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Federal judge orders Chicago Heights bar to pay $32,000 over copyright infringement at karaoke nights

By Andrew Thomason | Jul 10, 2014

A small bar in Chicago Heights and its owner will have to pay one of the nation's largest music licensing businesses $32,000 for illegally using eight songs during a karaoke night.

Broadcast Music Inc. late last month was awarded summary judgment in its federal lawsuit against M.R.T.P. Inc, which does business as Prisco’s Eleven West, and its owner, Anthony Prisco.

U.S. District Judge John F. Grady, however, denied the company's motion for summary judgment against co-defendant Michael Rossi and granted his request to be dismissed from the suit since he was affiliated with the bar at the time of the infringement.

The judge also awarded attorney's fees to both Broadcast Music and Rossi.

Broadcast Music Inc., known more widely as BMI, works on behalf of artists to collect and distribute royalties. In 2013, BMI brought in $944 million, $814 million of which was distributed to artists.

BMI first contacted Prisco, the owner of Prisco’s Eleven West, in 2010 about obtaining licenses to use its protected songs at karaoke nights. Over the course of the next two years, BMI claims it sent several letters and at least two emails restating that message to Prisco.

Prisco, according to the federal ruling, disregarded the warnings.

Eventually, BMI sent an investigator to a karaoke night at Prisco’s in 2012. The investigator then made a report of the songs recognized as under BMI’s control performed that night and additional songs were identified through a recording the investigator made.

The songs at the center of the copyright dispute are “The Beautiful People,” "Keep Your Hands To Yourself," "Killing Me Softly With His Song," “Mr. Jones," “Round Here," “Walk," “Keep it Comin Love” and “Name."

BMI and the artists that stood to get royalties filed a suit against Prisco's, Prisco and Rossi, who was listed on paperwork the bar filed with the Illinois Liquor Control Commission. The plaintiffs sought statutory damages, as well as attorney's fees and costs.

The plaintiffs then filed a motion for summary judgment in their favor and the defendants countered with a cross-motion seeking summary judgment in their favor.

In his June 26 ruling, Grady granted BMI summary judgment, exempting Rossi, and awarded the company $4,000 for each violation, for a total of $32,000.

"They were on notice that copyright infringement was occurring at Prisco’s and did not attempt to correct it," Grady wrote in his ruling, which noted that the two defendants "acted willfully in violating plaintiff’s rights."

Grady said that his $32,000 award, which was what the plaintiffs requested, is more than six times the amount of unpaid licenses fees for the eight songs.

"At first blush, this sounds a bit excessive, but not after we consider that MRTP and Prisco continued their infringing behavior after being given numerous notifications and opportunities to obtain a license over the course of a year and a half," he wrote. "They dragged their feet on appearing in this action and have contested liability with no basis for doing so."

Grady said he believes his award is reasonable, is within the statutory range, and "should be sufficient to deter future violations."

In regards to Rossi, the judge granted his own request for summary judgment. In his motion, Rossi claimed he was no longer associated with Prisco’s enterprise and as such, should not be held liable for the copyright infringement.

Rossi was named as a defendant because he was listed as the secretary for Prisco’s Eleven West on the Liquor Control Commission’s website. When Prisco’s liquor license was renewed with the state, it stated that officers listed on the paperwork would remain the same unless otherwise noted.

Rossi claims he stopped having any association with Prisco’s in 2002, but his name continued to show up on the liquor license renewal.

Grady agreed with Rossi and said even if he was named as secretary on the liquor license, the plaintiffs still shouldn't have named him as a defendant in their suit.

“The fact that he may have been a corporate officer of MRTP at one time is not material because it does not imply a financial interest," Grady wrote, adding that the "plaintiffs completely ignore the factor of whether Rossi had the right and ability to supervise the infringing activity at Prisco’s."

Not only did Grady award BMI attorney's fees against MRTP and Prisco, but he did the same for Rossi since he was the prevailing party in his motion for summary judgment.

He said that MRTP and Prisco's "defense of this case was frivolous," making an award of attorney's fees to the plaintiffs reasonable.

While he sided with the plaintiffs on that point, he disagreed with their contention that Rossi shouldn't be awarded attorney's fees on his "distracting and frivolous" summary judgment motion because his co-defendants "essentially admitted the copyright infringement claims in this case."

"The liability of Rossi’s co-defendants has nothing to do with Rossi’s liability," Grady said. "As to Rossi, it is not Rossi’s motion, but that of plaintiffs, that was frivolous. Their argument for Rossi’s vicarious liability was so weak that they could not meet their initial burden on summary judgment."

As such, Grady determined Rossi is entitled to attorney's fees and costs. He noted that because Rossi shares the same attorneys as MRTP and Prisco, he is only entitled to the fees and costs incurred on his behalf, which "appear to be negligible."

The judge "strongly encouraged" the parties to try to come to an agreement on the amount of attorney's fees, saying "the court has spent an undue amount of time on this case.

He said if an agreement isn't reached by August 15, the parties should submit a proposed judgment order to the court by August 25.

The plaintiffs are represented by Paul R. Coble and Charles A. Laff of Michael Best & Friedrich LLP. Anthony C. Scrementi of Cifelli, Scrementi & Dore represents the defendants.

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