Audio Home Recording Act Complaint Fails Plausibility Test, Automakers Tell Court
A "plain reading" of the Audio Home Recording Act (AHRA) "confirms" that the CD-copying hard drives built into Ford vehicles don't violate the law, Ford and its supplier Clarion said in a joint motion to have the Alliance of Artists and Recording Companies (AARC) lawsuit dismissed. Ford and General Motors and their respective suppliers Clarion and Denso violated the AHRA because they shipped vehicles with CD-copying hard drives without building the Serial Copy Management System (SCMS) into the devices or paying the Copyright Office the required 2 percent hardware royalty on the wholesale price of the hardware, said the AARC lawsuit filed late July in U.S. District Court for the District of Columbia.
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Though all four defendants argued in their first answers to the AARC complaint that the hard drives built into Ford and GM vehicles were not covered by the AHRA, Ford and Clarion filed a joint motion for dismissal of the case, while Denso and GM each filed separate counterclaims seeking a declaratory judgment that their products are not covered under the AHRA. Legal sources we canvassed surmised that the differences in the various defenses were more procedural than substantive. All represent different strategies for seeking an early resolution of a case on legal rather than factual grounds, the sources said. Which defense is pursued says as much about the lawyer involved as about the legal arguments, they said.
The recording functionality in the hard drives used in the infotainment devices that Denso supplies GM "is a standard magnetic head resting on a moving actuator arm in order to read and write digital data to the platter," Denso said in its filing, typifying the other replies. The Denso infotainment system, including its hard drive, does not "qualify" as a digital audio recording device under the AHRA, nor is it designed or marketed "for the primary purpose" of making a digital audio copied recording, as the AHRA requires for a device to be considered covered, it said. Denso "therefore is not obligated to conform its devices to the regulations of the AHRA and is not required to make royalty payments on its devices under the AHRA," as the AARC alleged, it said. Since the Denso devices also don’t allow for serial copying, "as that term is used in the AHRA," Denso has no obligation to build a "serial copying control mechanism" such as SCMS into its products, it said.
Since the AARC complaint fails the plausibility "on its face" test, "it must be dismissed," said the Ford-Clarion motion. "To be plausible, the plaintiff’s right to relief must be more than speculative." Under "the plain meaning" of the AHRA, the "Nav Systems" that Clarion supplies Ford "cannot plausibly reproduce digital musical recordings," they said. "Therefore, they cannot be deemed digital audio recording devices as defined under the AHRA. The AHRA, therefore, does not apply, mandating that AARC’s complaint be dismissed."
Unlike a CD burner or a tape deck that clearly were covered under the AHRA, the Nav System "does not create a separate material object like a CD or cassette tape on which music files are recorded," Clarion and Ford said. "Instead, it records music from CDs and stores or fixes it on its own hard drive, which also houses software programs and other data." Applying the AHRA’s "plain language to the facts of this case will follow Congress’s intent: music copied and fixed on the Nav System’s hard drive cannot be a digital musical recording because the Nav System’s hard drive contains software unrelated to playing music and data other than sounds," they said. AARC representatives didn't immediately comment on the Clarion, Denso, Ford and GM replies. In a FAQs section posted on the AARC website after the complaint was filed, the group said arguments that the products involved aren't covered under the AHRA won't be "persuasive in court" (http://bit.ly/1o9oAho).