ASCAP Loses Major Music Download Appeal Case; Blanket License Fee Calculation Remanded to District Court

The US Second District Court of Appeals has ruled against ASCAP in a landmark case involving internet companies RealNetworks and Yahoo that attempted to establish that music downloads constitute a public performance.

In a strongly worded opinion, the court affirmed the district court’s ruling that a download of a musical work does not constitute a public performance of that work. The court sent a related matter regarding the calculation of blanket license fees for RealNetworks and Yahoo back to the US Second District Court to be reconsidered.

Click here to download the complete court decision (PDF)

In the opinion written by Circuit Judge John M. Walker, Jr, the court analyzed existing copyright law and precedent, and made extensive references and explanations regarding the definition of “perform” in Section 101 of the US Copyright Act which states that “to perform a work means to recite, render, play, dance or act it, either directly or by means of any device or process.” The decision in large part hinged on the fact that a download does not include a “contemporaneously perceptible event” – that during a download, the musical work could not be heard or listened to.

After describing ASCAP’s legal conclusions as “flawed” and accusing ASCAP of misreading the court’s own opinion in a related case, Judge Walker writes, “The downloads at issue in this appeal are not musical performances that are contemporaneously perceived by the listener. They are simply transfers of electronic files containing digital copies from an on-line server to a local hard drive. The downloaded songs are not performed in any perceptible manner during the transfers; the user must take some further action to play the songs after they are downloaded. Because the electronic download itself involves no recitation, rendering, or playing of the musical work encoded in the digital transmission, we hold that such a download is not a performance of that work, as defined by [US Copyright Act] Section 101.”

ASCAP released a statement on the decision, stating, “ASCAP and its songwriter, composer and music publisher members are, of course, disappointed in the Court’s decision that there is no public performance in the transmission of certain musical downloads. We are studying the decision and will determine what further action is appropriate. The Second Circuit remanded the rate calculation back to the district court with instructions to determine whether there are “more precise or practicable” methods of fixing a rate for the use of our members’ music. We anticipate that in the end, the proceeding will result in a fair and favorable license fee to be paid by commercial online services for the valuable intellectual property they use to sustain their businesses — the music created and owned by the songwriters, composers and music publishers ASCAP represents.”