Elohim EPF USA, Inc. v. 162 D & Y Corp.

Background

Elohim EPF USA, Inc. alleged that the defendants—operators of karaoke bars and affiliated persons and entities—violated copyrights in musical works. Elohim claimed to be the United States subpublisher for a substantial number of music publishers in the Republic of Korea and to control the right to license those publishers’ compositions in the United States. At the time of the order, Elohim claimed infringement involving sixteen works.

The predecessor district judge referred the case to Magistrate Judge Aaron for pretrial supervision and rulings on certain dispositive motions. Judge Aaron recommended denying Elohim’s motion for partial summary judgment and denying the defendants’ motions for summary judgment. Elohim objected principally to the recommendation’s conclusion that factual disputes remained about whether performances in private karaoke rooms were public performances. The defendants objected principally to the conclusion that a reasonable fact finder could find that Elohim had established a clear chain of title and ownership of valid copyrights.

Public-performance issue

The Copyright Act defines performing a work publicly to include performing it at a place open to the public or at a place where a substantial number of people outside a normal family and social circle are gathered. Elohim argued that performances in private areas of establishments otherwise open to the public should qualify as public performances. The defendants argued that no public performance occurred in the private rooms, which patrons rented for set periods for use by the renting party and guests, apart from food and beverage service.

The court explained that a performance could be public if the establishment was predominantly a public space despite its small private areas, or if the rented-room gatherings routinely included a substantial number of people outside the ordinary family and social circle. A defendant that actively facilitated such performances could be liable for contributory or another form of infringement.

The court held that the summary-judgment record was too sparse and generic to determine whether any particular defendant infringed any particular protected work. The record showed that certain defendants may have regularly rented private areas and supplied karaoke equipment, but factual questions remained about the establishments’ layouts, the size and location of public and private areas, whether doors were kept closed, whether sound traveled outside the rooms, and whether users routinely allowed casual acquaintances to enter. The court stated that a trial was necessary and that the trial evidence might eventually permit a ruling as a matter of law that the works were performed publicly.

Copyright ownership and right to sue

Elohim sought to enforce rights in fourteen works whose registrations had been issued within five years. It asserted that it owned exclusive U.S. public-performance rights through subpublishing agreements with Elohim Korea and Prime M&E, which had obtained rights from the original songwriters. The defendants challenged Elohim’s title in twenty-five works, relying in part on search results from the Korea Music Copyright Association and the Korean Digital Copyright Exchange.

The court concluded that the defendants’ evidence did not establish as a matter of law that Elohim lacked the right to enforce the copyrights. Because the evidence was insufficient on its face to defeat Elohim’s claims, the court did not need to rule on Elohim’s objections to that evidence. The magistrate judge had not reached the ownership issue because of the unresolved public-performance issue.

Ruling and next steps

After reviewing the objected-to portions of the Report and Recommendation de novo, meaning independently and from the beginning, Judge Castel found it well reasoned and supported by the facts and law. He adopted it in its entirety. The order therefore denied Elohim’s motion for partial summary judgment and denied the defendants’ motions for summary judgment. The Clerk was directed to terminate the listed motions.

The case was to proceed toward trial. The order set deadlines for the parties’ proposed jury questions, verdict sheets, jury instructions, motions concerning the evidence to be presented at trial, and joint pretrial submission, and scheduled a final pretrial conference for September 21, 2022.