## Facts

- Record-company plaintiffs alleged that Launch Media’s LAUNCHcast internet radio service publicly performed their sound recordings without negotiating individual licenses.
- LAUNCHcast let users create personalized “stations” by selecting artists or genres and rating songs, artists, and albums; the service then adjusted future programming using an algorithm.
- LAUNCHcast delivered a filtered but randomized stream: users could not request a particular recording at a particular time and could not know in advance what songs would play or in what order.
- Under 17 U.S.C. § 114, non-interactive digital audio transmissions may use a statutory license, while “interactive services” must secure direct licenses from rights holders.
- The jury found LAUNCHcast was not an “interactive service” under § 114(j)(7), and the district court entered judgment for Launch and denied post-trial motions.
- The record companies appealed, arguing LAUNCHcast was interactive as a matter of law and, alternatively, that instructional and evidentiary errors required a new trial.

## Issues

1. Whether LAUNCHcast constituted an “interactive service” under 17 U.S.C. § 114(j)(7), requiring direct licenses rather than reliance on the statutory license.
2. Whether alleged errors in jury instructions or evidentiary rulings warranted judgment as a matter of law or a new trial.

## Decision

- The Second Circuit affirmed judgment for Launch.
- The court held LAUNCHcast was not an “interactive service” within § 114(j)(7) because users lacked sufficient control and predictability over specific recordings and sequencing.
- The court rejected the argument that individualized streams automatically qualify as “programs specially created for the recipient.”
- The court found no reversible error in the jury instructions or evidentiary rulings.

## Legal Principles

- Under 17 U.S.C. § 114(j)(7), an “interactive service” includes services that (a) provide, on request, transmissions of particular sound recordings selected by or for the recipient, or (b) enable receipt of a program “specially created for the recipient” in a manner that gives the recipient meaningful predictive control over what will be played.
- “Specially created for the recipient” requires more than personalization; it requires user control and predictability approaching on-demand functionality such that the service can substitute for purchasing or owning recordings.
- A service that uses user inputs to increase the likelihood of certain music but still delivers randomized, non-predictable playlists without track-specific requests is non-interactive and may rely on the § 114 statutory license.
- Trial court rulings on jury instructions and evidence are reviewed for legal error and abuse of discretion; absent prejudice affecting substantial rights, a new trial is not required.

## Conclusion

The Second Circuit concluded that LAUNCHcast’s personalized but randomized webcasting did not provide the user control and predictability necessary to qualify as an “interactive service” under § 114(j)(7), allowing Launch to rely on the statutory licensing scheme and defeating the infringement claims premised on a failure to obtain direct licenses.


Arista Recs., LLC v. Launch Media, Inc., 578 F.3d 148 (2d Cir. 2009)