Play Meter

Issue: 1981 June 15 - Vol 7 Num 11

Letters to
the editor. • •
~--tl
Stern vs. Omni
On behalf of our clients, Ornni Video
Games, Inc, and Ferncrest
Distributors, Inc., we are writing in
response to an article which
appeared in the February 1981 issue
of Play Meter regarding a lawsuit
pending in the United States District
Court, Eastern District of New York
between Stern Electronics, Inc.,
plaintiff, and Omni Video Games,
Inc. and Ferncrest Distributors, Inc.,
defendants. That article incorrectly
characterized the proceedings
which took place on December 19,
1980. Contrary to the report, the
Court did not "grant" a preliminary
inj uc tion. Rather, the parties
consented to the entry of an order
during the pendency of the lawsuit.
At the time of the commencement of
the lawsuit, Omni Video Games Inc.
had already stopped production of
the Zygon game for reasons
unrelated to an alleged copyright
infringement. No "hearing" was held
nor did the court make any
preliminary findings of fact or
conclusions of law.
With respect to that lawsuit, Ornni
Video Games, Inc. and Ferncrest
Distributors, Inc, have denied Stern
Electronics' allegations relating to an
alleged infringement of the copyright
concerning the Astro Invaders game
and those issues remain to be
determined by the Court.
:Richard W. MacAdams
Providence, Rhode Island
[Ed. note: The writer refers to a
news article in Play Meter News
Update Apri/1 .
Response from George H.
Gerstman, attorney for Stern
follows:
"I represented Stern Electronics,
Inc . at the hearing before Judge
PLAY METER, June 15,1981
Nickerson last December in
connection with the lawsuit filed by
Stern Electronics, Inc. aqainst
Omni, Ferncrest and others. I have
seen the April 7, 1981 letter from
Richard W. MacAdams, the
attorney for Omni and Ferncrest,
and I have determined that Mr.
MacAdams' letter is incorrect and
requires a response.
First, neither Mr. MacAdams nor
anyone from his law firm was
present at the hearing before Judge
Nickerson . Instead, an attorney
from New York City was present at
the hearing on behalf of Omni and
Ferncrest.
Second, the article in the
February, 1981 issue of Play Meter
was entirely correct, in that the
court did grant Stern a preliminary
injunction against Omni and
Ferncrest. After Judge Nickerson
compared Omni and Ferncrest's
Zygon video game against Stern's
copyrighted Astro Invaders game,
Judge Nickerson stated "I will issue
/
a preliminary injunction
Thereafter, Omni and Ferncrest's
attorney indicated that he would
consent to the preliminary
injunction, and of course I did not
object to the consent because it
effectively waived Omni and
Ferncrest's right to appeal.
Third, the playing of the video
tapes on a television set in the
courtroom and the discussions in
open court between the attorneys
and Judge Nickerson clearly
constituted a "hearing" in any sense
of the term.
A preliminary injuction [was]
issued against Omni and Ferncrest.
Judge Nickerson issued the
preliminary injunction against one of
the other defendants, Bay Coin
Distributors, Inc., without the
consent of Bay Coin. Please note
that the injunction order specifically
recites that a hearing was held
before the court of December
19,1980 on Stern's motion for a
preliminary injunction. '1
;~
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1040 Boulevard, S.E. -Atlanta, Ga. 30312
Telephone 404-622-4401

Iff
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For further information, call Pete Entringer (collect)
9
GRASSROOTS LOBBYING:
Points to send to Congress
on the jukebox plight
By David Pierson
Copyright fees for the jukebox operator, prior to the
Copyright Act of 1976, totalled about $9.44 per jukebox.
Ne xt year copyright payments by the average jukebox
operator will escalate to $38 .73 per jukebox per year. In
1984 it will skyrocket to an average of more than $63 per
jukebox , and there are even more increases built into the
fu ture .
The reason for the excessive increase within just a few
short years is that jukebox operators are paying both a
Copyright double dipping: Operators pay
mechanical fees PLUS the per-jukebox fee .
mechanical royalty (a copyright fee that is built into the
purchase price of each record they buy) and a federally-
controlled per-jukebox fee . That per-jukebox fee is
increasing from $8 to $25 in 1982, to $50 in 1984, and even
higher, according to the Consumer Price Index, in 1987.
As can be expected, once things taken to the extreme
hit the pocketbook, then anger modifies itself into a
search for some sort of legal remedy- in the case of the
jukebox operators, it's taking the form of a possible
"grassroots" effort to get the law changed.
Heartened by the conservative mandate in the
November national elections, jukebox operators sense a
chance to reverse some adverse legislation which was
created by a congressional attitude that catered to
special interests groups such as ASCAP, SESAC, and
BMI.
Already in Louisiana, operators have tested the
co ngressional waters and have found it's not as hard to
talk to their congressmen as they had imagined. Many
operators , it appears , harbor hobgoblins of
misinformation about the way congressmen work-that
it's money and other gratuities, more than sound
reasoning, that make congressmen vote the way they do.
Such is not the case, however, as Louisiana operators
have found out (See "It's not my fault," PLAY METER,
May 15, pages 40-45) . They found their arguments in the
jukebox copyright debate are forceful and convincing,
convincing enough to make congressmen see the law
has to be changed.
In fact , Congresswoman Lindy Boggs of Louisiana,
after having the details of the problems of the existing
copyright law outlined to her by two jukebox
operators-John Elms of T AC Amusement and Bob
10
Nims of Lucky Coin-as well as this reporter at a March
21 meeting in New Orleans, offered an interesting
explanation as to why a law with such bad provisions
could make it through Congress: "That was right before
the election recess ,"she said, "and with everyone
anxious to get back home in time for the election, there
was a flurry of legislative activity. And a lot of what
passed at that time is being bounced back at us now." In
particular, she mentioned new regulations governing the
sugar industry.
This bears out when compared to comments made on
the floor on of the U.S. House of Representatives when it
considered the omnibus copyright bill. The House
considered and passed the law in a single night session, a
procedure which caused one Congressman, Bill Frenzel
of Minnesota to state on the floor of the House : "I
support the · copyright revision bill, S . 22, although I
believe it is poor management on the part of our
leadership to bring this complicated bill up for debate and
vote at 10 p.m. The importance and complexity of the bill
deserve better treatment.. .. . This bill should have been
handled under an open rule with at least a full day
available for debate and questions. Under these
circumstances, I will vote 'aye', and urge its passage and
fervently hope that the sections we have not discussed
adequately tonight are in good shape."
Let's dismiss for now the moot question of where was
the AMOA at this time , and why they didn't make a point
of showing the problems in the law at that time . At this
point, such arguments are unproductive. Instead,
operators should turn to the more immediate task of
pointing out to their congressmen that the sections they
did not discuss that night were not in good shape.
The purpose of the first meeting with your
Congressman: Let him know there are
problems with the law, and be as specific as
possible.
Many operators may not feel adequate talking with
their congressmen right now about the problems with
the law because they themselves may not even know
how the law should be remedied. But such mental
reservations should not stop operators from
buttonholing their congressmen anyway, in a special
meeting preferably with as many other area operators
present as possible.
After all, before the congressmen can be asked to
PLAY METER, June 15 , 1981

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