Gordon Rees Scully Mansukhani Partner Craig Mariam and Senior Counsel Alison Pringle secured an appellate victory in a copyright infringement matter concerning audiobook subscriptions, with the Second Circuit affirming the dismissal of all claims against the firm’s client, one of the country’s leading audiobook publishers.
The underlying lawsuit arose from the distribution of audiobook versions of the plaintiff’s works via subscription-based streaming services. The plaintiff alleged this distribution infringed its copyrights in books by a particular author and exceeded the scope of the applicable distribution license. Critically, however, the license provided for the exclusive rights to distribute copies of the works via mediums and means capable of emitting sounds derived from the recording of audiobooks, without restriction.
The Eastern District of New York previously granted the defendants’ motion to dismiss, where GRSM successfully argued that the license agreement at issue unambiguously allowed for the defendants’ distribution of the works through online subscription services and that the plaintiff’s claims sounded in breach of contract, not copyright infringement. The plaintiff’s arguments that the license agreement required distribution on a per-unit basis only, and not via subscription memberships, were unavailing. The Eastern District also rejected the plaintiff’s claims that the availability of excerpts for subscribers to listen to without paying would constitute unauthorized distribution of “abridged” versions of the works, as there were no allegations that the works were condensed or otherwise altered.
On appeal, the Second Circuit affirmed in full, finding that the plaintiff had failed to allege copyright claims against the firm’s client. The Second Circuit further rejected the plaintiff’s arguments that the works were improperly distributed for “free” via the subscription services, noting repeated contradictory allegations from the complaint that the works were in fact distributed to subscribers in exchange for compensation in the form of membership fees. The license agreement did not require that the works be distributed only in a manner that would generate royalties on a per-unit basis. Instead, the plaintiff’s allegations amounted to only a contractual dispute over what royalties the plaintiff should have received for the distribution of the works.
Partnering with GRSM’s Intellectual Property practice provides clients with a sophisticated, highly skilled team adept at securing, asserting, and defending all aspects of intellectual property rights, including patents, trademarks, copyrights, design rights, and trade secrets. With a deep bench of professionals, GRSM’s proven litigation and trial experience, global reach, and technical backgrounds ensure effective protection and strategic management of valuable IP assets.