![]() AFTERMATH RECORDS 13405 nent download shall be treated as Net Sales for the purposes of escalations. In 2004, the parties amended the agreement to provide that Sales of Albums by way of perma- F.B.T. The 2003 agreement increased some royalty rates, but incorporated the wording of the Records Sold and Masters Licensed provisions from the 1998 agreement. and Aftermath entered into a new agreement that terminated the 1998 agreement. Since 2003, Aftermath has also concluded contracts with major cellular telephone network carriers to sell sound recordings as mastertones, which are short clips of songs that can be purchased by users to signal incoming calls, popularly known as ringtones. The contract between UMG and Apple is but one example of the many agreements that Aftermath has concluded to sell sound recordings in digital formats since approximately 2001. Permanent downloads are digital copies of recordings that, once downloaded over the Internet, remain on an end-user s computer or other device until deleted. In 2002, Aftermath s parent company, Defendant UMG Recordings, Inc., concluded an agreement with Apple Computer, Inc., that enabled UMG s sound recordings, including the Eminem masters, to be sold through Apple s iTunes store as permanent downloads. The agreement does not contain a definition of the terms licensed or normal retail channels. The contract defines master as a recording of sound, without or with visual images, which is used or useful in the recording, production or manufacture of records. The parties refer to this provision as the Masters Licensed provision. to others for their manufacture and sale of records or for any other uses. is to receive 50% of Aftermath s net receipts n masters licensed by us. The agreement further provides that otwithstanding the foregoing, F.B.T. is to receive between 12% and 20% of the adjusted retail price of all full price records sold in the United States. The Records Sold provision of that agreement provides that F.B.T. AFTERMATH RECORDS ring Eminem s exclusive recording services to Aftermath. and to Defendants collectively as Aftermath. For ease of reference, we refer to Plaintiffs collectively as F.B.T. signed an agreement transfer1 This case involves multiple Plaintiffs and Defendants. signed Eminem in 1995, gaining exclusive rights to his recordings. We therefore reverse the judgment and vacate the district court s order awarding Aftermath its attorneys fees. We agree that the contracts are unambiguous and that the district court should have granted summary judgment to F.B.T. reasserts that the Masters Licensed provision unambiguously applies to permanent downloads and mastertones. did not move for judgment as a matter of law, and the jury returned a verdict in favor of Aftermath. moved for summary judgment that the Masters Licensed provision unambiguously applied to permanent downloads and mastertones. and Aftermath disagree on whether the contracts Records Sold provision or Masters Licensed provision sets the royalty rate for sales of Eminem s records in the form of permanent downloads and mastertones. Mathers, III, professionally known as the rap artist Eminem.1 Specifically, F.B.T. Productions, LLC, and Em2M, LLC, under their contracts with Defendant Aftermath in connection with the recordings of Marshal B. OPINION SILVERMAN, Circuit Judge: This dispute concerns the percentage of royalties due to Plaintiffs F.B.T. Lemoine, Munger, Tolles & Olson LLP, Los Angeles, California, for the defendants-appellees. Busch, King & Ballow, Nashville, Tennessee, for the plaintiffs-appellants. Eisenberg, Howard Rice Nemerovski Canady Falk & Rabkin PC, San Francisco, California and Richard S. AFTERMATH RECORDS Before: Jerome Farris, Cynthia Holcomb Hall and Barry G. Gutierrez, District Judge, Presiding Argued and Submitted JPasadena, California Filed Septem13399 13400 F.B.T. 2:07-cv-03314-PSGMAN OPINION  Appeal from the United States District Court for the Central District of California Philip S. AFTERMATH RECORDS, DBA Aftermath Entertainment INTERSCOPE RECORDS UMG RECORDING, INC. PRODUCTIONS, LLC EM2M, LLC, Plaintiffs-Appellants, v. FOR PUBLICATION UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT F.B.T. ![]()
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