Three Boys Music Corp. v. Bolton

Citation: 212 F.3d 477Docket: Nos. 97-55150, 97-55154

Court: Court of Appeals for the Ninth Circuit; May 9, 2000; Federal Appellate Court

SummaryOriginalCytator Case TreatmentBackward CitatorAnalysis

EnglishEspañolSimplified EnglishEspañol Fácil

In 1994, a jury determined that Michael Bolton's 1991 song "Love Is a Wonderful Thing" infringed the copyright of the Isley Brothers' original 1964 song of the same name. The district court upheld the jury's findings and awarded $5.4 million to the Isley Brothers, denying Bolton's request for a new trial. Bolton, co-author Andrew Goldmark, and their record companies, including Sony Music, appealed on several grounds: 1) they claimed insufficient evidence supported the jury's conclusion that they had access to the Isley Brothers' song; 2) they disputed the jury's finding of substantial similarity between the two songs; 3) they questioned the district court's subject matter jurisdiction based on the Isley Brothers' copyright registration; 4) they challenged the evidence supporting the jury's profit attribution to the infringing elements; 5) they argued that Sony Music should have been allowed to deduct its tax liability; and 6) they contended that their motion for a new trial based on newly discovered evidence was justified. The appeals court affirmed the district court's decision.

The Isley Brothers, a prominent rhythm and blues group recognized for their contributions to the genre, recorded "Love Is a Wonderful Thing" in 1964 and received copyright protection for it. Although the song was initially released as a single, it did not achieve significant chart success. It was later re-released in 1991 as part of a collection. Meanwhile, Bolton's version, released in 1991, became popular, finishing the year at number 49 on Billboard's year-end chart. Following a copyright infringement action initiated by Three Boys Music Corporation in 1992, the trial was conducted in phases, with the jury concluding in the first phase that Bolton had indeed infringed the copyright. In subsequent phases, the jury attributed a significant portion of the profits from Bolton's album to the infringing song. The district court entered judgment for the Isley Brothers, and the appellants' post-trial motions were ultimately denied.

On June 8, 1994, the appellants submitted a second motion for a new trial regarding newly discovered evidence on copyright ownership, which the district court dismissed as untimely. On December 5, 1996, the court adopted the Special Master’s Amended Report on damages, resulting in a final judgment against the appellants that ordered Sony Music to pay $4,218,888, Bolton to pay $932,924, Goldmark to pay $220,785, and their music publishing companies to pay $75,900. The appellants appealed this judgment.

In copyright infringement cases, particularly in music, proof is often circumstantial, requiring the plaintiff to demonstrate ownership of the copyright and that the defendant copied protected elements of their work. In the absence of direct evidence of copying, infringement must be shown through circumstantial evidence of the defendant's access to the plaintiff's work and the substantial similarity of the two works. Appellate courts typically hesitate to overturn jury verdicts in such cases due to the challenges in proving access and substantial similarity.

Judge Newman’s opinion in Gaste v. Kaiserman emphasizes the standard for appellate review of jury verdicts, stating that a verdict should only be overturned if no reasonable jury could have reached that conclusion based on the evidence. Similarly, in Arnstein v. Porter, it is established that copying and improper appropriation are factual issues, and appellate courts are bound by the trial court’s findings if supported by evidence. The general standard for reviewing jury verdicts is whether they are supported by "substantial evidence."

The appellate court affirmed the jury’s verdict, focusing particularly on the issue of access, which is deemed the most challenging aspect in this case. Judicial deference was applied, affirming that the law was appropriately executed, with a favorable view of the facts for the appellees and respect for the jury's judgment. Proof of access requires a reasonable opportunity for the defendant to view or copy the plaintiff's work, defined as exceeding a mere "bare possibility."

Reasonable opportunity for access to a plaintiff's work requires more than mere speculation; it necessitates a reasonable possibility of viewing the work. Access can be established through two primary methods: 1) demonstrating a specific chain of events linking the plaintiff's work to the defendant’s access, such as interactions with publishers or record companies, or 2) showing that the plaintiff's work was widely disseminated. In music copyright cases, proving widespread dissemination—such as sales, radio play, or sheet music availability—is typically the more successful approach. The concept of subconscious copying has been recognized since a 1924 case, where Judge Learned Hand noted that even unintentional similarities can constitute infringement if the defendant has been exposed to the plaintiff's work. This principle was further illustrated in ABKCO Music, Inc. v. Harrisongs Music, Ltd., where the Second Circuit upheld a finding that George Harrison subconsciously copied the song "He’s So Fine" due to his previous exposure to it, even though the access was six years prior to the creation of his song "My Sweet Lord." The court highlighted that a significant time lapse between access and the creation of the infringing work does not negate the possibility of copying.

The Isley Brothers argued that Bolton and Goldmark had access to their song "Love is a Wonderful Thing" through widespread dissemination and subconscious copying. Four main points of evidence were presented:

1. **Personal Background**: Bolton's history included listening to the Isley Brothers and performing covers of their songs as a youth. He had a significant appreciation for rhythm and blues music, particularly from Black artists.

2. **Media Dissemination**: Three disk jockeys testified about the extensive airplay of the Isley Brothers' song. Jerry Blavitt noted it was played multiple times on a prominent Philadelphia TV show and regularly on his radio station. Earl Rodney Jones mentioned playing it several times daily on WVON radio in Chicago, while Jerry Bledsoe indicated it was aired on WUFO radio in Buffalo and WWRL radio in New York, with additional exposure on the TV show "Soul."

3. **Bolton’s Affinity**: Bolton expressed himself as a dedicated fan and collector of the Isley Brothers' music, evidenced by his statements to Ronald Isley about his familiarity with the artist's work.

4. **Confusion with Other Artists**: Bolton questioned whether a song he and Goldmark were composing was actually a work by Marvin Gaye, indicating uncertainty about the song’s origin. This suggested a possibility of subconscious influence from the Isley Brothers’ song.

The court noted that the appellants argued the Isley Brothers' claims constituted a delayed subconscious copying assertion, emphasizing the lack of direct evidence of access since the song did not chart and wasn’t released until after Bolton and Goldmark wrote their piece. Despite the Isley Brothers’ theory facing challenges, the appellants were allowed to fully present their case to the jury.

Three rhythm and blues experts, including Motown songwriter Lamont Dozier, testified they were unfamiliar with the Isley Brothers' song "Love is a Wonderful Thing." Bolton provided 1966 "TV Guide" copies indicating the song did not air in Connecticut and noted that 129 songs share the same title, with 85 registered before 1964. The Isley Brothers’ argument regarding reasonable access is plausible, as two Connecticut teenagers passionate about rhythm and blues might remember a song played briefly and subconsciously replicate it decades later. Ronald Isley recalled Bolton stating, "I have all his stuff." The district court noted Bolton's comments about Marvin Gaye's "Some Kind of Wonderful," suggesting his awareness of potential copying. Judge Frank's caution in Arnstein v. Porter, which deemed the plaintiff's claims "fantastic" while accepting the defendant's denial of access, is relevant. However, the jury's credibility concerning access should be evaluated by them. Judge Baird recognized this principle, affirming that the court would not assert that reasonable jurors could only conclude the defendants lacked access. The court's focus is on whether reasonable minds could find that the defendants had an opportunity to hear the plaintiff's song, with substantial evidence supporting the jury's finding of access. The court clarified that it is not setting a new standard for access but respecting the jury's factual determinations. 

Substantial similarity is closely linked to access, governed by the "inverse ratio rule," which allows for a lower standard of proof when access is high. If no access is proven, a plaintiff can still establish infringement by showing "striking similarities." The proof of substantial similarity involves a two-part test: the extrinsic test, requiring objective identification of concrete elements, often necessitating expert analysis, and the intrinsic test, which assesses whether an ordinary person would find the works substantially similar. The jury's application of the intrinsic test will not be second-guessed by the court.

The court emphasizes its reluctance to overturn findings made by the trier of fact, particularly regarding the intrinsic test for expression and factual determinations of the extrinsic test, unless there is a clear error. The jury may determine that a combination of unprotectible elements constitutes protectible material if the overall effect suggests substantial appropriation. 

In the case at hand, the Isley Brothers' expert testified that their song shared five unprotectible elements with the appellants' work, contradicting the appellants' argument of insufficient evidence for substantial similarity. Although the appellants' expert acknowledged some similarities, he did not find those elements present in prior works. The jury's decision to find infringement based on the unique combination of these elements was upheld, as the court found no clear error in their assessment of credibility.

Regarding independent creation, the court explains that once a copyright plaintiff establishes reasonable access and substantial similarity, a presumption of copying arises, shifting the burden to the defendant to prove independent creation. The appellants' defense relied on a work tape, their songwriting history, and testimony about contributions from their arranger. However, evidence suggested potential subconscious copying by one of the appellants, and the contributions were deemed common by the appellants' own expert. The jury's finding regarding independent creation was also upheld, as substantial evidence supported the claim of copying.

Lastly, the court addresses the inverse-ratio rule, which allows a lesser showing of substantial similarity if access is strongly demonstrated. Despite arguments of weak access and circumstantial evidence, the court finds no basis for reversing the jury's verdict, asserting that the case does not risk undermining standards for musical copyright infringement.

The excerpt addresses two main legal issues: the sufficiency of the deposit copy and the attribution of profits in a copyright infringement case involving the Isley Brothers and Bolton/Goldmark. 

Regarding the deposit copy, the court clarifies that a weak showing of access does not require a stronger showing of substantial similarity, and the test for substantial similarity is not being redefined. The Isley Brothers registered a deposit copy of "Love is a Wonderful Thing," which the appellants claimed was incomplete. However, the court maintains that the definition of a "complete copy" is broad and that inaccuracies do not bar infringement actions unless there is intent to defraud. Testimony from an expert indicated that the deposit copy contained all essential elements of the song, leading the jury to conclude that the Isley Brothers had deposited a sufficient copy.

On the issue of profit attribution, Sony Music contended that the district court wrongly assumed all profits from Bolton and Goldmark’s song were attributable to the Isley Brothers, and argued that the jury's apportionment lacked evidence. The law allows copyright owners to recover only profits directly attributable to infringement. Sony Music needed to demonstrate what portion of their profits was not linked to the infringing work. Their evidence indicated that the infringing song contributed only a small percentage of the overall album profits, but the Isley Brothers countered with their own evidence regarding the song's prominence and promotional efforts. The jury ultimately found that 28% of the album’s profits came from the song, with 66% of those profits arising from infringing elements. The court affirmed the jury's findings, noting that the jury instructions were clear and that the burden of proof lay with Sony Music, whose evidence was not fully credited by the jury.

Sony Music contested a district court ruling allowing Bolton and Goldmark, but not itself, to deduct income taxes from profits related to a copyright infringement. The deductibility of income taxes under § 504(b) is a novel issue in this circuit. The Supreme Court has previously ruled that willful infringers cannot deduct taxes, but it has left open the possibility for non-willful infringers. The circuits are divided on this issue; the Second Circuit permits deductions to avoid infringers paying more tax than received, while the Sixth Circuit denies them, arguing that increased pre-tax awards for copyright holders would be offset by tax refunds. The district court sided with the Second Circuit, allowing Bolton and Goldmark to deduct their actual income taxes and management fees but denying Sony Music's request to deduct its Net Operating Loss Carry-forward (NOL) since it lacked a concrete financial impact. The court upheld the decision, affirming a damages award of $4,218,838 against Sony Music, which had not paid income taxes on its infringing profits.

In a separate issue, Bolton and Goldmark's second motion for a new trial was denied by the district court, which ruled it untimely. This motion was based on newly discovered evidence concerning the authorship of the song "Love is a Wonderful Thing," but Bolton and Goldmark waited fourteen days past the deadline to file the motion, which the court found unreasonable. The standard of review for this denial is abuse of discretion, particularly concerning the motion's timeliness.

The district court denied the second motion for a new trial as untimely, and this decision is affirmed. The evidence presented by the Turkcords, even if true, primarily impacts the weight and credibility of existing evidence rather than the case's outcome. Ronald Isley asserted co-authorship of "Love is a Wonderful Thing" with Jimi Hendrix, who had previously played in the Isley Brothers’ band. The Turkcords' claims are questioned due to their awareness of the song's re-release in 1991, yet they alleged a royalty-sharing agreement only after a damages award was publicized. Additionally, Bolton and Goldmark failed to promptly inform the district court of new evidence before the deadline for post-trial motions. Even if Turkcords' claims were valid, they do not threaten the Isley Brothers’ copyright ownership, as registration serves as prima facie evidence of validity under 17 U.S.C. § 410(c). The definition of originality is broad, requiring contributions beyond trivial variations, and the Isley Brothers are deemed to have contributed original elements to the song. The Turkcords never secured copyright for their composition, relying instead on an alleged promise of royalties from the Isley Brothers. The district court did not err in rejecting the second motion for a new trial, as the Turkcords’ claims would not have changed the jury's decision. The court upheld its prior rulings and the jury’s credibility assessments. The decision is affirmed.