Sybersound Records, Inc. Attacks Piracy in Karaoke Industry
LOS ANGELES, May 13 /PRNewswire/ -- Sybersound Records, Inc., an artist-run
record company based in Malibu, California, has filed suit in Los Angeles
Superior Court and Ontario Superior Court in Canada, seeking more than $200
million in damages arising from music piracy by karaoke record manufacturers.
Sybersound produces high-quality recordings for home-market karaoke use, under
product lines known as "Party Tyme Karaoke" and "Billboard Top 10 Karaoke."
Sybersound obtains karaoke synchronization licenses from publishers for all of
the songs released on its albums and pays royalties for all units sold.
The lawsuits allege that Sybersound's competitors have failed, unlawfully, to
license competing karaoke records, and have underreported sales to publishers
as a way of selling product below cost and undercutting Sybersound's pricing.
These below-cost sales amount to unfair trade practices, according to the suit.
"This has plagued the karaoke business for a long time," said Jan Stevens,
President and CEO of Sybersound. "We've always been scrupulous about paying
writers for the use of their songs, and have expected that our competitors
would do the same. It's time for the rest of the industry to do the right
thing, and we hope that our lawsuit will help make this happen." Propelled in part by the success of such television programs as American Idol,
the home karaoke business has grown rapidly over the last five years. Karaoke
machines and karaoke CD+Gs are now carried by major retailers nationally.
The lawsuits allege that Sybersound's competitors infringe on copyrights in
several ways. Certain popular writers, such as U2, Bon Jovi and ABBA, do not
permit karaoke use of their songs. Nonetheless, many karaoke companies include
songs by these writers on their albums.
In other cases, companies either fail to secure proper licenses or grossly
underreport sales to avoid paying royalties, the lawsuit contends.
The result, according to the lawsuits, is that illegal karaoke products are
available at many of the major retailers in the United States and Canada. "The
last thing we want is for the retailers, who are Sybersound's best customers,
to be treated as copyright infringers just because they're misled into selling
pirated karaoke product," said Peter Haviland, Sybersound's Los Angeles trial
counsel.
"We believe that Sybersound's competitors have been engaging in music piracy
and unfair trade practices for years," Haviland continued. "We hope to clean
this up and collect substantial damages for the injury they've caused to fair
competition and to the image of the karaoke industry." Robert Meloni, Sybersound's New York lawyer and an internationally recognized
expert on copyright issues said, "Musical copyrights are the fuel which powers
the entire music industry engine. Songwriters and artists, and the music
companies that finance and sell their music, directly suffer when karaoke
vendors violate those rights for quick profits. But when the problem is
industry wide, as this lawsuit alleges, legitimate record companies like
Sybersound unfairly suffer as well since they are not able to compete on an
even playing field." Karaoke albums typically include new recordings of hit songs, with the lead
vocals omitted. Sold as CD+Gs, karaoke records include graphics which enable
song lyrics to appear on a TV screen with the use of a karaoke machine, as well
as printed lyric booklets.
The release of karaoke albums requires licensing for the reproduction of
musical compositions, for the synchronization of lyrics on screen, and for the
printed lyrics. Since licensing fees can be as high as $2 per CD+G sold,
companies that avoid paying royalties have a significant price advantage over
Sybersound, which follows all the licensing rules.
The companies named in the Los Angeles lawsuit include: * UAV Corporation of Fort Mill, South Carolina
* Madacy Entertainment Group of Montreal, Canada
* Singing Machine Company of Coconut Creek, Florida (AMEX:SMD)
* Audio Stream Inc. and Top Tunes Inc. of Hilliard, Ohio
* BCI Eclipse of Newbury Park, California
* Compass Productions of Minneapolis, Minnesota The companies named in the Ontario lawsuit include:
* Legacy Entertainment, Inc of Stoney Creek, Ontario
* Navarre Corporation Company of New Hope, Manitoba
* Direct Source, Inc. of Burlington, Ontario
* Direct Source Special Products Inc. of Lasalle, Quebec Sybersound CEO Stevens said, "We've found that our karaoke CD+Gs are being
purchased primarily by moms for their families. It's great to be part of a
business that invites people to sing and brings music into their homes. But
unfortunately, behind the scenes, the karaoke industry is corrupted by
competitors who fail to license properly and pay royalties to songwriters." The lawsuits allege, among other things, wrongful interference with business,
unfair trade practices and unfair competition.
About Sybersound Sybersound is a privately-held record company based in Malibu, California, that
produces fully-licensed dance remixes, karaoke content, and original records.
Sybersound is known for its top-quality production of music tracks. The
company's products are distributed in the U.S. by Universal Music & Video
Distribution, the U.S. sales and distribution arm of the Universal Music Group. In Canada, Sybersound is distributed by Sony BMG. The company's products are
sold in most major retailers in the U.S. and Canada. Information about the
products is available at http://www.partytyme.net/.
About Peter Haviland Peter Haviland is a trial lawyer who heads the entertainment industry
litigation practice group at Akin, Gump, Strauss, Hauer & Feld LLP, an
international firm. Named a Southern California "Super Lawyer" by Los Angeles
Magazine and "One of America's Top Black Lawyers" by Black Enterprise, he won a
$132 million jury verdict for TVT Records in TVT Records v. The Island Def Jam
Music Group and Lyor Cohen.
About Robert S. Meloni Robert S. Meloni is the founding partner of the boutique entertainment
litigation firm Robert S. Meloni, P.C. He has specialized in intellectual
property and entertainment litigation for 25 years, handling matters for major
recording artists, songwriters and producers, music publishers and record
labels. He is recognized nationally as the leading expert in copyright and
related issues in the karaoke music field. He is the author of a number of
published scholarly articles on copyright, internet, and music industry related
topics and a former Adjunct Professor at New York University. DATASOURCE: Sybersound Records, Inc.
CONTACT: Mark Saylor, or Terry Fahn, both of Sitrick And Company, +1-310-788-2850, for Sybersound Records, Inc.
Web site: http://www.partytyme.net/
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