Opinion
1:19-cv-02431 (AJN) (SDA)
03-12-2022
Elohim EPF USA, Inc., Plaintiff, v. 162 D & Y Corp. et al., Defendants.
THE HONORABLE ALISON J. NATHAN, UNITED STATES DISTRICT JUDGE
REPORT AND RECOMMENDATION
STEWART D. AARON UNITED STATES MAGISTRATE JUDGE
This Report and Recommendation addresses the pending cross-motions for summary judgment in this action.
BACKGROUND
Elohim EPF USA, Inc. (“Elohim” or “Plaintiff”) brings this action, pursuant to the Copyright Act, 17 U.S.C. §§ 101 et seq., alleging that the defendants, the owners and operators of karaoke establishments, willfully infringed its copyrights through unauthorized public performance and public display of musical compositions to which Elohim has exclusive rights. (See Second Am. Compl. (“SAC”), ECF No. 140.) Now before the Court are Plaintiff's partial motion for summary judgment against defendants 162 D & Y Corp.; Y & P Bayside Corp.; Musicbox KTV, Inc.; SS Noblesse House, Inc.; Place of Happy & Lucky, Inc.; YS2 Enterprises, Inc.; Sagwa Namoo, Inc.; Open Karaoke Corp.; Whitestone Bell, Inc.; Base Karaoke, Inc.; Sing Sing Bell, Inc.; M & S. Music Studio, Inc.; and Bizmax NY, Inc. (collectively, the “Corporate Defendants”) (See Pls.' Not. of Mot., ECF No. 186) and cross-motions for summary judgment filed by the Corporate Defendants and defendants Dong Hyun Ha, Phil Sook Cho, Hyun Hak Yi, Kyung Soon Nam, Anthony Kim, Kyung A. Chung, Ku Ho You, Winnie H. Chung, Dong Hun Kim, Jin E. An, Hye Kyung Han, and Li Beom Kim (collectively, the “Individual Defendants” and, together with the Corporate Defendants, the “Defendants”). (See Ji Defs.' Cross-Mot., ECF No. 215; Desh Defs.' Cross-Mot., ECF No. 220.)
Defendants 162 D&Y Corp.; Y&P Bayside Corp.; Musicbox KTV, Inc.; SS Noblesse House, Inc.; Place of Happy & Lucky, Inc.; YS2 Enterprises, Inc.; Sagwa Namoo, Inc.; Open Karaoke Corp.; Whitestone Bell, Inc.; Base Karaoke, Inc.; Dong Hyun Ha; Phil Sook Cho; Hyun Hak Yi; Kyung Soon Nam; Anthony Kim; Kyung A. Chung; Ku Ho You; Winnie H. Chung; and Dong Hun Kim are represented by Ahne & Ji, LLP, and defendants Sing Sing Bell, Inc.; Jin E. An; M&S Music Studio, Inc.; Hye Kyung Han; Bizmax NY, Inc.; and Li Beom Kim are represented by Desh Law, LLC. Thus, the Court cites to the motion papers submitted by Defendants according to their counsel, i.e., with the prefix “Ji Defs.'” or “Desh Defs.'”
For the reasons set forth below, I respectfully recommend that Plaintiff's partial motion for summary judgment be DENIED and Defendants' cross-motions for summary judgment be GRANTED IN PART and DENIED IN PART.
PROCEDURAL HISTORY
Plaintiff commenced this action on March 19, 2019. (Compl., ECF No. 1.) Following discovery, Plaintiff filed its partial motion for summary judgment on September 24, 2021. (Pl.'s Mot., ECF No. 186.) Defendants filed their oppositions and cross-motions on October 22, 2021. (Ji Defs.' Cross-Mot.; Desh Defs.' Cross-Mot.) Plaintiff filed its opposition to Defendants' crossmotions and reply on December 3, 2021 (see Pl.'s Reply Mem., ECF No. 226) and the Ji Defendants filed a reply in support of their cross-motion on December 21, 2021. (Ji Defs.' Reply Mem., ECF No. 235.)
In making the recommendations contained herein, in addition to reviewing and considering the papers filed by the parties in connection with the pending cross-motions, the Court also reviewed and considered the ancillary motions filed at ECF Nos. 230 and 238, which contain requests for judicial notice. I recommend that those motions be denied as moot. Although “[a] court may take judicial notice of a document filed in another court” it may not do so “for the truth of the matters asserted in the other litigation, but rather to establish the fact of such litigation and related filings.” Glob. Network Commc'ns, Inc. v. City of New York, 458 F.3d 150, 157 (2d Cir. 2006). To the extent Plaintiff relies upon the declarations only to establish the fact of the filings, the Court finds that they are not necessary, since the relevant documents referenced therein also have been produced in this case. (See Pl.'s Reply Mem. at 16.)
LEGAL STANDARDS
I. Summary Judgment
Summary judgment is appropriate where there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-50 (1986). The moving party has the initial burden of demonstrating the absence of a disputed issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 32123 (1986). “A fact is ‘material' for these purposes when it ‘might affect the outcome of the suit under the governing law.'” Jeffreys v. City of New York, 426 F.3d 549, 553 (2d Cir. 2005) (quoting Anderson, 477 U.S. at 248). A dispute concerning a material fact is genuine if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. (quoting Anderson, 477 U.S. at 248). “In resolving cross-motions for summary judgment, ‘each party's motion must be examined on its own merits, and in each case all reasonable inferences must be drawn against the party whose motion is under consideration.'” Automated Irrigation Controls, LLC v. Watt Stopper, Inc., No. 18-CV-02435 (GHW), 2019 WL 4256388, at *5 (S.D.N.Y. Sept. 9, 2019) (quoting Morales v. Quintel Entm't, Inc., 249 F.3d 115, 121 (2d Cir. 2001)).
II. Copyright Infringement
“To prevail on a claim of copyright infringement, the plaintiff must demonstrate both (1) ownership of a valid copyright and (2) infringement of the copyright by the defendant.” Lee v. Karaoke City, No. 18-CV-03895 (PAE), 2020 WL 5105176, at *3 (S.D.N.Y. Aug. 31, 2020) (quoting Yurman Design, Inc. v. PAJ, Inc., 262 F.3d 101, 108-09 (2d Cir. 2001)). Among other rights, copyright owners retain the exclusive right “to do and to authorize” the public performance and public display of the copyrighted work. 17 U.S.C. § 106.
Under the Copyright Act of 1976, applicable to actions taken after 1978, a certificate of registration from the United States Register of Copyrights within five years of first publication of a work “constitutes prima facie evidence of the valid ownership of a copyright, although that presumption of ownership may be rebutted.” Stern v. Lavender, 319 F.Supp.3d 650, 669 (S.D.N.Y. 2018) (quoting Hamil Am. Inc. v. GFI, 193 F.3d 92, 98 (2d Cir. 1999)); see also id. at 667 (Copyright Act of 1976 applies to actions taken after 1978). Plaintiff also is entitled to a presumption of the accuracy of statements contained in a certificate. See R.F.M.A.S., Inc. v. Mimi So, 619 F.Supp.2d 39, 54 (S.D.N.Y. 2009) (“Section 410(c) offers a presumption of the accuracy of statements contained in a certificate because ‘[t]he plaintiff should not ordinarily be forced in the first instance to prove all of the multitude of facts that underline [sic] the validity of the copyright unless the defendant, by effectively challenging them, shifts the burden of doing so to the plaintiff.'”) (citing Notes of Committee on the Judiciary, H.R. Rep. No. 94-1476).
“The ‘presumption of validity' from a certificate of copyright registration may be rebutted by presenting evidence that the copyright is in fact not valid.” Johnson v. Classic Material NY, LLC, No. 19-CV-10529 (AJN), 2021 WL 1164089, at *2 (S.D.N.Y. Mar. 25, 2021) (quoting Folio Impressions, Inc. v. Byer California, 937 F.2d 759, 763 (2d Cir. 1991)); see also Stern, 319 F.Supp.3d at 669 (“Generally speaking, the presumption of validity may be rebutted ‘[w]here other evidence in the record casts doubt on the question.'”) (quoting Fonar Corp. v. Domenick, 105 F.3d 99, 104 (2d Cir. 1997)). “[I]f the certificate of copyright registration is not obtained within five years of the first publication of the work, the work is not entitled to the statutory presumption of validity” and “the ‘evidentiary weight to be accorded the certificate . . . shall be within the discretion of the court.'” Johnson, 937 F.2d at 763 (quoting Michael Grecco Photography, Inc. v. Everett Collection, Inc., 589 F.Supp.2d 375, 381-82 (S.D.N.Y. 2008)).
DISCUSSION
I. Plaintiff's Motion For Partial Summary Judgment Should Be Denied
In its motion for partial summary judgment, Elohim seeks summary judgment only with respect to the 14 musical compositions that it registered with the United States Copyright Office (“USCO”) within five years of the date of publication (the “Registered Compositions”). (See Pl.'s 56.1 Statement ¶ 1; Ji Defs.' Response to Pl.'s 56.1 ¶ 1; see also Cha Decl., ECF No. 188, ¶ 3; Pl.'s Mem., ECF No. 187, at 4-9 (alleging infringement only with respect to 14 compositions).) Elohim contends that it owns the exclusive rights to display and publicly perform the Registered Compositions in the United States through subpublishing agreements with two Korean music publishers, Elohim Korea and Prime M&E, which obtained the rights from the original songwriters. (Pl.' 56.1 Statement ¶ 3; Supp. Cha Decl., ECF No. 231, Exs. Q & R.) Plaintiff further contends that the Registered Compositions were publicly performed and displayed at Defendants' karaoke establishments. (See Pl.'s 56.1 Statement ¶¶ 14-26.) Defendants dispute the validity of the subpublishing and songwriter agreements and contend that records from the Korea Music Copyright Association (“KOMCA”) show that Plaintiff does not have exclusive rights to the Registered Compositions. (See Ji Defs.' Mem., ECF No. 216, at 5-7, 11-16; see also Ji Defs.' 56.1 Statement, ECF No. 216-1, ¶¶ 24-29, 60-95, 110-22, 132-36, 138-42, 144-45.) Defendants also assert that Plaintiff cannot establish infringement because any display or performance of the musical compositions took place in private rooms. (See Ji Defs.' Mem. at 26-30; see also Ji Defs.' 56.1 Statement ¶¶ 160-78.)
These compositions are: Gin Sang Meo Ri Geu Nyeo; My Boy; So Cool; Push Push; Gudaewa Hamke; Neomanul Nukimyeo; Sal Man Jji Go; Ni kka Jit Ge; Ga Sik Geol; Bae A Pa; Gil Eul Geot Da Ga; Sa Rang Ha Go Sip Eo; Love Attack; and Hot Boy. (See Pl.' 56.1 Statement, ECF No. 196, ¶ 1; Ji Defs.' Response to Pl.'s 56.1, ECF No. 216-2, ¶ 1.)
According to Plaintiff, S.D. Music was not the Korean publisher for any of the 14 songs subject to its motion. (Pl.'s Reply Mem. at 1 n.1.) Instead, the relevant publishers are Elohim Korea and Prime M&E Co., Ltd. (“Prime M&E”), formerly known as Taejin Media. (See id. at 1.) The Court refers to Elohim Korea, S.D. Music and Prime M&E collectively, as the “Korean Publishing Companies.”
To resolve Plaintiff's motion, the Court need not address whether Plaintiff can establish as a matter of law ownership of a valid copyright in the Registered Compositions, which the parties dispute (see Discussion Section II, infra), because there are genuine issues of material fact as to the element of infringement such that Plaintiff's motion should be denied. Accord Capitol Recs., Inc. v. MP3tunes, LLC, No. 07-CV-09931 (WHP), 2013 WL 1987225, at *9 (S.D.N.Y. May 14, 2013) (“To prevail on a motion for summary judgment, the moving party must demonstrate each essential element of its infringement claim or defense.”) (citing Jorgensen v. Epic/Sony Records, 351 F.3d 46, 50 (2d Cir. 2003)).
“To ‘perform' a work means to recite . . . either directly or by means of any device or process.” 17 U.S.C. § 101. “To perform a work ‘publicly' means (1) to perform or display it at a place open to the public or at any place where a substantial number of persons outside of a normal circle of a family and its social acquaintances is gathered; or (2) to transmit or otherwise communicate a performance or display of the work to a place specified by clause (1) or to the public, by means of any device or process, whether the members of the public capable of receiving the performance or display receive it in the same place or in separate places and at the same time or at different times.” Id.
Plaintiff contends that performances occurring in private karaoke rooms are considered public performances as a matter of law. (See Pl.'s Mem. at 13-14.) Plaintiff argues that, because the karaoke establishments at large are open to the public, any performance or display within the establishments is considered public. (See id. at 13; see also Pl.'s Reply Mem. at 25.) In opposition, Defendants argue that performances inside an enclosed, private room, are not public. (See Ji Defs.' Mem. at 26-28; Desh Defs.' Mem., ECF No. 221, at 10-12.) Defendants contend that these rooms are more like hotel rooms because they require reservations; can be used for purposes other than karaoke; that no one other than the customer and their invitees have access to the room during the rental period unless they request food and beverage service; and there are no bars or open stages where karaoke is performed in front of members of the public. (See Ji Defs.' Mem. at 27-28; Desh Defs.' Mem. at 10-11.) Plaintiff disputes many of the facts regarding the use of the private rooms (see Pl.'s Response to Ji Defs.' 56.1 Statement, ECF No. 232, ¶¶ 164, 170-73) and asks the Court to reach the opposite conclusion, namely that “[h]otel rooms are unlike karaoke establishments because karaoke establishments are opened to the public specifically for the use of musical compositions whereas a hotel room is intended to be private for the exclusive use of the guest.” (Pl.'s Reply Mem. at 25.)
The Court finds that “whether defendants' establishments are more like private movieviewing rooms in a public establishment, see Columbia Pictures Indus., Inc. v. Redd Horne, Inc., 749 F.2d 154, 158-59 (3d Cir. 1984) (screening of movies in private viewing rooms in larger public establishment held public performance), or like movies presented in hotel guests' individual rooms, see Columbia Pictures Indus., Inc. v. Prof'l Real Est. Invs., 866 F.2d 278, 280 (9th Cir. 1989)], ” is a question of fact that should be resolved by the jury. Lee v. Karaoke City, No. 18-CV-03895 (PAE) (SDA), 2020 WL 9815181, at *6 (S.D.N.Y. Dec. 18, 2020); accord Elohim EPF USA, Inc. v. 162 D & Y Corp., No. 19-CV-02431 (AJN), 2021 WL 2292682, at *3 (S.D.N.Y. June 4, 2021). Thus, I recommend that Plaintiff's partial motion for summary judgment be denied.
II. Defendants' Cross-Motions Should Be Granted In Part And Denied In Part
In their cross-motions, Defendants seek summary judgment in their favor with respect to all 25 musical compositions at issue in the SAC. (See Ji Defs.' Mem. at 1; Desh Defs.' Mem. at 3.) In response to Defendants' cross-motions, Plaintiff states that it “does not dispute that it does not have complete chain of title for nine compositions that are not subject to a presumption of validity” and, thus, narrows its opposition to 16 compositions “that are presumptively valid” and/or for which it “can establish complete chain of title.” (Pl.'s Reply Mem. at 1 n.1; see also id. at 5 (“This copyright infringement action now involves 16 musical compositions that Elohim registered with the USCO.”).) These 16 compositions are the 14 Registered Compositions that are the subject of Plaintiff's partial motion for summary judgment, as well as Jeong Sin I Na Gat Eot Na Bwa and Hoe Sang, which Plaintiff registered with the USCO more than five years from the date of first publication. (See Supp. Cha Decl. Ex. O, ECF No. 231-1.) Since Plaintiff does not oppose Defendants' cross-motions with respect to the other nine compositions, I recommend that Defendants' cross-motions be granted as to those compositions and that the claims based upon those compositions be dismissed.
These nine compositions are: Tteol Eo Jinda Nun Mul-I, Go Hae, Baramkyul, Sa Rang A, Ibyeol-Eun Sarang Dwileul Ttalawa, Ga Sum A-Pa Do, Gondrae Mandrae, It Ji Mal A Yo, and Kong Kak Ji. (Compare SAC ¶ 55 with Supp. Cha Decl. Ex. O.)
With respect to the remaining 16 compositions, as set forth above, I find that there are genuine issues of fact as to the second element of Plaintiff's claim. I now consider Defendants' argument that they are entitled to summary judgment on the ground that Plaintiff cannot establish the element of ownership as a matter of law. I then consider Defendants' arguments with respect to enhanced statutory damages and individual liability.
A. Ownership Of A Valid Copyright
Defendants argue that they are entitled to summary judgment because Plaintiff cannot establish chain of title to prove ownership of the musical compositions. (See Ji Defs.' Mem. at 426; Desh Defs.' Mem. at 6-9.) In support of their cross-motions, Defendants rely on records from the KOMCA website that they assert disprove Plaintiff's claim of ownership and argue that Plaintiff's evidence of ownership is insufficient on other grounds. The Court considers Defendants' arguments in turn.
1. KOMCA Records
First, Defendants argue that records of search results from the KOMCA website show that the Korean Publishing Companies were not the registered domestic publishers of the compositions and, therefore, the Korean Publishing Companies could not have transferred exclusive rights to Plaintiff. (See Ji Defs.' Mem. at 6-7; Desh Defs.' Mem. at 6-8; Ji Defs.' Reply Mem. at 2-6.) Defendants point to search results from the KOMCA website that list other companies as “Music Publisher” or “Assignee” and argue that these records show that Plaintiff's claim to ownership “has been conclusively rebutted.” (Ji Defs.' Mem. at 7; see also Ji Decl. Ex. D, ECF No. 218-4.)
Plaintiff contends that the KOMCA records are inadmissible and, in any event, have “no bearing on whether the publishers held U.S. rights to the songs, as that is not the domain of KOMCA.” (Pl.'s Reply Mem. at 6; see also id. at 9-12.) The Court need not decide the admissibility question because, even considering the KOMCA records, Defendants provide no support for their contention that the KOMCA is a definitive database of rights holders, such that the KOMCA search results conclusively demonstrate that the Korean Publishing Companies could not have assigned to Plaintiff the exclusive rights to administer the compositions in the United States.
Plaintiff also raises other evidentiary objections with respect to the KOMCA records and related documents relied upon by Defendants. (See Pl.'s Objs., ECF Nos. 228 & 229.) The Court need not resolve Plaintiff's objection at this time because, even considering these documents, I find that they do not entitle Defendant to summary judgment. If Defendants seek to introduce these documents at trial, Plaintiff may raise its evidentiary objections at the appropriate time.
Notably, the relevant songwriter agreements granting rights to the Korean Publishing Companies do not purport to govern domestic publishing rights in Korea. (See, e.g., Ji Decl. Exs. N, O.)
Defendants further argue that Plaintiff has not established that the Korean Publishing Companies owned exclusive copyrights to the compositions because the KOMCA records show that the compositions were the product of more than one author and, thus, could not properly have been transferred to the Korean Publishing Companies without the consent of each of the co-authors. (See Ji Defs.' Mem. at 11-17.) Defendants' argument is based on search results on the KOMCA website showing the names of “writers” that that do not appear on Plaintiff's USCO registrations. (See Ji Decl. Ex. D.) However, as Plaintiff asserts, Defendants have not submitted any evidence that the writers listed in the KOMCA search results are original co-authors of the compositions. (See Pl.'s Reply Mem. at 12.) Notably, the records themselves contain “classification codes” next to each writer's name, the meaning or significance of which Defendants do not explain. (See generally Ji Decl. Ex. D.) Moreover, many of the KOMCA records do match the information contained in the Certificates of Registration. (See generally Ji Decl. Exs. D, K.) In those cases, Defendants, while not acknowledging the consistency, point to the fact that other entities are listed as “assignee” to support their arguments. (See Ji Defs.' Mem. at 12-16; Desh Defs.' Mem. at 8.) This information has nothing to do with authorship, however, and instead appears to relate back to Defendants' first argument that the KOMCA records somehow cast doubt on the ability of the Korean Publishing Companies to transfer exclusive copyrights to Plaintiff.
Defendants argue that the Court should apply Korean law to determine whether a transfer by only one co-author is valid. (See Ji Defs.' Mem. at 9-11; Ji Defs.' Reply Mem. at 1-2.) Defendants later argue that the consent of all co-authors also is required under United States law. (See Ji Defs.' Mem. at 18-19.) The Court need not decide what law would apply because, as set forth herein, I find that there is, at best, a factual dispute as to whether there are additional co-authors of the compositions such that Defendants are not entitled to judgment as a matter of law.
The registration certificates indicate a single author for each of the Registered Compositions, except Love Attack, which lists one author for the lyrics and another author for the sounds recording and music. (See Supp. Cha Decl. Ex. S.) The KOMCA records list multiple “writers” for each composition, including at least three for Love Attack. (See Ji Decl. Ex. D.)
For example, for the composition Gudaewa Hamke, the KOMCA records adduced by Defendants list Ji Chang Son and Young Jin Seo as writers next to the classification codes A and C, respectively, but the Certificate of Registration from the USCO lists only Young Jin Seo as the author of the sound recording and the music. (Ji Defs.' Mem. at 12 (citing Ji Decl. Ex. D at PDF pp. 3-4).)
In their Reply Memorandum, the Ji Defendants further argue that search results from the Korean Digital Copyright Exchange (“KDCE”) support their contention that the KOMCA records accurately depict the original authors. (See Ji Defs.' Reply Mem. at 3-4.) Even if Defendants are correct, however, these additional records still only raise an issue of fact with respect to ownership. Thus, Defendants are not entitled to summary judgment based upon KOMCA records.
Plaintiff objects to the Court's consideration of the evidence submitted by the Ji Defendants in support of their reply. (See Pl.'s Objs., ECF No. 236; Second Supp. Ji Decl., ECF No. 239.) However, even considering these documents, I find that they do not entitle Defendant to summary judgment. If Defendants seek to introduce these documents at trial, Plaintiff may raise its evidentiary objections at the appropriate time.
Moreover, Defendants only provide KDCE records for three compositions. (See Supp. Ji Decl. Ex. II, ECF No. 235-4.)
2. Subpublishing Agreements
Defendants argue that the Court should not consider the subpublishing agreements submitted by Plaintiff because the agreements were first written in Korean, and Plaintiff has failed to produce the original documents in Korean and an affidavit of a translator. (Ji Defs.' Mem. at 7-8.) Defendants' argument is based on deposition testimony of David Cha that there were Korean versions of the subpublishing agreements. (See id. at 8.) Defendants contend that, without this evidence, Plaintiff has “failed to provide any supporting evidence crucial to prove a valid chain of title in admissible form[.]” (Id. at 9) Plaintiff argues that Defendants misinterpret Mr. Cha's testimony and that the Korean drafts of the subpublishing agreements are “wholly irrelevant” because they were superseded by the English language versions, which contain different material terms. (Pl.'s Reply Mem. at 18; see also Supp. Cha Decl. Exs. Q, R, V.) The existence and terms of a contract are questions of fact for the jury. See, e.g., Welfare Fund, New England Health Care Emps. v. Bidwell Care Ctr., LLC, 419 Fed.Appx. 55, 58 n.4 (2d Cir. 2011). In any event, Defendants are not entitled to summary judgment because they have not adduced evidence to suggest that any Korean versions would undermine Plaintiff's claims to ownership. Defendants' contention that, without the subpublishing agreements, Plaintiffs have failed to provide any evidence of ownership is incorrect. Plaintiff has produced the English language version of the agreements, as well as Certificates of Registration.
The Certificates of Registration constitute prima facie evidence of ownership for the 14 Registered Compositions. Moreover, although two of the musical compositions were registered more than five years from the date of first publication, the Court finds, in its discretion, that they are entitled to at least some evidentiary weight. Accord Stern, 319 F.Supp.3d at 671 (exercising discretion under § 410(c) to apply presumption of valid ownership to photographs registered more than five years after first publication) (citing cases).
Next, Defendants argue that the subpublishing agreements are not valid because, under Korean law, the Korean Publishing Companies were required to obtain the consent of the original authors before granting subpublishing rights to Plaintiff. (Ji Defs.' Mem. at 17.) Plaintiff argues that United States law applies, and, in any event, Defendants' argument is based on their faulty contention the Plaintiff lacked rights to administer the copyrights in the United States. (Pl.'s Reply Mem. at 22.) The Court finds that, even if Korean law applies, Defendants have not established that they are entitled to judgment as a matter of law. Defendants' argument appears to be based on an assertion that the Korean Publishing Companies were not the “holder[s] of author's economic rights” in the compositions and instead were only authorized to use the compositions. (See Ji Defs.' Mem. at 17; Ji Decl. Ex. I.) Defendants do support this argument with citation to any facts, let alone undisputed ones. Moreover, Plaintiff has presented copies of songwriter agreements from which a reasonable factfinder could conclude that the Korean Publishing Companies were the holders of economic rights such that no further consent was required. (See Supp. Cha Decl. Ex. P.) Thus, I find that Defendants are not entitled to summary judgment on this ground.
Defendants also argue that the subpublishing agreements did not grant Plaintiff the right or authority to file for copyright registration applications with the USCO. (Ji Defs.' Mem. at 1718; Ji Defs.' Reply Mem. at 7-8.) In response, Plaintiff asserts that the plain language of the agreements granted it exclusive rights to administer the musical compositions in the United States “without limitation” and that such language necessarily includes the right to register the copyrights. (Pl.'s Reply Mem. at 22-23; see also Pl.'s Response to Ji Defs.' 56.1 Statement ¶ 144.) The Court finds that this argument again raises, at best, a factual dispute as to ownership that cannot be resolved on summary judgment.
3. Copyright Registrations
Defendants also raise several arguments regarding Plaintiff's Certificates of Registration that they argue render the certificates invalid. (See Ji Defs.' Mem. at 22-26.) The Court has considered Defendants' arguments and finds that, at best, they raise issues of fact that must be determined at trial. For example, Defendants argue that the information in the registration certificates is insufficient to ascertain which version of a given musical composition Plaintiff registered. (See Ji Defs.' Mem. at 22.) Defendants do not provide any examples, however, and, as Plaintiff points out, the fact that other variations exist does not impact the chain of title because the original authors remain the same. (See Pl.'s Reply Mem. at 13.)
Defendants further argue that Plaintiff's copyright registration applications of Sal Man Jji Go and Hot Boy fall outside the term of the purported Agreement on Management and Assignment of Copyright between Elohim Korea and Brave Brother, which was the basis of Plaintiff's applications. (See Ji Defs.' Mem. at 22-23.) Plaintiff asserts that the agreement was extended, and such agreement was produced during discovery, and that Defendants' argument is solely an objection to the validity of that agreement based on the fact that they did not receive a Korean version in discovery. (See Pl.'s Reply Mem. at 14; see also Pl.'s Separate Statement Facts, ECF No 232, at PDF p. 71 ¶ 2.) However, Plaintiff now has produced the Korean version of the songwriter agreements. (Supp. Cha Decl. Ex. U.)
In their Reply Memorandum, citing Int'l Media Films, Inc. v. Lucas Ent., Inc., 703 F.Supp.2d 456 (S.D.N.Y. 2010), the Ji Defendants argue that the Court should not consider the Korean versions because they were not produced during discovery. (See Ji Defs.' Reply Mem. at 9-10.) Plaintiff claimed that Defendants never requested them and are not prejudiced because they had English language versions from this case and a prior case. (See Pl.'s Reply Mem. at 14-16.) The Court need not resolve this dispute, however, because it does not affect the admissibility of the documents. Moreover, Defendants' reliance on International Media is misplaced because, in that case, there was no presumption of validity and the defendants presented evidence that one of the agreements the plaintiff relied upon to prove chain of title was forged. See Int'l Media Films, Inc., 703 F.Supp.2d at 464 (granting summary judgment to defendants on ground that plaintiff could not prove chain of title when, inter alia, plaintiff could not produce original copies of certain transfer agreements and did not respond to questions regarding their authenticity).
Defendants also argue that the Certificates of Registration are invalid because Plaintiff's applications included inaccurate information that Plaintiff knew was inaccurate, which would have caused the Register of Copyrights to refuse the copyright registration application. (See Ji Defs.' Mem. at 24-26 (citing 17 U.S.C. § 411(b)).) Where there is proof of deliberate misrepresentation to the Copyright Office, the copyright may be invalided by the Court, vitiating subject matter jurisdiction. See Fonar Corp., 105 F.3d at 105. However, “[o]nly the knowing failure to advise the Copyright Office of facts which might have occasioned a rejection of the application constitute[s] reason for holding the registration invalid and thus incapable of supporting an infringement action.” Eckes v. Card Prices Update, 736 F.2d 859, 861-62 (2d Cir. 1984) (internal quotation marks omitted)).
Here, Defendants have not conclusively demonstrated that inaccurate information was included in the applications, let alone that Plaintiff knowingly made a misrepresentation. Defendants contend that Plaintiff's statements in its copyright applications that it became the copyright owner of the compositions by written agreement were inaccurate because “Plaintiff was not able to produce the referenced written agreements, under which it allegedly became the copyright owner, in their original format written in Korean in admissible form.” (Ji Defs.' Mem. at 24.) However, even if Defendant's are correct that Plaintiff was unable to produce the agreements, it does not mean that Plaintiff's statements regarding ownership by written transfer were inaccurate. Further, Defendant's argument that the author information in the registrations is inaccurate based on the KOMCA search results is without merit because, as set forth above, Defendants have not “indisputably demonstrate[d] that there are additional co-authors, ” as Defendants contend. (See Ji Defs.' Mem. at 25.) At most, Defendants' arguments regarding the validity of Plaintiff's registrations raise issues of fact that cannot be resolved on summary judgment. Accord R.F.M.A.S., Inc., 619 F.Supp.2d at 57 (“If the factfinder should determine that the Registration contains errors, the Court will decide at that time whether such inaccuracies render the copyright invalid.”).
III. Enhanced Statutory Damages
Defendants argue that the evidence in the record fails to establish that Plaintiff is entitled to enhanced statutory damages. (See Ji Defs.' Mem. at 30-32.) “The Copyright Act provides for enhanced statutory damages in cases of willful infringement.” Lee, 2020 WL 5105176, at *10 (citing 17 U.S.C. § 504(c)(2)). “To prove willfulness, the plaintiff must either show (1) that the defendant was actually aware of the infringing activity, or (2) that the defendant's actions were the result of reckless disregard for, or willful blindness to, the copyright holder's rights.” Id. (internal quotation marks omitted) (quoting Island Software & Comput. Serv., Inc. v. Microsoft Corp., 413 F.3d 257, 263 (2d Cir. 2005)). “Where the plaintiff proves that ‘the defendant recklessly disregarded the possibility that its conduct represented infringement,' the ‘plaintiff is not required to show that the defendant had knowledge that its actions constituted an infringement.'” Sands v. CBS Interactive Inc., No. 18-CV-07345 (JSR), 2019 WL 1447014, at *5 (S.D.N.Y. Mar. 13, 2019) (citing Yurman, 262 F.3d at 112).
Here, because I recommend that both Plaintiff's partial motion and Defendants' crossmotions for summary judgment be denied with respect to the 16 compositions still at issue, I find that a determination regarding willfulness is premature. See Disney Enterprises, Inc. v. Sarelli, 322 F.Supp.3d 413, 444 (S.D.N.Y. 2018), reconsideration denied, No. 16-CV-02340 (GBD), 2018 WL 5019745 (S.D.N.Y. Sept. 26, 2018) (“Since summary judgment is denied with respect to Plaintiffs' claims for copyright infringement, a determination at this stage that Defendants' infringement was willful is premature.”); see also Sands, 2019 WL 1447014, at *6 (“Generally speaking, summary judgment is not a tool well suited to determining willfulness[.]”) (quoting Close-Up Int'l, Inc. v. Berov, 382 Fed.Appx. 113, 117 (2d Cir. 2010)).
IV. Individual Liability
Defendants argue that the Individual Defendants are entitled to summary judgment because Plaintiff has not produced evidence from which they could be liable under a theory of contributory or vicarious liability or inducing infringement. (Ji Defs.' Mem. at 32-34.)
Inducing infringement is a form of contributory liability. See, e.g., Palmer/Kane LLC v. Benchmark Educ. Co. LLC, No. 18-CV-09369 (NSR), 2020 WL 85469, at *10 (S.D.N.Y. Jan. 6, 2020) (“One infringes contributorily by intentionally inducing or encouraging direct infringement[.]”); see also Arista Recs. LLC v. Lime Grp. LLC, 784 F.Supp.2d 398, 424 n.23 (S.D.N.Y. 2011) (citing cases).
“A defendant may be held liable for contributory copyright infringement if, ‘with knowledge of the infringing activity,' [he] ‘materially contributes to the infringing conduct of another.'” Capitol Recs., LLC v. Escape Media Grp., Inc., No. 12-CV-06646 (AJN), 2015 WL 1402049, at *43 (S.D.N.Y. Mar. 25, 2015) (quoting Arista Records LLC, 784 F.Supp.2d at 432). “To show material contribution, a plaintiff must establish that the defendant (1) had actual or constructive knowledge of the infringing activity, and (2) encouraged or assisted others infringement, or provided machinery or goods that facilitated infringement.” Id. (internal quotation marks omitted).
Defendants argue that Plaintiff has failed to establish that they had knowledge of or contributed to the alleged infringement. (Ji Defs.' Mem. at 33-34.) However, if a jury determines that the karaoke performances are public, the jury also could find that the Individual Defendants contributed to the infringement by making the karaoke machines available to their customers. In addition, Plaintiff has presented evidence, in the form of cease-and-desist letters, from which a reasonable jury could conclude that the Individual Defendants were aware of the infringement. (See, e.g., Supp. Cha Decl. Ex. T.) Thus, the Court finds that there are genuine issues of material fact regarding contributory liability.
The Ji Defendants have filed declarations from the presidents of certain defendant karaoke establishments stating that the cease-and-desist letters did not enable them to ascertain the songs for which Plaintiff was claiming copyrights because the letters did not list or identify the 25 musical compositions at issue in the SAC. (See, e.g., Kim Decl., ECF No. 217, at ¶¶ 22-25.) However, Plaintiff contends that it provided contact information, including Elohim's website, where Defendants could have found “reference to the copyrighted works that [were] being used without permission.” (Pl.'s Reply Mem. at 27; Pl.'s Response to Defs.' 56.1 Statement ¶ 19 (citing Supp. Cha Decl. ¶ 13; Supp. Cha. Decl. Ex. T, ECF No. 231-6, at PDF p. 24).) It is for the jury to weigh this evidence and assess the credibility of the witnesses to determine whether the Individual Defendants had actual or constructive knowledge of the alleged infringement.
B. Vicarious Liability
To be vicariously liable for the direct infringement of another, a defendant “must have (1) had the right and ability to supervise the infringing conduct and (2) received a financial benefit directly attributable to the infringing conduct.” Capital Records, 2015 WL 1402049, at *41 (internal citation and quotation marks omitted); see also Viacom Int'l, Inc. v. YouTube, Inc., 676 F.3d 19, 36 (2d Cir. 2012) (“The common law imposes liability for vicarious copyright infringement ‘[w]hen the right and ability to supervise coalesce with an obvious and direct financial interest in the exploitation of copyrighted materials.'” (citation omitted)).
With respect to the first element, “[the] Court of Appeals for the Second Circuit has found that a defendant need not have formal power to control where a direct infringer ‘depend[s] upon [the defendant] for direction.'” Capital Records, 2015 WL 1402049, at *43 (quoting Arista Recs. LLC v. Usenet.com, Inc., 633 F.Supp.2d 124, 157 (S.D.N.Y. 2009)). “Rather, ‘[t]he ability to block infringers' access to a particular environment for any reason whatsoever is evidence of the right and ability to supervise.'” Id. (quoting A&M Recs., Inc. v. Napster, Inc., 239 F.3d 1004, 1023 (9th Cir. 2001), as amended (Apr. 3, 2001), aff'd, 284 F.3d 1091 (9th Cir. 2002), and aff'd, 284 F.3d 1091 (9th Cir. 2002)).
“Under the common law vicarious liability standard, there must be ‘a causal relationship between the infringing activity and any financial benefit a defendant reaps, regardless of how substantial the benefit is in proportion to a defendant's overall profits.'” Capital Records, 2015 WL 1402049, at *42 (quoting MP3tunes, 2013 WL 1987225, at *9)). “This causal relationship is established when the service provider profits from its ability to attract infringing users, including through increased advertising revenue.” Id. (internal quotation marks and alterations omitted). “[T]he law is clear that to constitute a direct financial benefit, the ‘draw' of infringement need not be the primary, or even a significant, draw-rather, it need only be ‘a' draw.” Id. (quoting Usenet.com, 633 F.Supp.2d at 157); see also EMI Christian Music Grp., Inc. v. MP3tunes, LLC, 844 F.3d 79, 99 (2d Cir. 2016). “Additionally, evidence of financial gain is not necessary to prove vicarious liability as long as the service provider has an economic incentive to tolerate infringing conduct.” Id. For example, “[a]n increase in subscribers or customers due to copyright infringement qualifies as an obvious and direct financial interest.” Id. at 99 (internal quotation marks omitted).
Defendants argue that the Individual Defendants did not have the right to supervise “the alleged infringing activities inside the private rooms” and, in any event, did not receive a financial benefit because “[r]egardless of what customers do in the private rooms, the Korean karaoke establishments charge customers for the duration of hours they use and occupy the private rooms as opposed to any conduct occurring inside the private rooms.” (Ji Defs.' Mem. at 34.) The Court finds that a karaoke establishment's collection of karaoke songs is certainly at least “a draw” for potential customers and there are issues of fact as whether the Individual Defendants had the right to supervise the activities of their patrons. (See, e.g., Pl.'s Response to Ji Defs.' 56.1 Statement, ¶¶ 172-77.) Thus, I recommend that Defendants' cross-motion be denied with respect to Plaintiff's claims against the Individual Defendants. Accord Elohim EPF USA, Inc. v. Total Music Connection, Inc., No. 14-CV-02496 (BRO) (EX), 2015 WL 12655556, at *19 (C.D. Cal. Oct. 1, 2015) (finding reasonable to infer that individual defendants with ownership interest in karaoke establishments would financially benefit from infringement, but finding triable issue of fact as to individual defendants possessed right and ability to supervise infringing activity).
CONCLUSION
For the foregoing reasons, I respectfully recommend that Plaintiff's partial motion for summary judgment be DENIED and Defendants' cross-motions for summary judgment be GRANTED IN PART and DENIED IN PART. Specifically, it is my recommendation that Defendants' cross-motions be granted with respect to the following nine musical compositions: Tteol Eo Jinda Nun Mul-I, Go Hae, Baramkyul, Sa Rang A, Ibyeol-Eun Sarang Dwileul Ttalawa, Ga Sum A-Pa Do, Gondrae Mandrae, It Ji Mal A Yo, and Kong Kak Ji. In addition, as set forth in footnote 2 above, I recommend that the motions at ECF Nos. 230 and 238 be DENIED AS MOOT.
NOTICE OF PROCEDURE FOR FILING OBJECTIONS TO THIS REPORT AND RECOMMENDATION
The parties shall have fourteen (14) days (including weekends and holidays) from service of this Report and Recommendation to file written objections, pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure. See also Fed.R.Civ.P. 6(a), (d) (adding three additional days when service is made under Fed.R.Civ.P. 5(b)(2)(C), (D) or (F)). A party may respond to another party's objections within fourteen days after being served with a copy. Fed.R.Civ.P. 72(b)(2). Such objections, and any response to objections, shall be filed with the Clerk of the Court. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(d), 72(b). Any requests for an extension of time for filing objections must be addressed to Judge Nathan.
FAILURE TO OBJECT WITHIN FOURTEEN (14) DAYS WILL RESULT IN A WAIVER OF OBJECTIONS AND WILL PRECLUDE APPELLATE REVIEW. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(d), 72(b); Thomas v. Arn, 474 U.S. 140 (1985).