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Case: Lideres Entertainment Group Inc. v. Aaron Lopez Valdovinos, Aaron Lopez Jr. and Jacqueline Lopez d.b.a. AJR Discos Case no.: 03cv21044, U.S. District Court, Southern District of Florida Description: Copyright infringement Filing date: June 25, 2003 Trial date: Sept. 13-23, 2005 Judge: U.S. District Judge Jose Martinez Plaintiff attorney: Cheryl Hodgson, Law Offices of Cheryl Hodgson, Santa Monica, Calif.; Karen L. Stetson of Broad and Cassel, Miami Defense attorneys: Thomas Meeks and Matthew Davidson, Zuckerman Spaeder, Miami Details: Miami-based music producer Lideres Entertainment Group entered a contract with the Santa Monica, Calif.-based producer of Mexican regional music AJR Discos in April 2001, allowing Lideres to produce certain albums created by AJR. Under the agreement, Lideres would pay AJR $150,000 in advances plus royalties on the albums. In February 2003, AJR sent Lideres a letter demanding that the company cease marketing, advertising and selling its products, alleging that Lideres had not paid all of the money due and that the company had ceased marketing its product. Lideres responded by suing in Miami federal court, claiming it was not in breach of the contract and had not been given 30 days to rectify its nonpayment as required in the contract. AJR responded with counterclaims, alleging Lideres breached the contract and its continued retention of the albums amounted to copyright infringement. AJR sought statutory damages for its music and demanded a jury trial for damages — a rare move that has only been possible under the copyright law since 2001. The case went to trial on the copyright counterclaims last month. Plaintiff case: The plaintiffs alleged Lideres breached the contract by not paying royalties for the music on time. AJR argued that since the contract had been breached, it had the right to get the license to its music back. Since Lideres refused, AJR sought statutory damages under copyright law, which are $750 to $30,000 if the infringement is not willful and $750 to $150,000 if the infringement is willful. AJR claimed infringement on 93 songs on a total of 20 albums. The 2001 U.S. Supreme Court decision Feltner v. Columbia allowed the claims to go to a jury for the first time, but the ability to seek statutory copyright damages before a jury has not been used frequently. Defense case: Lideres admitted it breached the contract but claimed it had tried to correct its mistake and pay the royalties within the 30-day period allowed in the contract. Lideres also argued that there were no damages because it had not made any money off of AJR’s albums. Outcome: After a two-week trial, an eight-member jury returned a mixed verdict. After deliberating less than two days, the jury determined that Lideres had breached its contract but owed AJR no damages. Meeks said that rolling the dice with a jury on a complex copyright case might not be the best thing to do. “It’s not always the best decision,” he said. “The lesson of this case is maybe you shouldn’t request a jury on a copyright case.” Hodgson said she plans to appeal the jury’s decision to the 11th U.S. Circuit Court of Appeals.

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