Student, youth, nonprofit, and local theater companies must be careful to obtain permission and licensing to stage copyrighted plays and musicals. Even performance groups that may think of themselves as amateur or small scale must consider whether they are crossing the line into infringement and should seek advice from an intellectual property attorney to avoid legal liability.

Finding of infringement

For example, a federal court in Virginia has found a Virginia youth nonprofit theater company liable for almost a half-million dollars in damages for performing musical theater productions without proper licensing. In MTI Enter., Inc., v. Theaterpalooza Cmty Theater Prod., Inc., the court found that a youth theater company called Theaterpalooza staged three well-known musicals without obtaining licenses from the copyright holder, Music Theater International, known as MTI.

Monetary damages

The defendant had received prior notices and demands for it to buy licenses, but it failed to obtain licenses. Theaterpalooza did not respond to the complaint, and the matter proceeded to a default judgment. The judge adopted the main provisions of a U.S. Magistrate Judge’s Report and Recommendation that the defendant theater knowingly and willfully infringed on copyrights in “Annie,” “Hairspray” and “Mama Mia!” Federal law allows up to $150,000 in statutory damages for each violation, for a total assessment of $450,000. The court also awarded $1,532.72 in costs.

Injunctive relief

An important part of many copyright lawsuits is a request for a court order called an injunction that requires the defendant to stop engaging in the infringing conduct. In the MTI case, the judge entered a permanent injunction against Theaterpalooza to stop infringing on MTI’s copyrights.

The court looked at the four factors that the U.S. Supreme Court said in eBay Inc., v. MercExchange, L.L.C., are relevant to this issue. The plaintiff must prove all four factors for a court to issue an injunction:

  • Irreparable injury to the plaintiff
  • Inadequacy of money damages
  • Balancing the hardships between the parties, the injunction is warranted
  • An injunction would not be against the public’s interest

The MTI court opinion is available on Westlaw at 2019 WL 99267.