Walk into any bar on a karaoke night in Los Angeles and you’re certain to spot a DJ behind a computer monitor, able to queue up thousands of songs and their lyrics at the click of a button.

The companies that make karaoke music suspect many of those songs are illegal copies of their products. Now one of the largest, Sound Choice, has launched a massive campaign to hunt down pirates, and it’s taken the fight to Los Angeles, one of the country’s karaoke hotbeds.

The Charlotte, N.C., company has sued 36 karaoke bars and DJs in Los Angeles County and an additional 26 in surrounding counties since October, alleging piracy and seeking unspecified damages – and is promising more to come.

And its investigators don’t play nice: They pay informants for tips and prowl around from venue to venue, photographing evidence and confronting DJs about where they get their music.

In fact, the tactics here have drawn anger from the local karaoke scene, where many feel the company has cast too wide a net and taken an unreasonable stance that punishes individual DJs and business owners with settlement demands of $7,000 to $15,000. The targets include many of the scene’s prominent DJs, as well as bars such as Koreatown’s Brass Monkey, Santa Monica’s Gaslite and Culver City’s Backstage Bar & Grill.

One DJ, Gary Weber, said harassment from investigators was one factor that drove him to retire from hosting karaoke shows last year. He said he’d built up a library of karaoke songs over a decade, but transferred them to a hard drive several years ago – considered by Sound Choice to be an illegal commercial use.

“It’s a crock,” he said. “They’re threatening everybody in the business, just killing people left and right.”

Sound Choice owner Kurt Slep claims he has no choice but to wage this battle because piracy has nearly driven him out of business. He said revenue from selling CDs of karaoke music dropped from $12 million in 2001 to less than $1 million last year, and the number of employees has dwindled down from more than 80 three years ago to just eight today. So far, he’s sued more than 500 bars and DJs across the country, by far the largest anti-piracy effort in the industry’s history.

“If I had my druthers we’d be suing every other week, until enough people finally realize they’re either going to get out of this business or they’re going to do it right,” Slep said.

The problem

There are more than 500 venues in Los Angeles and surrounding counties that host a regular live karaoke night, according to trade magazine Karaoke Scene. Most venues hire a DJ to host the nights once or twice a week, generally for between $100 and $300 a night. The DJ brings his or her own equipment as well as a library that can contain tens of thousands of songs.

Such a library used to take years to build up, and DJs spent thousands of dollars buying CDs from companies that record backing tracks. One of the first and largest such companies was Sound Choice, founded by Slep and his brother in 1985.

The company bought licensing rights and paid studio musicians to record the songs. Employees also encoded the lyrics to be scrolled across the screen. At its peak, Sound Choice churned out 100 songs a month, playable on all kinds of karaoke hardware.

But today, a newcomer can buy a hard drive full of illegally copied or downloaded songs for just a few hundred dollars. That’s destroyed Sound Choice’s bottom line, to the point where it stopped recording new music in 2009.

Piracy has also hurt legitimate DJs who are being undercut by a flood of newcomers with four or five times as many songs obtained at a fraction of the cost. Rates for karaoke DJs have been driven down by these factors as well as the economic downturn, with bars that might have shelled out $175 a night a few years ago now paying $100.

“Piracy is a huge problem for software sales, and it’s also keeping (DJs) from commanding better rates,” said Peter Parker, publisher of Cypress-based Karaoke Scene. “If I were hosting shows today, I would want to be legal to avoid worrying about someone looking over my shoulder, but then you have other pirates out there who lower the prices. It’s a vicious cycle.”

Slep said he started his crusade in order to break up this cycle. He had been a part of previous industry efforts to stop karaoke piracy dating back 10 years, but they never went very far. Finally, a few years ago, he found a local North Carolina attorney willing to take on a large caseload on contingency. The lawyer hired an investigation firm, APS and Associates in Phoenix, to handle investigations in the western United States.

“Karaoke is now built into society, but unfortunately the revenue to make it profitable on most levels has gone out of it,” Slep said. “We hope to build that back in at all levels.”

Aggressive tactics

But those who have been the target of Sound Choice’s investigations said the company’s more interested in making money by bullying as many businesses as possible than in determining which ones are actual culprits.

Angela VanBuren, owner of Long Beach-based Encore Entertainment, is one such target. VanBuren, 40, runs a company that employs four other DJs, and also works as a DJ herself. She said she was named in Sound Choice’s lawsuit after an employee was confronted by an investigator at a show.

Over 20 years of collecting, VanBuren has amassed a library of about 40,000 songs – a fraction of what many others have these days. She said she bought them on CD but transferred some of them to a hard drive that would be easier to carry around. Sound Choice only allows such transfers if the DJ gets permission from the company first – though if the DJ can prove they bought the CDs first, by showing discs and receipts, the company will drop its lawsuit.

VanBuren fired the DJ who was investigated and even dumped all of her Sound Choice songs, putting up a “Sound Choice Free Zone” sign at her shows.

But instead of working out a minimal cost settlement, she said, Sound Choice has taken a hard-line stance and is demanding thousands of dollars. Money she said she doesn’t have, considering her revenue is down to about $500 a week, about half of what she was making three years ago.

Saddled with medical bills – most DJs don’t have health insurance – she plans to file for personal bankruptcy as soon as the lawsuit is resolved.

“I think they’re just targeting people at random,” VanBuren said. “They’ve been extortionists and bullies. They could have gone about it in a better way.”

Another karaoke DJ, Tom Corcoran, was surprised to receive a call from an investigator who told him there was photographic evidence of him playing Sound Choice music and using a hard drive, and that his shows had been fingered by an informant. The 71-year-old has since quit doing shows at Long Beach-area bars, only playing the occasional private event, but that hasn’t stopped Sound Choice from suing. He also claims he bought music legitimately and transferred them to a hard drive.

“I’m in a total stupor,” he said. “I don’t know what they want with me.”

Venues being sued by Sound Choice say it adds another headache to the nightlife business. David Houston, owner of the Barney’s Beanery restaurant chain with locations in West Hollywood, Westwood and elsewhere, said that he had karaoke systems installed in his bars several years ago by someone he thought was legitimate. But Barney’s was among the venues named in a Sound Choice lawsuit.

“Doing business in America these days is one giant game of gotcha. There are an unlimited number of rules and regulations and if you don’t cross a ‘t’ or dot an ‘i’ they want to take all your money away from you,” he said. “Early on we said that we didn’t know, send us a bill for whatever this is, but they want to leverage it into a payday.”

Will it work?

Slep said he hears similar complaints all the time.

“People come up with all sorts of excuses,” he said. “If you get caught speeding, pay your fine and don’t speed again.”

But while most agree that piracy is a problem, it remains to be seen how effective that strategy will be.

The efforts mirror, on a smaller scale, the mass lawsuits filed by the music industry against music downloaders beginning in 2003. But those moves were heavily criticized and did little to reverse the drop in U.S. record sales, which have fallen by more than half over the last decade. The Recording Industry Association of America said it was abandoning that strategy in 2008.

Still, Slep’s hope is that the lawsuits will warn those who aren’t compliant to get compliant. His company offers a “Dog Ate My Discs” amnesty package of 6,000 mp3s on CD for $4,480 to those DJs who aren’t under investigation yet. It wants DJs using these discs because they may be of a higher quality than songs copied to a hard drive. DJs who want to copy songs to a hard drive must get permission first and agree to an audit.

Karaoke hosts who have been sued are also given a package of legitimate songs if they agree to pay the settlement Sound Choice is demanding.

Karaoke Scene’s Parker expects other large karaoke music makers, such as Seymour, Tenn.’s Chartbuster Karaoke and Stellar Records in Fall Rivers, Mass., could follow suit.

“I think it depends on how successful Sound Choice is,” he said. “They may be looking at this as a test case.”