Goody Behavior

Piracy on the high Cs

Sam Goody started a popular chain of New York record stores by buying old jazz recordings for resale. Last week a Brooklyn grand jury indicted Sam Goody Inc., President George Levy and Vice President Samuel Stolon for illegally improving on the founder's good thing. Goody and its officers were charged with counterfeiting eight-track tapes and cassettes and then selling them in their stores. They are also accused of returning unsold counterfeits to the record companies for credit as original merchandise.

The Federal Bureau of Investigation uncovered the Goody scam through one of its now glamorous "sting" operations. The FBI probe started three years ago, when a strike force opened a record shop in Westbury, Long Island, with agents posing as owners and employees. A total of more than 200,000 cloned tapes worth millions were eventually involved. Most of the fakes were sound tracks of the movies Grease and Saturday Night Fever. Other popular copies included hits by Pop Stars Billy Joel, Olivia Newton-John and Paul McCartney.

The record industry has been plagued in recent years by piracy, which costs it an estimated $400 million annually in lost sales. Says Joseph Smith, chairman of the board of Elektra/Asylum/Nonesuch Records: "Counterfeiting of records and tapes is getting to be big business. They aren't playing games now. These things are damn good quality. It's hard to tell the imitations even when they come back to us as returns."

Duplicating records and tapes is now a fairly cheap and easy process, costing about $1 for a record and somewhat less for an eight-track tape. Smith charges that organized crime figures steal so-called master stamps, which permit nearly perfect reproduction copies. Album covers are then duplicated with the skill of a forger making a $100 bill.

The average buyer would have trouble distinguishing the phony from the original either in appearance or audio quality. Both usually retail for the same $6-to-$9 price, thus giving the retailer a huge profit. The losers in the pirated music business are the recording artists and Uncle Sam. Artists and producers receive no royalties from the clones, and the Government collects no taxes.

The pirates usually restrict themselves to plundering pop recordings because classical and jazz albums do not sell well enough to make duplicating profitable. Counterfeiters are said to have sold almost as many copies of John Denver's Greatest Hits as RCA, the singer's legitimate recording company. The death of Elvis Presley and the subsequent demand for his songs have been a pirate's gold mine. Among the cloned hits: Jailhouse Rock.

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