This is Bloomberg Law with June Grasso from Bloomberg Radio. You can't always get what you want. You can't always get what you want Travel the Rolling Stones, Elton John and Phil Collins are just some of the rock stars who have complained about the Trump campaign using their hit songs at campaign events. Neil Young is even suing the campaign over it. But Eddie Grant has a more unusual complaint about the use of his signature hit Electric Avenue.
In August, President Trump tweeted an animated ad that shows a high speed Trump train ray sing through a town while now President elect Joe Biden follows along slowly in a railroad hand car. Electric Avenue plays in the background with random odd snippets from Biden. Grant says he never licensed the song to Trump or his campaign, and he's suing for copyright infringement. My guest is intellectual property litigator Terence ross A partner captn Uten Rosenman. What would normally happen.
Let's say I want to do a video and I want to use someone's music. Could I use small parts of it? Or do I have to get permission no matter what I use it for? So the way This would normally work is that the creator of the video would take it to a lawyer and a pain pre clearance, and the lawyer would analyze the video to determine whether or not a license for the music was required or not.
In a very large number of cases, that determined that no license is required because the use being made in the video is a fair use after the copyright law therefore does not constant copyright infringement. Why do you think the Trump campaign just didn't get a license. I assume they obtained legal advice that they didn't have to. Quite frankly, that would be pretty good legal advice. Really, So what has the Trump campaign come back with in its response
to the complaint? So the Trump campaign moves to dismiss the lawsuit, which in the federal court system is a mechanism for an early termination with prejudice based on a failure of the complaint to state a legal claim for relief. You know, the basis of the motion to dismiss on the Trump campaigns part is exclusively the fair use doctrine.
The fair use doctrine is a well established legal principle under copyright law that's codified in the Copyright Act of nine that says there are instances in which a person may use a copyright at work without permission because there are public policy reasons why we as a society need
to allow such use. Here, it strikes me that the fair used doctor and his tailor made or the defense of this lawsuit by the Trump campaign, if you look at the statute and the case law that is evolved around the fair use doctrine in the United States, a defendant would have to show four items are established to obtain a dismissal based on fair use, and those are that somehow the use of the copyright at work was
transformed by their own use. Second, that somehow the nature of the copyright at work deserve less protection, Third, that very little of the copyright at work was actually used, and force that there is no impact or very little impact upon the market for the copyright at work. And the Trump campaign here as filed emotion in which it has argued that three of those four requirements for fair use are met under these facts and their forts entitled
to have the lawsuit dismissed with prejudice. R. Cavenue I believe was forty seconds out of a fifty second video. Does that matter. It matters a lot. The measurement you use for that prong of the fair use test is how much was used Visa v. The copyright at work. The copyright at work was over three minutes long and about forty seconds were used in this animated video by the Trump campaign, and in past cases that level of usage has been held as a matter of law to
be sufficiently limited to justify invocation and fair use. Doctor Grants, Attorney, says that the Trump campaign should have gotten a synchronization license to sink the music to the video. Is that a separate question? Now not necessarily. You only need a license if there is copyright infringement going on. So the fair use doctrine here, if the court finds it to be applicable, would give the Trump campaign a complete pass
on this lawsuit. This lawsuit would go away, and the synchronization license issue, whether or not it's required or not required, probably would be required if there was copyright infringement. That would only come up if the plaintiff can get passed this fair use defense. Cherry explain why the Trump campaign says this video was a transformative use of electric avenue
So June in the second Circuit. That element of a fair use doctrine is often regarded as the most important element, and the Trump campaign takes it on in its motion to dismiss right up front, knowing what the law in the second circuit, which includes New York City is, and they say that what they've done here with the song is taking a tiny portion of it and repurposed it for political purposes in an animated video that attacks the Biden candidacy. And the case for this being a transformedive
use as a legal matter is very strong. There are past instances in this court in which small portions of songs have been used in this way with pictures or video, and the court is how that that does indeed constitute
transformedtive use. Of particular importance here is the repurposing of the song from a popular entertainment media to a political use in the context of a specific campaign, and that is going to be a very strong argument for the Trump campaign that the fair use doctrine should apply here. It must frustrate the artists to have their work used, even if it's transformed, to have it used in ways that they don't agree with or by people they don't
agree with. Yes, It really does have represented many artists who come to me with that complaint, and it is a genuine line, heart felt concerned that they expressed and should be respected. But you have to understand that in order to prevent the copyright hack from being turned into some sort of mechanism for censoring speech, we have to allow at the margins for this sort of fair use. We cannot judge the fair use based on our politics,
or our morality or any other subjective criteria. We have to really focus on the fact that this Further's First Amendment right by allowing such fair you heely Young is also sue Trump's campaign for playing his songs Roughing in the Free World and Devil's Sidewalk at rallies, saying he can't allow his music to be used as a theme song for a divisive un American campaign. Is this also
a copyright infringement lawsuit? So at its core, it is a copyright lawsuit, but it's really based on licensing law. This is not something that's new to this particular campaign cycle. Recording artists have complained about the use of their music for several decades now, specifically the use at rallies, live appearances by candidate as well as in political commercials, and
so it's not really something new. So Neil Young contends that at a Trump rally in June in Tulsa, Oklahoma, two of his song were played apparently in their hole at the rally as part of hyping up the crowd, and that the Trump campaign in doing that did not have a license to play the songs and did not
have Neil Young's authorization to play the songs. Could the Trump campaign to be operating under the theory that they have an ask cap a general license from as CAP or b m I. So when Donald Trump first announced that he was running for president in two thousands fifteen, this campaign but to the license on the song that was played as he famously descended the escalator Trump Power to make the announcement, and the performer of that song complained,
but the fact remained that it was not copyright in French because the Trump campaign had obtained a license to perform the song in public and was therefore entitled to do so. And that's the problem typically with all of
these recording artists bringing lawsuits against politicians. The way the business has worked since is that recording artists, in order to obtain licensing revenues, give the licensing rights to one of several large licensing organizations, and they then go out and vigorously enforced the copyright laws against anybody playing that artists music in public and generate quite a lot of revenue. What they will tell the world is that you don't
need to get in trouble with us. You can come and get a blanket license to perform the music of all of our artists in our stable and in that way have protection from any copyright infringement lawsuits. And so many advertising agencies, many venues, particularly stadiums, will go out
and obtain these blanket licenses. And in the complaint that Neil Young has brought against the Trump campaign, he goes out of his way to point app that although the venue where this Trump rally and post local helmet took place did have a license, that under the terms of that license, a third party coming in and using the venue could not take advantage of the license, and therefore
the Trump campaign was unlicensed. And this is a common mistake that organizations coming in and renting a venue make, thinking that they're entitled to piggyback on the ASCAP license that the venue has. The venue has that license in order to play music during intermissions and as the crowds coming in, But that does not give the third party organization in this case Trump organs as the right piggieback
on it. They needed, arguably to take their own license to play the Neelly Young music, and Neil Young contends that they did not have such a license. Can an artist like Neil Young instruct as CAP or b m I that he doesn't want his music licensed to the Trump campaign, So June, that's a great question, um, and the one and one that has not been resolved yet by the courts and has to be at some point.
In the nineteen forties, UM, the United States government brought antitrust lawsuits against a SCAP and b m I, saying that in effect that they were monopolizing the business of music because they would pick and choose who they wanted to license to and in that way be able to
drive up UM the prices for the licensing. UM. The Rather than take that lawsuit through the courts, UMSCOT b m I entered into what it called antitrust consent decrees, and under the terms of those decrees, which are still in effect, eight years later, the both of them are required to license any song or portfolio songs upon request. They do not get to pick and choose. And therefore, if and artists took that position, it may very well expose a scap or b am I too ant I
trust considerations. There are artists who are now trying to do exactly that, and they will probably in the long run face some sort of legal consequences as they continue insist on doing this, and it does threaten the very
nature of these consent decrees. An artists who wants to UM be able to pick and choose who can license their works, and in particular to discriminate amongst political candidates or political campaigns, probably needs to take their songs out of a step and be a mindset their own licensing
UM organizations. So the artists, by the way, a very good defense here to the for the Trump campaign UM to argue that UH that Neil Young was not free under the antitrust laws and under that consent degree too UM deny them UM a license and could have limiting effect upon any damages or injunction that gets issued. Is there any case to be made that this implies a false endorsement by the artist to have their music played
at a Trump rally. So that's an argument that you hear recording artists make all the time in this context, that somehow they are being pegged at supporting this candidate. It is a cause of action that only exists in hands full of states, and it would be difficult one
to make in this context. I think the American public is arguably sophisticated and not to understand that music gets used to sell all sorts of products, including candidates for office, and that does not necessarily imply an endorsement by the performing artist of whatever that product is, or in this case a candidate um So it would be a difficult cause of action to make, even in those states in
which it is available as a cause of action. So it appears that the Eddie Grant lawsuit might be dismissed on a motion to dismiss before you really get into discovery and any kind of heavy litigation. But what about the Neily Young lawsuit? So June the motion is smiss brought in the Eddie Grant case by the Trump Organization has a long pedigree in the in that federal court.
It is regularly allowed because all you do is look at the face the complaint and the facts as alleged by the copyright owner, and it's relatively easy to determine whether or not the fair use doctrine has the factual predicates on the face of complaint um to be considered at an early point in case. And that's probably a good thing here for the Trump organization. I think that
lawsuits likely to be resolved relatively quickly without discovery. In contrast, the Nenal Young lawsuit will turn on a lot of details in the facts that are not evident on the face of the complaint and therefore going to require factual discovery and likely to be um long and dragged out, and may take as much as a few years to to decide if it isn't dropped in the interim given the results of the election. Thanks Terry. That's Terence Ross,
a partner Caton Uchen Rosenman. The United States versus Google, it will be an epic antitrust court battle as the government tries to prove that Google illegally monopolized Internet search. It's just the beginning of what's expected to be a long battle, with the government having the burden of proving several elements to make at its case. Joining me is Sam Weinstein, a professor Cardozo Law School and a former
official in the Justice Department's antitrust Division. First, the government has to prove that Google has monopoly power in the market. And it's laid out three markets, that's right. So the government's alleging three markets, right. So one is general search services, which is what we think of when we enter a search term into Google. And then a search advertising market,
which is a general market for search advertising. And something they call general search text advertising, which is the ads that show up on the top of your Google results page, right of sponsored ads above the organic so called organic peoples. Right. So, in the way these cases work, as the government has to allege these markets and then shows they are indeed markets, right, and then that Google has monopoly power in these markets, right WHI would be something about a seven share, And
you know, Google will contest these market definitions. They will say that the markets are broader then the government is alleging, and Google wants them to be broader because then their share drops, and you know, in particular and search advertising and general search text advertising, I imagine Google will push
back hard that those are relevant markets. Right, Google will say advertising dollars are distributing amongst things like billboards and podcasts and television, right, And that's the market general advertising, not not an internet not a search based advertising market. So then is it just the judge's decision what the market is? And for Google's monopoly share? Is that easy to figure out? I mean the numbers? So right, it's a good question. Right, So the fact finder, it's in
front of the judge and tromp. The jury will determine in the end what the market is. And you know, if you say, for instance, let's say the market is general search, and I think that's an easier market for the god want to prove, there's going to be data out there that economists will put together to say how many searches are done a year in the United States and how many of those go to Google. Um, that's Google's percentage of general search. So that's pretty straightforward advertising.
I think. Also, if in fact the finders fact in the case agrees that the market is search advertising, an economist will come along and say, well, the next number of dollars are spent on search advertising this year, and these are how many dollars want to Google, and here's Google's percentage, and that's how they would determine Google's percentage of you above or below seven sever five percent not a magic number, but the case will suggests you have
to be above sent five percent, so you know that. The steps would be defining the role that market first and then proving Google share that levant market. Google earned se of search advertising revenue in the US, according to a report by E Markett. If that number holds, does that mean that Google is not a monopoly in that market? The parties would fight about this, right, So there's no
hard and fast number. I used. Seven percent is a shorthand be because there is some case law saying you know above stating his pipercent probably is a monopoly share. But that's a moving target, right, so a judge or the journy will decide what the Probably the judge will decide what the appropriate legal standard is. But I think is a good shorthand for monopoly power. So if the government can prove Google is a monopoly and at least one market, then it has to show that Google illegally
keeps control of that market. And the suit focuses on the billions of dollars that Google pays each year to make sure it's search engine is the default on mobile phones and web browsers. So, any monopolization case, what we call Section to at the Sherman Act, has two parts. The plainests. In this case, the government has a burden to prove two things. One is monopoly power. Let's we just talked about, right, so a certain share of a
relevant market. And the second is some bad acts, some bad conduct that either allowed to defend it, to acquire or to maintain the monopoly share. And this is a monopoly maintenance case. So the alleged bad conduct is a few ease of agreements that the government is saying Google uses to maintain its monopoly shia and it does so unlawfully. On their face, when you hear about those agreements, they
sound like Google's locking in the market. So what could Google come back with as a legitimate reason for those So I mean, I think if I'm Google, let me just lay out a little bit what will happen on the on the context side of the case. Right, the government has a burden to come forward with an allegation
of anti competitive conduct. And here we'll just say for shorthand is these various agreements like preinstallation agreements for the search engine, revenue sharing agreements right with the big phone manufacturers. So the government's going to allege that those are anti competitive agreements, and Google can then attack the governments of the anti competitive theory, and Google will come back with its own pro competitive explanations. Right, So let's first talk
about the government's theory. The government's theory is that these agreements lock in distribution for Google, lockout distribution for the Google's rivals, right, raised rivals costs to try to get their search engines to consumers. So if I'm Google, I think the first thing I'm going to argue is, well, that's not really what's happening, right, That's not how consumers actually choose search engines. So to me, this case many people have made this observation harkens back to the Microsoft came.
In the Microsoft case, one of the allegations among many was that Microsoft ups for closed distribution of rival Internet browsers by locking up space on the hard drive the ali apps. Right, people making this has looked similar. Right, these agreements allegedly locked up space on the phone or on your computer. From what you see as a default is Google search engine. But Google is pretty straightforward. Counter argument is you can switch anytime if you don't like Google.
It's a clicker way to do DUC dot go, which I think it's a pretty powerful argument. Now, it could be the government has alleged facts here when we don't see the backup for it, that consumers don't switch right that once you see on your phone Google is the default, that you're not going to switch over to DUC dot go. But it does seem pretty easy, a lot easier than it was in the Microsoft case to switch. So that's
one thing I'm going to say if I'm Google. Those thing I'm going to say if I'm Google, and this is before I even get to my pro competitive justifications, is so you know the reason why consumers use Google, it's because we're really really good. It's true we have these agreements in place, but even if we didn't have them,
consumers prefer us. That's probably pretty persuasive argument, you know, need to feel plays out right, But the government has to draw a link between these agreements and Google's monopoly, share them and Google to try to break that causation link by saying we're just really good. So that's if I'm Google. That's why I'm arguing to sort of overcome the government's prema facial case, right, their initial assertion that
these agreements are any competitive. And then I'm going to say, okay, course, if you don't buy that, I have pro competitive justifications to agreement. Right, So what could that be? You know, it's a little unclear, right, So this is I think a little harder for Google. What is pro competitive about these agreements? Well, maybe it produces some certainty for them. Maybe it protects the Android operating system from being broken by third party apps. Right, you can imagine some explanation.
It's a little harder for me to get there. We'll let to see what Google does explain with the rule of reason analysis is that the judge is going to use sure the great question. Right, So the rule of reason. You know, you can think of this a balancing test, right, And but it's it's done step by step. So first step, as the government says, hey, this conduct you're doing, defendant is anti competitive. Here's why we think it's any competitive.
And then the defending gets to come back and say, no, first of all, we're gonna attack your assertions government that this is anti competitive. Second, we're going to show that's actually permpetitive. And then if if the defendant can come forth to some plausible pro competitive justifications that in the third steps the judge will determine will weigh the anti competitive conduct against the pro competitive justifications and come out one way or the other. So that's the theory behind
the rule of reason. Why we're weighing what's bad about the conduct against what's good about the conduct. In reality, that hardly ever happens. In most cases, the judge will say something like, all I see here is any competitive conduct. I don't see any po competive justification or vice versa. Right, All I see here is pro competitive good here, And I don't really say anything negative? Right? And why because it's very hard to weigh, right, how do you weigh?
But essentially are apples? Are these are not measurable things? How much anti competitive harm versus pro competitive benefit of right? But that's the theory that it's a it's a way tests for the judge. It seems like the implication would be that it harmed competition there, but the government also has to show that it harmed consumers. Thank you raised. An interesting is on a good point. Right, So it's not enough for the government to allege that these distribution
agreements harmed Google's rivals. Andre's law doesn't care about that. Andel's law only cares about consumers. So the government has to have a theory for why even if Google's rivals are being harmed. But that's bad for us, bad for consumers, right, And and there are a couple of theories in the case going to this point. Right, So when we think about end users like you and me, what is harmful to us about these distribution agreements. Well, maybe we're getting
less innovation. Right, Maybe if these distribution agreements were in place, we'd see more duck dot goes who might protect our privacy better, we have more choice. Right, that's the theory for consumer harms on the search side. On the advertising side, the consumer harm is clearer. Right if if the government can prove that Google is unlawfully maintainance monopoly in search
advertising or general search text advertising. If I'm an advertising on my rates are going up and I'm getting less good service, right, that's just like you know, a classic monopoly problem. Right, If there are more competitors out there advertising rates with fall, I pay less I get better service. Right.
But but in both cases, the government has to show not only that the rivals are being harmed, but that consumers, either end users like you and me or advertisers are being hard How do they do that when Google is free to consumers? So how do they proved that consumers are harmed? Yeah, so end users like you and me? It's hard, right for those those reasons that you say, we it's it's I'll put quotes around free. It's a quote free product that's not really free, right because you
give Google your data. Um, but we're not paying cash, right, so it's difficult to prove that we're you know, we're paying the monopoly price for this service. So it's tricky, right. The government has to make a nuanced argument, and you can see and their claims that they're claiming is you and I are getting less good service essentially a quality adjusted price that's lower than if there was more competition. Right,
So I'm not making this cognimer specsticulately. Theoretically Google doesn't do a good job protecting our class right solve their data. If there was more competition, that would be less of that, or our data would be buying more highly to get money for it. That's the kind of nuanced argument have
to make for an end user. Again, for advertisers, it's a much clearer argument, right if Google is the only game in town and search advertising on paying more if I'm an advertiser than I would if there were by competitors. Is Google's response just we're better or is there a different response? Yeah, I mean, so Google got a bunch of entry points here for their argument. One is we're just better, So the distribution agreements, there's no causation here
with our monopoly position. We have a monopoly position because we have the best product, not that argument, And I think a lot of people would agree right that they have the best search engine. So that's that's one argument. Another argument that if I'm Google, I'm making is that two consumers like you and me end users, we're not really being harmed, that there is choice. You and I could easily switch to duct Tecto or to being You
and I aren't tired of by any agreements. We can do whatever we want, So if we really like those other search engines, we could easily swem. That's two arguments I'm making up on Google. It's a little tougher in the in the advertising side right where the advertisers are paying in money, And if you know, we haven't seen the evidence yet, but I'm sure the government will have an economist come and say, look, advertisers paying a lot more money thybel in the competitive market, right, That's that's
harder to attack. So if I'm Google, my argument there's gonna be based on, hey, you've you've defined the market wrong. That In fact, advertising is a market that includes television and billboards and you know what's on the subway and podcasts right and and in that market we have a very small ship. Do you see one side or the other having an advantage here where it looks like their side is stronger. So it's a little bit hard to say without seeing more evidence. Good government, I think has
a certainly a plausible theory here, particularly in search. So I think it's we're playing out the government's case here in search. It's pretty clear or maybe not that difficult to prove that Google has an opplipition in search, and these agreements, as you said, sort of on their faith and look bad. Google's paying a lot of money to Apple and to Android manufacturers to make them the exclusive search engine, and you asked, why are they paying all
that money? What are they getting for that? So I think that the government has put together, you know, sort of a plausible case on search. Search advertising is a little harder, I think, just because of the market definition issue. You know, what is the market there? What is what is Google share? But if the government could prove that the shares is big and that the market is narrow, then the government have a strong case there too. So
I would say that the government's case is certainly plausible. Right. Google has some arrows and square though, And I think what we were talking about before that there will will fight on market desfinition as to advertising, but you know, as to search, they're going to fight about our consumers haunt. Right, And again I would come back to this argument that they will certainly make which is you and I can choose whatever search engine we want. We're not being harmed.
We choose Google for the most part because we like it better. What remedies is the government seeking if it wins the case, it does speak speak remedies right at the end of the complaint. So the government says that it wants to enjoin these practices, these alleged any competitive practices, which are the distribution agreements and pre installation agreements and
revenue sharing agreements. And then they ask for this catch all what you often see or maybe always seen interested which please enter any other preliminary relief or permanent relief that's appropriate to restore competition in these markets. Right, So we're asking for the government are asking for injunctions on the conduct that we've laid out here that's bad, and then we want anything else you can give us that
will restore competition. And they also say, the government does we ask you court to enter structural relief as needed to curinate in a competitive talks. So structural relief is generally breaking up a company in some way or another, right, So spinning off a portion of the company. Now, that's interesting that that that's in there, this prayer for structural relief. And there's a couple of ways you can look at that.
One is they have it the government has in their just in case, right and just in case that the judge is so inclined, or that they have some other theory coming where they're going to tie the bad conduct to a theory in which the a way to fix that bad connected to break up Google. Now, I don't see anything in this complaint that gets you from A to B R get you from the bad acts to
breaking up Google. Nonetheless, it's there in the in the request for release, but that's probably wouldn't take that too seriously, you know. I think the standard response to a case of remedial response to a case like this is to enjoy the practices right to say stop. The court will order the defendant to stop doing what they were doing. Now, I should just point out here that the government can't ask for money in an answers case brought by the
governments a civil case. What all the government can get is some kind of injunctive relief or structure relief or conduct relief right. Essentially, stop what you're doing, or we're gonna break you up something like that. They can't get money.
But what can happen is this, For instance, the government wins the course of the believe your theory, we can get the government's right that private parties will follow on and bring their own lossters asking for monetary relief right, but in this case there will be no monetary relief. So in the government's case, the standard is we want
an injunction. You want an injunction against the bad conduct, and that that was seemed to me here to be the appropriate relief of the government table to its kids. I mean, settlement is always a possibility, but is it likely here a settlement as this case goes on and on, So it's always hard to say it right what the parties are thinking, And you know, often it depends on
how the case appears to be going, right. But sure, you know many many ancest cases settle, very very few of the trial, right, So you know it's Google decides at some point this isn't worth it to us, We're getting too much bad pr We'll just end these practices. We we believe in our product. I can see that happening, right, We believe we'll keep sharing because we're so good. You could see that happening. That would be a settlement here,
that might end the case. But I just don't think we'll know for some time why the whether the party of going to settle. Thanks for being in the Bloomberg Law Show. That's Sam Winstein, professor at Cardozo Law School. That's it for this edition of the Bloomberg Law Show. Remember you can always hit the latest legal news on our Bloomberg Lawn podcast. You can find them on iTunes, SoundCloud, or at bloomberg dot com slash podcast, Slash Law. I'm
June Grasso. Thanks so much for listening, and remember to tune to The Bloomberg Law Show every weeknight at ten pm Eastern, right here on Bloomberg Radio