c. staley said:
Why am I not surprised either?
Let's look at the major differences.
The following sections are in the post-audit agreement, but not the voluntary audit agreement:
2. EXISTING EVIDENCE. Because we do not have any written Covenant Not to Sue authorizing the copying of our content to a hard drive or computer, you were investigated. A Sound Choice representative has already visited one or more of your shows and gathered evidence, including photographs, video, song lists and other information, which based upon experience, reflects a high probability that you have committed acts of infringement. You have been or may be sued for trademark infringement involving counterfeiting
It makes sense that the post-audit form would speak of an investigation done by Sound Choice prior to filing suit, where as the voluntary audit would not speak of any such investigation, as the KJ is coming forward on his/her own, likely prior to any investigation.
3. REJECTION OF SETTLEMENT OFFER. You acknowledge that Sound Choice has offered to settle this matter on certain conditions. Your request for an audit constitutes a rejection of that settlement offer. If you fail this audit, it will be significantly more expensive for you to settle this case. You should consider carefully whether you can pass or not.
It makes sense that the post-audit form would speak of settlement offers, whereas the voluntary audit form would not.
6. AUDIT PROCEDURE
C. If at any time during the audit process you fail to cooperate fully with the representative’s reasonable requests, the audit may terminate and Sound Choice will consider you to have failed the audit.
To me, this is superfluous. It could have been included in both or not included in either. Complicit in the agreement to submit to an audit is the agreement to cooperate fully with the auditor’s reasonable requests.
Section 6D. adds the following sentence in bold:
Failure to present all materials for the inspection will constitute failure of the audit.
Again, superfluous. If the audit is to show 1-1 compliance, it makes sense to require all the related equipment, discs and media to prove said compliance, and that a failure to bring such items constitutes failure of the audit.
There is a big difference between the following two sections:
VOLUNTARY AUDIT – D, You should also assemble for inspection all of your song lists and at least two copies of your songbooks and receipts for your discs.
POST –SUIT AUDIT – E. You should also assemble for inspection at least three of your song books and all of your song lists and receipts from disc purchases made within the last five years. Receipts for disc purchases may be verified against seller records to prevent falsification. Discs acquired after Sound Choice’s initial investigation will be matched against load dates on your system to determine whether infringement occurred prior to acquisition of the disc. An indication of a track loaded before purchase will be considered an indication of infringement and will result in your failing the audit.
The differences here make sense to me. The post-suit audit is filed after investigation, when Sound Choice allegedly has evidence of specific tracks played on specific dates. The post-suit audit is designed to show the KJ owned the discs before those dates. Buying discs after the fact doesn’t change the fact that the KJ was infringing prior to purchase. In the case of the voluntary audit, the KJ is coming forward on his own, likely before an investigation, thus there are no dates to look back to.
G. Sound Choice may employ software designed to examine any hard drives in your possession to determine whether songs have been deleted from the system after Sound Choice’s investigation began. The existence of deleted track files may indicate an attempt at spoliation and constitute evidence of willful infringement, as well as trigger an audit failure.
It makes sense that Sound Choice would speak of spoliation in the post-suit audit document, but not the voluntary audit document. If the case were to proceed to trial, all the drives used in any way related to the case in the defendant’s possession would likely have to be surrendered to Sound Choice for examination during the discovery process and forensic examination would likely be performed on these drives. Once a defendant has notice that a lawsuit has been filed against him, it is a crime to destroy evidence relating to that lawsuit (spoliation).
In the voluntary audit process there is no discovery process or spoliation issue.
8. DISMISSAL OF SUIT. If you successfully complete the audit, Sound Choice will be willing to not file suit or dismiss the suit against you provided that you agree to adhere to all applicable copyright and trademark laws with regard to the use of Sound Choice accompaniment tracks and to submit to future audits at Sound Choice’s reasonable request
There is no suit filed to dismiss in the case of the voluntary audit.
10. FAILED AUDIT. At the conclusion of a failed audit, Sound Choice may tender you a new settlement offer. Our usual practice is to set the settlement demand at least $5,000 per system higher than the most recent settlement offer made, but that decision will be made based upon the particular circumstances and it might be higher. If a new settlement offer is made and not accepted within 5 days of being tendered, it will be withdrawn, and Sound Choice will be committed to commencing or continuing the lawsuit to its conclusion. In any event, you should be aware that statutory damages for trademark counterfeiting can be as high as $2,000,000 per mark (there are two federally registered trademarks at issue here, for a total of $4,000,000). Recent case law suggests that even minor cases of non?commercial infringement can result in significant damage awards. Because your use is commercial, Sound Choice believes it can obtain a significant verdict against you
It makes sense that this section is not included in the voluntary audit form. In the case of a failed voluntary audit, a settlement offer would likely be made.
I AM NOT AN ATTORNEY AND THIS IS NOT LEGAL ADVICE
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