Music piracy reaches the on-line record stores

Mundo Digital USA, a company created in Florida, and related to another company based in Madrid, is using almost all the Venezuelan musical heritage after a suspicious and unclear operation. This is a situation derived from the paradigm change of consumption of songs and a certain indifference on behalf of the main record labels and those in charge of their labels, who failed to notice ahead of time the changes bequeathed by technology. The affected - singers, composers - remain the usual victims. The money they should receive for their creations arrives incomplete and sometimes it never does at all.
It's
called Mundo Digital USA.
It has taken over much
of the catalogs of the Venezuelan record labels Sonografica, Velvet, El Palacio de la
Musica and the ones that disappeared like Sonorodven, who had in their portfolios
the best singers of the local scene of the Eighties, and distributes through
online stores, against the will of their heirs, the songs of Simon Diaz, the
most emblematic of the folklorists. The story is a sum of carelessness, mistakes
and, to say of those affected, a blatant robbery of the collection of pop
created in Venezuela three decades ago.
Those affected say that
70 percent of the collection of Venezuelan music is in the hands of impostors.
That is, about 1,500 albums are available to Mundo Digital USA. If each one contains
10 songs, it reaches a figure of 15,000 pieces. If each one, which costs almost
a dollar, is downloaded ten times, it would be about $150,000 per month that are
in the hands other than its real owners. The figure is a twist in the eternal
conflict between producing houses and artists. Composers and singers are even
more unprotected because they are not getting anything for their creations. And
how was it possible that the catalogs changed hands without their original
owners knowing?
In these lines lies a
possible explanation:
Track 1: Sonografica
It is perhaps the most
horrible story. The musical wing of Grupo
1BC, owner of the late television station Radio Caracas Television and of the
radio station 92.9 FM, both closed by
the Chavez regime, took many years to understand that the digital format was the
future of the business. Compact discs and vinyls are sold less each month
because music, whether pirated or not, is within reach of iTunes, Spotify,
Amazon, Deezer or Pandora.
It took Sonografica a year to recover its entire
catalog and the covers of those records. In some cases they redesigned the
covers. They also hired foreign individuals and companies who digitized their
products and loaded them onto a special platform. In all that time they talked
to The Ochard, one of the main distributors or music aggregators and digital
content in the world. On April 29, 2016, the entire catalog of Sonografica, about 4,400 titles and more
than 100 artists, was available for the first time online, anywhere in the world
where the internet allowed to click play to a song and buy it for $0.99 or
buy the entire album for $10.
It was not anything. It
was all the titles of its archives, from the catalog inherited from the company
Polydor de Venezuela (created in the
60's of the last century) - with which Sonografica was born in 1982 - plus
everything produced during the 1980s, when a decree by the then-President Luis
Herrera Campins, known as "one for one", made it compulsory for radio stations
to broadcast a theme by a national artist for each international artist who was
played in their programs.
The drive it gave to
the national record industry and Venezuelan artists was unprecedented. Sonografica became the main rival of Sonorodven, also born in the 80’s, which
belonged to the Grupo Cisneros,
owners of the TV channel Venevision.
The compulsory "one for one" witnessed the emergence of talents such as Ricardo
Montaner, Karina, Melissa, Yordano, Ilan Chester, Franco De Vita, Rudy La Scala,
Colina, Guillermo Davila and others who joined the music scene where already
important voices resonated.
The joy of being in the
top online stores was short lived. Twelve days after that April 29, 2016, Sonografica began to see its duplicate
catalog in every online store. Not only were the titles repeated (some
identified with the copyright of Sonografica and others with the
copyright of the company Mundo Digital
USA), but names of albums copied on different covers, compilations never
made by this record label and supposed new albums that mixed themes of rival
record labels.

It happened, for
example, with the "The Halley
Generation" record plate, the soundtrack of the film by the same name directed
by Thaelman Urguelles, success of Sonorodven in the 80’s that was
versioned by Mundo Digital USA under
the name of "The Halley Degeneration", mixing songs by Sonorodven and Sonografica. All a nonsense that ignores
the disputes that the companies had at the time. "We could never reach an
agreement to make a record together, and these people have done it," says Luisa
Elena Flores, in charge of the digital management of the Sonografica
catalog.
They also placed in the
digital stores the first two albums sung in English by Rudy La Scala when he
arrived in Venezuela. Only the artist knew that they existed because it never
became part of the catalog of Polydor
acquired by Sonografica, and they did
the same with two albums of Kiko
Botones, a character incarnated by the Mexican Carlos Villagran, member of
the cast of El chavo del 8, when the
artist recorded a series in Radio Caracas
Television.
The finding of the
copied titles makes the Sonografica
team think that behind Mundo Digital
USA there is a collector and knower of the Venezuelan record industry,
because they have titles as unknown as valuable, including record plates that
were believed to be lost because in the process of digitalization of the content
the master tape of the recording was never found. "That person was waiting for
Sonografica to leave for him to come out, so that he would be like the curtain
that would cover the rest of the catalogs. It’s not only mine, there are many.
Virtually 70% of the Venezuelan catalog has been uploaded by them", says Sonografica's
representative.
Upon hearing the
complaint, The Orchard connected Sonografica with the distributor who
sent them the catalog attributed to Mundo
Digital. From there onward the mailings and calls began, which resulted in
nothing. Not even the value of copyright has been considered 16 months
later.
Some singers and
composers began to realize almost by chance. Among them is Rudy La Scala, who
has not changed record label in spite of living in Los Angeles, and today
appears as the artist that generates more profits for Sonografica. But others are not aware.
There are more than 100 artists and contracts dating back to the Polydor era, so there is easily more
than one who ignores it. In this other group is Oscar de Jesus Colina, the
irreverent singer of the 80’s that established a milestone in musical aesthetics
and video clips, and embraced success in that decade to then hit rock
bottom.
"I'm learning this
thanks to you, from this call," he answers on the other side of the phone. “I
know Amazon sells several of my songs, I thought Sonografica was doing it. I knew nothing
of this. I have not received anything from Amazon
either.”
Track 2: Simon Díaz
It is not difficult to
find the name of Mundo Digital USA in
Amazon and other online stores, each album includes data from the company that
edited the product, including one important detail: copyright. The copyright
indicates the year of the first publication and the name of the producer or
owner of that recording. While the original titles of Sonografica are published with the
copyright "Distribuidora
Sonografica", and the year in which it was effectively released for the
first time (between the 80’s and 90’s), the titles copied by Mundo Digital are copyright 2016 or
2017.
chevron_leftDesliza la imagen para ver máschevron_right
zoom_inHaz click sobre cada imagen para ampliar
You would have to be
Venezuelan to detect that anomaly in the years of recording an album that turned
out to be a hit in the 80's or to be curious and check the credits of the plate.
Almost no one cares what the C of copyright means and if the record you
are listening to is an illegal copy.
In a routine search on
Spotify and iTunes, in mid-2016, Bettsimar Diaz, heiress of the musical heritage
of Simon Diaz, found several albums owned by the family with those details. The
record label of Simon Diaz used to be El Palacio de la Musica, but between 1994
and 2008 the remembered Uncle Simon
began to record and produce without a record label as intermediary. Bettsimar
found in one of those platforms one of the independent
recordings.
For the recordings to
get there, there were only two options: that Bettsimar herself, as legal
representative, made a negotiation with an aggregating company or distributor
like The Orchard, a possibility she denies because it has not happened, or they
copied it. She does not doubt the second option because she knows that some of
these albums produced without the support of the great record labels have been
uploaded on YouTube by spontaneous people. From there they can take the audio to
upload the songs or the complete record. This is how the production "Hand in
hand with children", from the catalog 1994-2008, with Copyright 2017 from Mundo Digital USA, may have reached
iTunes. The name is repeated.
The titles that are
property of El Palacio de la Musica
have also been copied. The first album of Simon Diaz with this record label,
recorded between 1963 and 1964, is sold as property of Mundo Digital USA and at the same time
with the seal of his initial record label; legal and pirate in the same
platforms.
El Palacio de la
Musica was the record label
that distributed Fania All Star throughout Latin America. Not any more; this
catalog was sold, and the company has remained as the main representative of
Venezuelan folklore and other genres, with Simon Diaz, Serenata Guayanesa, Hugo
Blanco and Cheo Feliciano as the sales leaders of its
catalog.
All of their titles
were traded with The Orchard in 2009 and since then it can be purchased at major
online stores. Ernesto Aue, president of El Palacio de la Musica, remembers that
at that time they had to send to the transnational all the documents that proved
the ownership of the company on all the recordings that they negotiated.
Although at that time its entire catalog traveled in physical, without risk of
some digital filtration, it did not save them from its titles being copied. "I
don’t want to know how many have been plagiarized. I don’t want to imagine how
much we have stopped receiving because if not, I won’t sleep anymore", he says. "Technology ended our
business," he adds, with evident nostalgia.

Bettsimar Diaz's claim
had two answers: Spotify stopped selling the questioned material, but iTunes did
not. The latter company has the policy to bring the parties together to reach an
agreement. If it is verified that the title denounced is an illegal copy they
remove it from their listing. Perhaps because they are aware of this situation,
the representatives of Mundo Digital
USA stopped responding to Bettsimar and referred her to a lawyer. While the
dispute is not resolved, iTunes continues to offer the questioned titles without
caring if they are duplicates.
For Palacio de la Musica it was not
different. Since they detected the first irregular sales more than three years
ago they tried to locate the people behind those companies, but it was useless.
The Orchard also did not facilitate the search, nor have the alleged stolen
titles been disincorporated from their offer. For Aue, this transnational
escapes from the legal conflict.
Track 3: Velvet
With the death of Jose
Page, owner of the label Velvet de
Venezuela, in April 2016, his sons inherited the business. When they began
to see the status in which the family business was, they realized that their
catalog - considerable from everything achieved since the 1960s with artists and
groups such as Billo's Caracas Boys, Los Melodicos, Los Impala, Felipe Pirela,
Lila Morillo, Mirla Castellanos, Henry Stephen and Estelita del Llano, among
many others - was being exploited by someone else.
The inquiries led them
to Mundo Digital USA. The company is
by now a great common place. But the tracks also lead to another company called
Sono Ediciones de Venezuela,
dependent of the first or allied. The heirs managed to locate Alvaro Veli,
director of the label and who says he lives in Madrid. Veli assured them that in
the 90's he bought absolutely all the catalogs of the Venezuelan record labels
Velvet, Sonografica, Sonorodven and TH (Top Hits), that is to say, all the
productions of the most successful era of music in
Venezuela.
chevron_leftDesliza la imagen para ver máschevron_right
zoom_inHaz click sobre cada imagen para ampliar
Faced with this
information, Velvet representatives
asked Veli to show the documents proving that they had purchased the Velvet catalogs, and in that way be able
to accept the conditions of said negotiation. The entrepreneur's answer brought
to a halt any possible friendly arrangement: "I made that business with your
father, not with you". The talks, then, were over.
"If you say you bought
all those catalogs in the 90s, why did you wait until 2016 to assemble them?"
Comments one of Velvet's
representatives from Venezuela, who prefers to remain anonymous facing the
intrigue of ignoring the power of the person behind those companies. Despite
Veli's refusal, the heirs of the record company continued to request information
regardless of the absence of answers, and looking for documents to prove the
existence of said negotiation never mentioned by their father. After almost
eight months of investigation they did not find any documentation in Venezuelan
and American registry offices, nor in the offices of Velvet located in
Caracas.
"This is a company that
has dedicated itself to pirate all the catalogs of Venezuelan origin. There are
some other recordings from other countries, but basically almost all of their
products are from Venezuela”, says the representative of the label. Just in the
CD Universe platform, Mundo Digital
USA has 1,270 albums for sale.
The Ochard, the great
digital music distributor, was founded in 1997, acquired by Sony Music in 2015
and has presence in more than 10 countries. However, among the products it has
the duplicate catalogs: those that have come directly from Sonografica, Velvet de Venezuela and El Palacio de la Musica, and those
gathered by Mundo Digital USA. This
would be the equivalent of a traditional record store displaying on its shelves
the original compact of the record label and the pirate
version.
The Ochard did not
respond to the repeated attempts made to its branch in Argentina and its
headquarters in New York since last August to obtain comments on that paradox.
Only the platforms that have for sale the Venezuelan titles have responded to
the complaints of the record companies. The company that sent them these
catalogs under the label of Mundo
Digital is called "Mojito / Pimienta Digital Content Management Corp",
registered in Miami in July 2012.
Heading it are Juan
Estevez and Mel Carmona, Cubans residing in Miami, linked to the record world
for more than a decade. At least Carmona got to know the Venezuelan industry
between the 70’s and 80’s, when he worked for Velvet de
Venezuela.
chevron_leftDesliza la imagen para ver máschevron_right
zoom_inHaz click sobre cada imagen para ampliar
Before Mojito/Pimienta
Carmona was associated with other record labels, including Pimienta Records (also with Estevez),
and Max Music, as president of that label, Carmona faced a lawsuit in New York
over an alleged violation of US copyright law, for using productions over which
it was no longer licensed for exploitation. It is a similar accusation to what
is happening with Mundo Digital USA,
which authorized Mojito/Pimienta the distribution of some products of which it
claims to be owner without presenting the pertinent documents to the aggrieved.
But neither Juan Estevez nor Mel Carmona wanted to give their version for this
report. On August 17, Carmona resubmitted the interview request of Armando.Info
to his lawyer Albert Xiques, with the comment; "Just got this email ... next
step?".
Xiques offered an
interview by means of a conference call for August 24, but the day arrived and
there was no response, as he did to five other communications sent before this
publication.
2004 US Court Case, Mel Carmona by ArmandoInfo on Scribd
While The Orchard may
be responsible for offering to the digital stores the disputed titles, the
representatives of the record companies and some affected artists consider that
the transnational is looking at Digital
World, Sonografica, Velvet de Venezuela and El Palacio de la Musica as equally
guilty or suspicious. Anyone could be lying about the ownership of the catalogs.
Others consider that the Venezuelan record labels are a grain of sand on the
beach and that is why The Orchard has not turned to see what is going on, but
what they do question is that it does not take into account the value of the
copyright of each production, which should be sufficient to confirm
suspicions.
Still, with all the
differences, The Orchard maintains relationships with the labels that chose it
as its distributor on the Internet, legally selling its catalogs and sending
quarterly sales reports with the respective money deposit, so that each company
complies with the royalties agreed with their artists.
Track 5: Without faces
Mundo Digital
USA has been receiving
dividends since at least May 2016, when Sonografica detected the irregularity.
But the company was born five months later, on October 26, when it was
registered in Miami.
chevron_leftDesliza la imagen para ver máschevron_right
zoom_inHaz click sobre cada imagen para ampliar
Argenis Salazar, Carlos
Eduardo Molina Gonzalez and Gabriela Salazar are the names of the president,
vice president and administrator of the company, whose purpose is the
distribution world wide of the original music catalogs of Velvet, TH, TH Rodven, Sonográfica,
Distribuidora Sonografica, Love Records, Sono Ediciones de Venezuela,
TH Top Hits Venezuela and TH
Velvet. That is to say, all the record labels that came to exist in
Venezuela and that served as base for the birth of others, like the case of Love Records and TH or Top Hits.
A month earlier, on
September 21, 2016, these same people had already incorporated in the same
division of Florida the company "Sonografica Music & Distribuidora
Sonográfica Digital, LLC", homonymous of the original Sonografica with headquarters in Caracas
and existing since 1982.
The incorporation dates
of both coincide with the months in which Sonografica contacted Mundo Digital to claim in view of the
copied catalogs.
In the same line of
action, on December 22, 2016, Velvet de
Venezuela S.A, Corporation LLC was incorporated. In its board, besides
Argenis Salazar and Gabriela Salazar, is Alvaro Veli. They also copied the name
of the Venezuelan label, which is still active in Caracas.

Velvet de Venezuela Company registry | Velvet de Venezuela Company registry | Velvet de Venezuela Company registry | Velvet de Venezuela Company registry |
Velvet and Sonografica were able to be incorporated
in Miami because the original Venezuelan companies, registered in that same city
in the 80's, were not kept up to date and were inactive. Now these actions
suppose a fight to verify which is the true recording label and which is the
true owner of the catalogs.
Only Argenis Salazar
has responded to the complaints of the representatives of the record companies
and several singers, through emails. Salazar has reiterated that he owns the
contracts that prove the ownership of the disputed titles, but that he cannot
show them because they are confidential. When those affected insist, he promises
that his daughter Gabriela, a lawyer, will show them the documentation. The
first meeting has not yet taken place.
It is a response that
Bettsimar Diaz, the legal representatives of Velvet and Sonografica, and even the authors and
composers have received, who, without knowing the extent of this illegality, are
claiming their copyrights.
This is the case of
Pedro Castillo, remembered vocalist and composer of Aditus. In May of 2016, some friends
told him with excitement that they had listened to a compilation of Aditus’
themes in Spotify. The new record was very good, they said. Strangely, Castillo
asked them to see what it was and found an invented album, with a cover that did
not exist among the Aditus’ albums, and even misspelled names of songs. The
plate had been edited by Mundo Digital
USA.
Something tragicomic
happened to the singer-songwriter, Guillermo Carrasco. Some friends of his
downloaded an incomplete album from iTunes and with songs different from those
indicated. Once again, the copy belonged to Mundo Digital.
In the mails exchanged
with the artists or their representatives, Argenis Salazar usually places the
footer of the company Sono Ediciones de
Venezuela. It is a company allegedly registered in Madrid, Spain, which he
shares with Alvaro Veli. Luisa Flores, general manager of Sonografica, does not believe the name
selection to be a coincidence because they are trying to emulate that of "Sono Editora", the Sonografica unit that handles copyright.
"They made a mistake, they copied it wrong," she says.
chevron_leftDesliza la imagen para ver máschevron_right
zoom_inHaz click sobre cada imagen para ampliar
From
Sono Ediciones de Venezuela there is
no documentation. No one answers the
local number of the office in Madrid and the headquarters is located in an area
of residential buildings, Plaza Los
Mostrenses. Nor does it appear in the commercial registry offices of
Spain.
And of their legal
representative, Gabriela Salazar, they have sent information from the office in
Venezuela that, like the whole plot, is impossible to verify. The supposed
address is in Neveri Avenue, postal code 1250 in Caracas, but that code does not
exist in Venezuela. The mentioned avenue is located in Colinas de Bello Monte,
whose postal code is 1050. Also, the indicated building does not exist, the
telephone number is not active and the Tax Registration Information
(J-04042536-9) of the company is non-existent either.
Neither Veliz nor the
Salazars, father and daughter, answered the requests for interviews sent since
August. Their identities only seem to be in the bits of the "digital world" (“mundo digital”) where they
operate.
In the case of the
third partner of Mundo Digital USA,
Carlos Eduardo Molina Gonzalez, aka Eddie Gonzalez (he introduces himself in
both ways), his name is not foreign to the Venezuelan record industry. One of
members of Los Fantasmas del Caribe,
a Caribbean music group that sounded strongly in the 90’s was called that
way.
Molina has dedicated
himself to musical and audiovisual production and has registered at least four
companies with the name of the group. In 2016 he faced a lawsuit as a
representative of the entertainment company Just in Time, for breach of contract,
fraud and defamation. Some people doubt that it is the same person, others
neither confirm nor discard it.
Bonus track: What they had left
What has been happening
with these music catalogs, says Jose Rafael Fariñas, intellectual property
lawyer and general director of the Society of Authors and Composers of Venezuela
(Sacven by its acronym in Spanish), is a violation of the economic or
patrimonial rights derived from the rights of author, which could also include
the violation of moral rights by affecting the integrity of the
work.
The key, according to
the specialist, would be to determine who has the rights on the content that is
being offered, which are usually generated in three ways: a contract (by
agreement of the parties), provision of a law, or for mortis causa reasons (the owner dies and
the heirs remain). If any of these three conditions is not present, it must be
presumed that they are illicit products, he adds, although it may also be the
case that the alleged contract that one of the parties claims to have, turns out
to be a scam.
The Venezuelan Chamber
of Phonographic Producers is aware of what happens with some of its members, and
has even written to Mundo Digital
USA. "We cannot do much because, in these cases, it corresponds to
individual claims," clarifies Olga Tovar, director.
What they do warn, with
concern, is that this misappropriation of music catalogs means an unexpected
advance of piracy. Usually, pirates copy current trendy music, the new releases,
the new hits and the great artists. With these principles the illicit market of
pirate music was born and has lived on. "Until now they had not meddled with the
catalogs, we kept them guarded because they are our livelihood. The fact that
they have reached them, leaves us breathless", he
says.