Google may have been caught "redhanded," but a federal judge rules that Genius hasn't alleged any viable claims not be preempted by copyright law.
Genius Media Group was pretty clever when it used digital watermarks to show that Google had been copying its huge collection of song lyrics. One of those watermarks spelled "redhanded" in Morse code. That Google was caught lifting another site's song lyrics made international news — and even merited a mention during Congress' Big Tech hearing late last month. But was Google's alleged scraping (direct or indirect) illegal? On Monday, a New York federal judge dismissed claims by Genius.

Genius doesn't own copyrights to the song lyrics. Those rights belong to publishers and songwriters. Genius does have a license to the song lyrics in question. Additionally, Genius spends a lot of time and millions of dollars facilitating collaborative lyric transcription. Can't it protect its sweat? Genius believed so. Genius prohibits its users from transmitting its transcriptions for commercial purpose. Google breached the Terms of Service, claimed a complaint filed in New York state court. Google says that that the source of these lyrics are third parties. Genius' suit also targeted LyricFind for what it was allegedly providing Google.

After the case was filed last December, Google had it removed to federal court on the basis that Genius' state claims were preempted. As federal court provides the exclusive jurisdiction for copyright controversies, the initial question in this case was whether Genius was doing anything more than disguising copyright claims. That's the subject of a new 36-page opinion from U.S. District Court Judge Margo Brodie.

There's little doubt that the transcribed song lyrics fit within the types of works protected by the Copyright Act and thus satisfy subject matter of a preempted claim. However, under precedent, state contract claims over what's typically regarded as intellectual property can nevertheless survive so long as there's an "extra element" at play. That could be contractual obligations that are qualitatively different from a copyright claim.

Here, Brodie rejects the proposition that Genius' attempt to guard against scraping for profit constitutes an extra element.

"Plaintiff’s breach of contract claims are nothing more than claims seeking to enforce the copyright owners’ exclusive rights to protection from unauthorized reproduction of the lyrics and are therefore preempted," writes the judge. "Although Plaintiff describes the rights it seeks to enforce as 'broader and different than the exclusive right existing under the Copyright Act,' based on 'the substantial investment of time and labor by [Plaintiff] in a competitive market,' and asserts breach of contract claims based on alleged violations of Plaintiff’s Terms of Service, Plaintiff’s own ability to transcribe and display the lyrics on its website arises from the licensing rights Plaintiff has in the lyrics..."

Judge Brodie goes on to add that Genius' transcriptions are really just "derivative works," and even if Genius created them and retains some ownership, "Plaintiff’s claim is preempted by the Copyright Act because, at its core, it is a claim that Defendants created an unauthorized reproduction of Plaintiff’s derivative work, which is itself conduct that violates an exclusive right of the copyright owner under federal copyright law."

Additionally, the opinion finds that Genius' unfair competition claim is also preempted. Brodie writes that Google isn't accused of having "breached any fiduciary duty or confidential relationship" and that the lawsuit essentially accuses Google of "passing off" its own work product as its own. She concludes, "Unfair competition claims involving allegations of reverse passing off are preempted by the Copyright Act," and Genius' "unfair competition claims are not saved from preemption by its allegations of bad faith, unfairness, and deceptive, unethical, and immoral conduct."

Rejecting Genius' motion to remand the case back to a state court, Brodie dismisses the complaint for failure to state a claim. Here's the full opinion: