By The great reggae musician Bob Marley passed away more than 30 years ago. Nevertheless, litigation surrounding his music legacy continues on. The Ninth Circuit recently issued an opinion in Rock River Communications, Inc. v. Universal Music Group, Inc. that dealt again with the issue of who owns the rights to Mr. Marley’s music.
Rock River is a producer and distributor of music records. In 2006, it entered into a licensing agreement with San Juan Music Group that granted it a non-exclusive license to “sample” 16 musical recordings performed by Bob Marley and the Wailers. San Juan has been licensing Mr. Marley’s music since 1980 through an agreement with a producer of Mr. Marley’s early recordings, Lee Perry.
Rock River made a series of remixes based on the recordings it had licensed from San Juan and created an album titled, “Roots, Rock, Remixed.” Rock River intended to sell the album on iTunes, distribute it in record stores, and also had plans to allow the use of one of its recordings in the film “Dear John”. Rock River was unaware that any entity had disputed San Juan’s right to license Mr. Marley’s early recordings.
In October 2007, UMG sent cease and desist letters to Rock River and its business partners claiming that Rock River’s album violated UMG’s exclusive licensing rights to Mr. Marley’s recordings. UMG also sent letters to Apple requesting that the music be removed from the iTunes store; Relativity threatening to sue it if it used one of the Rock River’s tracks in its movie “Dear John” and other companies demanding that they cease distributing Rock River’s album. As a result of these letters, Rock River’s album was removed from the iTunes stores and a decision was made not to use one of its songs in the “Dear John” movie.
Rock River then sued UMG for various claims, including a claim for intentional interference with prospective economic advantage. After obtaining the dismissal of Rock River’s other claims, UMG moved for summary judgment as to the intentional interference claim arguing that Rock River could not produce evidence to establish that it had a valid license to distribute the music. In essence, UMG argued that because Rock River could not establish a valid license, it was seeking to enforce an “illegal business expectancy” and that such a claim would fail under California law. The District Court agreed with UMG and granted judgment against Rock River as to its intentional interference claim.
The Ninth Circuit began by acknowledging that the elements of an intentional interference claim include: (1) an economic relationship between plaintiff and a third party that would bring economic benefit to plaintiff; (2) defendant’s knowledge of the relationship; (3) an intent by defendant to disrupt the relationship; (4) defendant engaging in wrongful conduct to disrupt the relationship; (5) the disruption of the relationship; (6) damage to plaintiff; and (7) the defendant’s wrongful conduct being a substantial factor in causing plaintiff damages. UMG argued that intentional interference claim also requires proof of an additional element: “the validity or legality of the plaintiff’s business expectancy”. The Ninth Circuit rejected this argument and held that this was not a required element for a plaintiff to establish to prevail on an intentional interference claim. Rather, the Ninth Circuit held that the issue of the illegality of the business expectancy is an affirmative defense that must be pled and proved by the defendant.
The Ninth Circuit began by reviewing California cases concerning intentional interference claims and concluded that “the California state cases are in accord that the validity and legality of the expectancy are not elements that must be proved by the plaintiff.” The Ninth Circuit acknowledged that a plaintiff could not prevail on an intentional interference claim if the contract or relationship that was interfered with was in fact illegal, but that the burden of proving illegality remains on the defendant. This is premised in large part because “[B]oth California and federal law assume that people act lawfully unless proven otherwise.”
The Ninth Circuit continued by recognizing that it was “not at all clear that UMG (or any other entity) holds exclusive rights to the Marley Recordings such that Rock River’s attempt to distribute and license its remixes would be an unlawful pursuit.” The Court found that Rock River had submitted some evidence that in fact its license was legal in that it had received “a non-exclusive oral license for [some of the tracks] from Lee Perry.” The Court also found it significant that San Juan had an established history of licensing the Marley tracks, at issue and accounting for them to Lee Perry. The Court held that the testimony of Lee Perry that he had granted an oral license to Rock River for some of the Marley tracks and San Juan’s uninterrupted history of licensing said tracks, created a triable issue of fact as to whether Rock River had a valid license to distribute its Roots, Rock, Remixed album. Therefore, the Ninth Circuit reversed the grant of summary judgment and remanded the case back to the District Court for trial of Rock River’s intentional interference claim against UMG.
The holding in the Rock River case may be of limited significance to future litigation because of the improvements in record-keeping over the last several decades. There is a potential, however, that plaintiffs asserting rights to older music where documentation of licensing rights may be spotty or incomplete may have an easier time in stating a claim for intentional interference which would at least allow the plaintiff to proceed to trial.