring onto their premises stan-

dard radio or television equipment and turn it on for

their customers’ enjoyment.

H.R. Rep. No. 94-1476, 94th Cong., 2d Sess. 87 (1976),

reprinted in 1976 U.S.C.C.A.N. 5659, 5701 (emphasis

added).

1. Gap Stores And United States Shoe Were The Estab-

lished Law Under Section 110(5) At The Time The

BCIA Was Enacted

From the date of enactment of section 110(5) until the date

of United States adherence to the Berne Convention, federal

courts almost invariably followed Congress’ mandate that

Aiken be the ‘‘outer limit of the exemption.’”

The Second Circuit’s 1981 decision in Sailor Music v. The

Gap Stores, Inc., 668 F.2d 84 (2d Cir. 1981), cert. denied,

456 U.S. 945 (1982) was the first appellate decision to discuss

the scope of section 110(5). There, The Gap, a chain of 420

retail clothing stores was sued for acts of copyright infringe-

ment based on the use of music from a radio receiver at two

specified stores. The district court, relying heavily on the

House Report, concluded that Congress did not intend to

exempt The Gap from copyright liability. 516 F. Supp. 923,

925 (S.D.N.Y. 1981). Finding that the size of The Gap’s

operation was dispositive, the court refused to allow The Gap

the benefits of the Section 110(5) exemption. Jd. On appeal,

8 The Eighth Circuit refused to consider the clear congressional man-

date concerning the scope of section 110(5), Edison Bros., 21

U.S.P.Q.2d at 1444-45, notwithstanding this Court’s recurring reliance

on legislative history in the copyright arena. See, e.g., Stewart v.

Abend, 495 U.S. 207, 110 S.Ct. 1750, 1758, 1763 (1990) (renewal

rights); Harper & Row, Publishers, Inc. v. Nation Enters., 471 U.S.

$39, 549, 553-54, 568 (1985) (fair use); Capital Cities Cable, Inc. v.

Crisp, 467 U.S. 691, 709-11 n.15 (1984) (compulsory licensing); Sony

Corp. of America v. Universal City Studios, Inc., 464 U.S. 417, 447

n.29, reh’g denied, 465 U.S. 1112 (1984) (fair use). Indeed, the Eighth

Circuit itself has relied on legislative history in interpreting this very

section of the 1976 Copyright Act. See National Football League v.

McBee & Bruno’s, Inc., 792 F.2d 726, 730-31 (8th Cir. 1986).

the Second Circuit affirmed the district court’s decision. 668

F.2d 84 (2d Cir. 1981). Focusing on both the size of The

Gap’s operation and its ability to pay for the use of copy-

righted music, the court found the store to exceed Aiken’s

“outer limit’’. Jd. at 86. The Second Circuit therefore con-

cluded that The Gap Stores ‘‘had made infringing use of

appellee’s copyrighted works.’” Id.

The Ninth Circuit applied similar reasoning in Broadcast

Music, Inc. v. United States Shoe Corp., 678 F. 2d 816 (9th

Cir. 1982). In that case, the court found that the music

broadcast in defendant’s chain of more than 600 women’s

apparel stores, fell outside of the section 110(5) exemption.

Citing to the ‘‘careful and well-reasoned opinion’’ of Gap

Stores, the court held that ‘‘the size and nature of the opera-

tion justifies the use of a commercial background music sys-

tem.”’ Jd. at 817. The United States Shoe court thus affirmed

the lower court’s award of summary judgment for BMI, find-

ing that appellants infringed the exclusive right of public per-

formance. Jd. at 817-18.

In addition to Gap Stores and United States Shoe, virtually

every other case decided since the enactment of the 1976

Berne Convention followed the mandate of the House Report

and ruled that the section 110(5) exemption is not available to

businesses financially capable of paying normal copyright

licensing fees for their use of music. See Merrill v. Bill Mill-

er’s Bar-B-Q Enters., Inc., 688 F. Supp. 1172, 1176 (W.D.

Tex. 1988) (‘‘it is clearly ‘practical’ for a chain of restau-

rants, each. . . grossing well over $500,000 annually, to sub-

scribe to a commercial background music service.’’); Merrill

v. County Stores, Inc., 669 F. Supp. 1164, 1170 (D.N.H.

1987) (‘‘defendants’ $2.5 million in annual retail sales justi-

fies subscription to a commercial background music sys-

tem.’’); Lamminations Music v. P & X Markets, Inc., 1985

1985) (finding infringement because defendant’s operation

consisted of a chain of grocery stores).”

Indeed, when this Court wants to know the intent of Con-

gress in respect of legislation concerning existing copyright

case law, it looks to the House Report. For example, in the

discussion of joint works of authorship in the legislative his-

tory of the 1976 Copyright Act, Congress expressly states

that there is ‘‘no need for a specific statutory provision con-

cerning the rights and duties of the coowners [sic] of a work;

court-made law on this point is left undisturbed.’’ H.R. Rep.

No. 94-1476, 94th Cong., 2d Sess. 121 (1976), reprinted in

1976 U.S.C.C.A.N. 5659, 5736. Both this Court (and the

Ninth Circuit) have noted and respected this express congres-

sional declaration. See Community for Creative Non-Violence

v. Reid, 490 U.S. 730, 749 n.15 (1989) (in framing certain

provisions of the 1976 Copyright Act, ‘‘Congress indicated

when it intended to incorporate existing case law.’’) (citing

H.R. Rep. No. 94-1476, 94th Cong., 2d Sess. 121 (1976));

Dumas v. Gommerman, 865 F.2d 1093, 1102 (9th Cir. 1989)

(‘‘[w]here the drafters of the 1976 Act intended to include

existing law, they stated that intention clearly.’’) (citing H.R.

Rep. No. 94-1476, 94th Cong., 2d Sess. 121 (1976)).

Similar to the description of the rights of co-owners in

joint works, in describing the exemption to the exclusive right

of public performance, the House Report refers to and incor-

porates existing case law (i.e., Aiken) as the outer limit to

this exemption. Moreover, BCIA section 2(3) states that its

amendments to the 1976 Copyright Act, together with exist-

ing law, satisfy the obligations of the United States in adher-

ing to the Berne Convention. Berne Convention

Implementation Act of 1988, § 2(3), Pub. L. 100-568, 102

Stat. 2853 (1988). Nevertheless, the Eighth Circuit ignores

these declarations in respect of section 110(5), repudiating

9 The following cases also based their findings of infringement on the

defendants’ ability-to-pay, but were decided after the United States

adhered to the Berne Convention: Hickory Grove Music v. Andrews,

749 F. Supp. 1031, 1038 (D. Mont. 1990); Crabshaw Music v. K-Bob’s

of El Paso, Inc., 744 F. Supp. 763, 767 (W.D. Tex. 1990).

Gap Stores and United States Shoe and gratuitously expand-

ing the Aiken exemption. In so doing, the Eighth Circuit

ignores express congressional intent that such existing case

law become statutory law.

2. The Decision Below Improperly Diminishes Rights

That Congress Intended To Preserve

As noted above, Congress expressly declared in section 2(3)

of the BCIA that:

[t]he amendments made by [the BCIA], together with

the law as it exists on the date of the enactment of this

Act, satisfy the obligations of the United States in

adhering to the Berne Convention and no further rights

or interests shall be recognized or created for that pur-

pose.

Berne Convention Implementation Act of 1988, § 2(3), Pub.

L. 100-568, 102 Stat. 2853 (1988) (emphasis added).

When Congress enacts a statute which, like the BCIA, is

intended

to bring the United States into compliance with interna-

tional law, and when those obligations are reaffirmed by

treaty, a court must give careful consideration before it

sets aside that which the legislative and executive

branches have deemed necessary to fulfill the nation’s

international responsibilities. It [is] quite improper for

the judiciary to disregard international obligations that

are inseparable from our nationhood.

Finzer v. Barry, 798 F.2d 1450, 1460 (D.C. Cir. 1986), aff’d

in part, rev’d in part sub nom., Boos v. Barry, 485 U.S. 312

(1988); see also United States v. Muench, 694 F.2d 28, 32 (2d

Cir. 1982), cert. denied, 461 U.S. 908 (1983) (in interpreting

obligations of the Convention on Psychotropic Substances,

an international treaty which is expressly not self-executing,

the court stated that where Congress has declared that United

States drug laws are intended to meet the nation’s duties

under an international treaty, ‘‘[iJt would be absurd to ignore

Congress’ expressed intent. . . .’’); United States v. Elder,

601 F. Supp. 1574, 1581 (S.D. Tex. 1985) (‘‘[t]he Court can-

not interfere with political decisions which the United States

as a sovereign nation chooses to make in the interpretation’”’

of treaty commitments).

The Eighth Circuit in the instant case has improperly disre-

garded the congressional declaration of the treaty obligations

of the United States under the Berne Convention, carving out

an expanded exemption to an author’s exclusive right of pub-

lic performance. Edison Bros., 21 U.S.P.Q.2d at 1446. No

logical reading of the Berne Convention and the BCIA would

permit a nationwide chain of 2,000 retail stores with annual

revenues of a billion dollars to benefit from the ‘‘small busi-

ness’? exemption to the right of public performance. Thus,

the Eighth Circuit’s substantial expansion of the public per-

formance exemption does more than just uproot an estab-

lished line of federal copyright cases; it flouts a congressional

declaration regarding international treaty interpretation.

D. Congress Knew Of And Relied On Gap Stores And

United States Shoe In Adhering To The Berne Conven-

tion

It is a well-settled principle that Congress is presumed to be

knowledgeable about existing case law pertaining to the legis-

lation it enacts. See Goodyear Atomic Corp. v. Miller, 486

U.S. 174, 184-85 (1988); Director, Office of Workers’ Com-

pensation Programs v. Perini North River Assocs., 459 U.S.

297, 319 (1983) (citation omitted); Cannon v. University of

Chicago, 441 U.S. 677, 696-97 (1979). In fact, in respect of

Gap Stores and United States Shoe, such a presumption is

reinforced by the citation to and reliance upon both decisions

by Congress’ advisory committee on adherence to the Berne

Convention.

In 1985, at the request of the State Department, a group of

individuals known as the ‘‘Ad Hoc Working Group on U.S.

Adherence to the Berne Convention’’ (hereinafter the ‘‘Ad

eee

Hoc Working Group’’)"® joined together to identify provi-

sions of United States law relevant to the Berne Convention

and to analyze the compatibility of those provisions with the

Berne Convention. H.R. Rep. No. 100-609, 100th Cong., 2d

Sess. 7 (1988). The Ad Hoc Working Group’s mandate was

to report to Congress and the Executive Branch on these mat-

ters, enabling them to give informed consideration to United

States adherence to the Berne Convention. Final Report of

the Ad Hoc Working Group on U.S. Adherence to the Berne

Convention, reprinted in 10 Colum.-VLA J.L. & Arts 513,

514 (1986).

In its Final Report, the Ad Hoc Working Group cited both

Gap Stores and United States Shoe to support its finding that

section 110(5) was compatible with the requirements of

Article 11 bis of the Berne Convention on public perform-

ance rights. Jd. at 529 n.23. Congress relied heavily upon the

findings of the Ad Hoc Working Group, and cites to its Final

Report throughout the House Report on the BCIA. See H.R.

Rep. 100-609, 100th Cong., 2d Sess. (1988) 8 n.5, 31 nn.49 &

57, 32 n.59, 34 n.67, 37 nn.85 & 87, 38 nn.88 & 90, 41 nn.95

& 96, 43 n.101, 47 n.109, 49 nn.114 & 116, 51 n.121]a.

Thus, it is evident that Congress was aware of Gap Stores

and United States Shoe and, in the complete absence of any

case law to the contrary, may be presumed to have relied on

those cases when it stated ‘‘[t]he amendments made by this

Act, together with the law as it exists on the date of the

enactment of this Act, satisfy the obligations of the United

States in adhering to the Berne Convention. .. .’’ Berne

Convention Implementation Act of 1988, § 2(3), Pub. L. 100-

568, 102 Stat. 2853 (1988) (emphasis added).

10 The Ad Hoc Working Group included such nationally recognized

America, and Jon A. Baumgarten, counsel to the Association of

American Publishers, and former General Counsel of the United States

E. The Decision Below Improperly Puts United States Law

At Odds With That Of Other Berne Convention Member

Nations, Contrary To Congress’ Intent

The Eighth Circuit’s holding also brings the United States

into a state of disharmony with other member nations’ inter-

pretations of Article 11 bis (1)(iii). Writers from all Berne

Convention member nations will be denied those compensa-

tory benefits in the United States which are consistently con-

ferred on United States writers throughout the Berne

Convention member nations. In its decision to adhere to the

Berne Convention, Congress recognized the importance of

international uniformity in copyright interpretation. Through

its actions and express language, Congress emphasized that

the objective of the Berne Union is the ‘‘development of the

‘effective and harmonious’ copyright laws among all

nations.”’ H.R. Rep No. 100-609, 100th Cong., 2d Sess., at

20 (1988).

Before acceding to the Berne Convention, members of the

Senate Committee on the Judiciary travelled to Geneva,

Switzerland and Paris, France to consult with experts on for-

eign copyright and discuss what statutory changes Congress

would have to make to conform the 1976 Copyright Act to

the Berne Convention. Jd. at 9. The trip was the first time

the United States ever requested foreign consultation on

domestic legislation required to join an international intellec-

tual property treaty. Jd. Lamentably, the congressional objec-

tive of international harmony under the Berne Convention

has been undermined by the Eighth Circuit. If the Eighth

Circuit’s holding is allowed to stand, the United States will

be alone in maintaining a radically broad exemption to the

author’s exclusive right to authorize public performance.

Where uniformity in the international arena is sought, the

opinions of ‘“‘sister signatories [are] entitled to considerable

weight.’’ Air France v. Saks, 470 U.S. 392, 405 (1985) (citing

Benjamins v. British European Airways, 572 F.2d 913, 919

(2d Cir. 1978), cert. denied, 439 U.S. 1114 (1979) (realizing

the importance of international uniformity in interpreting

Articles of the Warsaw Convention). In addition, ‘‘[iJt is

accepted judicial practice to construe away apparent ambigui-

ties or gaps in implementing legislation by referring to overall

treaty principles and policies.”’ Paul E. Geller, Copyright

Protection in the Berne Union: Analyzing the Issues, 13

Colum.-VLA J.L. & Arts 435, 472 (1989) (citing Rickless v.

United Artists Corp., [1987] F.S.R. 362, 371 (British court

construing the U.K. Performers’ Protection Act, 1963 to

grant a private right of action in light of the Rome Conven-

tion); CAPAC, Ltd. v. CTV Television Network, Ltd.,

[1968] S.C.R. 676 (Canadian court referring to Berne texts

appended to the Canadian Copyright Act as interpretive

aids)). Thus, this Court should consider member nations’

obligations in respect of the public performance right.

Berne member nations permit only narrow exemptions to

the author’s exclusive right to authorize public performance.

The performance of a work is exempt from the author’s

exclusive right of authorization when it is done in private. A

number of the courts of member nations have required that,

for a performance to be private and thus immune from the

author’s exclusive right, there should be a ‘‘familial inti-

macy’’ among those attending the performance. See M. Nim-

mer & P. Geller, International Copyright Law and Practice

§ 8[1][d], at BEL-28 (1991).'' For example, in The Nether-

lands, the private performance exemption is a very limited

one, with the ‘‘private circle’ consisting of relatives or

friends or persons who may be assimilated to relatives or

friends. Jd. at § 8[2][b], at NETH-63."* Thus, the Supreme

Court of The Netherlands held that a cafe owner who oper-

ated a radio receiver with a loudspeaker on his premises,

which were accessible to the public, infringed on the author’s

11 Jan Corbet, Professor and Faculty of Law at the Free University of

Brussels authored the Belgium chapter of Jnternational Copyright Law

and Practice.

12 Herman Cohen Jehoram, Professor of Intellectual Property and

Information Law at the University of Amsterdam authored The Neth-

erlands chapter of International Copyright Law and Practice.

exclusive right to public performance. Jd. at § 8[l][e], at

NETH-60 (citation omitted).

Similarly, in Sweden, ‘‘public’’ rather than private per-

formance occurs if the work leaves the ‘‘circle of the author,

his closest family, and friends.’’ Jd. at § 8[1][d], at SWE-

35.'° In France, only performances which occur in the ‘‘fam-

ily circle’? are exempt from royalty payments. Jd. at

§ 8[b]}[2][a], at FRA-113-14 (quoting the Law of Copyright of

March 1957, art. 41.1).'* And in the United Kingdom, any

performance which is not domestic (within one’s home) or

“‘quasi domestic’’, a narrowly interpreted category, will be

deemed public. Jd. at § 8[1][a][iii], at U.King-56.'° Thus, the

author’s exclusive right of public performance in Berne mem-

ber countries is quite thorough, and only in rare instances

will a third-party’s use of a broadcast of an author’s work

not entitle the author to remuneration.

As the foregoing qualified commentators have shown,

member nations have not diminished the author’s exclusive

right of public performance to the drastic extent of the court

below. The Eighth Circuit’s overexpansion of the sharply lim-

ited congressional exemption to the exclusive right of public

performance not only ignores clearly stated congressional

intent, but violates the obligations of the United States, and

puts the United States out of harmony with its sister Berne

Signatories in respect of United States obligations in adher-

ence to the Berne Convention. Accordingly, the Eighth Cir-

cuit’s decision should not be allowed to stand.

13 Dr. Gunnar Karnell, Professor at the Stockholm School of Eco-

nomics, authored the Sweden chapter of Jnternational Copyright Law

and Practice.

14 Robert Plaisant, Professor Emeritus, Faculty of Law, University of

Le Mans, authored the cited portions of the France chapter of Jnterna-

tional Copyright Law and Practice.

15 William R. Cornish, Professor of Law at the University of Cam-

bridge, and External Scientific Member of the Max Planck Institute

for Foreign and International Patent, Copyright, and Competition

Law, Munich, authored the United Kingdom chapter of Jnternational

Succinctly, for more than a century, this Court has held

that the judiciary must defer to the treaty-making and enforc-

ing branches of government in the interpretation of United

States treaty commitments. See Sumitomo Shoji America,

Inc. v. Avagliano, 457 U.S. 176, 185-86 (1982); Kolovrat v.

Oregon, 366 U.S. 187, 194 (1961); Chae Chan Ping v. United

States, 130 U.S. 581, 602 (1889). In the decision below, the

Eighth Circuit contravened this long-standing tenet of treaty

construction by setting aside a determination by both the

executive and legislative branches regarding the obligations of

the United States under the Berne Convention. Edison Bros.,

21 U.S.P.Q.2d at 1446.

Congress decided to adhere to the Berne Convention in

order to protect United States interests in the international

righted material, Congress regarded United States participa-

tion in the Berne Convention as ‘‘essential’’. S. Rep. No.

100-352, 100th Cong., 2d Sess. 4 (1988), reprinted in 1988

U.S.C.C.A.N. 3706, 3709. The House Report on the BCIA

states:

the relationship of Berne adherence to promotion of

U.S. trade is clear. American popular culture and infor-

mation products have become precious export commodi-

ties of immense economic value. That value is badly

eroded by low international copyright standards. Berne

standards are both high, reasonable and widely accepted

internationally. Lending our prestige and power to the

international credibility of those standards will promote

development of acceptable copyright regimes in bilateral

and multilateral contexts.

H.R. Rep. No. 100-609, 100th Cong., 2d Sess. 19-20 (1988).

Congress concluded that a strong international legal regime

would develop as a result of United States adherence to the

Berne Convention, benefiting not only proprietary interests

but also the public good. Jd.

Prior to accession, representatives from the United States

had attended Berne-related conferences, but only as private

observers, Outsiders without any direct voice or influence on

the outcome of the deliberations. S. Rep. No. 100-352, 100th

Cong., 2d Sess. 4, reprinted in 1988 U.S.C.C.A.N. at 3709

(quoting Barbara Ringer, The Role of the United States in

International Copyright—Past and Future, 56 Geo. L.J.

1050, 1070 (1968)). Congress believed that adherence to the

Berne Convention would give the United States a meaningful

voice in the development of international copyright, allowing

the United States to participate fully in the administration

and management of the Convention. S. Rep. No. 100-352,

100th Cong., 2d Sess. 4, reprinted in 1988 U.S.C.C.A.N. at

3709. United States court decisions deviating from the Berne

Convention jeopardize these goals.

CONCLUSION

For the foregoing reasons, a writ of certiorari should be

granted and the decision of the Court of Appeals should be

reversed.

Dated: April 7, 1992

Respectfully submitted,

By: /s/ STANLEY ROTHENBERG

Stanley Rothenberg

Counsel of Record

David Rabinowitz

Helene Godin

MOSES & SINGER

1271 Avenue of the Americas

New York, New York 10020

(212) 246-3700

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