publish and distribute lists of musical works not controlled by the society and of publishers whose publications may be used free of charge. The following is one of such lists: PUBLISHERS OF TAX-FREE MUSIC Following is a list of music publishers who are not members of the Society of American Authors and Composers, and whose music can be played either orchestra or music roll, tax free. Asher, Emil. Ballinger, Edw. L., Music Publishing Co. Berg, S. M. Bond, Carrie Jacobs. Bossey & Co. Boston Music Co. Manning, Clarice, & Co. Morris, Josephy, & Co. Piantodost, Al & Co. (Inc.) Browne, Ted, Music Co. (Inc.). Carlson, M. L., & Co. Craig & Co. Ditson, Oliver & Co. Fay, Louis J., Publishing Co. Fox, San Publishing Co. Granville, Bernard, Publishing Co. Hinds, Hayden & Eldredge (Inc.). Inter-City Music Co. Krey Music Co. Rosey, Geo., Publishing Co. Southern California Music Co. Snyder Music Publishing Co. White-Smith Music Publishing Co. The Motion Picture Theater Owners of America have established a music department for the purpose of supplying to the theater owners everywhere suitable music for all purposes free from license fees. The National Broadcasters Association has also from time to time issued and distributed simifar lists. It maintains a bureau of music release which releases to its members for radio broadcasting at stated periods numbers available and suitable for such purposes. How large the supply is from which radio broadcasters, motion-picture houses, and hotels can draw without infringing upon the rights of the members of the society is demonstrated by the fact that the largest and most popular broadcasting stations in the United States, viz WJZ and WJY, operated by the Radio Corporations of America, at New York; WGY, operated by the General Electric Co., at Schenectady; WCAP, operated by the Radio Corporation of America, at Washington, D. C.; WNAC, operated by the Shepard Stores, at Boston; KYW, operated by the Westinghouse Electric & Manufacturing Co., at Chicago; KDKA, operated by the Westinghouse Electric & Manufacturing Co., at Pittsburgh; KFI, operated by Earl C. Anthony (Inc.), at Los Angeles, Calif.; WBZ, operated by the Westinghouse Electric & Manufacturing Co., at Springfield, Mass.; WLW, operated by the Crosley Manufacturing Co., at Cincinnati, Ohio; and WGR, operated by the Federal Telephone Co., at Buffalo, N. Y., hold no licenses from the society and furnish to their radio audiences musical programs of the highest quality, character, and merit, and have been so doing for the past two years. Mr. McDonald's station, known as WJAZ, operated by the Edgewater Beach Hotel, at Chicago, Ill., and WDAP, operated by the board of trade at Chicago, Ill., have likewise given programs for the past two years without recourse to the works copyrighted by members of the society. The station of McDonald secured a license on February 1, 1924, and notwithstanding it had the right to use the works in the catalogue of the society, it continued down to the 1st of June, 1924, to furnish daily programs without using any of the works in the society's repertoire. Evidently these stations had no difficulty in securing musical works that are not controlled by members of the society. Mr. Klugh, executive chairman of the National Association of Broadcasters, before the Committee on the Merchant Marine and Fisheries of the House of Representatives, having under consideration House bill 7357, for the regulation of radio communication, ridiculed the idea that the society was a monopoly. He there expressed himself as follows: "As a matter of fact, the American Society consists of 253 publisher members out of a known list of 6,500 publishers, authors, and composers in the United States, as can be ascertained by going to the Congressional Library in the Copyright Office. Therefore, we maintain that this organization is an aggressive minority who have been successful in some measure in having their way." When asked by Mr. White, the chairman of the committee, what his complaint was with respect to the society, he said: * * "The complaint is that they ask for payment from broadcasting stations for the right to use compositions of their members, and the charge for that right is out of proportion with what they are able to deliver Mr. Klugh there also made a statement as follows: "That is a statement of their claim, but that does not bring in the question involved, however. The question involved is simply this: A minority owning less than 3 per cent of the current copyrights attempts to dictate, attempts to construe the copyright law, and it has succeeded in a certain measure in forcing through coercive measures and collection of money to which they are not entitled. That is our claim." Several members of the committee questioned Mr. Klugh, and he replied as follows: "Mr. BLAND. How about this large number of composers that you say do not belong to that society? Can not you use them? "Mr. KLUGH. We can, but there you see one of the effects of lack of organization. Those are all independent operators; they are not organized, whereas this group of 46 publishers out of a known list of 6,500 are well organized and well administered. "Mr. DAVIS. Why can not the broadcasters get ample material of meritorious songs of the 97 per cent, instead of being compelled to resort to the 3 per cent? “Mr. KLUGH. I might answer that by saying we are. We have set up competition with the American Society by encouraging the independents, which has really struck fear into their hearts, and has already caused the resignation of two of their principal members and will cause more. "Mr. BLAND. Organizing the 97 per cent would relieve the immediate situation." Under date of March 26, 1925, the National Assocation of Broadcasters sent out a letter to the "Independent Authors, Composers, and Publishers" in which it stated: "The American Society of Composers, Authors, and Publishers will appear at this meeting and endeavor to show that they represent the majority of authors. composers, and publishers. We want to appear with evidence which will show that they do not represent the majority, and to this end we are inclosing 10 petitions to be signed by you and any other independent author, composer. or publisher who would like to have the truth known." 66 The petition mentioned and inclosed in that letter reads in part as follows: Petition: The undersigned, believing that the best interests of the public, the composers of music, the authors of songs, the publishers of music, and the performers thereof, will be served, hereby petitions the Congress of the United States to amend the copyright act of 1909, so that individual or detached songs and melodies, as distinguished from complete musical scores of operas, light operas, musical comedies, oratorios, cantatas, and other musical scores, designed to provide a whole performance, may be publicly performed without restriction by law or otherwise, to the end that 6,500 independent composers, authors, and publishers may have an equal chance with the 326 members of the American Society of Composers, Authors, and Publishers." In a letter dated April 25, 1924, Mr. Klugh states that over "700 petitions for independent composers, authors, and publishers were submitted to the t Senate committee." Surely these 700 composers, authors, and publishers ought to be able to supply the reasonable wants of all the broadcasters, all the motion-picture theaters, and all the hotels of America? There are references to the large amounts of license fees which the society is charged with trying to collect. The following statistics concerning the operations of motion-picture theaters for the year 1922 proves the absurdity of this charge: Total number of motion-picture theaters_. Nine thousand operating six to seven days per week. One thousand five hundred operating four to six days per week. Average weekly attendance_. Admissions paid annually-- Average gross earnings per seat per annum. Fee for music at 10 cents per seat would be one six hundred and eighty-fourth part of gross earnings, or 1 cent out of $6.84. Average seating capacity__. Average annual license fee for music at 10 cents per seat_ Fee for music at 10 cents per seat again figures one six hundred 15,000 7,605, 000 50, 000, 000 $520, 000, 000 $68.37 507 $50. 70 $34, 666. 66 The triumph of Paul B. Klugh, the executive chairman of the National Association of Broadcasters, in making the first successful inroad into the society by securing Waterson's defection therefrom, was heralded far and wide and was given great publicity by the broadcasters' association. Announcement was made that the National Association of Broadcasters had enlisted the cooperation of 16,000 motion-picture theaters, 2,000 hotels, and 800 dancing academies to carry to a finish the already partly successful fight. In accordance with the broadcasters' program a bill was introduced in the United States Senate (Senate bill 2600) designed to exempt radio broadcasting from copyright control. This bill was sponsored by the National Association of Broadcasters. The principal line of attack was that the defendant society enjoyed the benefits of the existing musical performing rights under the provisions of the act and that the society was a combination in restraint of trade. Mr. Paul B Klugh, of the Broadcasters' Association, expressed it as follows: "That so-called American Society of Composers, Authors, and Publishers is composed of 326 individuals and firms with a self-perpetuation board of directors of 24, and an administrative board of 3, who have pooled their interests for the purpose of controlling 90 per cent of popular music; who fix prices and use coercive and intimidating methods, all in contravention of the antimonopoly laws of the United States. * * * That the society has undertaken to collect from broadcasting stations, and in a few instances does therefore illegally collect, under contracts with members executed before radio broadcasting was known, and that such contracts can not be construed to include, and do not include, what may be termed 'radio rights.' 999 To give color to this false charge the plaintiff's aid was enlisted to actively join in not only cooperating in securing the repeal of the law but also to bring suit directly charging the society with operating in violation of the Sherman Act. The filing of the suit and the first hearing on the bill were contemporaneous acts. The plaintiff furnished to the Broadcasters' Association and its counsel all available data and material for use before the Senate committee. On April 8, 1924, the day before the hearing, the bill of complaint in this suit was verified and filed with the clerk of this court. It was not served on that day, but somehow the contents of that bill of complaint found their way into the press, and that evening the public press carried the story that this plaintiff had commenced an action against the society. Charles H. Tuttle, Esq., appeared on April 9, 1924, before the Senate committee as the attorney and spokesman for the National Association of Broadcasters. He was armed with this complaint, and he stated to the committee (p. 25, hearings, Senate bill No. 2600): "I will show you practices which would confirm that thought, if there could be any doubt about it, on their own confession." "If I Senator Dill, who introduced the bill, then made this query (p. 26): may interrupt, a suit was started yesterday, was it not, on this trust?" And Mr. Tuttle, not to lose the advantage, expatiated upon the suit as follows: "Yes; Mr. Waterson, one of the publishers, has become convinced that the methods now being pursued by the society are illegal. Mr. Waterson is one of the large publishers of the country. He is listed in this publication as one of their members--Waterson, Berlin & Snyder Co. Mr. Waterson, having withdrawn, has found himself the subject of attack. Although he has withdrawn, they have not allowed him to withdraw from this pool the music which he was obliged to assign to them-this copyright music under the blank form of assignment which I have read to you from the by-laws. They have not allowed him to withdraw that, and they are actually using that at the present time contrary to his will, and they are insisting that the radio people pay them a license fee in connection with that very music. 66 So that Mr. Waterson finds himself still serving the purposes of what he considers an illegal society and unable to extricate himself from it. He is subject to attack and he has brought suit to, among other things, have it held that the agreement by which he assigned originally his copyrighted music as a publisher to this society is not being used for illegal purposes and is therefore void." 66 And the chairman of the committee asked: "This litigation is pending where? Mr. Tuttle replied: "In New York; in the United States District Court for the Southern District of New York." The fact was that at this time defendant had not yet been served, and there isn't any doubt that this suit was commenced purely for the purpose of aiding the broadcasters before the Congress committee. It was intended to place the society in an unfavorable light before the committees. This plaintiff was acting not for itself but in bad faith and as a cat's-paw and tool of the radio broadcasters. It is strange that after 10 years the plaintiff only became aware of the monopolistic tendencies of the society the day before the hearings. The fees charged by the society to the broadcasters are ridiculously low. There are in the United States approximately 536 licensed broadcasting stations. Of this number 36 hold licenses from the society and pay an aggregate license fee of $16,000-approximately $500 a station per year. The Radio Corporation of America did a gross business of $26,000,000 in radio products last year and has a monopoly upon the production of bulbs which are retailed at $5, and cost but 81 cents to manufacture. It controls seven of the largest radio broadcasting stations in the United States, and for these seven stations, the society quoted a figure of $5,000 per station, or $35,000. In the aggregate per year 80 per cent of the entertainment of these seven broadcasting stations lies in the musical program. The fee charged by the society to broadcasters is low. The licensed hotels, theater owners, and broadcasters give thousands and thousands of performances per year of the works of the society's combined catalogue. Were there no organization such as the defendant, users of copyrighted music would be under the same obligation to play none of the musical works of the members of the society without obtaining a license and without the payment of the fee demanded by the composer. Each composer would have the legal right to demand a fee satisfactory to him for the right to play his works. He might also demand that his compositions should not be used as a part of a musical performance in which the works of other composers are infringed because its use will permit the practice of piracy. If the users of copyrighted music were obliged to deal separately and individually with each individual composer, publisher, and author, the combined royalties payable to the owners of such works in order to make up suitable programs for the users would be many, many times the amounts now charged. The users of music, knowing that they would not get the licenses any cheaper by separate contracts with each composer, have never attempted to approach any member of the society for an individual license agreement providing for a bona fide payment to the composer of a license fee. The fight has been to pay no fee at all, but for the free, unlimited, and unrestricted use for all performing purposes of copyrighted music. Everp picture theater man, hotel man, and broadcasting man can obtain the right to use the society's music by paying the reasonable license fees that the society imposes. The society has not raised the fees in 10 years, although a revision of rates was proposed, but the revised schedule was never adopted. The society has never refused to give a license to any user of music. Thousands of licenses have been granted by the society throughout the country in the 10 years that it has been in existence. Not one license has ever been revoked except for nonpayment of the license fee. That answers the plaintiff. Parties who obtain licenses to use the works of the society are not prohibited from using the works of nonmembers. They may combine in their programs the works of members of any other works. There is no attempt to force any party to use the works of the society; the only aim that the society is working for is to prevent piratical exploitation of the works of its members. That is the very aim that the plaintiff's associates-the National Association of Broadcasters, the Motion Picture Theater Owners of America, and the American Hotel Association and its constituent membersare seeking to defeat. The plaintiff and its associates aim to deprive the individual composer of the cooperation of his fellow composers, of the aid of the organization formed for the purpose of such cooperation, because it is hoped that after the destruction of their organization the composers will again be helpless against despoliation. The uses of copyrighted music are not confronted by any larger restriction by reason of the organization of the society than they would be without it. Every action that has been brought against infringers has been brought in the name of the composer, author, or publisher whose work has been infringed with his knowledge and consent and under direct authority of the assignment made by him to the society. What the society is doing is merely to use the funds contributed by the members and the royalties derived from their works under the authority of the members for the purpose of aiding each member in suppressing piracy and in prosecuting his Federal remedy. The real grievance of the hotel man, the motion-picture theater men, and the broadcasters is that they are not satisfied to make up their musical programs from older classical music and from those innumerable composers and copyrighted proprietors who are not members of the society. They find it desirable to perform the works of composers of great reputation who are members of the society. They want the works of these men because they are better drawing cards, the performances of their works will bring larger audiences, more admission fees, and more profit. And they want to use these works for more profit for themselves without paying anything whatever to the composers, no matter how small the fee may be. The music publishers who are members of the society do not as members represent their printing, publishing, and selling business. They are joined solely to cooperate for the protection of the performing rights against the piratical practices of others. The society was not organized for the purpose of affecting in any way the trade in printing and selling musical compositions or musical instruments. The society does not sell, circulate, publish, or deal, directly or indirectly, in any publication or concern itself in the sale of publications or musical instruments. The society does not ask anyone to buy musical works published by its members. It does not hold or own any copyright. It has never published nor owned, nor does it own or publish, any musical works. It concerns itself only in suppressing piracies of the works of its members and in granting licenses to publicly perform musical works in places as an incident of some other principal business, trade, or commerce. It confines its activities solely with the intangible and incorporeal right to give public performances for profit of the works of its members. The licenses are issued by the attorneys for the society in the place where the performances are to be given. There is no dealing with an article of trade or commerce, nor any use made of any of the instrumentalities of commerce. The society's business is not an aid or facility to commerce and does not affect interstate commerce, directly or indirectly, or substantially or incidentally. It does not consign or ship, or cause to be consigned or shipped, directly or indirectly, to any of its licensees any musical compositions or other matter. The license between the society and its licensees, or the contracts between the society and its members, do not in their effect operate in furtherance and in aid of commerce, nor does the society furnish any facilities, conveniences, privileges, or services connected, directly or indirectly, for interstate commerce. The society does not send any performing companies, instrumentalities, or singers throughout the country to render the musical works of its members. It does not ship any copies of musical works to any person who wishes to perform them. The licensee may buy the musical score whenever and wherever he likes, and he |