Frank Music Corp. v. Metro-Goldwyn-Meyer, Inc.
United States Court of Appeals for the Ninth Circuit
886 F.2d 1545 (1989)
Frank Music (plaintiff) owned the copyright to Kismet; MGM (defendant) used Kismet's music, characters, and set design in an 11.5-minute tribute act (Act IV) within its larger 10-act Las Vegas show, performed 1,700 times over about two years before being replaced due to litigation. After MGM was found liable for infringement, the district court on remand calculated damages by treating Act IV as one-tenth of the show (based on act count rather than actual run time), attributed only 25% of Act IV's value to the infringement (crediting 75% to MGM's own creative contributions), found only 2% of hotel/casino revenue attributable as indirect profit, and denied prejudgment interest — yielding a $22,000 award. Frank Music appealed the damages calculation.
Whether, in calculating copyright infringement damages based on the infringer's profits, courts should include both direct and indirect profits attributable to the infringement along with prejudgment interest.