Whose Song Is It Anyway?

Times Staff Writer

It’s past midnight, and the suburb of South El Monte is shut down -- except for a cream-colored storefront where a ring of purple neon serves as a beacon.

Young expatriates from Hong Kong, dressed in vintage jeans, faded T-shirts and biker jackets, glide through the entrance to Forbes, one of the hottest karaoke bars in Southern California. Inside, the blast of Cantonese pop music hits them like a punch.

In the main club, patrons chew dried squid and throw dice to see who will down the next glass of green tea and whiskey. Others disappear into one of seven karaoke rooms rented by the hour. There, customers settle into cushioned booths, pick from among 20,000 karaoke music videos, take swigs of liquor and reach for the microphone.

Viewed as kitsch by many Americans, karaoke is a cultural cornerstone of Chinese American life and the heart of the social scene in immigrant communities in the San Gabriel Valley.

Now, a pitched legal battle has the karaoke world in turmoil. Clubs such as Forbes have become the latest front in the piracy wars of the digital age.


Private investigators are infiltrating the sing-along subculture, furtively documenting the use of bootlegged music videos. Clubs are being sued, even threatened with criminal prosecution. Sheriff’s deputies have descended on karaoke establishments, seizing microphones, speakers and stacks of DVDs.

The man behind the crackdown is Nicolas Chai, a former waiter and karaoke bar manager. Chai has secured the North American rights to the most popular Cantonese pop songs and videos.

Many bar owners purchase collections of “Canto pop” DVDs at music stores or on the black market for a few hundred dollars. Chai is demanding royalties of $20,000 or more per year from 300 karaoke bars from Queens, N.Y., to Alhambra.

Club owners say such payments would drive them out of business. Their distress is rippling through Chinese American communities.

“If they close some of these places down, it would be like taking away mariachi from the Mexican community,” said Joaquin Lim, mayor of Walnut, in the eastern San Gabriel Valley. “That’s how popular karaoke is.”

Chai, 41, insists he is not trying to put anyone out of business. All he wants, he says, is for the clubs to pay for what they use.

“Just like every game, every society, there needs to be rules and regulations. Otherwise, nothing is going to be developed,” he said. “You can’t go to Blockbuster, rent ‘Harry Potter’ and start charging people to watch it. These karaoke places have to recognize that to use someone else’s property, they have to get permission first.”


Chai was born and raised in Hong Kong, the son of a commercial seaman. He was a teenager when karaoke swept Asia in the 1980s, and he became a devotee of the Canto pop that pulsated in the former British colony’s karaoke clubs.

Asian karaoke bars are unlike American sing-along establishments. Americans generally regard karaoke as goofy fun and revel in performing -- badly -- in public. Many Chinese prefer a private karaoke room with a small audience of friends or family.

Cantonese pop, the soundtrack for Chinese karaoke, is one of Hong Kong’s main cultural exports. It started in the 1970s, with singers like Sam Hui strumming acoustic guitars and singing about working-class life in Hong Kong’s Cantonese language. By the 1980s, the genre had found a mass audience.

Today’s Canto pop is formula fare, whose key elements are sentimental lyrics, lilting melodies and driving rhythms. The arrangements are heavy on electronic keyboards and drum machines.

There are no sexually explicit lyrics or grungy tattooed stars.

Canto pop thrives on being tame, equally palatable to toddlers, teens and adults. Fans embrace the music’s innocence; at concerts, they wave glow sticks, blow whistles and toss stuffed toys onstage as offerings to their idols.

Many of Canto pop’s biggest stars are also Asia’s top movie stars -- it’s as if Brad Pitt and Julia Roberts were also America’s most popular musicians.

In contrast to U.S. stars such as Britney Spears and Christina Aguilera, who flaunt their sexuality, Canto pop divas strive to appear virginal and cute. One of the hottest acts, the Twins, is shown on an album cover in a cartoon setting, surrounded by animated creatures and children.

Canto pop was thriving in Asia but little-heard in America’s Chinese communities when Chai left Hong Kong for Brooklyn nearly 20 years ago. He worked his way through a community college and earned a degree in marketing from New York University, all the while waiting tables at a Szechwan restaurant in Manhattan’s Chinatown.

“Hard work, long hours, low pay, bad boss,” Chai says of the experience.

In 2001, Chai agreed to manage a friend’s struggling karaoke bar in Chinatown. Chai slashed prices for drinks. Then it dawned on him why customers were passing his place by: Other bars had the latest songs from Hong Kong. Chai’s was playing tunes that were months, sometimes years, out of vogue.

He knew there was a brisk market for bootlegged recordings of the latest music. Chai saw an opportunity. The record labels in Hong Kong were missing out on millions of dollars in royalties. What if he offered to serve as their collector in return for a share of the money?

Chai quit managing his friend’s bar so he could pursue this inspiration. He spent five months arranging meetings with recording executives and flew to Hong Kong in January 2002.

The executives were skeptical. They didn’t think the North American market was particularly big compared with China, where karaoke is much more popular. And they were unsure about the American and Canadian legal systems. Would courts uphold their copyrights?

Chai assured them that they would. In March 2003, Chai signed his first contract, with EEG, the label of Canto pop superstar Joey Yung.

Other record companies -- Universal, Warner, Go East, EMI and BMG -- followed suit. The agreements gave Chai’s company, Entral, the U.S. and Canadian rights to all the labels’ karaoke music videos, in return for a percentage of whatever royalties he collected. (Chai and the companies declined to reveal what that percentage is.)

With backing from investors and an advance from the record companies, Chai hired private investigators to identify karaoke bars that were violating the copyrights he now owned.

The investigators, all from Hong Kong, fanned out into Chinese communities in New York, San Francisco, Vancouver, Toronto and the suburbs that stretch east from downtown Los Angeles.


One of the places they targeted was Forbes.

The club sits in the shadow of the Pomona Freeway on Peck Road in South El Monte, near established Chinese communities in Alhambra and Monterey Park, and the hillside suburbs of Hacienda Heights and Rowland Heights, which have seen an influx of wealthy Chinese in recent years.

Co-owners Dee Ng and Dan Cheng named Forbes after the business magazine; it reflected their desire to attract the rich and famous.

Ng left Hong Kong for the U.S. in 1989, jumping from college to college in the Midwest before earning a degree in graphic design. He met Cheng, a Vietnamese immigrant and former restaurant owner, at a karaoke bar eight years ago. They decided to open their own place in Alhambra. The bar was a success, but they were forced to close it to make way for a city redevelopment project.

Ng and Cheng decided to try again, opening Forbes in 2001. It was an instant hit, drawing Chinese immigrants in their 20s and visiting Hong Kong celebrities such as Sam Hui.

“People here miss their home country,” said Ng, 37, who has spiky bleached-blond hair. “They miss their culture. The songs bring back memories. They can pretend they’re still in Hong Kong when they’re here.”

Unknown to Ng and Cheng, Chai’s private investigators were making surreptitious visits throughout 2004. They blended in with customers, munched on fried chicken wings, even belted out tunes from time to time.

Last spring, the two owners received a letter from Entral demanding royalties.

“I didn’t think they were for real,” Cheng said.

Forbes was one of 300 bars across the country that received such letters. Chai waited three months. Only four of the bars agreed to pay; Forbes was not one of them. Then Chai turned up the heat.

“We started to send cease-and-desist letters and gave them another three to four months to respond,” Chai said from Entral’s office in midtown Manhattan, where he oversees a staff of seven. “When we realized there was no chance to get anyone else to join through our very humble approach, we started litigation.”

Thirty East Coast establishments have settled with Chai, agreeing to pay $20,000 to $30,000 a year each for the right to use more than 6,000 karaoke videos.

Now, he is focusing on California, starting with 18 bars in the Bay Area and 16 in Southern California.

Chai won a major legal victory in November and December when federal courts approved consent decrees between Entral and karaoke clubs in New York and San Francisco. The courts reaffirmed that Entral held the rights to the music and that there was evidence the establishments were violating his copyrights. The bars were ordered to destroy pirated videos and pay Chai between $18,000 and $25,000 a year in licensing fees.

Chai said that Entral is breaking even in the United States but suffering losses in Canada because of the slower pace of litigation there. He declined to offer any details of his company’s finances.

But he said he is confident it soon will be profitable. Clearly, Chai has come a long way from his days waiting tables. He lives in suburban Edgewater, N.J., and commutes to Manhattan in a 2004 Land Rover Freelander, in Monte Carlo blue.

“My dealer says there’s only 500 in North America,” he says.

Chai said friends have warned him that taking on karaoke clubs could be dangerous; some of the establishments are said to be controlled by Chinese organized crime. Chai said he takes the warnings seriously and has avoided some clubs. He agreed to be photographed for this article on the condition that his face not be shown.


Chai has asked Forbes for $25,000 a year, based on the volume of customers and the use of music videos observed by his investigators.

After Forbes and other Southern California bars ignored his initial letters last spring, Chai complained to the Los Angeles County Sheriff’s Department and the Alhambra Police Department that the clubs were violating state and federal anti-piracy laws.

In June, sheriff’s deputies confiscated Forbes’ equipment while detectives investigated Chai’s allegations. Forbes and two other clubs in the San Gabriel Valley were left on the brink of collapse.

Without karaoke, business dropped to a trickle.

“It was dead in here,” said Dorothy Kwok, a Forbes regular. “All the rooms were empty. People went to other karaoke clubs.”

In November, the Sheriff’s Department told Ng it would not file charges, and deputies returned the equipment.

The partners didn’t think twice before plugging the machines back in and cranking up the karaoke. The crowds returned on Friday and Saturday nights, crooning love songs by the likes of Cantonese heartthrob Andy Lau under shimmering disco balls.

The owners know they are risking a lawsuit by Entral and possible criminal prosecution.

“We have to do this,” Ng said. “We cannot just close the business. We were closed for four months already, and we struggled for what seemed like forever.... We still have to take the risk and stay open.”

Chai says they will hear from him again.