Defendants File Motions to Dismiss in Audiobook Copyright Infringement Case

“Downstream defendants” Amazon.com, Audible and Blackstone jointly moved (docket 1:23-cv-00507) the U.S. District Court for Eastern New York in Brooklyn to grant their motion to dismiss plaintiff Teri Woods Publishing’s complaint with prejudice, saying Friday the copyright lawsuit “should never have been brought.” They requested an oral argument before U.S. District Court Judge Dora Irizarry at a date and time to be determined by the court.

TWP asserts copyright infringement claims against the downstream defendants, which the three companies claim is “merely a contract dispute” between TWP and defendant Urban Audio Books. TWP entered a license agreement with UAB, which granted its rights under the agreement to Blackstone, which in turn granted rights to Audible, said the motion.

TWP claims the downstream defendants infringed its copyrights by allowing consumers to access its titles as part of membership subscription services, without compensating it on an alleged “per-work basis.” The downstream defendants said the agreement “expressly and unambiguously” allows the sale of Plaintiff’s works “in all markets,” including internet downloads and means that are “capable of emitting sounds derived from the recording of audiobooks.”

Separately, UAB filed a motion to dismiss the case with prejudice Friday, (docket 1:23-cv-00507) saying TWP granted UAB exclusive unabridged audio publishing rights for 20 works on various audio media including cassette, internet downloads “and means (now known and hereafter developed) which are capable of emitting sounds derived from the recording of audiobooks.” In return, UAB agreed to pay a percentage of net receipts received in connection with the audiobooks’ distribution, varying by method, said the motion. TWP was to receive 25% of net receipts on all internet downloads of a particular work, it said.

Beginning with an April 5, 2021, royalty statement, UAB reported distribution of audiobooks by digital streaming, noting it would pay TWP 25% of the net receipts from streaming, said the motion. In October, UAB “sought to clarify TWP’s misunderstanding” of royalties paid for digital streaming of audiobooks, saying receipts were calculated based on “total minutes consumed” for each audiobook and listed as “Units Sold.” The letter clarified UAB didn’t pay receipts for the time customers spent listening to a title for less than five minutes, which “did not constitute a “Qualified Listen."

TWP fails to state a claim for direct copyright infringement, UAB said, saying it asserts UAB exceeded the scope of rights granted by the license agreement “by distributing itself, and authorizing the other Defendants to distribute,” the licensed works in the form of digital streams. That denied TWP “contractually specified per-unit royalties,” and any royalties at all, the distributor alleged, because digital streams were made available to certain readers for free or because such digital streams aren't "Qualified Listens."

TWP’s direct copyright infringement claims are barred by the license agreement, and it also fails to state a claim for secondary copyright infringement and breach of contract, said the motion to dismiss. TWP failed to plead its own performance under the license agreement, representing it was the “sole and exclusive owner” of the copyrights of the licensed works, including non-TWP works, it said. "TWP does not own -- and fails to plead any cognizable interest in -- the copyrights to 14 of the 20 literary works covered by UAB’s license, on which TWP’s copyright claims are based," the motion said.

TWP’s breach of contract allegations are “contradictory,” said UAB, noting the plaintiff said it received “no royalties” where works were made available to end users for free, while also acknowledging the streaming platforms paid UAB, “and in turn TWP,” royalties “as a function of the length of time end users listened to the audiobook.”

TWP fails to state a claim for direct copyright infringement because conduct “falls within the scope,” and is authorized by, the license agreement’s “unambiguous terms” that anyone authorized by the copyright owner to use the work in a way specified by the Copyright Act “is not an infringer of the copyright with respect to such use,” said the motion. TWP also failed to identify any provision in the agreement restricting the sources of revenue from which UAB could accept “net receipts,” such as accepting receipts from streaming services’ subscription fees, it said.

UAB said TWP’s application for injunctive relief is “moot” because the company ceased distributing the licensed works “and has no intention of resuming their distribution in the future.”