## Facts

- Plaintiffs owned copyrights in the musical stage adaptation of *Kismet*, including the copyrighted score and individual songs.
- The underlying 1911 dramatic play *Kismet* entered the public domain after its copyright expired in 1967, but plaintiffs’ later musical additions remained protected.
- Defendants operated and produced a Las Vegas musical revue, *Hallelujah Hollywood*, containing an Act IV segment titled “Kismet,” billed as a tribute to the MGM film.
- Act IV ran about 10–11 minutes within a 100-minute show and used multiple *Kismet* songs along with characters, settings, costumes, and staging associated with the musical.
- The revue was performed about 1,700 times from 1974 to mid-1976, when the segment was replaced after the lawsuit was filed.
- MGM Grand had an ASCAP blanket license for non-dramatic public performances and claimed that license authorized its use of the *Kismet* songs.
- After a bench trial, the district court found copyright infringement, found no proof of actual damages, awarded $22,000 in apportioned profits, and rejected unfair competition and breach of contract claims.
- Plaintiffs appealed the damages/profits award and other rulings; defendants cross-appealed, contesting infringement and invoking the ASCAP license.

## Issues

1. Whether the “Kismet” act was a dramatic performance outside the scope of a non-dramatic ASCAP blanket license.
2. Whether defendants’ combination of copyrighted music with characters and staging from the musical constituted actionable infringement despite the public-domain status of the underlying play.
3. Whether the district court properly calculated and apportioned defendants’ profits attributable to the infringing act, including treatment of overhead and potential indirect profits.
4. Whether plaintiffs established unfair competition or breach of contract based on defendants’ use of *Kismet* material and the *Kismet* title.

## Decision

- The Ninth Circuit affirmed the finding that Act IV exceeded the ASCAP license and infringed plaintiffs’ copyrights.
- The court held Act IV was a dramatic (dramatico-musical) presentation because it used the songs in a staged sequence evoking story elements, characters, and settings, not merely isolated concert-style performances.
- The court affirmed the finding that plaintiffs failed to prove actual damages.
- The court vacated the $22,000 profits award as grossly inadequate and remanded for a revised profits analysis, including reconsideration of attribution/apportionment and potential liability of additional defendants.
- The court affirmed dismissal of the unfair competition and breach of contract claims.

## Legal Principles

- ASCAP blanket licenses typically grant only non-dramatic public performance rights; staged uses that present narrative or dramatic elements from a musical require separate dramatic performance rights.
- Even when source material is in the public domain, later original expressive contributions (including music, lyrics, and protectable dramatization choices) remain protected; infringement may be found where a defendant appropriates those protected elements in combination.
- A copyright plaintiff may recover the infringer’s profits attributable to infringement; apportionment is permitted, but awards must reflect the evidence of the infringing material’s role in generating revenue.
- In profits litigation, the infringer bears the burden to support deductible expenses and to show what portion of profits is not attributable to the infringement; inadequate apportionment warrants reversal.

## Conclusion

The Ninth Circuit held that MGM Grand’s staged “Kismet” tribute was a dramatic use outside its ASCAP license and infringed plaintiffs’ copyrighted musical material, affirmed the denial of actual damages, and remanded because the district court’s apportioned profits award was grossly inadequate, while leaving ancillary unfair competition and contract claims dismissed.


Frank Music Corp. v. Metro-Goldwyn-Mayer, Inc., 772 F.2d 505 (9th Cir. 1985)