Leadsinger, Inc. v. BMG Music Publishing

I. FACTUAL AND PROCEDURAL BACKGROUND

Karaoke devices necessarily involve copyrighted works because both musical compositions and their accompanying song lyrics are essential to their operation. BMG owns or administers copyrights in musical compositions and through its licensing agent, the Harry Fox Agency, has issued to Lead- singer compulsory mechanical licenses to copyrighted musi- cal compositions under § 115 of the Copyright Act. In addi- tion to the mechanical fee required to secure a compulsory license, BMG has demanded that Leadsinger and other karaoke companies pay a “lyric reprint” fee and a “synchroni- zation fee.” Leadsinger has refused to pay these additional fees and filed for declaratory judgment to resolve whether it has the right to visually display song lyrics in real time with song recordings, as well as print song lyrics, without holding anything more than the § 115 compulsory licenses it already possesses.

In its complaint, Leadsinger describes the karaoke device it manufactures as “an all-in-one microphone player” that has recorded songs imbedded in a microchip in the microphone. When the microphone is plugged into a television, the lyrics of the song…