Beastie Boys et al v. Monster Energy Corporation

Filing 202

OPINION & ORDER: The Court hereby finds, based on the undisputed calculations above, that Brooklyn Dust is entitled to $108,000 in copyright damages for each of the first four musical composition copyrights and $59,400 for the musical co mposition copyright for "Looking Down the Barrel of a Gun." These awards total $491,400, Should UMPG, as a co-owner, obtain judgment against Monster on these five claims based on collateral estoppel, it would be entitled to an award of damages, consistent with these calculations, totaling $54,600. In so ordering, the Court recognizes the theoretical - albeit unlikely - possibility that Dust Brothers, or one or more of its individual members, will one day surface and purs ue judgment against Monster, while claiming a greater ownership interest in the musical composition copyright for "Looking Down a Barrel of a Gun" than that posited by plaintiffs. To protect Monster against that contingency, the Court agr ees with Monster (see Dkt. 199) that it is proper to require plaintiffs to indemnify Monster for any damages awarded to Dust Brothers for infringement of this copyright that are based on a finding of an ownership interest for Dust Brothers exceedi ng 45o/o. Plaintiffs do not appear to object to this reasonable condition. Accordingly, for the reasons stated herein: The Court awards a total of $300,000 to the Beastie Boys for Monster's infringement of the five sound recording copyrights at issue in this litigation. The Court also awards a total of $491,400 to Brooklyn Dust for Monster's infringement of the five musical composition copyrights. (Signed by Judge Paul A. Engelmayer on 2/20/2015) (kgo)

USDC SDNY

DOCUMENT

ELECTRONICALLY FILED

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEV/ YORK

DOC

X

#:_

DATE FILED Lt7.ôlrÉ,

BEASTIE BOYS, et al.,
12 Civ.6065 (PAE)

Plaintiffs,

OPINION & ORDER
v
MONSTER ENERGY COMPANY,
Defendant.

-------x
PAUL A. ENGELMAYER, District Judge:
This Opinion and Order apportions copyright damages among the plaintiffs in this case.
By way of background, between May 27 and June 5, 2014, the Court presided over a jury trial in
which the hip-hop group the Beastie Boys and affrliated persons and entities-namely, the two
surviving members of the Beastie Boys; the executor of the estate of the third Beastie Boys
member; and Brooklyn Dust Music, a distinct entity through which the Beastie Boys did
business (together,

"plaintiffs")-pursued claims against Monster Energy Company, the

beverage company. These claims arose out of Monster's creation and dissemination of a

promotional video that, without the Beastie Boys' knowledge or permission, used portions of

five songs composed and recorded by the Beastie Boys as its soundtrack and included text that
referred to the Beastie Boys. Plaintifß asserted 10 counts of copyright infringement in violation

of the Copyright AcI,17 U.S.C. $ 101 e/ seq.-one for each musical composition copyright and
one for each sound recording copyright

infringed-and one count of false endorsement in

violation of the Lanham Act, l5 U.S.C. $ i051 et seq.

On February 14,2074, Monster filed a pretrial memorandum that argued, inter alia, That
the plaintiffs are not the sole owners of the copyrights at issue, and so their share of any damages

awarded on the copyright claims must be limited to reflect their ownership interest. Dkt. 70, at

9. Plaintiffs

conceded that the Court would need to adjust any final judgment in their favor on

the copyright claims in light of the existence, for each of the copyrights, of other owner(s) who
had not brought

suit, Dkt. 86, at 7. In its March 18,2014 decision resolving various motions ln

limine, the Court agreed that, because the copyrights at issue are owned in part by entities that
had not joined in the lawsuit, any award of copyright damages would have to be discounted to

correspond to plaintiffs' ownership interests. Dkt. 90, at19-20.
On May 22,2014, the Friday before trial began, plaintiffs informed the Court that two of
the other co-owners of the copyrights at issue-Capitol Records ("Capitol") on the sound

recording side, and Universal Music Publishing Group ("UMPG") on the musical composition

side-had

agreed to assign to the Beastie Boys their rights to litigate copyright infringement

respect to Monster's

with

video. Dkt. 141, at9l. Plaintifß therefore proposed that the then-

upcoming trial resolve not only their legal interests, but also those of Capitol and UMPG.

Monster objected that the Court's acceptance of that assignment of rights on the eve of trial
would be unfairly prejudicial because plaintiffs had not given prior notice of this assignment, and
Monster had conducted the litigation up to that point, including in making offers ofjudgment
pursuant to Federal Rule of Civil Procedure 68, on the understanding that plaintiffs' ownership
interests were the only ones at issue. Id. at 99.
The Court ruled for Monster on this point. The Court noted that plaintiffs' last-minute

bid to expand the claimants at trial was extremely belated, without any justification. Out of
respect for Monster's "reasonable expectations" and "the integrity of the settlement process," the

2

Court denied plaintifß' bid to add the claims of Capitol and UMPG to those to be resolved at

trial. Dkt. 149,at34.
The Court noted, however, that the copyright claims that each co-owner could assert
against Monster appeared to be entirely identical. Therefore, not only were Capitol and UMPG

(or any other part-owner of a copyright interest) at liberty to vindicate their interests through a
separate lawsuit, but

it appeared that, were plaintiffs to prevail on their copyright claims here,

Capitol and UMPG could thereupon obtain judgment against Monster in such a lawsuit, as a
matter of collateral estoppel. See Roe v. City of llaterbury, 542 F,3d

31,4I (2d Cir. 2008) ("The

doctrine of offensive collateral estoppel permits a plaintiff tobar a defendant from relitigating an
issue that was decided in a prior case against the defendant."); Faulkner v.

Nat'l Geographic

Enters. Lnc.,409F.3d26,37 (2d Cir. 2005) ("In order for aplaintiff to bar a defendant from

litigating an issue on collateral estoppel grounds: '(1) the issues in both proceedings must be
identical, (2) the issue in the prior proceeding must have been actually litigated and actually
decided, (3) there must have been a full and fair opportunity for litigation in the prior proceeding,
and (4) the issue previously litigated must have been necessary to support a valid and hnal

judgment on the merits."' (quoting Gelb v. Royal Globe Ins. Co.,798F.2d38,44 (2d Cir.
1936)); see also Pqrklane Hosiery Co. v. Shore,439 U.S. 322,326 n.4,331-32 (1979)

(explaining the contours of the offensive collateral estoppel doctrine).

At trial, the jury found in plaintiffs' favor on all claims. The Court, without objection,
had instructed the

jury to measure damages on the copyright claims based on an assumption that

the plaintiffs owned I00% of the copyrights in question, with any ensuing allocation among

ownerstobedonebytheCourt. SeeTr.1608. Thejuryawardedatotalof $1.2millionin
statutory damages, which reflects an award of $120,000 for each of the five sound recording

J

copyrights and $120,000 for each of five musical composition copyrights. SeeDkL147

("Verdict Form"), at 3.1
On September 24,2014, Capitol and UMPG filed a Complaint against Monster, which
asserts 10 copyright infringement claims that are essentially identical to

plaintiffs' claims

and,

consistent with the jury verdict, measures total damages for each infringement at $120,000.
14 Civ. 7718,

,See

Dkt. 1. In tight of the fact that this lawsuit is ongoing, and that an application for

entry ofjudgment in Capitol's and UMPG's favor as a matter of collateral estoppel would appear

to be premature until a final judgment has been entered, the Court has granted several extensions
of time for Monster to answer, See id. Dkt. 9, 10, 11, 12. The lawsuit brought by Capitol and
UMPG therefore remains in its infancy.
This Order apportions, as to each of the 10 copyright infringement claims, the damages
owed to the Beastie Boys and Brooklyn Dust, the plaintiffs in this case who have ownership
interests in one or more of the copyrights at issue. The Court has received several helpful letters

from counsel on this point. See 12 Civ. 6065, Dkt. 164,

l7I,

172, 187, 196,199. Further, with

the exception of one of the 10 copyrights at issue, the Court has received writings reflecting the

affirmative agreement of all copyright holders as to the percentage interest held by each owner in
that copyright. Therefore, as to nine of the 10 claims, there is no risk that inconsistent ownership
allocations will be used to apportion damages in the different lawsuits against Monster, thereby

resulting in unfairly high damages awards. As to the tenth copyright, the Court explains below
the mechanism it will use to guard against any such unfair outcome.

I The;ury, in the alternative, awarded $1 million in actual damages, which reflects an award of
$100,000 for each of the five sound recording copyrights and $100,000 for each of five musical
composition copyrights infringed. Id. at2.
4

The Court's award of damages to these plaintiffs is based on the following calculations:

Sound Recordins Copvright Damases

Copyright

Damages Awarded

Beastie Boys Share

Capitol Share

Make Some Noise

$120,000

$60,000

$60,000

$120,000

$60,000

$60,000

Sabotage

$120,000

$60,000

$60,000

So What'Cha Want

$120,000

$60,000

$60,000

Looking Down the
Barrel of a Gun

$120,000

$60,000

$60,000

Pass the

Mic

As noted in the Court's December 15,2014 Order, Dkt. 185, plaintiffs represent, and
Monster has not disputed, that the Beastie Boys and Capitol Records each own a 50Yo undivided
legal and beneficial interest in the five sound recording copyrights at issue. See Dkt. 164,171.

A written agreement between the Beastie Boys and Capitol Records, which was entered into
evidence attrial, confîrms that Capitol has consented to this allocation. See PX 110, at25.

Accordingly, the Court finds that the Beastie Boys are entitled to 50Yo of the sound recording
copyright damages awarded by the jury. The Court therefore awards $60,000 to the Beastie
Boys for each of five copyrights infringed, for

a

total of $300,000. Should Capitol, as the other

50% owner, pursue and obtain judgment against Monster on these claims based on offensive

collateral estoppel, it would be entitled to an identical award of damages.

Musical Composition Copvrisht Damages

Bklyn. Dust Share

UMPG Share

$

108,000

$12,000

$

108,000

$12,000

120,000

$108,000

$12,000

So'What'Cha Want

$120,000

$108,000

$12,000

Looking Down the
Barrel of a Gun

$120,000

$59,400

$6,600

Copyright

Damages Awarded

Make Some Noise

$120,000
$120,000

Pass the

Mic

Sabotage

$

5

Plaintiffs also represent that,

as

to four of the five music composition copyrights at issue,

Brooklyn Dust is a90o/o owner, and UMPG is a I\Yo owner. As to the fifth musical composition
copyright, for the song "Looking Down the Barrel of a Gun," plaintiffs represent that Brooklyn
Dust is a 495% owner, that UMPG is a 5.5Yo owner, and that another non-party, Dust Brothers
Music,2 is a 45o/o ownet. Dkt. 164. UMPG agrees with the calculations of its ownership interest

in each of these songs: Plaintiffs have provided the Court with a declaration from David
Kokakis, UMPG's Senior Vice President, which accepts these representations and agrees that
UMPG will be bound by the schedule apportioning musical composition copyright damages
set out above.

as

Dkt.164,Ex.4.

Unfortunately, despite what appears to have been considerable effort, plaintifß have not
been able to confer with representatives of Dust Brothers or all of its various successors. See

Dkt. 1 87, 196. Nor have they been able to produce

a declaration, comparable to

which Dust Brothers agrees that its ownership interest is as plaintifß represent

UMPG's, in

it. At the same

time, there is no basis to assume that Dust Brothers would claim an ownership interest greater
than 45Yo in the musical composition copyright for "Looking Down the Barrel of a Gun."

The Court hereby finds, based on the undisputed calculations above, that Brooklyn Dust
is entitled to $108,000 in copyright damages for each of the first four musical composition

copyrights and $59,400 for the musical composition copyright for "Looking Down the Barrel of
a

Gun." These awards total $491,400, Should UMPG,

2

as a co-owner, obtain judgment against

The Court has been advised that, despite the confusing similarity in names, Dust Brothers
Music is wholly distinct from Brooklyn Dust Music. Dust Brothers Music was an entity through
which three songwriters-Matt Dike, John Robert King, and Michael Simpson-did business.
Each of those individuals, though their respective music publishing companies, now owns onethird of the copyrights previously held by Dust Brothers. Dkt. 164, at3.
6

Monster on these five claims based on collateral estoppel, it would be entitled to an award of
damages, consistent with these calculations, totaling $54,600.

In so ordering, the Court recognizes the theoretical-albeit unlikely-possibility that
Dust Brothers, or one or more of its individual members, will one day surface and pursue

judgment against Monster, while claiming a greater ownership interest in the musical
composition copyright for "Looking Down a Banel of a Gun" than that posited by plaintiffs. To
protect Monster against that contingency, the Court agrees with Monster (see Dkt. 199) that it is
proper to require plaintiffs to indemnify Monster for any damages awarded to Dust Brothers for

infringement of this copyright that are based on a finding of an ownership interest for Dust
Brothers exceeding 45o/o. Plaintiffs do not appear to object to this reasonable condition.

Accordingly, for the reasons stated herein: The Court awards a total of $300,000 to the
Beastie Boys for Monster's infringement of the five sound recording copyrights at issue in this

litigation. The Court also awards

a

total of $491,400 to Brooklyn Dust for Monster's

infringement of the five musical composition copyrights.

SO ORDERED.

P^,^X A
Paul A. Engelmayer
United States District Judge

Dated: February 20, 2015
New York, New York

7