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Baker Botts Secures Landmark Copyright Win for Clarion Corporation of America in the D.C. Circuit

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WASHINGTON, D.C., February 3, 2020 – On January 28, 2020, Baker Botts, taking the lead on oral argument, secured a landmark copyright victory for client Clarion Corporation of America before the United States Court of Appeals for the District of Columbia Circuit in Alliance of Artists and Recording Companies, Inc. v. Denso International America, Inc. et al.

The three-judge panel unanimously affirmed the District Court’s summary judgment ruling that automakers and manufacturers of certain onboard vehicle systems, comprised of hard drives, computer programs and databases, were not liable for damages or royalty payments under the Audio Home Recording Act of 1992, 17 U.S.C. §1001, et. seq. (“AHRA” or “Act”). Baker Botts partner Scott Keller argued the case before the D.C. Circuit on behalf of all the joint Defendant-Appellees, which also included General Motors LLC, Ford Motor Company, FCA US LLC, DENSO International America, Inc., and Mitsubishi Electric Automotive America, Inc.

This victory is the culmination of a years-long legal dispute over the interpretation of the AHRA, a highly technical statute that imposes serial copying restrictions and royalty requirements on certain types of equipment, namely, “digital audio recording devices” as defined in the Act. Critically, the D.C. Circuit noted, Congress crafted the AHRA’s definitions “to ensure that personal computers and computer storage media generally would not be subject to the Act.”

In 2014, AARC filed lawsuits in the United States District Court for the District of Columbia, alleging that certain vehicle systems of the defendants fell within the scope of the AHRA and seeking an injunction prohibiting the importation, manufacture, or distribution of the systems, as well as statutory damages and royalty payments. Baker Botts represented Clarion before the District Court, including a highly technical discovery process and arguments over the construction of the AHRA’s nested statutory definitions—a matter of first impression in the D.C. Circuit.

The District Court and D.C. Circuit both agreed that the Defendant-Appellee’s systems at issue are not covered by the AHRA because they are typical computer hard drives and are not capable of making “digital musical recordings” under the AHRA’s plain text. As a result, the systems “are not ‘digital audio recording device[s]’ subject to the AHRA.”

The Baker Botts team included: Scott Keller (Partner, Washington D.C.), Paul Reilly (Partner, Dallas), Ben Geslison (Senior Associate, Houston), Tyler Beas (Senior Associate, Dallas), Adam Dec (Associate, Washington D.C.) and Julie Albert (Senior Associate, New York).

 

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Baker Botts is an international law firm of approximately 725 lawyers practicing throughout a network of 14 offices around the globe. Based on our experience and knowledge of our clients' industries, we are recognized as a leading firm in the energy and technology sectors. Since 1840, we have provided creative and effective legal solutions for our clients while demonstrating an unrelenting commitment to excellence. For more information, please visit bakerbotts.com.

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