# Amicus Curiae Brief — Goldstein v. California > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386414_0167%3A07 ## Record - **Collection:** Supreme Court brief - **Document type:** Amicus Curiae Brief - **Published:** January 1, 1973 - **Citation:** 412 U.S. 546 ## Text In THE Supreme Court of the United States Octoser Term, 1971 No. 71-1192 ——_ MOTION OF RECORDING INDUSTRY ASSOCIATION OF AMERICA, INC. FOR LEAVE TO FILE BRIEF AMICUS CURIAE The Recording Industry Association of America, Ine. (“RIAA”) hereby respectfully moves for leave to file the attached brief amicus curiae. Counsel for respondent has consented to the filing of this brief, but counsel for peti- tioners has declined to consent.* — * The letter from counsel for respondent giving consent to the filing of this brief is on file with the Clerk of this Court. The letter m counsel for petitioners also is on file. . Se 1 tee me arene. Pm aie = The Interest’ of the Amicus Curiae RIAA is a non-profit New York corporation, whose mem- bership consists of sound recording companies which to- gether account for close to 90% of all authorized phono- graph records and prerecorded tapes manufactured and sold in the United States. Among RIAA’s basic purposes is the representation of its membership before legislative, regulatory and judicial bodies with respect to federal, state and local legislation and regulations affecting the entire sound recording industry. RIAA has urged the adoption of state legislation de- signed to eliminate the manufacture and sale of unauthor- ized duplications of sound recordings, including Section 653h of California’s Penal Code which is under attack in the instant case. RIAA also has been active in representing the sound recording industry before the Congress of the United States. The testimony and detailed information provided to Congress by RIAA were instrumental in the passage of Public Law No. 92-140, 85 Stat. 391 (October ' 15, 1971), which provides federal statutory copyright pro- tection for sound recordings made after February 15, 1972. RIAA’s status as an appropriate representative of the sound recording industry was specifically recognized by the granting of its motion to intervene as a defendant in the case of Shaab v. Kleindienst, 174 U.S.P.Q. 197 (D.D.C. 1972),** which upheld the constitutionality of Public Law No. 92-140. * The Membership List of RIAA is set forth as Appendix A to the Brief annexed hereto. ** The report of this case in the advance sheets contains an error in the name of RIAA and also identifies it incorrectly as an amicus curiae instead of an intervenor-defendant. - eg 3 Thus, RIAA is intimately acquainted with the legislative history and purposes of the state statute which petitioners assert is incompatible with federal copyright policy, and also of the federal act which petitioners claim has a pre- emptive effect. It also has developed an extensive knowl- edge of the economics of the industry and the working operations of the pirates. While the respondent has a specific interest in upholding the validity of the statute under which petitioners pleaded nolo contendere, RIAA represents the broader interests of the sound recording industry. These broader interests are intimately involved in this case, because a decision that See- tion 653h of the California Penal Code is unconstitutional would, by implication, invalidate all state law in this area, both civil and criminal. The result would be to permit the unrestricted duplication of the vast majority of sound re- cordings now in existence. These sound recordings, which constitute the very life blood of RIAA’s members, have been protected in an almost unbroken line of decisions for “well over half a century. Such a decision would have a direct and devastating impact upon the members of RIAA, as well as on many other individuals and enterprises con- nected with the production and sale of sound recordings. Accordingly, because of its extensive knowledge of and direct interest in the issue presented for decision in this case, RIAA requests permission to file the attached brief amicus curiae in support of respondent herein. Respectfully submitted, Siwyey A. Diamonp 425 Park Avenue New York, New York 10022 wi (212) PL 9-8400 Y Ernest S. Meyers 74 Trinity Place New York, New York 10006 (212) HA 2-0081 Counsel for Recording Industry Association of America, Inc., Amicus Curiae > Dated: New York, New York September 20, 1972 To: a ArtTHuR LEEDS Paut T. Locke DanieEt M. Gorr.ies 9229 Sunset Boulevard Suite 306 Los Angeles, California 90069 (213) 278-3232 Counsel for Petitioners Roger ARNEBERGH : Davi M. ScHacter © Steven A. ScHWABEP 205 South Broadway Suite 500 Los Angeles, California 90012 (213) 485-5483 Counsel for Respondent cat IN THE Supreme Court of the Hnited States OcroBer TERM, 1971 No. 71-1192 —<>— DonaLD GoupsTeIn, RutH Koven and DonaLp Koven, Petitioners, —against— State or CaLirorNi, Respondent. ON WRIT OF CERTIORARI TO THE APPELLATE DEPARTMENT OF THE SUPERIOR COURT OF THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA po BRIEF OF RECORDING INDUSTRY ASSOCIATION OF AMERICA, INC., AMICUS CURIAE Siwney A. Diamonp 425 Park Avenue New York, New York 10022 (212) PL 9-8400 Ernest S. MEYERS 74 Trinity Place New York, New York 10006 (212) HA 2-0081 Counsel for Recording Industry Association of America, Inc., Amicus Curiae Kaye, ScHouer, FIERMAN, Hays & HanpLER David Goldberg William M. Borchard Ronald S. Kadden Laporte & MEYERS Of Counsel ———————— mets? PPT RE RR OTE eR mer eS A. The Interest of the Amiicus Curiae B. Summary of Argument .. C. Factual Background ... I. The Sound Recordiing Industry II. The Production of Sound Recordings ................ III. The Operation of Rtecord and Tape Pirates .... 10 ‘D. Argument I. IT. ITT. INDEX Reversal of the Judigment Below Would Have the Effect of Owerturning Long-Standing Principles of State Law on Which the Owner- ship of Sound Recordings Is Based, In- cluding Various Recent Decisions Distin- guishing Sears amd Compco. The Conse- quences to the Recording Industry Would Be Disastrous. No Overriding Considerations of Public Policy Comprel Such a Result. States Can Protect Sound Récordings Under Unfair Competition Principles. States Also Can Protect Sound Recordings Under Common Law Copyright Principles. .... The Sears and Compco Cases Are Distin- guishable. 17 17 24 29 38 li PAGE V. The California Statute Is a Proper Exercise of the State Interest in Punishing Conduct Equivalent to Larceny. 42 E. Conclusion 45 Appenpix A—Recording Industry Association of America, Inc., Membership List .............. 1-A APPENDIX B—Glossary 1-B AUTHORITIES CITED : CasEs A&M Records v. Northwest, Inc., (Ore. Cir. Ct.), in Casx Box, Sept. 2, 1972, at 7 22n Aeolian Co. v. Royal Music Roll Co., 196 F. 926 (W.D. N.Y. 1912) 2in Alfred Bell & Co. v. Catalda Fine Arts, Inc., 191 F.2d 99 (2d Cir. 1951) , 38n American Visuals Corp. v. Holland, 239 F.2d 740 (2d Cir. 1956) 32n Artia v. Colosseum Records, Inc., 150 F. Supp. 550 (S.D.N.Y. 1957) 21n Atlantic Recording Corp. v. Magnitron, Inc., No. 72 CH 3431 (Ill. Cir. Ct., Jun. 13, 1972) ... 22n Atlantic Recording Corp. v. Superba Tapes, Inc., No. 995811 (Cal. Super. Ct., Feb. 19, 1971) 21n Baez v. Fantasy Records, Inc., 144 U.S.P.Q. 537 (Cal. Super. Ct., 1964) 2in Baker v. Selden, 101 U.S. 99 (1879) 38n Bond Buyer v. Dealers Digest Publishing Co., 25 App. Div. 2d 158, 267 N.Y.S. 2d 944 (1st Dept. 1966) .......... 27n \ a PAGE California v. Zook, 336 U.S. 725 (1949) .. 48n Capitol Records, Inc. v. Campoy, No. 191454 (Cal. Super. Ct., Aug. 28, 1967) 22n Capitol Records, Inc. v. Erickson, 2 Cal. App. 3d 526, 82 Cal. Rptr. 798 (1969), cert. denied, 398 U.S. 960 (1970) 15n, 21n, 40n Capitol Records, Ine. v. Greatest Records, Inc., 43 Mise. 2d 878, 252 N.Y.S. 2d 553 (Sup. Ct. 1964) ..22n, 32n Capitol Records, Ine. v. Hollywood Music Program- mers, Inc., No. 944640 (Cal. Super. Ct., Dee. a, 1968) 21n Capitol Records, Inc. v. International Tape, Inec., No. 72 CH 301 (Ill. Cir. Ct. Feb. 23, 1972) = Capitol Records, Inc. v. MeGettigan, No. 359-225 (Ore. Cir. Ct., June 21, 1971) 22n Capitol Records, Inc. v. Mercury Records Corp., 221 : F.2d 657 (2d Cir. 1955) 21n, 30n, 32n : Capitol Records, Inc. v. Muntz, (Cal. Super. Ct.), in - Brtpoarp, Mar. 7, 1970 2in Capitol Records, Inc. v. Schaak Electronics, Ine., No. 671559 (Minn. Dist. Ct., Jul. 21, 197 1) 22n Capitol Records, Ine. v. Spies, 130 Ill. App. 2d 429, 264 N.E. 2d 874 (1970) 9n, 23n, 40n Capitol Records, Ine. v. Winokur, (Cal. Super. Ct. hi in _ Bazpoarp, Mar. 7, 1970 21n CBS, Ine. v. Cartridge City, Ltd., (N.Y. Sup. Ct. yin 155 N.Y.L.J. 113, at 10 (1966) 22n CBS, Ine. v. Custom Recording Co., S.C. , 189 S.E. 2d 305 (1972) 23n CBS, Inc. v. DeCosta, 377 F.2d 315 (1st Cir.), cert. denied, 389 U.S. 1007 (1967) 27n iv PAGE CBS, Inc. v. Documentaries Unlimited, Inc., 42 Mise. 2d 723, 248 N.Y.S. 2d 809 (Sup. Ct. 1964) 00000... 27n, 30n CBS, Inc. v. International Tape, Inc., No. 72 CH 302 (ill. Cir. Ct., Feb. 17, 1972) 29n CBS, Inc. v. Spies, 167 U.S.P.Q. 492 (Ill. Cir. Ct. 1970) 9n, 22n, 26n CBS Records v. Johnson, No. 4-71 Civil 255 and No. 4-71 Civil 436 (D. Minn., Jun. 20, 1972) 22n Columbia Records, Inc. v. Nance, (Mo. Cir. Ct.), in CasxH Box, Nov. 13, 1971, at 7 22n Compco Corp. v. Day-Brite Lighting, Inc., 376 U.S. 234 (1964) : 2, 17, 19, 20, 21, 26, 27, 33, 34n, 35, 37, 38, 39, 39n, 40, 41, 43, 44n Davis v. TWA, 297 F. Supp. 1145 (C.D. Cal. 1969) ........ 40n Duchess Music Corp. v. Stern, 331 F. Supp. 127 (D. Ariz. 1971), rev’d, 458 F.2d 1035 (9th Cir. 1972) ........ 12n Edgar H. Wood Associates, Inc. v. Skene, 347 Mass. 351, 197 N.E. 2d 886 (1964) 30n, 31n Ferris v. Frohman, 223 U.S. 424 (1912) 32n Fred Fisher, Inc. v. Dillingham, 298 F. 145 (S.D.N.Y. 1924) 39n Florida Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132 (1963) 42n Fonotipia Ltd. v. Bradley, 171 F. 951 (E.D.N.Y. 1909) .. 21n FTC v. Orient Music Roll Co., 2 F.T.C. 176 (1919) ..10n, 2in Gieseking v. Urania Records, Inc., 17 Mise. 2d 1034, 155 N.Y.S. 2d 171 (Sup. Ct. 1956) 21n, 32n . PAGE Greater Recording Co. v. Stambler, 144 U.S.P.Q. 547 (N.Y. Sup. Ct. 1965) 22n G. Ricordi & Co. v. Haendler, 194 F.2d 914 (2d Cir. 1952) 21n, 41n Heim v. Universal Pictures Co., 154 F.2d 480 (2d Cir. 1946) 32n Independent Tape Merchant’s Ass’n v. Creamer, No. 72-73 Civil (M.D. Pa., Jul. 24, 1972) 23n Independent Tape Merchant’s Ass’n v. Martin, Civil Action No. 3-5536-A (N.D. Tex., Feb. ae, 2078) 3... 23n International News Service v. Associated Press, 248 U.S. 215 (1918) 2, 24, 25, 26, 26n, 27, 29 International Tape Mfrs. Ass’n v. Gerstein, 174 U.S. | P.Q. 198 (S.D. Fla. 1972) (appeal pending) .............. 23n King v. Mister Maestro, Inc., 224 F. Supp. 101 (S.D. Mt MD Siesta os eh ee 32n Kortlander v. Bradford, 116 Mise. 664, 190 N.Y.S. 311 (Sup. Ct. 1921) 29n Lear, Inc. v. Adkins, 395 U.S. 653 (1969) . 39n Lennon v. Pulsebeat N ews, Inc., 143 U.S.P.Q. 309 (N.Y. Sup. Ct. 1964) 27n Liberty/UA, Inc. v. Eastern Tape Corp., 11 N.C. App. 20, 180 S.E. 2d 414, appeal dismissed, 278 N.C. 702, mm OS. OU Ls 12n, 22n Liberty/UA, Ine. v. Eastern Tape Corp., 70 CVS 15108, 71 CVS 2579, 71 CVS 4602, and 71 CVS 15105 (N.C. Super. Ct., Jul. 14, 1972) 22n PAGE Mazer v. Stein, 347 U.S. 201 (1954) 38n, 39n Mercury Records, Inc. v. McKenna Indus., Inc., (Il. Cir. Ct., Mar. 22, 1972), in Reconp Wor.p, Mar. 25, 1972, at 4 22n Metropolitan Opera Ass’n v. Wagner-Nichols Recorder Corp., 199 Mise. 786, 101 N.Y.S. 2d 483 (Sup. Ct. 1950), aff’d per curiam, 279 App. Div. 632, 107 N.Y.S. — 2d 795 (1st Dept. 1951) 15n, 25n, 32n Miller v. Universal Pictures Co., 11 App. Div. 2d 47, 201 N.Y.S. 2d 632 (1st Dept. 1960), aff’d, 10 N.Y. 2d 972, 224 N.Y.S. 2d 662, 180 N.E. 2d 248 (1961) .... 40n Mutual Broadcasting System, Inc. v. Muzak Corp., 177 Misc. 489, 30 N.Y.S. 2d 419 (Sup. Ct. 1941) 200.. 25n NBC v. Aiello, No. 970398 (Cal. Super. Ct., Apr. 13, 1970) 21n National Tel. News Co. v. Western Tel. Co., 119 F. 294 (7th Cir. 1902) 20n New York World’s Fair 1964-1965 Corp. v. Colourpic- ture Publishers, Inc., 141 U.S.P.Q. 939 (N.Y. Sup. Ct.), aff'd, 21 App. Div. 2d 896, 251 N.Y.S. 2d 885 (2d Dept. 1964) 27n Palmer v. DeWitt, 47 N.Y. 532 (1872) 29n Pittsburgh Athletic Co. v. KQV Broadcasting Co., 24 F. Supp. 490 (W.D. Pa. 1938) 25n Pottstown Daily News Publishing Co. v. Pottstown Broadcasting Co., 247 F. Supp. 578 (E.D. Pa. 1965) 27n, 38n Press Pub. Co. v. Monroe, 73 F. 196 (2d Cir.), appeal dismissed, 164 U.S. 105 (1896) 29n a PAGE Rare Earth Corp. v. Lear Jet Corp., No. 71 75821 (Mich. Cir. Ct., Jul. 1, 1971) 22n RCA v. Premier Albums, Inc., 19 App. Div. 2d 62, 240 H.Y.5. 2d 906 (ist Dept, 1968). 15n, 21n Schecter Poultry Corp. v. U.S., 295 U.S. 495 (1935) .... 26n Schulenburg v. Signatrol, Inc., 50 Ill. App. 2d 402, 200 N.E. 2d 615 (1964) 28n Sears, Roebuck & Co. v. Stiffel Co., 376 U.S. 225 (1964) 2,17, 19, 20, 21, 26, 27, 30, 33, 34n, 35, 35n, 37, 38, 39, 39n, 40, 41, 41n, 43, 44n Shaab v. Kleindienst, 174 U.S.P.Q. 197 (D.D.C. 1972) 19n, 30n Shapiro, Bernstein & Co. v. Remington. Records, Inc., 265 F.2d 263 (2d Cir. 1959) 44n Shaw v. Williamsville Manor, Inc., 38 App. Div. 2d 442. 330 N.Y.S. 2d 623 (4th Dept. 1972) 31n Sheldon v. Metro-Goldwyn Pictures Corp., 81 F.2d 49 (2d Cir. 1936), aff'd, 309 U.S. 390 SN veiisunisdaitecs 39n Sinatra v. Goodyear Tire & Rubber Co., 435 F.2d 711 | (9th Cir. 1970) = 39n- Smith v. Paul, 174 Cal. App. 2d 744, 345 P.2d 546 (1959) 31n Supreme Records, Ine. v. Decca Records, Inc., 90 F. Supp. 904 (S.D. Cal. 1950) ....- 40n Tape Head Co. v. RCA Corp., 452 F.2d 816 (10th Cir. 1971) 37n Tape Indus. Ass’n of America v. Younger, 316 F. Supp. 340 (C.D. Cal. 1970), appeal dismissed, 401 U.S. 902 (1971), appeal docketed, No. 26-628, 9th Cir., Oct. 22, 1970 4n, 7n, 9n, 11n, 21n, 23n, 40n PAGE Twentieth Century Sporting Club, Inc. v. Transradio Press Service, Inc., 165 Misc. 71, 300 N.Y.S. 159 (Sup. Ct. 1937) 25n United Drug Co. v. Theodore Rectanus Co., 248 U.S! 90 (1918) 26n Uproar Co. v. NBC, 8 F.Supp. 358 (D.Mass. 1934), aff’d as mod., 81 F.2d 373 (1st Cir. 1936) .................... 32n Victor Talking Mach. Co. v. Armstrong, 132 F. 711 (S.D.N.Y. 1904) 21n Waring v. WDAS Broadcasting Station, 327 Pa. 433, 194 A. 631 (1937) 26n Warner Bros. Records, Inc. v. David, (Cal. Super. Ct.), in Brzgoarp, Sept. 2, 1972, at 66 /21n Warner Bros. Records, Inc. v. Elliott, No. 378-969 (Ove. Chr. Ob, Fabs Dh, TTS) ccccicscisscepeentcciovinoncnnstienpharsiitih 22n Watson v. Buck, 313 U.S. 387 (1941) 44n Werckmeister v. American Lithograph Co., 134 F. 321 (2d\Cir. 1904) 32n Werckmeister v. Pierce and Bushnell Mfg. Co., 72 F. 54 (1st Cir. 1896) 31n Wheaton v. Peters, 33 U.S. (8 Pet.) 591 (1834) ............ 29n White-Smith Music Publishing Co. v. Apollo Co., 209 . US. i (es) 35n Woolsey v. Judd, 11 N.Y. Super. (4 Duer) 379, 11 How.Pr. 49 (1855)- 29n Wright v. Eisle, 86 App. Div. 356, 83 N.Y.S. 887 (2d Dept. 1903) 31n = ix Unrrep States Constitution PAGE US. Const. art. I, §8, el. 8 33n INTERNATIONAL AGREEME Convention for the Protection of Producers of Phono- grams against Unauthorized Duplicatidn of their Phonograms 24 Unitep States Statutes Act of May 31, 1790, 1 Stat. 124, DO ietenccicd 29n Act of Feb. 3, 1831, 4 Stat. 436, ¢ 9 : 29n Act of Jul. 8, 1870, 16 Stat. 230, 4102... 29n Act of Mar. 31, 1891, 26 Stat. 1106, OO vets 29n Copyright Act, 17 U.S.C. §1, et seg. Section 1(e), 17 U.S.C. §1(e) .. dn, 35n |... - Section 2, 17 D.B.C. 42...) 2, 29, 30, 30n, 34n, 35, 41n Section 5, 17 U.S.C. §2 31n Section 8, 17 U.S.C. §8 34n etien 10, UO CS 31n Section 12, 17 U.S.C. § 12 \ :. 30n Section 19,-17 U.S.C. § 19 ae Ser 31n Section 26, 17 U.S.C. § 26 .... 33n Patent Act of 1952, 35 U.S.C. § 1 et seq. SIL BUA SM ‘.. oon Section 154, 35 U.S.C. § 154 aa 38n Section 271, 35 U.S.C. § 271 oa . 38n Pub. L. No. 92-140, 85 Stat. 391 (Oct. 15, 1971) ....2, 18n, 28n, 33n, 36n, 40n, 41n, 42n ‘Rev. Stat. § 4967 (1875) 29n 18 U.S.C. § 2318 19n x State STATUTES PAGE Aniz. Rev. Stat. Ann. § 13-1024 (1971-2 Supp.) ............ 23n Ark. Stat. Ann. § 41-4617 (1971 Supp.) -...-..-.-...220e--000 23n Cat. Penau Cove § 653h (West 1970) .............-.....-2-000-+ 23n, 42 Pia. Beae. Ae. 4 Gee oes C19t2) 0, 23n La. Act 350 (Reg. Sess., 1972) 23n N.Y. Gen. Bus. Law art. 12-E, § 224 (McKinney 1968) .. 44n N.Y. Gen. Bus. Law §$ 561 (McKinney 1968) ............ 23n N.Y. Penat Law § 155.30 (McKinney Supp. 1971) .... 44n N.Y. Prenat, Law $165.07 (McKinney 1967) ................ 44n N.Y. Pena Law $170.15 (McKinney 1967) .................... 44n Pa. Star. tit. 18, § 4878.1 (1972-3 Supp.) ........................ 28n Tenn. Cope ‘Ann. § 39-4244 through § 39-4250 (1971 Supp.) hecinis Trex. Penat Cope Ann. art. 1137r (1972 Supp.) ............ 23n Va. Cove § 59.1-41.1 through § 59.1-41.6 (1972 Supp.) .. 28n OTHER AUTHORITIES Ahrens, The Misappropriation Doctrine After Sears- Compco, 59 TrapemarkK Rep. 88 (1969) ............ 26n, 27n, 48n Arnold, A Philosophy on the Protections Afforded by Patent, Trademark, Copyright and Unfair Cumpeti- tion Law: The Sources and Nature of Product Simu- lation Law, 54 TrapEeMarK Rep. 413 (1964) ................ 34n BILLBOARD Jan. 1, 1972 ao Jul. 22, 1972 ... 19n BuLBoaRD INTERNATIONAL Buyer's Guiwe 1971-72, Sept. 18, 1971 ; dn _ ae xi PAGE Boye, H., How to Make Money $ELLING THE $oncs You i 5n Brief for Petitioners (Appendix), Goldstein v. Cali- fornia, No. 71-1192, U. S. Supreme Court ............. dn, lin Brief for the United States as Amicus Curiae, Compco Corp. v. Day-Brite Lighting, Ine., 376 U.S. 234 (1964) and Sears, Roebuck & Co. v. Stiffel Co., 376 ee Oe NN 40n CattMann, R., Unrair Competition TRADEMARKS AND ee ee ee SS 27n CasH Box a 8) SSO Stebel ORG Serna 14n May 27, 1972 sso ensttdlswhernatweiiensenicownnstanitGnissiilins oe 14n ee ee 19n Chapman, The Supreme Court and Federal Law of ae fair Competition, 54 TrapemarKk Rep. 573 (1964) .... 34n Comment, 43 N.Y.U. L.Rev. 178 ee ee Comment, Performers’ Rights and Copyright: The Protection of Sound Recordings from Modern Pirates, 59 Cauir. L. Rey. 548 (1072) 9n, 31n Copyricut (Monthly Review of the World Intellectual Property Organization) RS BP dee SE re OE ona 24n i 24n Copyright Law Revision, Hearings on H.R. 4347, H.R. 5680, IT.R. 6831, and II.R. 6835 Before Subcomm. No. 3 of the House Comm. on the Judiciara y, 89th Cong., ist CO 4n, 5n, Gn i, — PAGE Copyright Law Revision, Hearings on §. 597 Before the Subcomm. on Patents, Trademarks, and Copy- rights of the Senate Comm. on the Judiciary, 90th Cong., Ist Sess. (1967) .......6n, 7n, 8n Corry, C., The Phonograph Record Industry; An Eeo- nomic Study, ‘Feb. 9, 1965 (Library of Congress Legislative Reference Service) ..................------ 3n, 4n, 6n, 7n DELLER’s WALKER ON Patents (2d ed. 1964) -200022..... 38n Derenberg, Consumerism and “Old-Fashioned Com- mercial Honesty,” 15 IDEA 45 (Special Conference TI TPE: ecanct besirccts vinccncsosiamonenstehopnsctnanceirenncition 27n, 38n Diamond, Copyright Problems of the Phonograph Rec- ord Industry, 15 Vanp. L. Rev. 419 (1962) ............ dn, 36n Diamond, Sound Recordings and Copyright Revision, 53 Iowa L. Rev. 839 (1968) 30n Diamond and Adler, Proposed Copyright Revision and Phonograph Records, 11 Arr L. Rev. 29 (1940) ........ Sn Hearings on H.R. 11258 Before the House Comm. on Patents, 68th Cong., 2d Sess. (1925)... 36n Hearings on H.R. 10431 Before the House Comm. on Patents, 69th Cong., Ist Sess. (1926) ... 36n Hearings on H.R. 9636 Before the House Comm. on Patents, 7ist Cong., 2d Sess. (1930) 7 36n Hearings on Revision of Copyright Laws Before the House Comm. on Patents, 74th Cong., 2d Sess. (1936) .. 36n Hearings on H.R. 1268, H.R. 1270 and H.R. 2570 Be- fore the Subcomm. on Patents, Trademarks and Copyrights of the House Judiciary Comm., 80th Cong., Ist Sess. (1947) .. . 36n H.R. Rep. No. 2222, 60th Cong., 2d Sess. (1909) ........ 29n, 35n H.R. Rep. No. 2237, 89th Cong., 2d Sess. (1966) ........ 36n, 37n — xiii PAGE H.R. Rep. No. 92-487, 92d Cong., Ist Sess. (1971) ....15n, 23n, 30n Kalodner and Vance, The Relation Between Federal and State Protection of Literary and Artistic Prop- erty, 72 Harv. L. Rev. 1079 ( 1959) ooo. 31n, 34n Kunin, The Lindsay Bill Before and After the Stiffel Case, 54 Trapemark Rep. 731 (1964) oon. 34n Livingstone, Piracy in the Record Industry, STEREO Review, Feb. 1970 srenennanAuhintnsitanessnncebesatacnensneninesatncdtansscves l1n Murray, D., THe Wortp or Sounp REcorDING (1965) .. 8n N.Y. Times, Jul. 17, 1972 ooo. 19n Nimmer, M., Tue Law or Copyricut (1972) oo... 33n, 34n Prohibiting Piracy of Sound Recordings, Hearings on S. 646 and H.R. 6927 Before Subcomm. No. 3 of the House Comm. on the Judiciary, 92d Cong., Ist Sess. UPC hip ere seine sence aterne 4n, 7n, 9n, 12n, 13n, 14n, 15n, 16n, 18n Report OF THE RecisTer oF CoryriGHTs ON THE GEN- ERAL REVISION OF THE U.S. Copyricut Law, 87th Cong., Ist Sess. (196L) o.oo ecccccceeccceseeeeeeee 36n Rincer, The Unauthorized Duplication of Sound Re- cordings, U.S. Copyricut Orrice, GENERAL REVISION OF THE Copyricut Law (Study No. 26, 1957) .......: 30n, 36n S. 644, 92d Cong., Ist Sess. (1971) 29n, 33n S. Rep. No. 92-72, 92d Cong., 1st Sess. (1971) ..15n, 19n, 23n SHEMEL, S., and M. W. Krasttovsky, Tus Business oF Music (Rev. ed. 1971) oo 3n, 4n, 5n, 7n PAGE Statement of Henry Brief, Executive Director, RIAA, Before the Commerce and Industry Committee, Ari- zona House of Representatives, Feb. 15, 1971 ....14n, 15n, 16n Statement gf Henry Brief, Executive Director, RIAA, Before the Criminal Procedures Committee, Cali- fornia State Assembly, Mar. 26, 1968 0. 14n Symposium, Product Simulation: A Right or a Wrong?, 64 Cotum. L. Rev. 1178 (1964) ............ 27n, 28n Tex. Att’y Gen. Opinion No. M-1114, Apr. 3, 1972 ...... 23n VARIETY May 10, 1972 7n Ftd, 26, 1972 nn iecccececesnceccceccececereresesese -19n ~ Whicher, The Ghost of Donaldson v. Beckett: An In- quiry Into the Constitutional Distribution of Powers Over the Law of Literary Property in the United States, 9 Buty. Copyricut Soc’y 102 (1961) ........ 29n, 34n IN THE Supreme Court of the United States OctoBer Term, 1971 No. 71-1192 —— DonaLp Gotpstern, RutH Koven and Donatp Koven, Petitioners, —against— State oF Carirornia, Respondent. ON WRIT OF CERTIORARI TO THE APPELLATE DEPARTMENT OF THE SUPERIOR COURT OF THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA i BRIEF OF RECORDING INDUSTRY ASSOCIATION OF AMERICA, INC., AMICUS CURIAE e A. THE INTEREST OF THE AMICUS CURIAE The interest of the amicus curtae is set forth in the mo- tion to which this brief is appended. | B. SUMMARY OF ARGUMENT The piracy of sound recordings is an anti-competitive activity that would virtually destroy the recording industry if this Court were to legalize it by reversing the judgment below. That such pernicious conduct cannot be condoned { i 2 is the substantially unanimous view of numerous judges in many jurisdictions, of various state legislatures, of the Congress and Executive branch of the United States, and of the international community. Sound recordings have been protected under the “mis- appropriation” unfair competition doctrine enunciated in the INS case. This doctrine evolved on a case-by-case basis to deal with a variety of blatantly inequitable practices, such as record and tape piracy. The Sears and Compco decisions relied on by petitioners did not even mention INS, and we cannot believe that the Court could have in- tended to overrule all misappropriation law sub silentio. In addition, sound recordings are unpublished works which are protectable under common law copyright. Sears and Compco cannot be read so as to declare that state pro- tection of unpublished works is constitutionally preempted because this interpretation is contrary to accepted canons of construction. Nor could Sears and Compco have de- creed statutory preemption in view of the explicit Con- gressional recognition of state power in Section 2 of the Copyright Act of 1909, as later confirmed in Section 3 of the sound recording amendment to the Copyright Act, effective February 15, 1972. Petitioners were convicted prior to that date for acts committed much earlier, and the application of the California statute to recordings made after the effective date of the amendment is not an issue here. In any event, Sears and Compco are distinguishable in that they dealt with patent questions which differ signifi- cantly from copyright questions; they dealt with the imi- tation of physical objects as distinguished from exact 3 electronic duplication of the performances comprising sound recordings; and they dealt with plaintiffs who had chosen to rely on a federal statutory form of protection to which they subsequently were held not to be entitled, while there was no possibility of federal statutory pro- tection for the sound recordings duplicated by petitioners in this case. Moreover, there is a legitimate state interest in protect- ing sound recordings from predatory activity which is equivalent to larceny. Therefore, the validity of this state criminal statute should be upheld and the judgment below should be affirmed. C. FACTUAL BACKGROUND I. ” The Sound Recording Industry The sound recording industry of the United States “has assumed a major role in the world of music, entertainment, and communication. Its product has an almost universal audience... .”? Retail sales of recordings rose from $48,000,000 in 1940 to almost $200,000,000 in 1950, $600,000,000 in 1960 and approximately $1,700,000,000 in 1970.2 An increasingly large proportion of these total sales is attributable to prerecorded tapes—mostly in the form of tape cartridges *C. Corry, The Phonograph Record Industry; An Economic Study, Feb. 9, 1965, at 1 (Library of Congress Legislative Reference Service) [hereinafter cited as Corry]. *S. SHEMEL aNnp M. W. KrasiLovskKy, THIs Business or Music xvii (Rev. ed. 1971) [hereinafter cited as SHEMEL]. 4 or tape cassettes. In 1966 sales of prerecorded tapes accounted for only approximately $40,000,000 at retail; by 1970 sales of prerecorded tapes had increased to $428,000,000, or 26% of the industry’s total sales ;* and by 1971 sales of prerecorded tapes accounted for approxi- mately $507,000,000.° Not only is the market vast, but access to it is relatively easy because recording studios and manufacturing facilities are available on a contract basis. New recording companies accordingly are constantly making their way into the in- dustry. In 1965 it was reported that the market share of the five largest recording companies had been declining steadily since the early 1950’s, a decline attributed in part to “the ready availability of processing facilities to small companies.” * In 1970, hundreds of record companies were in operation in the United States.’ * For definitions of these and other terms commonly used in the sound recording industry, see the Glossary set forth as Appendix B hereto. * SHEMEL, supra, at xviii; Statement of Stanley M. Gortikov on Behalf of RIAA, Prohibiting Piracy of Sound Recordings, Hearings on 8. 646 and H.R. 6927 Before Subcomm. No. 3 of the House Comm. on the Judiciary, 92d Cong., Ist Sess. [hereinafter cited as Piracy Hearings], ser. 7, at 25 (1971). 5 BILLBOARD, Jan. 1, 1972, at 29. * Statement of John Desmond Glover, Professor of Business Ad- ministration, Harvard University Graduate School of Business Administration, on Behalf of RIAA, Copyright Law Revision, Hear- ings on H.R. 4347, H.R. 5680, H.R. 6831, and H.R. 6835 Before Subcomm. No. 3 of the House Comm. on the Judiciary, 89th Cong., Ist Sess. [hereinafter cited as House Revision Hearings], ser. 8, pt. 2, at 913-14 (1965). Glover’s study is the most recent industry- wide economic study available. See also Corry, supra, at 48. * Tape Indus. Ass’n of America v. Younger, 316 F.Supp. 340, 343 (C.D. Cal. 1970), appeal dismissed, 401 U.S. 902 (1974), appeal docketed, No. 26-628, 9th Cir., Oct. 22, 1970 [hereinafter cited as TIAA v. Younger]. — Many producers entering the market with a minimal: investment have been able to produce “hit” recordings which provide the basis for growth into a major record company. A well-known example is A&M Records, which started in 1962 with an investment of $200 to make one recording that became a great commercial success and supplied the capital for expansion. A&M Records went on to become an established member of the industry.® 5 The consuming public has benefited from the large num- ‘ ber’ of recording companies. Every year approximately 6,000 singles and 4,000 long-playing records are released in the United States.° Furthermore, because of special provisions in the Copyright Act, everyone—large and small producer alike—has the right to use the musical composi- tions (as distinguished from the identical performances) recorded by any competitor.”® As a result, the public often | is given a choice between several versions of the same song.” *H. Boyz, How Tro Make Money $ELLING THE $oNGs You WriTE 22-3 (1970). A&M Records is the very company whose recordings were the subject of Counts I—X of the Misdemeanor Complaint against petitioners. Appendix to Brief of Petitioners at 15-23. *SHEMEL, supra, at xix—xx; BILLBOARD INTERNATIONAL BuyEr’s Guwe 1971-72, Sept. 18, 1971, at 8. * Copyright Act §1(e), 17 U.S.C. §1(e). Whenever the copyright owner of a musical composition permits it to be recorded, anyone thereafter may make his own independent original recording of the composition upon payment of a statutory royalty to the copyright proprietor. See Diamond, Copyright Problems of the Phonograph Record Industry, 15 Vanp. L. REv. 419, 420-29 (1962). » Between 1953 and 1964, 62 domestic record companies made at least 207 different releases of the song entitled “I Believe.” Several companies released a number of ‘different recordings of the same composition by different artists and musica] groups. Statement of Glover, supra, House Revision 'H earings, ser. 8, pt. 2, at 785 (1965). } a 6 “Although the industry is easy to enter and a newcomer may make fantastic profits through a record hit, it is also a highly competitive and risky business.” ?* Competition within the industry and from other sources of entertain- ment led to a continuous decrease from 1909 to 1963 in the average price paid by consumers for sound recordings.” Intense competition and the risks inherent in a business appealing largely to the popular taste have put constant pressure on profits. In 1964, only 300 of the approximately 3,000 individuals and companies who had phonograph rec- ord labor contracts with the American Federation of Musi- cians reported a profitable year.** In 1965, the net profit of the industry, after taxes, was calculated at 1.7 percent of net sales.’ It was estimated in 1965 that 60% to 70% of all long- playing albums lost money.’* More recent industry esti- mates indicate that as many as nine out of ten albums A 12 Corry, supra, at 247; see also Statement of Robert R. Nathan on Behalf of Music Publishers Protective Association, Inc., House Revision Hearings, ser. 8, pt. 3, at 1740 (1965). 18 Statement of Clive J. Davis, Vice President and General Man- ager of CBS Records, Copyright Law Revision, Hearings on 8S. 597 Before the Subcomm. on Patents, Trademarks, and Copyrights of the Senate Comm. on the Judiciary, 90th Cong., 1st Sess. [herein- after cited as Senate Revision Hearings], pt. 2, at 516 (1967). See also Statement of Glover, supra, House Revision Hearings, ser. 8, pt..2, at 822-823 (1965). 14 Statement of Alan W. Livingston, President of Capitol Records, Inc., Senate Revision Hearings, pt. 2, at 495 (1967). * Statement of Glover, supra, House Revision Hearings, ser. 8, pt. 2, at 801 (1965). 16 Td, at 797-799. ee i as 7 currently lose money.” “It is the small percentage of hits that pays the tab for all.” * In the field of classical music, the number of successful recordings is even smaller than’ one in ten. Yet, established recording companies continue to produce classical records, even though they must be subsidized from other revenues.” The increase in the number of unprofitable recordings is attributable in part to increased production costs.2° An- other reason obviously has been the increase in the para- sitic practice of record and tape piracy.” Statement of Gortikov, supra, Piracy Hearings, ser. 7, at 25 (1971) ; Statement of Hon. Richard H. Fulton, Congressman from Tennessee, Piracy Hearings, ser. 7, at 6 (1971). * Statement of Isabelle Marks, Assistant Secretary of Decca Records, a division of MCA, Inc., Senate, Revision H earings, pt. 2, at 527 (1967). : * Statement of Davis, supra, Senate Revision Hearings, pt. 2, at 516-517 (1967). *° For a more complete discussion of production costs, see Section C.II entitled “The Production of Sound Recordings”, infra. More sophisticated recordiftg techniques and increasingly expensive equip- ment and technicians are one component of this increased expense. Another well-known component is the ever-growing expense of re- | cording artists. An often overlooked factor is the increased cost of musicians who provide musical accompaniment. As of 1963, ac- cording to Corry (at 211), the minimum wage rate for American Federation of Musicians members was $56 for a 3-hour recording session. As of October 1, 1970 this figure had jumped to $90. SHEMEL, supra, at 53. "1 See Vartery, May 10, 1972, at 71. “Piracy” has become the term normally used by the courts and the public to describe the type of conduct for which petitioners were convicted. See TIAA v. Younger, supra, at 351: “Plaintiffs in this action are known in the record industry as ‘tape pirates’ and rightly so, for to the best of our knowledge all other courts that have had occasion to consider the conduct of such ‘tape pirates’ have sanctioned state limitations upon their piratical activities.” See cases cited in footnotes 51 and 52, infra. : aaa II. The Production of Sound Recordings The production of an original sound recording is an intricate and expensive process. Typically, it begins with the selection of several musical compositions determined to be suitable for performance .by a particular vocalist. ‘Special instrumental arrangements of these compositions are written and musicians are engaged to perform the orchestral accompaniment. Numerous rehearsals take place in the recording studio. The placement of microphones is critical and hours of experimentation may be required to achieve the desired tonal balance. During the recording process itself, adjustments constantly are made in the con- trol room where the sounds of the performance are converted electronically into impulses on magnetic tape— sometimes on 16 or more separate tracks. The results of a successful “take” must then be edited into a master tape, and further electronic and mechanical processing are re- quired before a finished disc record or prerecorded tape can be manufactured in quantity for sale to the public.” In addition to the obvious costs involved“in the use of skilled personnel, studio facilities and manufacturing plants, there are other expenses peculiar to the recording industry. Featured artists receive royalties based on the number of records sold. Other performers are paid for their services at rates not less than those fixed in union 22.2). Murray, THE Wor_”p or Sounp Recorpine 44-6 (1965); Statement of Livingston, supra, Senate Revision Hearings, pt. 2, at 494 (1967); Diamond and Adler, Proposed Copyright Revision and Phonograph Records, 11 Air L. Rev. 29, 47 (1940). — contracts, and recording companies also are required by contract to make continuing royalty payments to trustees for the benefit of performing artists. Finally, when copy- righted music is used (which is the normal situation), the recording company must pay royalties to the copyright proprietor for every record sold.”* 5 » Even though the initial investment to produce a record- ing for a single can be small, the cost of producing a recording for a long-playing album with an established artist can be staggering. Pre-release costs (z.e., prior to any manufacturing or advertising expense) run from a minimum of $50,000 or $55,000 to $75,000 or $80,000, according to various informed estimates.* The total ex- penditure involved at the point where manufacture, dis- tribution and promotion have been undertaken is from $180,000 to $200,000.27 And the continuing royalty pay- ments outlined above must be paid even though total sales may be insufficient to recoup the recording company’s investment. ** CBS, Inc. v. Spies, 167 U.S.P.Q. 492, 493 (Ill. Cir. Ct: 1970) ; Comment, Performers’ Rights and Copyright: The Protection of a Recordings from Modern Pirates, 59 Cau. L. Rev. 548, 562 1971). ** Capitol Records, Inc. v. Spies, 130 Ill. App. 2d 429, 264 N.E.2d 874, 875 (1970) ; Statement of Gortikov, supra, Piracy Hearings, ser. 7, at 26-8 (1971) ; TIAA v’ Younger, supra, at 344. aes of Gortikov, supra, Piracy Hearings, ser. 7, at 26 as | oy 10 III. The Operation of Record and Tape Pirates Record and tape piracy has grown at an alarming rate in recent years due to advancing technology. However, the activity in which petitioners and others like them are engaged has an ancient if not honorable history. In 1919, when player pianos were in vogue, the Federal Trade Commission issued a cease and desist order against the unauthorized duplication of perforated paper music rolls, based on the ultimate finding that: “the effect of the practice on the part of the respondent in making said duplicated or copied rolls from the original rolls of competing manufacturers and the sale of the same in interstate commerce in competition with competing manufacturers or wholesalers or re- tailers of the products of competing manufacturers is to secure to the respondent an undue advantage over competitors by appropriating the results of competi- tors’ ingenuity, labor, and expense, and thus avoiding the cost of producing the aforesaid master rolls.” * The techniques of modern-day pirates are simple and inexpensive: “[They] purchase on the open market long playing disc phonograph records which have been manufac- tured and sold through the usual commercial channels by record companies. Such dise phonograph records are generally referred to as albums and they usually contain 10 to 12 performances of one artist or group of artists. ... After purchasing an album, [they] make a tape recording of the exact sounds recorded on the 26 WTC vy. Orient Music Roll Co., 2 F.T.C. 176, 179 (1919). —- 11 album. The tape is made by playing the album on a record player connected to a tape recorder which turns out a tape. When this master tape is finished, it is played on a machine known as a ‘tape playback deck’. The ‘tape playback deck’ is connected to machines known as ‘tape slaves’ which in turn make additional tape recordings of the sound which have been trans- ferred from the record album to the master tape. A large number of ‘tape slaves’ may be connected to one ‘tape playback deck’ so that a correspondingly large number of tape recordings can be made at one time. After the tapes have been made by use of the ‘tape play- back deck’ and the ‘tape slaves’, each of the new tapes is placed on a hub. Each hub is placed into a plastic cartridge, and the ends of the tape are spliced together so’ that it forms a continuous ‘loop’ in the cartridge. The cartridge is sealed, tested, packaged, and labeled. ... Other than the small sums required to make and distribute their tapes, [they] do not pay any other expenses.” *” With the increased popularity of tape cartridges and cassettes, would-be pirates need not invest in the costly metal presses and other equipment required to produce dise phonograph records. All that is needed is the rela- tively inexpensive machinery to produce tapes.?® This has * TIAA v. Younger, supra, at 342-3 (emphasis added). The spe- cific method of operation used by petitioners is summarized in the Affidavit in Support of and Petition for Search Warrant. Appendix to Brief of Petitioners, at 41-2. , 8 “THlegally duplicating tapes turned out to be much simpler than pirating dises. The necessary equipment was less bulky and far quieter than the large presses needed to stamp out discs; it could be set up in a garage, a basement or the back room of a shop.” Livingstone, Piracy in the Record Industry, STEREO REviEw, Feb. 1970, at 63. This compactness and quietness are important to the illegal operations, which are generally clandestine and highly mo- bile. For descriptions of pirate enterprises utilizing such devices 12 made piracy even more profitable and easy to undertake, and has further underscored the fact that pirates “circum- vent a great portion of the costs of engaging in the record. ing business.” *° Indeed, compared to the costs of the producer of the original recording, the pirates have virtually no expense, and their profits reflect this fact. “The unauthorized re- cordings are generally sold by the manufacturers at a profit of at least 200% ....”* Naturally, the recording industry cannot match the pirates’ costs: “The pirate can go into business for as little as $500. Yet, we can’t even take one artist into one studio for one hour for $500.”* As a result, the price of the pirated article typically is far below that of the original. “Tilegally duplicated material is being supplied to re- tailers at a price sometimes as low as $2.00, which is about half the cost to the wholesaler of the legitimate product. The reasons for this are clear—minimal in- vestment by the pirate as against significant costs to the legitimate manufacturing company which pays the as armed guards, dummy names, telephone answering services which do not know the identity of their clients, post office boxes and other such devices, see Statement of Gortikov, supra, Piracy Hearings, ser. 7, at 26 (1971) ; Statement of Robert C. Osterberg on Behalf of The Harry Fox Agency, Inc., Piracy Hearings, ser. 7, at 64 (1971) ; see also Duchess Music Corp. v. Stern, 331 F.Supp. 127, 128 (D. Ariz. 1971), rev’d, 458 F.2d 1035 (9th Cir. 1972). 2° Liberty/UA, Inc. v. Eastern Tape Corp., 11 N. C. App. 20, 21, 180 S.E. 2d 414, 416, appeal dismissed, 278 N.C. 702, 181 S.E. 2d 600 (1971). 8° Statement of Osterberg, supra, Piracy Heorings. ser. 7, at 64 (1971). ‘1 Statement of Gortikov, supra, Piracy Hearings, ser. 7, at 25 (1971).