Thursday 19 March 2009

Bredonborough Mr Painter amp his

10.41

Bredonborough.

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Mr. Painter & his painters are in for the second day & Cheese Constructionists are continuing to work on the small roofs at the back.

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11.18 An e-letter has gone off to Apple in respect of 3 disputes: with Lakeshore over Buffalo 66, Sanctuary UMG over multiple licensing of KC downloads (presently unaccounted, although Mr. Big at UMG is investigating), and with Apple i-Tunes because their business model is fundamentally flawed.

From RF>Apple of today…

I write in respect of your overall company policy, although also in respect of the disputed Lakeshore license.

I note that as you have not replied to my earlier e-mail, you clearly do not take me seriously. But then, neither did Virgin in 1993 until the High Court writ arrived. May I recommend that you copy this to someone above your pay grade, one that has already begun to twitch gently at the issues to which I refer below?

For your convenience, my letter of 16th.March, 2009 (ii) to Mr. Lakeshore Lawyer, of which you are a recipient, is attached below as an Appendix to this letter.

I
Lakeshore

RF>various parties
Re: Buffalo 66 soundtrack
Date: Thu, 26 Feb 2009 17:28

very simply, property without bona fide title cannot be transferred to a third party; eg the buyer of stolen goods does not thereby acquire good title to those goods. surely none of those copied on this strand will dispute this?...
it is for you to justify your own position with appropriate documentation. are you able to do so? if you have such, this matter can be swiftly & simply resolved.

alternatively, if you believe that you were legally granted (your claimed) right by Virgin, i am assuming that you have some form of indemnity clause in respect of your dealings with them?

Apple>RF & various disputing parties…
Date: Mon, 2 Mar 2009 17:56

.. Mr Fripp, thank you for writing. While we do appreciate the mail, contractually, Lakeshore need to be the ones to resolve this.

Apple>Declan
Sent: Mon, 2 Mar 2009 18:22
Subject: Re: iTS3945 Declan Colgan Music

The way we operate is that the entity who delivered the material is the one who must take down the material.
 
If you look at it from the other side, we wouldn’t take down Declan Colgan-delivered material on the request of a third party, either. That is why we have asked that you pursue this directly with Lakeshore.

RF>Apple
Tue, 3 Mar 2009 10:52

… please note also: i hold i-Tunes liable for making available material to which i own the rights, and have denied them permission. please take this seriously.

II
Sanctuary UMG

You received an e-letter from Declan on 10 December 2008…

Sorry to trouble you with this, but you’re the only person at Apple whose email address I have.

I would appreciate it if you could forward this to your legal/takedown department.

iTunes UK… is currently offering two King Crimson albums "The Power to Believe" & "Happy With What You Have To Be Happy With" for sale.

Rights to these have been provided by Sanctuary/UMG.

Sanctuary/UMG has no rights to these masters.

This note is copied to the Sanctuary/UMG lawyer who will confirm this in any way required.

The license to all King Crimson and associated material is currently held by my company Declan Colgan Music Ltd.

It is issued on the DGM label via my label Panegyric.

I have a direct deal with Apple iTunes for this material.

Indeed we’re currently preparing proper masters for the Fripp & Eno catalogues as a start point for upload to iTunes early in the New Year.

I would be grateful if you could pass this takedown notice to the relevant people.

Accordingly, Apple received this e-letter from Mr. Second Tier Lawyer of Sanctuary UMG on 10 December 2008…

I confirm that Universal / Sanctuary does not have rights to exploit these albums digitally and they should not have been delivered to i-Tunes by Universal / Sanctuary. I am endeavouring to ensure that this does not happen again.

In the meantime, I confirm that you should take down these albums as soon as possible. Please ask your legal team to contact me if they have any queries about this.

Please could you ensure that I am notified when this has taken place.

Thank you for your assistance

Regards

Mr. Second Tier Lawyer
Sanctuary Records Group Limited

III

Apple>DGM: The way we operate is that the entity who delivered the material is the one who must take down the material.

What would you have done if Mr. Second Tier Lawyer had not contacted you? Left the material available until he had? Suggested this was for us to resolve directly with Sanctuary UMG, until which time you would continue to make available for sale the improperly licensed material?

Buffalo 66 & Lakeshore is small beer; one track. What is of greater concern is the light this shines on current practice in the music industry’s emerging primary means of commercial digital music provision.

EMI have also presented i-Tunes with KC material for download beyond the period (they construe) as having a bona fide license (to 31st. December 2003). The main difference between unauthorised sales provided by EMI and those of Sanctuary UMG (below) is that the EMI accounting department presented us with accounts. I note, we had not only not agreed to terms & royalty provisions, we ended the licensing to EMI specifically because of them.

Nevertheless, the EMI-provided KC downloads made available to the public through Apple i-Tunes were illegitimate, and from which you received income by making available KC material without a bona fide license in place.

RF>Lakeshore very simply, property without bona fide title cannot be transferred to a third party; eg the buyer of stolen goods does not thereby acquire good title to those goods Thu, 26 Feb 2009.

Reasonable questions:

1.    What systems did EMI have in place to check proper licensing before making the material available to you?

2.    What systems do you have in place to check proper licensing before making the material available to the public?

IV

We are currently in dispute with Sanctuary UMG over violation of our download rights, this to a remarkable extent. We licensed CD rights for two King Crimson albums to Sanctuary in 2002, for a five-year period from release, with download rights expressly removed.

In November 2007, we became aware that both our albums were available for download on i-Tunes and Rhapsody, licensed by Sanctuary. We asked for both to be removed, for detailed accounting and for an explanation as to how they appeared. As of today, we continue to await a detailed explanation. Once the material has been removed, it has re-appeared elsewhere. To date, we have spotted abuses, several repeatedly, on i-Tunes, Rhapsody/Comcast, imeem, Wippit, Napster and Three Mobile.

In November 2008, the material was available on i-Tunes in many territories.

The attitude of Universal’s legal department to these abuses has been astonishing.  Although the our complaints are presently being investigated by a senior figure at UMG, our enquiries were blocked from moving forwards for some 13 months by the same Mr. Second Tier Lawyer, Senior Business Affairs Manager at S/UMG (please see above) during which time you continued to present the unlicensed material for download.

In a telephone conversation with Mr. STL, c. October 2008, he asked us: you don’t expect us to read every contract, do you?

We were informed by S/UMG that they had no idea where the tracks have been licensed, and until a month ago, they had made no pro-active attempts to stop the abuse. Mr. STL suggested to us that it is unreasonable to expect S/UMG to police download abuse, even though this has been generated by licenses they themselves have illegally issued. He sees their role as exploiting tracks, not preventing exploitation. Seemingly, he places little weight on establishing the validity of a license.

Mr. Second Tier Lawyer did express willingness to act where we informed him as to the availability of the unlicensed material S/UMG had made available, in an e-letter of Wednesday 22 Oct 2008:

I assume that you are dealing with the digital department to get the product taken down from the sites you mention?  Do you need me to talk to anyone in this respect?

That is, the perpetrator placed the burden on us of informing them of their own malfeasance. I wonder: why should it be our responsibility to inform the (non-rights) licensor as to whom they were providing material, and when?

I note, you in turn have refused to act unless the provider (legal or otherwise) comes to you directly.

In this particular instance, with S/UMG:

1.    we have the work of informing S/UMG themselves of their improper licensing;

2.    if we were we to inform you of S/UMG’s improper action, you would decline to act;

3.    S/UMG’s Senior Business Affairs Manager declined to act for a period of 13 months;

4.    during which time you continue to make the unlicensed material available;

5.    at the beginning of February 2009, a senior figure at UMG acknowledged that the actions of their Senior Business Affairs Manager at S/UMG were inappropriate & mistaken; the material was withdrawn; an investigation launched into the systems in place for multiple & ongoing violation; and we are presently awaiting the report.

Nor, sadly, is that the end of the abuse. As these were “legal” downloads including through i-Tunes, the primary industry model, we might assume that Sanctuary / UMG would have accounted to us for your sales. While UMG publicly advocates the benefits of “legal sales”, we have to date received no royalty accounting and no publishing. Given that Sanctuary UMG has asked us to inform them as to the appearance of the material, and are continuing to investigate its mistaken licensing, it is difficult to be persuaded of S/UMG’s good intentions as to correct accounting (even had we agreed the terms).

This points to a systemic failure and has ramifications far beyond the small world of King Crimson. Given what we have learnt about Universal’s systems and business culture (as epitomised by Mr. STL) and your refusal to deal with the rights’ owner directly, my confidence in online sales is compromised.

The King Crimson / DGM / Declan Colgan case cannot be a one-off. At a BPI meeting last December, we discussed exactly these concerns, and were told that at the beginning of this decade it was common knowledge in the industry that at least one major label (and I know the label) was worried because it was only certain of its online rights in respect of less than 20% of its catalogue. At the same meeting, a lawyer pointed out that major labels often do not pursue pirates because they cannot prove rights’ ownership. If labels do not know with certainty the extent of their rights, and legal departments are unable to enforce a contract that categorically precludes downloads, what proportion of online sales offered by the majors to Apple i-Tunes might be illegal? That is, what proportion of Apple i-Tunes online sales can you be sure that you have proper licensing?

Reasonable questions:

1.    What systems did Sanctuary UMG have in place to check proper licensing before making the material available to you?

2.    What systems do you have in place to check proper licensing before making the material available to the public?

V

You wrote to Declan…
Apple>DGM Sent: Mon, 2 Mar 2009 18:22

The way we operate is that the entity who delivered the material is the one who must take down the material.
 
If you look at it from the other side, we wouldn’t take down Declan Colgan-delivered material on the request of a third party, either. That is why Chandani has asked that you pursue this directly with Lakeshore.

Perhaps you should change the way you operate.

If Declan Colgan delivered material to you without a proper license, would you continue to make that material available despite the proper rights holder complaining to you?
How would you know, for a certainty, that Declan were the proper rights’ holder? What degree of certainty might you allow for?
If you were unsure of Declan’s rights, would you take the material down?
At whose behest?

But, if Declan provided you with unsound material and you continued to make it available, you would be held liable by the rights’ owner.

Yours is a variation of the e-Bay argument: how can we know that we are selling illegitimate goods? We’re only selling them! Your argument is fundamentally unsound. If you are selling goods without bona fide title, you are selling “stolen goods”. To desist only when you are authorized to do so by the “thieves” is nonsensical. Outside the digital world, this is an argument without legs.

How about: I am about to supply you with download rights to the Beatles’ catalogue, also the Rolling Stones, Pink Floyd - and King Crimson. Am I right to assume that when EMI contact you, you won’t be taking the delivered material down until I notify you? Absurd, yes?

I take little comfort in your declaration above. Rather, I am persuaded that you do not take this matter seriously. Your business model makes available copyrighted material without the copyright owners’ permission. Therefore, your business model is unsound.

VI

RF very simply, property without bona fide title cannot be transferred to a third party; eg the buyer of stolen goods does not thereby acquire good title to those goods. Thu, 26 Feb 2009 17:28

The RIAA industry standard seems to be $9,025 per single illegal download. For 121 illegal downloads, that equates to $1,092,025.

Apple>RF  Mon, 2 Mar 2009 17:56
 While we do appreciate the mail, contractually, Lakeshore need to be the ones to resolve this.

If Lakeshore is unable to prove their rights originate from Virgin, what do you intend to do? (I suggest, continuing to make the material available is not an option).

1.    Will you kindly confirm that you are prepared to accept company liability for your decision?

2.    Alternatively, would you please direct us to who is able to accept liability & responsibility for that judgement?

VII
Summary
Buffalo 66 – Lakeshore is a quantatively small matter that draws attention to key principles of determining significance for the emerging new-model music industry.

The primary issues raised are those of accountability, responsibility, straightforwardness, transparency and equity.

Apple i-Tunes have been selling my copyright material;
without my permission;
without me being a party to the terms of sale;
in a format without my approval;

provided to you by a party contractually specifically & contractually excluded from providing you (and anyone else) this material;
which income they have not accounted to us;
and blocked our enquiries into the matter;

while you refuse to deal with me, the rights owner;
and instead accept instructions from the offending party;
who accept they are the offending party;
and are one of the world’s four largest music corporations;
whose systems & mechanisms of control they acknowledge, on the basis of repeated errors, to be unreliable;
and with whom you continue to deal.

This has had negative effects upon DGM Live’s business model and business plan;
you use masters unapproved by me for downloading, which offends my musical sensibilities.

None of this seems to resonate with you. You ignored my last e-letter. Yet somewhere in the Apple i-Tunes food chain, there will be a person holding an overview who is already twitching gently, concerned by the issues raised above; and hoping that no one will launch a test case to query the basis on which you are presently setting the industry standard for the commercial digital provision of downloaded music.

Similarly, someone somewhere is presently looking at:
 
suing i-Tunes for providing illegal downloads;
suggesting that if you continue to stock (eg) Universal downloads you will be knowingly selling a proportion of illegal items;
launching a press campaign to inform fans that they should avoid a “legal” download site such as i-Tunes because there is no guarantee that the downloads are, in fact, legal;
lobbying government that bills involving ISPs should not be passed because the labels cannot be sure about what rights they own, or correctly share the money with the artists.

"Steve Jobs ... discussed his company’s relationship with UMG as that of a ’license’ in an essay titled ’Thoughts on Music’ dated February 6, 2007," the papers read. "Although he consistently referred to Apple ’licensing’ music from ’the big four music companies’, when deposed in this case he claimed not to know whether his company’s relationship with Universal was, in fact, a licence."
The Guardian 25th February 2009

Fundamentally, if your business model is to be trusted and establish an industry standard of practice, two reasonable questions:

1.    What process of due diligence do you have in place to assure yourselves of the provider’s bona fides, please?

2.    What systems do you use to assure rights’ owners & customers that they can be confident in downloading from you?

There is a third: will you also ignore this e-letter?

14.58    E-flurrying.

An interesting offer has come in for a KC ProjeKct.

20.12    A walk around the town with the Minx.

Early evening in Bredonborough I…

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II...

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III...

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IV...

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DISCOVER THE DGM HISTORY
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