EMI April Music Inc. et al v. 4MM Games, LLC et al

Filing 73

MEMORANDUM AND OPINION. The January 13, 2014 Report is adopted. The Clerk of Court shall enter judgment against 4MM for $535,125, plus pre-judgment interest at the rate set forth in 28 U.S.C. § 1961, in favor of Capitol. And 4MM, its agen ts, officers, servants, employees, successors and/or assigns, and all persons or companies in active concert and/or participation with 4MM, are hereby enjoined from reproducing, distributing, publicly performing or otherwise exploiting the Recordings , including without limitation in conjunction with the Rapstar video game. The parties' failure to file written objections precludes appellate review of this decision. See United States v. Male Juvenile, 121 F.3d 34, 38 (2d Cir. 1997). (Signed by Judge Denise L. Cote on 4/7/2014) (gr)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
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:
EMI APRIL MUSIC INC., et al.,
:
:
Plaintiffs,
:
:
-v:
:
4MM GAMES, LLC, et al.,
:
:
Defendants.
:
:
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12 Civ. 2080 (DLC)
MEMORANDUM OPINION
& ORDER ADOPTING
REPORT &
RECOMMENDATION

DENISE COTE, District Judge:
On January 13, 2014, Magistrate Judge James L. Cott issued
a Report and Recommendation (“Report”) recommending an award of
statutory damages under the Copyright Act in the amount of
$535,125, plus pre-judgment interest at the rate set forth in 28
U.S.C. § 1961, as well as the entry of a permanent injunction
against defendant 4MM Games, LLC (“4MM”).

For the following

reasons, the Court perceives no error in the Report and the
Report is adopted.
BACKGROUND
Plaintiff Capitol Records, LLC (“Capitol”) is a major
American record label that produces, records, markets, and
distributes recordings by many well-known artists.

Capitol owns

or is the exclusive licensee of the copyrights for the sound
recordings “Oblighetto” by Brother Jack McDuff, “The Big Beat”
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by Billy Squier, “Harder Better Faster Stronger” by Daft Punk,
“It Was a Good Day” by Ice Cube, “Pass Out” by Tinie Tempah, “I
Got Five On It” by Luniz, and “This Is Why I’m Hot” by Mims (the
“Recordings”).
4MM is a video-game developer that created, published, and
distributed Def Jam Rapstar (“Rapstar”), a video game that
allows players to perform famous rap songs.

In 2009, 4MM

approached Capitol seeking to license the Recordings.

Capitol

agreed to license the recordings and sent terms to 4MM, which
included licensing fees totaling $78,375 for use of the
Recordings.

The terms also included a royalty of 15% of the

retail price charged for each downloadable Recording.
Capitol and 4MM never executed the proposed license
agreement, and 4MM never paid Capitol for use of the Recordings.
Nonetheless, 4MM used the Recordings in Rapstar, both in the
original game and as additional downloadable content.
Approximately 720,000 units of Rapstar were sold worldwide; the
number of Recordings purchased as downloadable content is
unknown.
Capitol, together with other plaintiffs, brought this
copyright infringement suit against multiple defendants,
including 4MM, alleging the unauthorized reproduction,
distribution, use, and exploitation of certain musical
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compositions and sound recordings, including Capitol’s
Recordings, in connection with Rapstar.
settled with plaintiffs.

All defendants but 4MM

4MM never responded to the complaint

or otherwise appeared in this action.

On November 15, 2012, the

Court ordered that a default judgment be entered against 4MM,
and on April 22 referred the case to the Honorable James L.
Cott, United States Magistrate Judge, for an inquest on damages.
Capitol was the only plaintiff to submit papers in support of a
claim for damages.
Magistrate Judge Cott issued a Report and Recommendation
(the “Report”) on January 13, 2014, recommending an award of
statutory damages under the Copyright Act in the amount of
$535,125, plus pre-judgment interest at the rate set forth in 28
U.S.C. § 1961, as well as the entry of a permanent injunction
against 4MM.

Pursuant to 28 U.S.C. § 636(b)(1) and Rule 72 of

the Federal Rules of Civil Procedure, the parties had fourteen
days from service of the Report to file any objections.

The

time for objections to be filed expired on January 27, 2013; no
objections have been filed.
DISCUSSION
When deciding whether to adopt a report, a court “may
accept, reject, or modify, in whole or in part, the findings or
recommendations made by the magistrate judge.”
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28 U.S.C.

§ 636(b)(1)(C).

To accept those portions of the report to which

no timely objection has been made, “a district court need only
satisfy itself that there is no clear error on the face of the
record.”

Skaff v. Progress Int’l, LLC, 12 Civ. 9045 (KPF), 2014

WL 856521, at *3 (S.D.N.Y. Mar. 4, 2014) (citation omitted).
Magistrate Judge Cott’s Report is supported by the record
and there is certainly no “clear error.”

In determining an

appropriate award, Magistrate Judge Cott balanced 4MM’s willful
infringement and the need for specific and general deterrence
against 4MM’s less than substantial profits and the uncertainty
concerning the number of downloads of three of the Recordings.
To calculate the appropriate damages award, the Report considers
awards in other cases, and ultimately recommends trebling the
licensing fee proposed by Capitol for the Recordings used in the
original game and granting $100,000 per work for the three
Recordings available for download.

There is no “clear error”

apparent in the Report’s damages calculation, or in its
recommendation of pre-judgment interest.
Nor is any error apparent in the Report’s recommended
permanent injunction.

As Magistrate Judge Cott notes, Capitol’s

damages are difficult to measure, 4MM may be unable to satisfy
judgments against it, and 4MM continued its infringing
activities even after being notified of the infringement.
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CONCLUSION
The January 13, 2014 Report is adopted.

The Clerk of Court

shall enter judgment against 4MM for $535,125, plus pre-judgment
interest at the rate set forth in 28 U.S.C. § 1961, in favor of
Capitol.

And 4MM, its agents, officers, servants, employees,

successors and/or assigns, and all persons or companies in
active concert and/or participation with 4MM, are hereby
enjoined from reproducing, distributing, publicly performing or
otherwise exploiting the Recordings, including without
limitation in conjunction with the Rapstar video game.

The

parties' failure to file written objections precludes appellate
review of this decision.

See United States v. Male Juvenile,

121 F.3d 34, 38 (2d Cir. 1997).

SO ORDERED:
Dated:

New York, New York
April 7, 2014
_________________________________
DENISE COTE
United States District Judge

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