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In a verdict that is sure to capture the attention of radio broadcasters and performers, a federal court jury in Pittsburgh has awarded more than $1.2 million to SESAC Inc. — the smallest and least-well-known of the three major performing rights organizations — in its copyright infringement suit against the owner of three radio stations. The jury found that WPNT Inc. — the owner of two radio stations in the Pittsburgh area and one near St. Louis — had infringed the copyrights of 31 songs, including such well-known ditties as “Like a Rolling Stone” and “Grandma Got Run Over by a Reindeer.” For 22 songs, the jurors said the infringement was “willful” and awarded statutory damages as high as $150,000, the maximum allowed under the law. For nine other songs, the jury found that the infringement was “neither innocent nor willful” and awarded damages ranging from $1,000 to $3,000. Plaintiff’s attorney Gary Rosen of Dallas-based Akin Gump Strauss Hauer & Feld said SESAC will also be asking U.S. District Judge Robert J. Cindrich of the Western District of Pennsylvania to exercise his discretion to award attorney fees that are likely to top $500,000. Like the more famous and larger ASCAP (the American Society of Composers, Authors & Publishers) and BMI (Broadcast Music Inc.), SESAC, which was founded in 1930 as the Society of European Songwriters, Authors and Composers, is in the business of licensing the rights to music. Although SESAC still has just a fraction of the market, its share has grown considerably in recent years with the acquisition of two heavyweight clients — Bob Dylan and Neil Diamond. All three companies sell a “blanket” license that allows radio stations to play any of the music covered by their copyrights. But while nearly all stations pay for ASCAP and BMI, a significant percentage continue to forego purchasing a SESAC license. According to court papers, of the more than 11,000 radio stations in the United States, 1,123 or about 10 percent, do not hold SESAC licenses, including 824 all-music stations. The jury’s verdict in Pittsburgh was the culmination of an ugly court battle SESAC began in 1998 against a trio of stations that decided to stop purchasing SESAC licenses, but continued to play SESAC music, according to court documents. WPNT Inc. owns WRRK-FM in Braddock, Pa., and WLTJ-FM in Pittsburgh, and, until 1999, owned KXOK in Florissant, Mo. The company is closely held by a New York man, Saul Frischling, and his three sons, Gregg, Todd and Michael. At one time, all of WPNT’s stations were licensed to publicly perform SESAC copyrighted works. But in 1989, the suit alleged that the company stopped payments to SESAC, claiming it no longer publicly performed SESAC works. Ever since, SESAC says it has repeatedly offered to sell WPNT a blanket license. In 1994, SESAC began to use new technology developed and patented by Broadcast Data Systems to monitor radio station performances, for apportioning royalties to its affiliates, court papers state. With the BDS technology, a digital fingerprint of a musical composition is created and then stored in BDS’ pattern library consisting of 100,000 works. BDS then reviews works that are being played by a selected sample of radio stations at one of its monitoring stations. The BDS technology converts the analog stream from the radio transmission into a digitized form, which is then compared to the works in its pattern library. Although the BDS system cannot identify performances of works that are not stored in its pattern library, the detections that it does make have been found, on aural comparison to actual audiotapes, to be 99.8 percent accurate, according to court papers. The BDS system is also used to compile the famous, industry standard “Billboard Charts” and, by many national advertisers, to monitor the airplay of their commercials. In April 1996, BDS began to monitor WLTJ and KXOK for SESAC and found that both stations were playing SESAC works, court documents state. But even when SESAC confronted the stations with proof that they had played SESAC songs, the suit alleged that WPNT continued to broadcast the songs and refused to buy any license. Rosen said that if WPNT had decided to pay instead of fighting the battle in court, its licenses for all three stations would have cost less than $5,000 per year — a fraction of the $170,000 in annual license fees it currently pays for ASCAP and BMI licenses for just their two remaining stations. Soon after the lawsuit began, WPNT promised in a consent decree that it would stop playing SESAC works. But in November 1998, SESAC was back in court asking that WPNT be held in contempt, saying it had flouted the consent decree by playing SESAC works at least 244 times, Rosen said. Judge Cindrich denied the contempt motion, and the 3rd U.S. Circuit Court of Appeals refused to take the issue up, saying SESAC’s appeal was premature. When the suit came to trial, SESAC set out to prove that WPNT had not only played the 31 SESAC songs on its stations, but did so with full knowledge that it had no license to do so. Rosen told the jury about the long history of communications between SESAC and WPNT in letters that informed the broadcasters about the growing library of SESAC works. In March 1995, he said, the broadcasters were specifically warned that Neil Diamond and Bob Dylan had become SESAC artists. In court papers, Rosen said that WPNT was “caught red-handed” repeatedly playing SESAC music. In his jury instructions, Judge Cindrich said there was “no dispute” that SESAC had valid copyrights and that WPNT had infringed them. As a result, the jury was asked to decide not whether infringement had occurred, but only what sort. For each of the 31 songs, jurors decided whether the infringement was “innocent,” “willful” or “neither innocent nor willful.” The jury found that none of the infringement was innocent. Instead, it found that for 22 songs, the infringement was “willful,” and that for the nine remaining songs, it was “neither innocent nor willful.” The damages aspect of the case was complicated by the jury’s duty to apply both the old and the new versions of the Copyright Act. For 19 of the songs, the jury applied the pre-1999 damage range of $500 to $20,000 per violation, with a maximum of $100,000 for willful violations; for 12 other songs, it applied the recently enhanced damage range of $750 to $30,000, with a maximum award of $150,000 for willful violations. The jury awarded the maximum $150,000 in damages for each of three songs, all by Bob Dylan — “Knockin’ on Heaven’s Door,” “Make You Feel My Love,” and “All Along the Watchtower.” Broadcasts of the Neil Diamond tune “Cracklin’ Rosie” were also labeled a willful violation and resulted in a $100,000 award, the maximum under the old law. But for many tunes, the jury awarded far less than the max, doling out just $63,000 for “Like a Rolling Stone” and $33,000 for “Lay Lady Lay.” Among the smaller awards in the verdict were damages of $1,000 to $3,000 for a slew of popular Christmas carols, including “Silent Night,” “Joy to the World,” Deck the Halls,” and “God Rest Ye Merry Gentlemen.” But the jury also found that WPNT was specifically warned that SESAC represented the copyright owner of “Grandma Got Run Over by a Reindeer,” and awarded $60,000 for that willful violation. By the time it was done, the jury had awarded $1,263,000 in statutory damages. WPNT’s lawyers Robert Sommer and Brian Sommer of Pittsburgh’s Hergenroeder, Rega and Sommer in Pittsburgh could not be reached for comment on the verdict

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