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Categotry Archives: Legal Issues

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New Video: This Trial Will Determine Songwriters’ Income Over the Next 5 Years

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Categories: Copyright, Legal Issues, Music Industry, Music Publishing, Royalties, Videos, Tags: , , , , , , , , , , , , , , , , , , , , ,

Read the article here.

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Erin M. Jacobson, Esq. on TAXI TV

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Categories: Copyright, Law, Legal Issues, Music Contracts, Music Industry, Music Libraries, Music Publishing, Performance, Royalties, Streaming, Videos, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

I appeared on TAXI TV yesterday discussing YouTube payments, royalty free music, cover records, and more!

Here’s the replay of the show:

 

Thanks to Michael Laskow of TAXI Music for having me on the show!

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Music Industry Cases to Watch in 2017

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Categories: Articles, Copyright, Infringement, Law, Legal Disputes, Legal Issues, Music Industry, Performance, Royalties, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

by:  Erin M. Jacobson, Esq.

This article was previously published on Forbes.com.

Following are the top music legal cases to watch in 2017, what to expect, and how they could affect the industry as a whole.

Global Music Rights v. The Radio Music Licensing Commission (and The Radio Music Licensing Commission v. Global Music Rights)

Background: As explained here, The Radio Music Licensing Commission (“”RMLC”) sued performance rights organization Global Music Rights (“GMR”) on anti-trust grounds for creating an artificial monopoly over and charging “exorbitant” licensing fees for works in its repertoire. In a separate and non-retaliatory suit (and explained here), GMR sued the RMLC claiming that the RMLC’s committee of radio stations seeks to discourage competition amongst these stations with the common goal of keeping payments to songwriters and music publishers artificially low and using its collective power to do so.

What you might expect: The parties will probably settle, as the implementation of judicial rate supervision would significantly curb GMR’s objectives in negotiating higher rates for its writers. If GMR had to submit to judicial rate setting proceedings, it is probable Irving Azoff would find a way around the regulations to command higher compensation for GMR writers.

How it could affect the industry: If radio does not want to pay GMR’s rates, then radio stations can refuse to play works in the GMR repertoire. As a result, these artists would lose the promotion and performance income provided by radio airplay. It could also affect writers belonging to other performance rights organizations that have co-written songs with GMR writers or covered songs by GMR writers.  The band Anthrax has already issued an open letter to Irving Azoff seeking to have its name disassociated with GMR, as the band is not a GMR client but is listed in the GMR repertoire because Anthrax covered “Phantom Lord” by Metallica (a GMR client) early in Anthrax’s career. Anthrax is afraid this association could stop radio stations from playing all Anthrax songs.

However, the radio stations themselves would also suffer because it would harm stations’ popularity with listeners if stations cannot play the music their listeners want to hear, resulting in a significant loss of advertising revenue.

The Turtles v. SiriusXM

Background: Flo & Eddie of The Turtles sued SiriusXM for playing their sound recordings without paying royalties. In the United States, all sound recordings made after February 15, 1972 are protected by federal copyright law. Prior to that date, sound recordings only had protection under state laws. In 1995, sound recordings were granted a digital performance right to earn royalties when played on digital media like satellite radio or streamed online. This case raised the question as to whether all sound recordings were entitled to the performance right or only those recorded post-1972. Flo & Eddie have been successful in several states to champion the right to royalties for owners of older recordings, but a New York appeals court just ruled against themsaying that the pre-1972 recordings are only entitled to protection provided by state laws.

What you might expect:  The outcome could go either way here, but its definitely one to watch. A settlement might also be possible for those involved in the lawsuit, however, a settlement would not dictate the future of royalties for other pre-1972 recordings not included in this class action suit.

How it could affect the industry: If it is found that pre-1972 sound recordings are entitled to a digital performance royalty, then owners of these recordings and the artists who recorded them would be entitled to an income stream much needed for older catalogues that do not currently make much money in terms of sales or other uses. Satellite radio and other Internet services would have to pay an appropriate amount of royalties, which seems doable for a company like SiriusXM worth billions of dollars, but potentially less so for smaller providers. If the appeal is upheld, then satellite radio and Internet services would continue to play these early recordings without paying royalties to the owners and artists of these recordings and would further the financial hardships for older artists without current hits.

“Blurred Lines” v. “Got To Give It Up”

Background: Pharrell Williams and Robin Thicke wrote and recorded a song (“Blurred Lines”) that they, as stated in interviews, wanted to sound like Marvin Gaye’s “Got to Give It Up.” The Estate of Marvin Gaye sued Thicke and Williams for copyright infringement and the closely followed trial yielded a jury verdict in favor of the Gaye family, with a judgment ultimately set at $5.3 million plus future royalties. The verdict inspired a string of similar lawsuits, including one challenging the originality of “Stairway to Heaven.”

A major issue within the trial was whether to consider only the lead sheet (musical notes) deposited with the Copyright Office (protocol at the time “Got to Give It Up” was registered) and not the recording of the song. Insiders of the music community debate the finding of infringement when many of the actual notes were not an exact match in both compositions versus looking at patterns and other music elements that were similar and repeated within both songs.

The case is now up for appeal. Thicke and Williams’ attorney claims that the trial court’s verdict will “chill” creativity. The attorney for the Gaye family argues in his appellate brief that the copyright for “Got to Give It Up” is not “thin,” and states a reminder that the
test for infringement is substantial
similarity and not virtual identity.

What you might expect: This case will once again be closely followed, but the verdict cannot be predicted at this time. A settlement is doubtful because the stakes have become too high for both sides.  This case has become much bigger than just the two songs involved.

How it could affect the industry: The impact of this decision could set an important precedent. If Thicke and Williams win, it would open the door to frequent usage of elements from older songs with little recourse for the copyright owners of the original songs. If the Gaye family wins, it would probably inspire even more lawsuits for infringement. Regardless of whichever party wins, this case may influence all future copyright infringement lawsuits involving music, as it may dictate which sources (lead sheets, recordings, etc.) can be considered in a copyright infringement suit and based on what is included in those sources, which elements of a composition can be protected and/or infringed.

The Department of Justice v. ASCAP and BMI

Background: Performance rights organizations ASCAP and BMI asked the Department of Justice (which oversees the consent decrees governing ASCAP and BMI) to reform the decrees based on today’s digital age. Music publishers asked for the ability to negotiate directly with companies licensing music for digital uses. The Department of Justice ruled against all that was asked for by the music community and decided to implement a model of 100% licensing, which mandates that a performance rights organization can only license rights to perform a work if the organization controls 100% of that work.

BMI appealed the decision and got an immediate verdict in BMI’s favor allowing the industry practice of fractional licensing to continue. The Department of Justice has appealed BMI’s victory and that appeal is currently pending.

What you might expect: This is going to be an ongoing fight to the bitter end.

How it could affect the industry: As explained in more detail here, a ruling in favor of the Department of Justice would force the entire music industry to completely change the way it does business, render hundreds of thousands of works to be unlicensable by ASCAP and BMI, place incredible burdens on composition owners to track performances, potentially require hundreds of thousands of contracts to be amended, and would also affect the music industry throughout the world due to the reciprocal agreements ASCAP and BMI have with performance rights societies in other countries.

*This article does not constitute legal advice.

Erin M. Jacobson is a music attorney whose clients include Grammy and Emmy Award winners, legacy clients and catalogues, songwriters, music publishers, record labels, and independent artists and companies. She is based in Los Angeles where she handles a wide variety of music agreements and negotiations, in addition to owning and overseeing all operations for Indie Artist Resource, the independent musician’s resource for legal and business protection.

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The Significance Of Irving Azoff Calling The Radio Industry A Cartel (Forbes.com)

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Categories: Articles, Business, Legal Disputes, Legal Issues, Music, Music Contracts, Music Industry, Performance, Royalties, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

By:  Erin M. Jacobson, Esq.

This article was originally published on Forbes.com.

Global Music Rights (“GMR”), a performance rights organization founded by music industry mogul Irving Azoff, sued the Radio Music Licensing Committee (“RMLC”) this week for antitrust violations, claiming that the RMLC’s committee of radio stations seeks to discourage competition amongst these stations with the common goal of keeping payments to songwriters and music publishers artificially low and using its collective power to do so.

As I explained in a previous article, the RMLC recently filed a lawsuit against GMR claiming that GMR has created an artificial monopoly over works in its repertoire since GMR can dictate license fees and deny licenses to perform the music it represents if music licensees are not willing to pay GMR’s fees. Azoff founded GMR to offer a more boutique experience for the writers in its repertoire and seek higher licensing fees than ASCAP and BMI who are subject to government consent decrees and judicially restricted rates. The RMLC argued that the license fees required by GMR are exorbitant and seeks to lower them by forcing GMR to submit to judicial rate-setting proceedings, which would require a judge to mandate the rates GMR can charge its licensees.

GMR has been in negotiations with the RMLC since its inception, but still have not reached a deal because GMR will not agree to judicial rate-setting proceedings. GMR’s complaint states that its lawsuit is not in response to the RMLC’s previously filed antitrust suit against GMR, but rather “the group’s illegal conduct including price fixing, information sharing and threats of group boycotting.” GMR, who did reach a deal with two individual radio stations, argues that all stations should compete for the music they play, rather than banding together to force the music industry to succumb to low rates in order for music to be played. According to a press release from GMR, radio stations currently pay only about 4% of their revenue to songwriters and music publishers. To further put things into perspective, the RMLC represents over 10,000 radio stations that collectively bring in about $16 billion in advertising revenue annually, whereas GMR is an independent performance rights organization representing 70 songwriters and earns under $100 million per year.

As also explained in my prior article, radio stations rely on music for their content. Radio stations and other music content platforms repeatedly seek to reduce compensation to the songwriters and music rights owners that create the very music that establishes their listenership and drives their revenues. Although the stations behavior makes sense from a profit margin standpoint, it is still surprising that radio would seek to so significantly undervalue the music that comprises the foundation of its product.

The parties are at a standoff because if radio does not want to pay GMR’s rates, then radio stations can refuse to play works in the GMR repertoire. This is unfortunate for the artists in the GMR repertoire because they would lose the promotion and performance income provided by radio airplay. However, the radio stations themselves would also suffer because it would harm stations’ popularity with listeners if stations cannot play a requested new single by a GMR writer like Drake or Pharrell Williams, or even classic compositions by John Lennon or The Eagles. If radio listeners stop listening to stations because they do not play the music their listeners want to hear, then advertisers will stop buying advertising on those stations and move on to whatever other platforms their target markets have adopted. The RMLC is banking on being successful with this lawsuit as they were in their recent and very similar fight with performance rights organization SESAC. However, if the RMLC is unsuccessful at forcing GMR to submit to judicial rate proceedings, then radio stations will have the choice of either paying higher license fees for GMR artists or losing advertising revenue, a dilemma in which it would probably be to the stations’ advantage to pay the higher license fees requested by GMR than losing its advertisers.

Azoff said, “I will not stop the fight for fairness to artists and songwriters,” and he is not alone in his principles. Both creators and professionals within the music industry have seen rates steadily decline and are tired of accepting undervalued rates. Simultaneous to GMR’s battle for higher rates, songwriters and performance rights organizations have been combatting the United States Department of Justice amid other restrictions on music licensing. While the music industry is not dead yet, many within the industry are concerned about the viability of music as a career because without proper payment to songwriters and music publishers, the creation of music may be relegated to a hobby if the majority of creators cannot make a living from creating music.

*This article does not constitute legal advice.

Erin M. Jacobson is a music attorney whose clients include Grammy and Emmy Award winners, legacy clients and catalogues, songwriters, music publishers, record labels, and independent artists and companies. She is based in Los Angeles where she handles a wide variety of music agreements and negotiations, in addition to owning and overseeing all operations for Indie Artist Resource, the independent musician’s resource for legal and business protection.

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Radio Seeks to Pay Songwriters Lower Rates — Again (Forbes.com)

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Categories: Articles, Business, Legal Disputes, Legal Issues, Music, Music Industry, Music Industry Interviews, Performance, Royalties, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Radio Seeks to Pay Songwriters Lower Rates — Again

By:  Erin M. Jacobson, Esq.

This article was originally published on Forbes.com.

A committee representing roughly 10,000 commercial radio stations has sued performance rights organization Global Music Rights (“GMR”) in an effort to further reduce the amount radio stations pay to music composition creators and rights owners for performances of their works. This committee is the Radio Music Licensing Committee (“RMLC”) and it claims that GMR has created an artificial monopoly over works in its repertoire.

Performance rights organizations (“PRO’s”) are organizations that track and collect performance royalties on behalf of songwriters and music publishers. In the United States, there are four PRO’s: ASCAP, BMI, SESAC, and GMR. ASCAP and BMI are the two largest U.S. PRO’s and are also non-profit organizations. Since 1941, ASCAP and BMI have been subject to consent decrees issued by the Department of Justice. These consent decrees are agreements that allow the government to regulate ASCAP and BMI’s license fees and how they operate in order to prevent monopolization and encourage competition. SESAC and GMR are both independent, privately owned companies that operate on a for-profit basis and are not subject to consent decrees.

Music industry mogul Irving Azoff founded GMR in 2013 in order to provide a more boutique experience for managing performance rights licensing and potentially command higher rates for the performances of works in its repertoire, which includes compositions written and/or performed by artists such as Adele, The Beatles, Pharrell Williams, Katy Perry, Madonna, and many more.

Because GMR is not subject to a consent decree, it can deny a license to perform the works in its repertoire and can also negotiate license rates as it sees fit. The RMLC argues that the license fees required by GMR are exorbitant and seeks to lower them by forcing GMR to submit to judicial rate-setting proceedings, which would require a judge to mandate the rates GMR can charge its licensees. This is similar to procedures mandated for ASCAP and BMI, but without subjecting GMR to a full consent decree. The RMLC previously filed a similar suit against SESAC and reached a settlement in the RMLC’s favor.

Terrestrial radio makes its money on advertising revenue, and while radio is far from dead, it no longer holds the status of its heyday. Terrestrial radio and other broadcasters regularly fight to reduce license fees, as terrestrial radio lobbyists were also part of the group in favor of the Department of Justice’s crackdown on ASCAP and BMI’s licensing platforms, the outcome of which is still pending.

Most observers of this situation usually fail to mention that the public perception of radio’s purpose is music promotion. Without music driving the listenership of certain stations, those particular stations would not earn the ad revenue from advertisers who want to reach those stations’ listeners. However, the stations repeatedly seek to reduce compensation to the songwriters and music rights owners that create the very music that establishes their listenership and drives their revenues.

Terrestrial radio isn’t the only industry trying to reduce payments to music creators and rights’ owners. Those of us who regularly handle music licenses know that attempts to undervalue music also come from Internet and digital companies, as well as small bars and restaurants. Visual productions seeking synchronization and master use licenses also regularly try to lowball license fees or request gratis uses.

It is up to music creators and rights’ owners to value music (#valuemusic) and require proper payment for uses of their music, and to those that use music to recognize the value that music brings to their project or business.

*This article does not constitute legal advice.

Erin M. Jacobson is a music attorney whose clients include Grammy and Emmy Award winners, legacy clients and catalogues, songwriters, music publishers, record labels, and independent artists and companies. She is based in Los Angeles where she handles a wide variety of music agreements and negotiations, in addition to owning and overseeing all operations for Indie Artist Resource, the independent musician’s resource for legal and business protection.

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The DOJ’s Discordant Decision: An Overview of the Ruling and Its Repercussions

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Categories: Articles, Legal Issues, Music, Music Industry, Music Publishing, Performance, Royalties, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

doj-decisionPerformance rights organizations (“PRO’s”) are organizations that track and collect performance royalties on behalf of songwriters and music publishers. In the United States, there are four PRO’s: ASCAP, BMI, SESAC, and Global Music Rights (“GMR”). ASCAP and BMI are the two largest U.S. PRO’s and are also non-profit organizations. Since 1941, ASCAP and BMI have been subject to consent decrees issued by the Department of Justice (“DOJ”). These consent decrees are agreements that allow the government to regulate ASCAP and BMI’s license fees and how they operate in order to prevent monopolization and encourage competition. SESAC and GMR are both independent, privately owned companies that operate on a for-profit basis and are not subject to consent decrees.

In 2014, the music community asked for a review of these decrees and requested the removal of digital licensing from the blanket licenses offered by the PRO’s, allowing publishers to negotiate directly with and be paid higher rates by companies licensing music for digital uses.  This is referred to as “Digital Rights Withdrawal” or “DRW.” Digital giants like Google, Pandora, and Sirius/XM, joined by terrestrial radio, lobbied against DRW in order to pay smaller licensing fees to music owners.   The DOJ denied the music community’s request for DRW and has now mandated that music publishers be either “all-in” or “all-out” with the PRO’s, meaning that publishers must allow the PRO’s to license all types of performances of their catalogues or none at all.

In its recent ruling, the DOJ also chose to enforce “full-work licensing,” also known as “100% licensing.”   Under the practice of 100% licensing, any person with a percentage of ownership of the work has the right to license 100% of the work, not just the percentage owned. That licensor is then liable to account to other co-owners of the work for those co-owners’ share of compensation. This principle is in line with the provisions of copyright law governing joint works, and the longstanding language of the consent decrees supports the practice of full-work licensing. Despite the language of the consent decrees, the music industry has never operated on a 100% licensing basis. The principle of allowing one co-owner to license an entire work can be overridden by a contract between the parties, and the music industry has always operated on a “fractional licensing” basis where most owners agree in writing that each owner will administer its own share. Music users obtaining licenses have also historically accepted the practice of fractional licensing, and those users experienced with PRO licenses know that one must get a license from each PRO so that all shares of co-written compositions are covered. PRO’s also collect license fees from music users and pay its members/affiliates on a fractional basis, i.e. the amount collected or paid is proportional to the share of the composition controlled by that PRO.

While the language of the consent decrees and the practice of the industry have long been out-of-sync, the DOJ’s sudden decision to enforce 100% licensing may force an entire industry to change its longstanding way of doing business. The DOJ’s ruling stipulated that if a PRO cannot license 100% of a composition, then that PRO cannot license that composition at all. This means that any compositions written by co-writers belonging to different societies would potentially become unlicensable by the PRO’s.

What Problems Does This Create?

Those that lobbied against reforming the consent decrees failed to realize that their efforts to pay less may also prevent them from using or playing a large percentage of music, or may require them to remove music from rebroadcasts of older programming, because much of the music they wish to use may become unlicensable by the PRO’s.   If compositions are unlicensable by the PRO’s, then music users will have to go directly to music owners for performance licenses. While obtaining direct licenses may be feasible for more experienced users, many music users will not know where to find composition owners or how to go about obtaining licenses from them. If compositions become unlicenseable by the PROs and licenses are not obtained directly from the music owners, it is possible that many compositions may not be used, or many compositions may be used without permission resulting in copyright infringement.

All of these scenarios may hinder music owners from receiving payments for performance royalties, and without the PRO’s, music owners will be responsible for tracking and policing all uses of their music, which is normally too labor intensive and financially burdensome for most music owners.

Foreign performance societies, writers, and publishers are also affected by the DOJ’s ruling. Via reciprocal agreements, U.S. and foreign PRO’s work together to track and collect royalties for performances in a work’s home country and foreign countries. If certain works become unlicensable by U.S. PRO’s, then foreign societies and owners may have to track U.S. performances of their works in the U.S. Anyone in the U.S. wishing to use a foreign work not licensable by a U.S. PRO will have to get a direct license from the foreign licensor. In addition, U.S. owners issuing direct licenses may have to track and collect on foreign performances outside of the societies. Again, this creates burdens on all societies and owners, as well as opening the door for mass amounts of infringement and owners not receiving payments.

The DOJ proposed a solution of modifying all past agreements between co-writers of different societies to allow administration by one owner or PRO. This would apply to both U.S. and foreign writers and publishers. However, this is an impractical solution because many writers will not want another PRO that is not their chosen PRO collecting on their behalf; many writers do not speak to past co-writers or know where to find them; many writers are deceased, leaving one or more co-writers to deal with heirs that may not understand the principles involved or cannot be found; and many writers will not have the financial resources to have their agreements amended.

From a creative standpoint, many writers feel the DOJ’s decision will restrict them to only writing with co-writers from their chosen PRO. Restricting the freedom of writers to collaborate would be a fatal blow to creativity itself and cause many musicians to relegate music to a hobby rather than a career.

Where Are We Now?

The DOJ has allowed ASCAP and BMI a period of one year to comply with the new mandated changes, and if they are still non-compliant after one year, the DOJ can sue ASCAP and BMI for non-compliance with its decision. However, the one-year compliance period has not started yet, and will be delayed by the current efforts of BMI and ASCAP to get this decision reversed.

As of this writing, BMI has sued the DOJ and is appealing the ruling through legal proceedings. ASCAP is developing a lobbying strategy to seek much needed Congressional support and achieve changes from the legislative side. Those of us on the forefront of this issue feel it is best to wait until we have a definite outcome before spending time and resources on modifying agreements or making other changes to longstanding industry practices.  However, consult with me on this issue if you are concerned.

Some resources to take action and stay up to date include www.standwithsongwriters.org and www.artistrightswatch.com.

 

Disclaimer: This article is for educational and informational purposes only and not for the purpose of providing legal advice. The content contained in this article is not legal advice or a legal opinion on any specific matter or matters. This article does not constitute or create an attorney-client relationship between Erin M. Jacobson, Esq. and you or any other user. The law may vary based on the facts or particular circumstances or the law in your state. You should not rely on, act, or fail to act, upon this information without seeking the professional counsel of an attorney licensed in your state.

If this article is considered an advertisement, it is general in nature and not directed towards any particular person or entity.

 

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How Songwriters Just Got Screwed

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Categories: Articles, Legal Issues, Music, Music Industry, Music Publishing, Streaming, Videos, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

The Department of Justice has recently come to a decision regarding the review of the 1941 consent decrees that regulate the license fees and operations of ASCAP and BMI. Because ASCAP and BMI are non-profit organizations, they are subject to government-regulated consent decrees, meaning the government regulates ASCAP and BMI’s license fees and regulates how they operate in order to prevent monopolization and encourage competition. When ASCAP and BMI cannot settle on a equivalent fees, the dispute is taken to a rate court where the fee is settled. There have been massive lobbying efforts on the part of the music industry to reform these consent decrees and update them to the needs of writers and publishers in the Internet age.

A review of these decrees opened in 2014 in order to modernize the decrees so that they were more applicable to the ever-changing and evolving music industry – an industry where music is vastly consumed through Internet and streaming services. The goal of the modernization was to bring royalty rates up to fair market value and for the ability of music publishers to remove digital licensing from blanket licensing in order to earn more money from online music and digital streams. Much to the music community’s dismay, no changes were made to the consent decrees and the DOJ has also declared the implementation of full work licensing, also known as 100% licensing, which will end the current practice of fractional licensing that has occurred in the industry for decades.

Under the practice of 100% licensing, any person with a percentage of ownership of the work has the right to license 100% of the work, not just the percent owned. Even a 1% owner of a composition can now license 100% of the work without consent from the other co-owners, and is responsible to account to the other co-owners for their share of the payment. This creates problems because it enables music users to shop for the lowest price between owners and will make it harder for music owners to get paid due to frequent lack of communication between co-owners.  It also disrupts the effective system of fractional licensing, a system that has helped insure that owners receive equal income shares and rights.

The other aspect of the DOJ’s decision removes the option for music publishers and composition owners to do direct deals with digital and other service providers, while still allowing PROs to collect other aspects of performance income. Now, music publishers have to choose to be “all-in” or “all-out” with the PROs, allowing PROs to collect all performance royalties on their behalf or none. This will wreak havoc by further complicating the licenses needed by music users, complicated the tracking of performances from these users, and disrupting the income flow that would otherwise be collected by the PRO’s.

The DOJ’s decision will cause drastic decreases in the income streams for music creators. It not only affects the PRO’s themselves but also the thousands of music publishers, writers, companies, and foreign performance societies that hold business with these societies and rely on these rates.  Not only does the ruling further cripple the already narrowing income streams for music creators, but it also inhibits the industry from growing and progressing within the digital age, and prevents streaming from becoming a financially viable method of music consumption.

So what can you do?  As a music consumer, you can #valuemusic and pay for any music you listen to. If you own an establishment that uses music, make sure you are paying what licenses you can so the music owners and creators are fairly compensated. Everyone can go to standwithsongwriters.org and write to your congressional representative as well as sign up to get updates on this issue and how to stay involved in supporting this much needed reform in valuing music.

I became a music attorney because I am passionate about protecting and advocating for the rights of my clients — the creators and owners of musical works.  Contact me to protect your rights.

Disclaimer: This article is for educational and informational purposes only and not for the purpose of providing legal advice. The content contained in this article is not legal advice or a legal opinion on any specific matter or matters. This article does not constitute or create an attorney-client relationship between Erin M. Jacobson, Esq. and you or any other user. The law may vary based on the facts or particular circumstances or the law in your state. You should not rely on, act, or fail to act, upon this information without seeking the professional counsel of an attorney licensed in your state.
If this article is considered an advertisement, it is general in nature and not directed towards any particular person or entity.

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Don’t Get Screwed Over : 3 Scenarios Where a Handshake Deal Isn’t Enough – Video Format

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Categories: Legal Issues, Music, Music Contracts, Music Industry, Music Publishing, Videos, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

In case you didn’t read the whole article I just posted and you’d rather watch me explain it to you – here are the videos!

Part 1:  Songwriter Split Agreements

Part 2:  Producer Agreements

Part 3:  Band Agreements

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Don’t Get Screwed Over : 3 Scenarios Where a Handshake Deal Isn’t Enough

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Get It In Writing - Erin M. Jacobson, Esq.

Musicians often ask me when they need to “get it in writing” as opposed to just having a verbal agreement or handshake deal. The real answer to that question is that you should always get agreements in writing, but there are three frequently occurring scenarios where it’s essential. Doing so will provide you with much needed protection later on when money or fame create unanticipated problems. Here’s how to handle each situation.

1. Co-writing songs

When co-writing songs with others, it’s imperative to have a songwriter split agreement. This is a short agreement listing the writers of the song and in what percentages they are sharing ownership and royalties. There are longer versions of this agreement that lay out more terms, but a songwriter split agreement is the minimum that you should have in place.

This agreement is important because it offers some proof if someone who’s not a writer tries to claim he or she is owed a credit or portion of ownership or royalties on a song. Here’s a story of an actual situation that happened to a band several years ago.

A new band wrote some songs for their first album while in the studio. As is fairly common, the band had some friends and band members’ girlfriends in the studio with them. One of the songs the band wrote that day in the studio ended up being a huge hit for them that produced a large amount of royalties. The band never completed a songwriter split agreement.

A short time after the song became a hit and the money started rolling in, a girlfriend – now ex-girlfriend – of one of the band members contacted the band and said that the band had promised her 10 percent ownership of the song for contributing a certain line. The band said that they never promised her anything, but she threated to take them to court. The ex-girlfriend had no proof she actually contributed to the song, but the band had no proof that she was lying.

In order to avoid an expensive lawsuit, the band had to give her the 10 percent she wanted. While a written agreement doesn’t prevent someone from making a claim, if the band had completed a songwriter split agreement at the time the song was written, they would have had some sort of proof that the ex-girlfriend was not one of the writers of the song or owed any ownership interest in it. They could have potentially avoided giving up 10 percent ownership and income to someone who didn’t earn it.

2. Working with a producer

Musicians often come to me with problems they’re having with a producer. Often, the producer isn’t turning over the masters because there was a misunderstanding between the parties, or sometimes a producer’s claiming more ownership or income share than he or she should.

The source of these problems is usually that the band didn’t get the terms of the agreement with the producer in writing. As a result, the parties had different understandings of what they each thought the agreement entailed, important terms hadn’t been discussed and left to work out at some later date, or someone changed his or her mind because he or she didn’t have anything in writing to dispute the new terms.

Producer agreements are really important because the creator of the music is bringing in a third party who contributes (some more significantly than others) to the masters and sometimes to the compositions. Producers sometimes have claims to master ownership or require a songwriting credit when they haven’t written part of the song. Producer fees and royalty structures can vary based on genre, stature of the producer, and whether there’s a record deal involved. So, again, having the payment clearly defined is essential.

A band came to me recently after working with several producers on their album, with no written contracts. After spending a lot of money on recording, the band had allowed the main producer on the album to dictate terms of compensation with all the other producers. When the album was finished, the band was left with only 10 percent ownership of all compositions and masters on the album when they were the main songwriters and only performers.

I asked the band why they didn’t seek my counsel or other assistance earlier instead of waiting until this point, and their answer was that they had hoped things would improve on their own. Had the band sought advice on this situation earlier and gotten producer agreements in place with fair terms, this situation could have been avoided.

3. Forming a band

Band agreements are also really important because every band is different. In some bands, everyone writes and all members share equally in royalties, and in other bands, only the main members share credit and royalties while other members are treated more like employees. Bands also have unique issues regarding the band name and who can use or perform under that name if the band breaks up or a member leaves.

The time to create a band agreement is right in the beginning stages of the band when all members are still on good terms with each other. The conversation about the issues covered in a band agreement may seem uncomfortable at first, but ultimately clarifies expectations and protects everyone in the band. If certain band members are unreasonable or cannot agree during this initial conversation, that’s a red flag you’ll be glad you discovered sooner rather than later.

Although being in a band is a creative and fun experience, what many musicians forget is that it is also a business, and needs to be run as such in order to stay organized and find success.

Here’s a story about why having a band agreement is important: I received a call from a musician whose band was in the process of breaking up. The band had been together for several years, and this musician wanted to know if he could continue earning income from the band’s songs and whether he could use the band name in the future.

I learned the band didn’t have an agreement and hadn’t discussed ownership of compositions, masters, artwork, the band name, or how any of these things would be treated if the band broke up. The relationships between the members had turned contentious, and there was no way any of them were in an emotional state to agree on anything.

Because the members weren’t talking, it would have taken a lot of investigation or possibly litigation to figure out how the material should be split and who could use the name going forward. It was very probable this musician would no longer be able to profit from the hard work he had contributed to this band over the last several years.

Had the band created a band agreement in the beginning, they could have discussed these issues and decided how all of their material would be treated in the event of a breakup. While the agreement wouldn’t have prevented a breakup, it would have clearly explained how the material was to be treated and how the members could proceed when the event occurred instead of potentially stripping the members of the proceeds of their contributions.

How and where do you get it in writing?

The best option is to hire an experienced music attorney to draft these agreements with language and terms specific to the situation at hand.

If you cannot hire an attorney due to the cost or other reasons, you can download high-quality contract templates drafted by a music attorney at Indie Artist Resource. Each template covers the most common issues faced in those situations by musicians and comes with instructions to facilitate easy completion of the agreement.

If a formal contract is still not possible, having some evidence in writing is beneficial. You can follow a verbal conversation with an email saying, “To recap the terms of what we discussed…” and then briefly summarize the terms so there is a written record of it. While it is not the same as or as strong as having an actual signed contract, it does help to leave some trail of proof if things go wrong down the line. This is a good idea especially for situations where contracts aren’t always used, like casual agreements with venue talent buyers or promoters.

This article was originally published on Sonicbids.com.

Disclaimer: This article is for educational and informational purposes only and not for the purpose of providing legal advice. The content contained in this article is not legal advice or a legal opinion on any specific matter or matters. This article does not constitute or create an attorney-client relationship between Erin M. Jacobson, Esq. and you or any other user. The law may vary based on the facts or particular circumstances or the law in your state. You should not rely on, act, or fail to act, upon this information without seeking the professional counsel of an attorney licensed in your state.

If this article is considered an advertisement, it is general in nature and not directed towards any particular person or entity.

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June Music Legal and Business Roundup

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Categories: Copyright, Infringement, Legal Disputes, Legal Issues, Music, Music Industry, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

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Here’s a recap of my article’s this month:

 

The most talked-about topic in the music legal world this month was certainly the copyright infringement case where band Spirit is sued Led Zeppelin over allegations that “Stairway to Heaven” infringed on Spirit’s song “Taurus.”  The good news is that Led Zeppelin Wins ‘Stairway to Heaven’ Jury Trial!

Here’s a recap of the week’s trial coverage:

What was also exciting is the recent push by artists to urge online content providers like YouTube to #valuemusic.  This call to action also involves the request to reform the Digital Millennium Copyright Act (DMCA) which allows safe harbor provisions for YouTube and other online content providers.

In other news, those on the other side of the spectrum are filing lawsuits to force certain musical compositions into the public domain so that they don’t have to pay the license fees for them.  This is one of a few lawsuits to follow the “Happy Birthday” case.  This is certainly not a way to #valuemusic.

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