Universal Music Demands Insurer Pay For Infringement Damages

An anonymous reader writes with a new twist in the recently resolved Canadian music label infringement lawsuit. From the article: "Earlier this year, the four primary members of the Canadian Recording Industry Association (now Music Canada) — Warner Music Canada, Sony BMG Music Canada, EMI Music Canada, and Universal Music Canada — settled the largest copyright class action lawsuit in Canadian history by agreeing to pay over $50 million to compensate for hundreds of thousands of infringing uses of sound recordings. While the record labels did not admit liability, the massive settlement spoke for itself. While the Canadian case has now settled, Universal Music has filed its own lawsuit, this time against its insurer, who it expects to pay the costs of the settlement."

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I don't see a problem....

[Zocalo]

Universal's insurer agreed to indemnify against copyright cases, and this was a copyright case. I suppose Universal should perhaps have checked that they would have been covered before agreeing to settle the case, but other than that the only out clause I can see for the insurer is that they didn't technically "lose" the case - they agreed to a settlement without admission of guilt.

Still, it boils down to media company vs. insurance company vs. lawyers, and I think it's pretty obvious the only winner out of that triumvirate is going to be lawyers. Oh well, I guess two out of three will just have to do.

Re:I don't see a problem....

[freedom_india]

Agreed to indemnify if Universal lost the case. In this scenario, Universal refused to accept responsibility. Hence they can't get their money from insurer. Or they could accept liability and responsibility, and open themselves for more lawsuits.

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Re:Hmmm.

[ard]

My car insurance has a lot of provisions like "... void if vehicle is driven under the influence ...", "... void if vehicle is used in criminal activities ..." (i.e. smashing while being chased by the police gives no relief).

I would assume most insurances have exclusions if a crime has been involved. Copyright violation is theft, right?

Re:I don't see a problem....

[YeeHaW_Jelte]

Legally they may be in their right. Morally, not so much. They actually settled for 5$ million _less_ than they had already agreed to pay. And now they are trying to get the insurer to pay the money they already should have paid if they hadn't frauded and there wouldn't have been a case in the first place.

This is just sickening greed. They already got a profit of 5$ million dollars out of their cheating and are now seeking even more rewards for their fraud. If this isn't legally wrong, it should be.

They got off cheap

[Anonymous Coward]

There were 300,000 infringing works and the statutory damages were 20,000. That's 6 billion bucks.

50 million is chump change. The music industry is willing to take people's retirement savings, ruining their lives, but they get only a slap on the wrist.

Re:I don't see a problem....

[stiggle]

So if they've got insurance for copyright indemnity - why are they chasing John Doe cases when they can just claim on their insurance instead?

Re:Hmmm.

[Dog-Cow]

I realize that you're being rhetorical, so my reply is not directed at you, per se.

If you feel guilty when you copy some media, you've been brainwashed. Copyright law (as it stands) is immoral, and supporting or upholding copyright law is immoral.

Re:Hmmm.

[west]

No, if the market doesn't want it, then you starve - no immorality.

But if people are pirating it, then pretty much demonstrably, people want your product. If they're willing to forego it for the price you charge, you also starve - no immorality.

But where they get the benefit of it *and* you don't get recompense you asked. *That's* immoral.

Re:Hmmm.

[TheRaven64]

Not too far wrong. Jobs' salary was tiny, but he got a lot of share options. When Apple's value increased by 8,000%, Jobs made an enormous pile of money. If Apple's value had gone down, he'd have made $1/year (or lost money, depending on whether he exercised his options). Ideally, you'd pay your CEO something close to minimum wage (enough to live on, because you don't want only independently rich people to be qualified, but not enough to make them rich, or even particularly comfortably off), but then you'd link all of the rest of their income to the company's performance. Even more ideally, you'd set up their share options so that they couldn't sell the majority until five years after they left, so if they didn't choose a competent successor and leave the company in a long-term manageable state they'd lose too. With share options set up the way they currently are, it's typically a good strategy for a CEO to make massive cuts to R&D, wait for the share price to increase as the short-term profits double from not investing anything in growth, and then quit the company, sell the shares, and find another company to break.

Re:Hmmm.

[michelcolman]

I do understand the way you feel, and it is a valid objection, but just for argument's sake, imagine you see a beggar in the street, and you know he's homeless and hungry, and you want to help by giving him some money, but there's a big Maffia thug (obviously well fed, with a fancy car parked across the street) standing next to him and declaring that for every dollar you give to the bum, you have to give 20 dollars to the thug. Would you still give the money to the bum? Or would you walk away? Of course the beggar might say "but the thug is protecting me, he got me this spot, without him I wouldn't be able to beg here!". Still, I don't think many people would help the bum.

Now of course I do understand that this is the only way for many artists to get a living, and by not buying their music we are denying them their little bit of income, but that justification gets weaker and weaker the more you here about abuse by the labels. The thugs are even snatching the pennies away whenever the bums aren't looking. And they are denying them the right to do anything without them, treating them like slaves. And why should I pay for a ringtone, for example? In that case, the artist isn't getting anything whatsoever, thanks to some lawsuit the greedy labels won! This sort of bull shit takes away 90% of the motivation from people who might turn from piracy to decent buying.

Yes, there's still a little bit of a feeling left of "doing the decent thing", and "supporting the artists", but not as much as there could be if the labels were honest.

Would a long time pirate want to legalize his music collection by paying $1000 to the artists once he got well off financially? Maybe, seriously. Would he pay $10 to the artists and $990 to the labels? After reading one of many articles about the labels ripping off the artists? No way.

Re:Hmmm.

[mcgrew]

No, what's immoral is the life+70 years monopoly before it enters the public domain, DMCA, and many other faults of copyright law. The ludicrously long term hinders creativity. The DMCA makes backing up data you've paid good money for illegal.

Keeping what I've already paid for away from me is immoral. Taking what belongs to we, the people (art and literature) is immoral. Copyright law is in terrible need of reform. Power needs to be taken form the entertainment companies and given to the people who actually create the art and literature.

How is that life+75 years going to entice Jimi Hendrix of Janice Joplin to produce more works? It doesn't. It's a disincentive to the record companies to record someone new; they can still make money off the old. Make the term 20 years and an artist won't be able to retire on the revenues of a single work.

Re:Hmmm.

[delinear]

This is exactly the system I've talked about for years. Too many directors care only about pumping up the short term profitability or share prices of a company so they can make it look like they're doing a fantastic job, leave with a golden handshake and watch the company meltdown from a safe distance a few years later. There is absolutely no incentive at the moment to ensure the long term health of a company. It's exactly the same situation with governments - pretty much every political part in government cares more about being re-elected than ensuring the long term health of the country, that's why we often see big tax cut incentives right before an election even if it's not in the country's interest, because who wants to be the government to put taxes up and help your opponents to get elected with a healthy public chest? The incentives for business and politics are all wrong and that's why the world is in such a huge financial mess.

Re:Hmmm.

[delinear]

Only if we the public do it.

Re:Hmmm.

[west]

Outside of replacing your "No, what's" with "It is", I'd agree with your most of your post.

Heck, I'd even say that pirating a work that where the creator has been dead for a decade is not terribly immoral.

But then we both know that's not what's being pirated, don't we?

In other words, problems with copyright law are being used as a moral smoke-screen to justify pirating what artists produced last month or year and companies are still spending millions making available to the public.