WASHINGTON (Legal Newsline) - Ford and General Motors are being sued in a class action lawsuit by the Alliance of Artists and Recording Companies, alleging the CD players in the vehicles violate the law by ripping music to the vehicle's hard drive.
The AARC also named Denso International America Inc. and Clarion Corporation of America as defendants in the suit, alleging Denso and Clarion supplied GM and Ford with devices that are installed in and distributed with their vehicles.
The AARC claims that the defendants violated the Audio Home Recording Act of 1992, according to a complaint filed July 25 in the U.S. District Court for the District of Columbia.
"The AHRA is a comprehensive statutory scheme enacted in 1992 to regulate the manufacture, importation and distribution of digital audio recording devices," the complaint states. "Congress enacted the AHRA to ensure both that consumers would have access to digital audio copying technology and that artists and other copyright owners would be fairly compensated for the copying of their works."
The defendants are multi-billion dollar companies that manufacture, import and/or distribute hundreds of thousands of products in the United States every year, according to the suit.
AARC claims the defendants are also beneficiaries of the AHRA, which shields them from liability for copyright infringement for manufacturing, importing and/or distributing certain recording devices as long as they "incorporate certain copying control technology" and "pay a modest royalty per device that is then distributed to musical artists and music copyright owners."
"Nonetheless, defendants have refused to comply with the AHRA and refused to pay the royalties that Congress has determined they owe for the recording devices they manufacture, import and/or distribute—notwithstanding intensive efforts by the AARC going back at least two years to persuade defendants to live up to their statutory obligations," the complaint states. "Defendants’ intransigence has left the AARC with no choice but to file this lawsuit."
AARC claims the defendants distribute these devices either pre-installed in vehicles or intended for use in vehicles.
"Defendants designed these devices for the express purpose of copying music CDs and other digital musical recordings to a hard drive on the devices, and they market these devices emphasizing that copying function," the complaint states. "By doing so, defendants violate the AHRA because defendants (a) have not registered these devices with the U.S. Copyright Office; (b) have not paid royalties for these devices; and (c) have not incorporated the Serial Copy Management System or its functional equivalent in these devices, all of which are required by the AHRA."
The devices installed in Ford and GM's vehicles clearly fall within the scope of the AHRA, according to the suit.
AARC claims certain other manufacturers that distribute the same type of in-vehicle CD-copying devices acknowledge that such devices are subject to the AHRA.
"These manufacturers submit to the Copyright Office the required royalty payments for their devices," the complaint states. "Defendants, in stark contrast, continue to manufacture, import, and/or distribute such devices without complying with any of the AHRA’s requirements."
AARC is seeking class certification, permanent injunction enjoining the defendants from violating the AHRA; actual damages to the unpaid royalties on the digital audio recording devices imported and distributed or manufactured and distributed; for additional damages equal to 50 percent of the actual damages; for statutory damages equal to $2,500 per digital audio recording device manufactured, imported or distributed; and pre- and post-judgment interest. AARC is represented by Dustin Cho and Jonathan M. Sperling of Covington & Burling LLP.
The case has been assigned to District Judge Ketanji Brown Jackson.
U.S. District Court for the District of Columbia case number: 1:14-cv-01271
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