A karaoke music publisher brought a suit against several Houston bars that played its karaoke tracks without permission, but a Texas federal judge tossed part of the trademark suit. The infringement suit of Phoenix Entertainment Partners LLC’s is one of several hundred the company has filed around the country over its Sound Choice brand of karaoke tracks. The court admonished Phoenix’s repeated attempts to argue that the unauthorized copying and performance of its karaoke files constitutes a form of trademark infringement. U.S. District Judge Lee H. Rosenthal ruled, that this argument could not stand because allegation should properly be styled as a copyright claim, a differentiation that several appellate courts recently established in “well-reasoned opinions.” “Phoenix alleged that the defendants infringe its goods marks when they illicitly download and play Sound Choice-branded karaoke tracks,” the judge noted. “That is trademark lipstick on a copyright pig.”
The Texas Judge ruled claims as to the company’s “goods” trademark for the songs themselves are dismissed. However the karaoke music publisher may still proceed with claims that the Houston bars infringed its service marks by displaying Sound Choice name and logo during the performance of the tracks at their establishments. The ruling of Judge Rosenthal comes three month after the Ninth Circuit shot down a similar suit filed by Step-Tone (now Phoenix) against an Arizona karaoke provider. Phoenix’s primary argument is that the accused offenders played those tracks for their patrons without paying for a license and that the accused offenders have ripped the popular Sound Choice lyric-accompanied tracks to their own digital hard drives. Phoenix selected to go with a trademark infringement, instead of suing for copyright infringement under the theory that the consumers are misled into thinking they are getting a song off a Step-stone/Phoenix CD when in actual fact they are really getting it from a karaoke bar’s hard drive, the publisher contends.
But the argument of the publisher hasn’t held up well in the appellate courts. The Seventh Circuit similarly held last July that the company couldn’t sue under the Lanham Act, because the claims dealt with intangible expressive content, not actual market goods that might confuse consumers Both the Seventh and Ninth Circuit decisions heavily cited the U.S. Supreme Court’s 2003 Dastar v. Fox ruling, which provides clear limits between the source-designating scope of trademark law and the expression-protecting scope copyright law. Every one of those decisions came into play by the Texas court decision. Consumers cannot possibly be confused by the Sound Choice goods marks, Judge Rosenthal said, because bar patrons don’t actually see the digital files, only the performance of the digital files, which, for all they know, may have been derived from any number of sources, be it a hard drive or internet streaming source, she said. Indeed virtually identical attempts to assert a trademark-infringement claim based on the goods marks, the Supreme Court and two appellate courts has these firmly rebuffed. However on Phoenix’s trademark claims regarding the display of the Sound Choice name and logo during the performance of the karaoke songs, the judge eased up. “Unauthorized use of Sound Choice’s service marks in karaoke shows could plausibly confuse the bar patrons by unfairly trading on Sound Choice Entertainment’s brand identity and impairing Sound Choice Entertainment’s ability to differentiate its services from the competition,” she wrote, allowing those claims to move forward.