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Archive for March, 2012

NO MORE KARAOKE?

Many of you reading the headline will be eagerly hoping this is in fact the case, and the dreaded karaoke is gone.  Karaoke, or “empty orchestra” as translated in Japanese, has been fairly widely available in the United States since at least the 1990s.

The Hollywood Reporter recently published a story on the fight between karaoke company KTS Karaoke and Sony/ATS (a joint venture that is partially owned by the estate of Michael Jackson).  It seems Sony/ATS is suing KTS in federal district court for “willful copyright infringement.”  Sony/ATS is demanding damages, an injunction, and a recall of KTS’ products so they can be destroyed.

Copyright is an intellectual property concept which generally gives the holder of the copyright exclusive rights to an original work, for a limited period of time.  In the music world, this generally means that money needs to be paid for the use of original music or songs.  Sony/ATS’ lawsuit alleges that the use of original music in karaoke as the background score requires a license, as does the use of the song composition.  It also alleges that performance of an original song in public via karaoke requires payment.  By Sony/ATS’ calculations, KTS owes $1.28 billion in damages.

One of KTS’ arguments is that the company is not infringing on any rights as it purchases songs that are re-recorded by other musicians, and thus it is those musicians who are arguably responsible for any royalties.  KTS has also filed its own lawsuit against Sony/ATS, claiming that the latter has committed copyright misuse by attempting to collect multiple awards on a single product from the upstream producer, the downstream producer (the bars and restaurants with karaoke), and KTS, the packager/distributor.

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The Perils of Misclassifying Your Employees

Are you misclassifying the people that work for you?  The improper characterization of employees as independent contractors is, and has been, a major issue in California.  The potential civil penalties, not to mention the tax implications, are costly.   Well, those penalties just got worse.

Senate Bill 459 has added sections 226.8 and 2753 to the California Labor Code.  The first statute adds a potential penalty of $5,000 to $25,000 per violation for “willful misclassification” of an individual as an independent contractor.  The second statute provides that paid advisors of an employer (excluding attorneys and employees of the company) who “knowingly advise” employers to misclassify workers are jointly and severally liable for any penalties imposed on the employer as a result of the misclassification.

Perhaps more unusual is the requirement that employers who violate the law be required to post a “prominent” notice on their public website, stating, among other things, that the employer has “committed a serious violation of the law” by willfully misclassifying employees, and directing other employees who believe they have been wrongfully misclassified to contact the California Labor and Workforce Development Agency. Given that the vast of majority of businesses nowadays have websites, this posting requirement is something that could have serious and far-ranging effects on a business.  Moreover, if the business does not have a website this posting still has to be made “in a prominent and accessible” location at the employer’s physical location.

Do not take a chance on misclassifying employees.  If you have any questions on employment law do not hesitate to contact our offices at (916) 565-8161.  You can also obtain more information on employment law generally at:  http://radlegal.com/law-practice-employment-law-sacramento-ca.php

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