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Yelp Sues Google & Trump Can't Use Song 'Hold On' · Bloomberg Law

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  Speaker 1: This is Bloomberg Law with June Brusso from Bloomberg Radio.
• 0:10
  Speaker 1: Yelp is the first, but it won't be the last.
• 0:13
  Speaker 1: There will certainly be other tech rivals who launched private
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  Speaker 1: anti trust suits against Google to try to capitalize on
• 0:21
  Speaker 1: its major antitrust defeat. The online review site filed a
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  Speaker 1: complaint last week in federal court in California alleging Google
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  Speaker 1: has monopoly power in the local search advertising market. This,
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  Speaker 1: of course follows the landmark ruling in early August of
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  Speaker 1: DC federal Judge Amitt Meta, who found that Google had
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  Speaker 1: monopoly power in the product markets for general search services
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  Speaker 1: and general search text ads. Yelp didn't even wait for
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  Speaker 1: the case to end before suing Google. There's still going
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  Speaker 1: to be another trial to determine the remedy against Google.
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  Speaker 1: Joining me is anti trust expert Harry First, a professor
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  Speaker 1: at NYU Law School. Harry, it seems like there's an
• 1:04
  Speaker 1: anti trust story in the news every other day, well
• 1:07
  Speaker 1: sometimes every day. Is it the Biden administration's push or
• 1:11
  Speaker 1: something else.
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  Speaker 2: Yeah, it's been amazing. It's been going on sort of
• 1:16
  Speaker 2: for the last couple of years, but it seems like
• 1:18
  Speaker 2: it's particularly intense at the moment, and you know, I
• 1:22
  Speaker 2: don't really see any let up at least in the
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  Speaker 2: near future.
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  Speaker 1: So great for me, well great for me too, But
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  Speaker 1: I mean, do you think if there's a Trump administration
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  Speaker 1: we'll see less anti trust action and Lena Khan will
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  Speaker 1: be deposed?
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  Speaker 2: Well, you know, this is everyone's favorite guessing game. To me,
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  Speaker 2: the answer depends on I mean, it's partly on the president,
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  Speaker 2: of course, but it also depends a lot on who
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  Speaker 2: gets appointed to the main enforcement roles. There is a
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  Speaker 2: strain of populism in the Trump movement, if you will.
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  Speaker 2: And J. D. Vance had expressed support for Lena on
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  Speaker 2: in the past, thought she was a really good federal
• 2:04
  Speaker 2: enforcement agents. But you know who knows what that would
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  Speaker 2: translate to were they elected to office, And you know
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  Speaker 2: who knows what interest he would take, how the president
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  Speaker 2: would take in the specifics of any trust You know,
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  Speaker 2: the two of the cases, the major cases that are
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  Speaker 2: in process now were filed at the end of the
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  Speaker 2: Trump administration, and that depended a lot, I think, on
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  Speaker 2: who was attorney general at the time. So you know,
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  Speaker 2: we would have to wait and see who does get
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  Speaker 2: to be appointed attorney general and then who gets to
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  Speaker 2: be appointed as head of any trust division or the
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  Speaker 2: new chair at the Federal Trade Commission. And it's not
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  Speaker 2: so clear what the Harrison administration will do, so, you know,
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  Speaker 2: although you read that they're interested in continuing the current
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  Speaker 2: enforcement effort, there's always a change when a new administration
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  Speaker 2: comes in, always, and it's unpredictable, in part because you
• 3:01
  Speaker 2: don't know who's going to come in, in part because
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  Speaker 2: you don't know what's going to happen, what mergers are
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  Speaker 2: going to be proposed, you know, all of that.
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  Speaker 1: Do you think that now all Google's rivals are going
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  Speaker 1: to start filing private antitrust suits against Google bouncing off
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  Speaker 1: that decision.
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  Speaker 2: Well, if they do, that'll keep us even busier. Yeah,
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  Speaker 2: I think that's as they say TBD. A more conservative
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  Speaker 2: response is to wait until the decision is finalized for
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  Speaker 2: a number of reasons. There are legal benefits to a
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  Speaker 2: final judgment that may be far off, given that this
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  Speaker 2: will have to go through appeals, So it's not clear
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  Speaker 2: how much they want to wait. It's also not clear,
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  Speaker 2: you know, what sort of private negotiations might occur, not
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  Speaker 2: clear what sort of remedy the government might seek and
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  Speaker 2: whether that might help any of these competitors. Any trust
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  Speaker 2: litigation is expensive and private litigation, although there can be
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  Speaker 2: a pot of gold at the end because litigants can
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  Speaker 2: get treble their damages plus attorney's fees, the end can
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  Speaker 2: be you know, I guess the end of the rainbow
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  Speaker 2: is far off. So it requires a good claim and
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  Speaker 2: private counsel who are willing to wait or be paid
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  Speaker 2: or somehow finance this litigation. So I don't know. We
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  Speaker 2: do see this one case, Yelp has been a complainant
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  Speaker 2: both in the US and in Europe by a complainant
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  Speaker 2: to the government, so it struck me as a little
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  Speaker 2: early maybe, but I don't know. There are always the
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  Speaker 2: possibilities of settlement, so if we go back, I mean
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  Speaker 2: settlement between these parties. If we go back to the
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  Speaker 2: Microsoft litigation itself, a lot of private parties sued, including
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  Speaker 2: potential competitors and licensees of Windows, and some of them
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  Speaker 2: got quite substantial, you know, settle from Microsoft. But of
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  Speaker 2: course Microsoft, you know, eventually did lose on appeal, so
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  Speaker 2: that helped a lot. So yes, I would expect more,
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  Speaker 2: not just YELP. But I'm looking to see whether Microsoft
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  Speaker 2: will sue, which I think would be just quite amusing
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  Speaker 2: from any dress point of view, because you know, they
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  Speaker 2: testified that BING just could never get any traction because
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  Speaker 2: of Google's practices. They couldn't get the scale they needed.
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  Speaker 2: So in some ways BING should have a good suit.
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  Speaker 2: The question, you know, would be what's their damages and
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  Speaker 2: what sort of relief do they want? So yes, maybe
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  Speaker 2: being Yelp, maybe duck duck go, and we can you know,
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  Speaker 2: start listing them. People are suggesting maybe some you know
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  Speaker 2: advertisers who complained that price of advertising was raised because
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  Speaker 2: they monopolized this general search text advertising market. You know,
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  Speaker 2: all of these cases present different occulties, even with the
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  Speaker 2: win that the government just had on liability, so no
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  Speaker 2: lay downs here. But on the other hand, Google does
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  Speaker 2: face the possibility of these sorts of lawsuits.
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  Speaker 1: So the Yelp complaint was filed in the Northern District
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  Speaker 1: of California. Judge Meta is in the DC circuit. His
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  Speaker 1: ruling doesn't even have any presidential power in another circuit,
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  Speaker 1: does it.
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  Speaker 2: Well, it doesn't have any presidential value now in a
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  Speaker 2: technical sense at all, because it's not final and it
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  Speaker 2: hasn't been appealed. So what Judge Meta's opinion has is
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  Speaker 2: sort of legal momentum, so similar issues have been presented
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  Speaker 2: in different courts, and judges will look to see they're
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  Speaker 2: not necessarily bound. Well they're not bound, but they look
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  Speaker 2: to see, you know, what other judges have done. There
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  Speaker 2: aren't that many cases like this, so on product market definition,
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  Speaker 2: Judge Meta looked at a case that involve digital advertising
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  Speaker 2: in a completely different setting with different parties, and it
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  Speaker 2: was a merger case. So you know, I would expect,
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  Speaker 2: you know, a judge in the northern industry of California
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  Speaker 2: to consider carefully what Judge Meta is very thoughtful, very
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  Speaker 2: thorough opinion, and you know it may be persuasive. But
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  Speaker 2: I assume YELP file there for other reasons like thinking
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  Speaker 2: they'll have a better shot on damages and maybe a
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  Speaker 2: better shot on appeal. So you know, there are all
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  Speaker 2: sorts of complicated reasons for choice of court. But in
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  Speaker 2: any event, even filing in DC, another judge doesn't have
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  Speaker 2: to follow what Meta has decided because it's still not final.
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  Speaker 1: Can you explain what Yelp's complaint is?
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  Speaker 2: Well, I think generally, I mean YELP has YELP has
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  Speaker 2: felt that Google has has stolen their lunch the right phrase,
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  Speaker 2: you know.
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  Speaker 1: I don't know if it's the right phrase.
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  Speaker 2: Well, the local reviews, you know, Google has incorporated into
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  Speaker 2: its own system and then gotten advertising off of it,
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  Speaker 2: including reviews, So you know, to the extent that Yelp
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  Speaker 2: has to you know, buy advertising you know, under Google
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  Speaker 2: to get viewers, you know, to then click onto Yelp
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  Speaker 2: is one problems, and another problem may be the way
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  Speaker 2: reviews are done and whether Google has self preferenced its
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  Speaker 2: own search results over yelps. I mean, basically, I think
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  Speaker 2: they're complaining that Google runs its business in a way
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  Speaker 2: that makes it very hard for Yelp to compete because
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  Speaker 2: you know, they control the search engine results page and
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  Speaker 2: in the end degrade searches by favoring their own results,
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  Speaker 2: or at least that may be what they're claiming.
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  Speaker 1: Do Judgmenta's findings have anything to do with that the
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  Speaker 1: local search results that.
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  Speaker 2: Yelp does, well, he looked at it's really a different market.
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  Speaker 2: First of all, rejected the idea that brought by the
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  Speaker 2: States that there was some problem with vertical search engines,
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  Speaker 2: which Yelp is. So the advertising market that Yelp is
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  Speaker 2: alleging is different than the search advertising market that judge
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  Speaker 2: Meta focused on, so they'll have to slog through that.
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  Speaker 2: The idea that there is some degree of degrading of
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  Speaker 2: search results, which is shown by preferencing Google search results
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  Speaker 2: over others, that may help, But again I think this
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  Speaker 2: is all going to have to be sort of fought
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  Speaker 2: out anew by Yelp at this point in litigation, because
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  Speaker 2: they don't get any technical benefit from whatever findings judgemental
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  Speaker 2: made and judgementals decided on a somewhat different market, and
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  Speaker 2: I think Yelp is a legend.
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  Speaker 1: Wouldn't it be hard to prove damages in a case
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  Speaker 1: like this, Well.
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  Speaker 2: Yelp, assuming they can find some sort of liability if
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  Speaker 2: they've been excluded or their business has been harmed, My
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  Speaker 2: guess is that they would have a shot at damages.
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  Speaker 2: Excluded competitors are the most directly injured from these kinds
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  Speaker 2: of monopolizing behaviors because the focus is to exclude you know,
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  Speaker 2: other competitors. So, you know, damages are always a problem.
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  Speaker 2: Causation is a problem. You know, did it really cause
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  Speaker 2: you know, whatever the conduct in which Google engaged these
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  Speaker 2: particularly you know, exclusive contracts and so forth, paying for
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  Speaker 2: defaults on search. Did that directly harm YELP is going
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  Speaker 2: to be another question. They'll they'll have to litigate, but
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  Speaker 2: my guess is they'll have you know, good economists who
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  Speaker 2: will model the effect on their business, and you know,
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  Speaker 2: they do have a business, and presumably they can show
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  Speaker 2: that they you know, but for that behavior, they would
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  Speaker 2: have been more successful.
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  Speaker 1: And what do you think about the remedy in the
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  Speaker 1: Google case. I've been hearing that the Justice Department might
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  Speaker 1: actually ask for a breakup.
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  Speaker 2: Well, I hear that some commentators want a justice to
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  Speaker 2: ask for some sort of breakup. The Department probably will
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  Speaker 2: not want to call it a breakup, but a restructuring
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  Speaker 2: of Google's business. Now, I don't know. This has been
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  Speaker 2: one of the big puzzles to me of the Google litigations,
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  Speaker 2: to you know, what they will be able to get
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  Speaker 2: from the judge in terms of relief that will actually
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  Speaker 2: bring competition to this search business, And I don't, frankly,
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  Speaker 2: I'm not sure what that is. So it is possible
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  Speaker 2: that they'll ask that Chrome be spun off or that
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  Speaker 2: Android be you know, the Android operating system be spun off.
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  Speaker 2: But there are a lot of technical issues and bottom
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  Speaker 2: financial issues because these all rely on being connected to
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  Speaker 2: Google's advertising machine. So this is really a stay tuned
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  Speaker 2: and you know, let's see what they come up with.
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  Speaker 1: Coming up next on the Bloomberg Lawn Show, I'll continue
• 12:18
  Speaker 1: this conversation with NYU law professor Harry First in Nvidia
• 12:23
  Speaker 1: gets a subpoena in a Justice Department investigation and NFL
• 12:28
  Speaker 1: Sunday ticket subscribers appeal a judge's decision tossing a four
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  Speaker 1: point seven billion dollar jury verdict. This is Bloomberg. NFL
• 12:39
  Speaker 1: Sunday ticket subscribers are appealing a judge's decision to toss
• 12:44
  Speaker 1: a four point seven billion dollar jury verdict against the league,
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  Speaker 1: an award that could have been tripled to fourteen billion
• 12:52
  Speaker 1: under federal antitrust laws. The appeal is certainly not a
• 12:56
  Speaker 1: surprise in the legal fight over pricing of the NFL's
• 13:00
  Speaker 1: ticket game broadcast package. It's a case that's been going
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  Speaker 1: on for ten years. The judge found that the jury's
• 13:07
  Speaker 1: damages awards were not based on quote the evidence and
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  Speaker 1: reasonable inferences, but instead we're more akin to guesswork or speculation.
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  Speaker 1: But he did not order a new trial. I've been
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  Speaker 1: talking to antitrust professor Harry First of NYU Law School.
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  Speaker 1: The judge said that there was liability, but the jury
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  Speaker 1: miscalculated the damages, so he threw out the jury award,
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  Speaker 1: but then he didn't order a new trial, right that
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  Speaker 1: seems odd to me.
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  Speaker 2: Well, yes, that's presumably going to be one of the
• 13:41
  Speaker 2: arguments on appeal as to whether it should have been
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  Speaker 2: returned for a new trial on damages. Now, as I
• 13:49
  Speaker 2: read the judge's opinion, the judge said, well, it looks
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  Speaker 2: from the number that the jury came up with that
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  Speaker 2: they didn't really rely on the you know, on the
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  Speaker 2: expert's evidence. Not clear how they got to these numbers,
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  Speaker 2: And he didn't seem to have confidence that the jury
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  Speaker 2: could now go back and come to some other decision.
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  Speaker 2: I'm not quite sure why, and I'm not quite sure
• 14:15
  Speaker 2: why the plaintiffs should not be allowed to, you know,
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  Speaker 2: to come forward with evidence on damages that are not
• 14:25
  Speaker 2: from these flawed well what judge found was flawed damage's estimates.
• 14:30
  Speaker 2: So I'm not quite sure whether that's going to be
• 14:33
  Speaker 2: supportable on appeal. The judge did say, you're right that
• 14:38
  Speaker 2: there was sufficient evidence from which the jury could infer
• 14:41
  Speaker 2: a violation of Section one of the Sherman Act. Well,
• 14:45
  Speaker 2: that's you know, that's that's a pretty important finding. So
• 14:50
  Speaker 2: I think, you know, this argument is yet to be
• 14:53
  Speaker 2: fought out in the court of appeals as to whether
• 14:57
  Speaker 2: that's supportable, and it raises a good question about how
• 15:02
  Speaker 2: we feel about these juries in these complex cases. And
• 15:07
  Speaker 2: it seems to me that the use of juries, the
• 15:09
  Speaker 2: desire of plaintiffses includes the federal government to bring their
• 15:14
  Speaker 2: cases before juries, is increasing precisely because jurors do have
• 15:20
  Speaker 2: a sense of they are consumers, and they have a
• 15:23
  Speaker 2: sense of when things have gone wrong in the marketplace.
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  Speaker 2: So I think this will be an interesting one to
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  Speaker 2: follow through on appeal and see whether that is supportable
• 15:35
  Speaker 2: and whether plaintiff should have gotten a new trial.
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  Speaker 1: I mean, you would think that if there's liability but
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  Speaker 1: the jury miscalculated the damages, that okay, it seems like
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  Speaker 1: a new trial would be in order. There. Do they
• 15:48
  Speaker 1: want juris plaintiff's attorneys in the government because juries will
• 15:52
  Speaker 1: give awards that are bigger and perhaps more emotional than
• 15:59
  Speaker 1: a judge would.
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  Speaker 2: Well, I can't psychoanalyze plaintiff lawyers. I think they assume
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  Speaker 2: that jurors might be more more open to large damages
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  Speaker 2: awards than judges who you know, judges can be pretty skeptical,
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  Speaker 2: and you know, judges are often conservative, you know, that's
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  Speaker 2: how they got there. And I don't mean conservative in
• 16:22
  Speaker 2: a Republican point of view, I mean just generally, you know,
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  Speaker 2: they're conservative. They're not lay people. So yes, maybe plaintiffs
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  Speaker 2: think that jurors are a more hospitable forum, but I
• 16:34
  Speaker 2: think it goes beyond that. I think it goes to
• 16:39
  Speaker 2: the question of jurors being not as attached to technical
• 16:44
  Speaker 2: evidence as to you know, sort of a broader understanding of,
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  Speaker 2: you know, how the business operating, what the defendants have done,
• 16:54
  Speaker 2: and they haven't seen it all before. Judges may have
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  Speaker 2: seen a lot of this before, so they may come
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  Speaker 2: with a more open mind, you know, that may be
• 17:03
  Speaker 2: better and in some sense more democratic.
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  Speaker 1: This is the tenth year I think of this lawsuit.
• 17:11
  Speaker 1: I mean they could appeal, then there could be another trial,
• 17:15
  Speaker 1: then more appeals, more appeals. Is this something that could
• 17:19
  Speaker 1: be settled or after ten years are they dug in?
• 17:23
  Speaker 2: I hadn't really thought about that, since they hadn't settled before.
• 17:27
  Speaker 2: I think, you know, lawyers assess risk and the NFL
• 17:32
  Speaker 2: assesses risk and the owners a sess risk. So is
• 17:36
  Speaker 2: it possible to settle this? Well, you know, there's a
• 17:39
  Speaker 2: liability finding, so maybe maybe that will be possible. But
• 17:45
  Speaker 2: on the other hand, at this point, the worst that
• 17:49
  Speaker 2: can happen for the defendants, I guess is a new trial.
• 17:53
  Speaker 2: Now that might just make the chances of settlement, I mean,
• 17:57
  Speaker 2: the cost of settlement more expensive, I guess, or maybe
• 18:01
  Speaker 2: the plaintiffsin would be more willing to settle. So it's
• 18:04
  Speaker 2: a delicate issue. Settlements possible at any time, even while
• 18:09
  Speaker 2: the jury's out and the time you know, past time
• 18:13
  Speaker 2: doesn't matter, and you know, there's more that we'll go
• 18:16
  Speaker 2: into it, including the defendant's reputation for whether they'll settle
• 18:21
  Speaker 2: or sue.
• 18:23
  Speaker 1: Turning to another anti trust story, the Justice Department sent
• 18:27
  Speaker 1: subpoenas to Nvidia and other companies as it seeks evidence
• 18:31
  Speaker 1: that the chip maker violated antitrust laws. According to Bloomberg sources,
• 18:36
  Speaker 1: that's an escalation of the Justice Department's investigation into the
• 18:40
  Speaker 1: dominant provider of AI processors. According to people familiar with
• 18:45
  Speaker 1: the investigation, the Justice Department, which had previously delivered questionnaires
• 18:50
  Speaker 1: to companies, is now seeking legally binding requests that obliged
• 18:54
  Speaker 1: recipients to provide information. In response to a Bloomberg News story,
• 18:59
  Speaker 1: in DA said it has been in contact with the
• 19:02
  Speaker 1: government agency, but hasn't been subpoenaed. The DOJ often sends
• 19:07
  Speaker 1: requests for information in the form of what's known as
• 19:10
  Speaker 1: a civil investigative demand, which is commonly referred to as
• 19:14
  Speaker 1: a subpoena, And, according to one person what's direct knowledge
• 19:17
  Speaker 1: of the matter, the Justice Department has sent such a
• 19:20
  Speaker 1: request seeking information about Nvidia's acquisition of run Ai and
• 19:26
  Speaker 1: aspects of its chip business. So, Harry, what's the real
• 19:29
  Speaker 1: significance of the Justice Department sending subpoenas or the civil
• 19:34
  Speaker 1: investigative demands to Nvidia and other companies?
• 19:39
  Speaker 2: Well, I guess you know. The most direct answer is
• 19:42
  Speaker 2: they're investigating so an ant trust investigation I hope is
• 19:48
  Speaker 2: you know, not just chopped liver as they say. It's
• 19:50
  Speaker 2: something important for a company and it may amount to
• 19:55
  Speaker 2: no case being broad who knows what it'll amount to.
• 19:58
  Speaker 2: But what it doesn't amount to is it's not nothing.
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  Speaker 2: So they are being looked at, and you'd rather not
• 20:06
  Speaker 2: be looked at. Now, the other side of that is
• 20:10
  Speaker 2: all the cases we're talking about take a long time
• 20:13
  Speaker 2: before anything happens by way of remedy to any of
• 20:17
  Speaker 2: these companies. You know you mentioned the Sunday ticket case.
• 20:21
  Speaker 2: By looking at the government cases, I mean the decision
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  Speaker 2: JUDGMENTSA just decided this in twenty twenty four. The case
• 20:29
  Speaker 2: was filed in twenty twenty and this is just the trial.
• 20:34
  Speaker 2: So as Google's business been harmed by this, well, I
• 20:37
  Speaker 2: don't know they spend time defending it, but people aren't
• 20:41
  Speaker 2: selling off didn't sell off Google stock because of any
• 20:45
  Speaker 2: trust investigation, and my guess is they're not really the
• 20:50
  Speaker 2: volatility and Nvidia stock is not really much affected by
• 20:55
  Speaker 2: this now, but you know, who knows what they'll find.
• 20:59
  Speaker 2: And what what is interesting to me is in Vidia
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  Speaker 2: has a business plan that, as you read about it
• 21:07
  Speaker 2: in say the Wall Street Journal, is interested in being
• 21:11
  Speaker 2: not just if you can say, just the chip seller
• 21:16
  Speaker 2: for AI, but having a much broader role in the industry.
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  Speaker 2: There's a lot of concern I think this would be
• 21:22
  Speaker 2: broad ranging about how the AI industry, if you want
• 21:28
  Speaker 2: to call it that, or how AI is going to
• 21:30
  Speaker 2: evolve and who's going to control it. So I don't
• 21:34
  Speaker 2: know what the probe is about, and who knows what
• 21:36
  Speaker 2: they'll find, but they may turn out to be interested
• 21:41
  Speaker 2: in how Nvidia is pursuing this broader strategy and that
• 21:46
  Speaker 2: might present some challenge for the company that really does
• 21:51
  Speaker 2: it wants to be around in a broader sense that
• 21:55
  Speaker 2: the big platform companies are today. They that's my sense
• 22:00
  Speaker 2: of it. So yeah, in the long run, this may
• 22:03
  Speaker 2: pose some challenge to what they want to do is
• 22:08
  Speaker 2: evolving business.
• 22:09
  Speaker 1: So the subpoenas don't necessarily indicate that the government is
• 22:14
  Speaker 1: getting ready to file a lawsuit.
• 22:16
  Speaker 2: Oh no, no, these are they're civil investigation demands. They're
• 22:20
  Speaker 2: not grand jury subpoenas. So I mean it's not a
• 22:23
  Speaker 2: criminal case. I mean, although the report just says subpoenas,
• 22:29
  Speaker 2: I'm not sure how technical the terms being used. I
• 22:34
  Speaker 2: don't assume it's a grand jury, which is just for
• 22:37
  Speaker 2: criminal matters. So I assume there's what are called civil
• 22:40
  Speaker 2: investigative demands, and it's the beginning of gathering information. And
• 22:46
  Speaker 2: I mean, this can happen and then nothing happens, or
• 22:50
  Speaker 2: you know, it takes the departments are complicated companies. Takes
• 22:53
  Speaker 2: a division and trust division sometime to you know, get
• 22:58
  Speaker 2: the information, figure out what to do, and then figure
• 23:01
  Speaker 2: out what to do next. You know who they want
• 23:03
  Speaker 2: to talk to, what documents. I mean, it is a lot,
• 23:08
  Speaker 2: so I don't look for anything quick. I think they
• 23:11
  Speaker 2: are at the beginning of this investigation. But you know,
• 23:16
  Speaker 2: maybe there are complainants that have put them on the
• 23:20
  Speaker 2: track of some very specific practices involving exclusive contracts of
• 23:25
  Speaker 2: things that they think they can remedy rather quickly. So
• 23:29
  Speaker 2: we'll see, we will see.
• 23:31
  Speaker 1: And when we do see, I'll call you Harry, thanks
• 23:34
  Speaker 1: so much. That's Professor Harry First of NYU Law School
• 23:38
  Speaker 1: coming up next. Trump is barred from playing hold On
• 23:41
  Speaker 1: at rallies. This is Bloomberg. Donald Trump has been playing
• 23:55
  Speaker 1: the Sam and Dave song hold On at his rally
• 23:58
  Speaker 1: since twenty twenty, but according to a complaint by the
• 24:02
  Speaker 1: estate of the late musician Isaac Hayes, Trump never got
• 24:05
  Speaker 1: permission or obtained a valid license, and even ignored a
• 24:09
  Speaker 1: cease and assist letter the estates sent in twenty twenty.
• 24:13
  Speaker 1: It's unusual that these kinds of disputes with artists reach
• 24:17
  Speaker 1: a trial judge, but it's Donald Trump, whose tendency to
• 24:21
  Speaker 1: litigate is well known. Now A federal judge in Atlanta
• 24:25
  Speaker 1: has issued a preliminary injunction stopping Trump from playing the
• 24:29
  Speaker 1: song as the copyright case against him proceeds. Joining me
• 24:34
  Speaker 1: is Heidi Vakarano, a partner Fox Rothschild. Let's say a
• 24:38
  Speaker 1: politician wants to play the song of an artist at
• 24:41
  Speaker 1: campaign rallies. What do they have to do legally?
• 24:45
  Speaker 3: So it is a little bit complicated because of the
• 24:49
  Speaker 3: nature of how the licensing system is in the United States.
• 24:52
  Speaker 3: So if they're just going to play it at a
• 24:54
  Speaker 3: campaign at a public location like a convention center or rally,
• 24:58
  Speaker 3: then they need to obtain a public performance license from
• 25:02
  Speaker 3: the public performance organizations, which include ASCAP, BMI, Feedback or GMR.
• 25:08
  Speaker 3: And you need to obtain a license from each one
• 25:11
  Speaker 3: of them because a song could have various writers that
• 25:14
  Speaker 3: are registered to either one of these pros. So it's
• 25:18
  Speaker 3: not just that you would go to ASKCAF and think
• 25:21
  Speaker 3: that you have an entire license for a song, because
• 25:24
  Speaker 3: the songwriters there may be four songwriters and two are
• 25:26
  Speaker 3: registered with ASKCAF, one is registered with BMI, and one
• 25:29
  Speaker 3: is registered with FEEDSACKS. So they would need to obtain
• 25:32
  Speaker 3: a license from each of these pros.
• 25:34
  Speaker 1: Does an artist have the right to say I don't
• 25:37
  Speaker 1: want Trump to be playing my songs at his rallies
• 25:41
  Speaker 1: because there's an implication that I'm endorsing him.
• 25:45
  Speaker 3: They do. It's part of the rights under the copyright
• 25:48
  Speaker 3: law in the US, and it's also considered false endorsement.
• 25:53
  Speaker 3: So they do have the right to deny a youth,
• 25:56
  Speaker 3: either through their publishing administrator or their record label.
• 26:00
  Speaker 1: Is it unusual that a case like this actually gets
• 26:04
  Speaker 1: to a trial judge?
• 26:07
  Speaker 3: I would say so yes. Normally, a license like this
• 26:10
  Speaker 3: would be a very simple thing to obtain, and if
• 26:13
  Speaker 3: somebody sends a season assist letter, then they would definitely
• 26:16
  Speaker 3: discontinue the use. But I feel like this has kind
• 26:19
  Speaker 3: of gone all the way because it is like the
• 26:22
  Speaker 3: nature of the political campaign.
• 26:25
  Speaker 1: The Isaac Kaysa State claims that it sent a cease
• 26:28
  Speaker 1: and desist letter to Trump in twenty twenty when he
• 26:31
  Speaker 1: was using the song at his campaign rallies. If they
• 26:35
  Speaker 1: didn't have a license and they didn't get permission from
• 26:38
  Speaker 1: the Hayes estate, is it a pretty easy decision for
• 26:41
  Speaker 1: the judge to say you can't play that.
• 26:44
  Speaker 3: Yeah, it should be so, like I said, you would
• 26:47
  Speaker 3: have to check if they have the proper public performance
• 26:49
  Speaker 3: licenses from all the songwriters involved in this case. You
• 26:52
  Speaker 3: can at least see that it is performed by a
• 26:55
  Speaker 3: separate artist, but written by that Isaac case right who,
• 26:58
  Speaker 3: which is owned by the Isaac Caase estate. So if
• 27:00
  Speaker 3: they did not have the proper licenses, it should be
• 27:03
  Speaker 3: very easy. According to a copywriter.
• 27:05
  Speaker 1: At the hearing, the lawyers for Trump said a couple
• 27:09
  Speaker 1: of things. They said that the ISAA Kaysa State didn't
• 27:13
  Speaker 1: own the copyright and apparently the ISAACASA state produced documents
• 27:17
  Speaker 1: for the judge. They also said they obtained a license
• 27:20
  Speaker 1: from BMI Music in November twenty twenty two.
• 27:24
  Speaker 3: Also, I believe BMI has also sent a season desist
• 27:27
  Speaker 3: letter two removing the song from its catalog for youth.
• 27:31
  Speaker 3: So at this point, a lot of what the public
• 27:34
  Speaker 3: performance organizations are doing is actively going to their members
• 27:38
  Speaker 3: and saying, if you would like to exclude your works
• 27:40
  Speaker 3: from use by political campaigns, then please contact us and
• 27:44
  Speaker 3: send us a notice letter along with a list of
• 27:46
  Speaker 3: your work that you want to have excluded from use
• 27:49
  Speaker 3: and political campaign.
• 27:51
  Speaker 1: So is there a possibility they get a license from
• 27:54
  Speaker 1: BMI at any point, whether.
• 27:56
  Speaker 3: They obtained a license from BMI, and if that's the
• 28:00
  Speaker 3: correct license, you would have to check. Like if each
• 28:02
  Speaker 3: of the songwriters were all registered with VMI, then that
• 28:05
  Speaker 3: would cover all of the songs. But it's not just
• 28:07
  Speaker 3: enough to have a license from BMI. There might be
• 28:10
  Speaker 3: songwriters who are registered with a different pro that they
• 28:13
  Speaker 3: would still have.
• 28:14
  Speaker 1: So the judges preliminary injunction said the Trump campaign couldn't
• 28:19
  Speaker 1: continue to use the song without a proper license, but
• 28:22
  Speaker 1: he is allowing the campaign to keep videos that already
• 28:27
  Speaker 1: exist that include hold On, I'm Coming.
• 28:31
  Speaker 3: But even if a song is used in the background
• 28:34
  Speaker 3: of a video, you would still have to pain a
• 28:36
  Speaker 3: synchronization needs. My understanding would be that at this point
• 28:39
  Speaker 3: they would probably go back into Discovery and see what
• 28:43
  Speaker 3: licenses they had pained. An a fit he had pained
• 28:45
  Speaker 3: all the proper licenses.
• 28:47
  Speaker 1: I was confused because Trump's attorney said that we are
• 28:50
  Speaker 1: gratified that the court recognized the First Amendment issues at
• 28:53
  Speaker 1: stake and didn't order a takedown of existing videos.
• 28:57
  Speaker 3: I don't think that's in line with with the reasoning.
• 28:59
  Speaker 3: But the court, I think they would definitely want to
• 29:01
  Speaker 3: go in and see what licenses were obtained and see
• 29:03
  Speaker 3: if the videos that they're using with the song were
• 29:06
  Speaker 3: properly licensed. So if the videos, like when you use
• 29:09
  Speaker 3: a song in a video, it's called the synchronization licensing,
• 29:13
  Speaker 3: you need to obtain a license for both the master
• 29:16
  Speaker 3: recording so whatever master version they use, and also from
• 29:20
  Speaker 3: the music on the music publishing sides from the songwriters
• 29:23
  Speaker 3: of the music.
• 29:24
  Speaker 1: I mean, do most campaigns go through all these hoops?
• 29:28
  Speaker 3: They should. There definitely should be someone in a campaign
• 29:31
  Speaker 3: who is looking into all of the clearances required, whether
• 29:35
  Speaker 3: it's just that a political rally or they're going to
• 29:38
  Speaker 3: be using it in commercials.
• 29:40
  Speaker 1: Correct me if I'm wrong, But this doesn't go to
• 29:43
  Speaker 1: court much because usually when artists say I don't want you.
• 29:46
  Speaker 3: To use that, you stop using it.
• 29:49
  Speaker 1: Correct. There are lists of artists who have been complaining
• 29:53
  Speaker 1: about Trump using their songs, from Celine Dion to Bruce Springsteen, Rihanna.
• 30:01
  Speaker 1: The list is long. They featured a video at one
• 30:04
  Speaker 1: of their campaigns of Celine Dion performing I can't even
• 30:09
  Speaker 1: imagine any way that you could think that that was
• 30:11
  Speaker 1: allowable and all the rice use.
• 30:13
  Speaker 3: Yeah, that is definitely an infringing use, not only from
• 30:17
  Speaker 3: the use of the music, but also the false endorsement
• 30:20
  Speaker 3: any potential trademarks that we're used in whoever the owner
• 30:24
  Speaker 3: of the video footage is as well.
• 30:26
  Speaker 1: Isaac case the third said, we're pleased with this decision
• 30:29
  Speaker 1: by the court and move to the next phase of
• 30:31
  Speaker 1: the lawsuit. He called it the first step in the
• 30:34
  Speaker 1: copyright infringement case against Donald Trump and Donald Trump for President.
• 30:38
  Speaker 1: They're seeking actual and punitive damages for each proven infringement.
• 30:44
  Speaker 3: So the nature of how our copyright works is once
• 30:47
  Speaker 3: your cops have protection under the copyright, you registered it
• 30:51
  Speaker 3: with the copyright office, then you are entitled for statutory
• 30:55
  Speaker 3: damages and potentially additional damages, punitive damages like they're requesting
• 30:59
  Speaker 3: if they have sent these feats into this letters and
• 31:02
  Speaker 3: can prove that there has been economic harm due to
• 31:06
  Speaker 3: the continued use of the songs.
• 31:08
  Speaker 1: One of the things that Trump's lawyer said is that
• 31:10
  Speaker 1: they weren't harmed by this. They weren't economically harmed by this.
• 31:13
  Speaker 1: What kind of economic harm can you prove?
• 31:16
  Speaker 3: For example, like imagine if this was a car commercial
• 31:20
  Speaker 3: and they were the ISIC cases. They decided, okay, we
• 31:25
  Speaker 3: have already had a deal with BMW, But then bulbo
• 31:28
  Speaker 3: used it, you know, so if they have existing licenses
• 31:31
  Speaker 3: that this would put them in breach of that's one issue,
• 31:33
  Speaker 3: right that they can show they've lost money due to
• 31:36
  Speaker 3: this infringing use that was unauthorized. They can also show
• 31:40
  Speaker 3: that they potentially lost other uses because of this false
• 31:43
  Speaker 3: endorsement from the use of their music. And they can
• 31:46
  Speaker 3: also use the fact that they were in active negotiations
• 31:52
  Speaker 3: potentially with other publishers or whoever they are, that the
• 31:55
  Speaker 3: use of their music lost value because of a campaign
• 31:58
  Speaker 3: that used their music and authorized.
• 32:01
  Speaker 1: That sounds a little more difficult than I thought. It's
• 32:03
  Speaker 1: not just give me economic damages because you use this
• 32:07
  Speaker 1: song one hundred and thirty three times without my permission.
• 32:10
  Speaker 3: Correct. No, the statutory damages are set by the US
• 32:14
  Speaker 3: copyright law for this for each infringing use right. But
• 32:18
  Speaker 3: economic damages or for punitive damages are you know, more nuanced,
• 32:23
  Speaker 3: and they would have to prove that they potentially lost
• 32:25
  Speaker 3: other licensing opportunities and damaged their name imager likeness.
• 32:31
  Speaker 1: There's a little bit of a twist here because Sam
• 32:34
  Speaker 1: Moore of Sam and Dave was against the filing of
• 32:38
  Speaker 1: this lawsuit.
• 32:39
  Speaker 3: So Sam Moore had performed a song at an inauguration
• 32:44
  Speaker 3: concert for Trump. Right, So what's interesting in the US
• 32:47
  Speaker 3: is that you know, Britney Spears can perform a song,
• 32:50
  Speaker 3: but it's written by four different songwriters, right, But it's
• 32:55
  Speaker 3: her who's on the master recording, who's a performer on this.
• 32:58
  Speaker 3: So they would still need to get permission from the artists.
• 33:02
  Speaker 3: So in this case where Sam is saying like, hey,
• 33:04
  Speaker 3: I gave provision or potentially saying I'm okay with the youth,
• 33:08
  Speaker 3: if one person out of four songwriters denies the youth,
• 33:12
  Speaker 3: then you cannot use the song either way.
• 33:14
  Speaker 1: Actually, the Trump lawyers filed with the court a sworn
• 33:18
  Speaker 1: statement where he said he was opposed to the actions
• 33:21
  Speaker 1: sought by the Hayes estate. That carries no weight, I take.
• 33:24
  Speaker 3: It, no, not really. I mean, there's a nuance to
• 33:28
  Speaker 3: the US copyright app where a songwriter of a composition
• 33:33
  Speaker 3: can license the use of the songs for non exclusive use,
• 33:37
  Speaker 3: just solely in the US, But that does not really
• 33:40
  Speaker 3: extend to public performance uses because those are controlled by
• 33:44
  Speaker 3: the public performance organization and they would need the campaign
• 33:47
  Speaker 3: would still need to obtain a license from that. And
• 33:50
  Speaker 3: if a songwriter from one of the songs has already
• 33:54
  Speaker 3: asked the PRORO to exclude their music, then they couldn't
• 33:57
  Speaker 3: grant a license.
• 33:58
  Speaker 1: Sam Moore also said that he was afraid that if
• 34:01
  Speaker 1: the court were to grant the Hayes of States' wishes,
• 34:05
  Speaker 1: that he might be prohibited from ever appearing and performing
• 34:08
  Speaker 1: the song at a Trump event during or after the election.
• 34:12
  Speaker 1: That is true, then according to what you said, that
• 34:14
  Speaker 1: he is not allowed to perform that without the permission
• 34:17
  Speaker 1: of the Hazen.
• 34:18
  Speaker 3: Write the songwriter. Yeah, they would not be able to
• 34:21
  Speaker 3: obtain a public performance license.
• 34:23
  Speaker 1: For that song. How much does a public license usually cost?
• 34:28
  Speaker 1: Because the Hayes State said it would allow Trump to
• 34:31
  Speaker 1: pay a quote very discounted three million dollar licensing fee.
• 34:36
  Speaker 1: I mean, are they that high?
• 34:38
  Speaker 3: No, I don't. The public performance license depends on what
• 34:42
  Speaker 3: the nature of the youth will be, whether it's just
• 34:45
  Speaker 3: like for the life of the political campaign, which lasts
• 34:48
  Speaker 3: up until Canada is born into office. I'm not exactly
• 34:52
  Speaker 3: sure what the price is for each pro but I
• 34:55
  Speaker 3: don't believe it's been a million.
• 34:57
  Speaker 1: It'll be interesting to see how this turns out, since
• 35:00
  Speaker 1: we don't normally get this far in litigation over the
• 35:04
  Speaker 1: use of songs. Thanks so much, Heidi. That's Heidie Dekarano,
• 35:08
  Speaker 1: a partner at Fox Rothschild. And that's it for this
• 35:11
  Speaker 1: edition of the Bloomberg Law Podcast. Remember you can always
• 35:14
  Speaker 1: get the latest legal news by subscribing and listening to
• 35:17
  Speaker 1: the show on Apple Podcasts, Spotify, and at Bloomberg dot com,
• 35:21
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• 35:25
  Speaker 1: Bloomberg