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Tag Archives: record deal

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Erin M. Jacobson interviewed on the BBC

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Categories: Interview, Music Industry, Music Industry Interviews, Record Labels, Tags: , , , , , , , , , , , , , , , , , , , , ,

Erin M. Jacobson, Esq. was interviewed on the BBC World Service show, Business Daily.

The topic of the overall segment was corporate control over creative works, but Erin’s interview was focused on explaining the dispute over Taylor Swift’s master recordings, and begins at about 12:50.

You can listen to the interview here.

 

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Erin M. Jacobson, Esq. Quoted Again in US Weekly

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

Erin M. Jacobson has been quoted again in US Weekly magazine regarding further developments in the Taylor Swift masters dispute.

Click here to read the article.

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Erin M. Jacobson, Esq. Explains Taylor Swift’s Music Drama

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Categories: Articles, Legal Disputes, Legal Issues, Music Contracts, Music Industry, Music Publishing, Record Labels, Tags: , , , , , , , , , , , , , , , , , , , , , ,

Erin M. Jacobson is interviewed in US Weekly magazine to explain how Big Machine is blocking Taylor Swift from performing her old songs.

Read the article here:  https://www.usmagazine.com/celebrity-news/news/taylor-swifts-music-drama-explained-can-big-machine-block-her/ 

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Erin M. Jacobson, Esq. on Top of Mind, Sirius XM channel 143

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Categories: Interview, Music Catalogues, Music Industry, Music Licensing, Music Publishing, Record Labels, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

 

Erin was interviewed on the SiriusXM show, Top of Mind with Julie Rose regarding master ownership, re-recording, how artists are affected by this, and Taylor Swift.

You can stream here:

Or listen/download on iTunes Podcasts here.

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Erin M. Jacobson, Esq. on ABC’s Nightline

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Categories: Catalogue Acquisitions, Interview, Music Catalogues, Music Contracts, Music Industry, Record Labels, Royalties, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Erin M. Jacobson, Esq. appeared on the 7/1/19 episode of ABC’s Nightline to discuss the current news issue of Scooter Braun’s purchase of Big Machine Records (and Taylor Swift’s master recordings).  You can see Erin’s segments at 5:40 and 6:30.
Click here to watch!

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How Amazon’s Twitch.tv Cheats Music Creators

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Categories: Articles, Copyright, Infringement, Legal Issues, Music, Music Industry, Music Publishing, Performance, Record Labels, Royalties, Streaming, Videos, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

By:  Erin M. Jacobson, Esq.

This article was originally posted on Forbes.com.

Music creators (songwriters and performing artists) and rights’ owners (music publishers and record labels) are not collecting a new and substantial source of income – and most of them are not aware they are not collecting it. Enter Twitch, the website exploiting creators and owners without paying for a single cent of music usage.

What is Twitch

Twitch, a subsidiary of Amazon, is a live-streaming video platform that has “over two million broadcasters and 15 million daily active users.” Anyone can become a Twitch “broadcaster,” meaning users set up their own channels and live-stream various content, which includes, but is not limited to, video-game play, card games, pranks, craft tutorials and more.

The broadcasts start out as live streams and are saved on the channel for re-broadcasts and on-demand watching. Watching videos and channels on Twitch is free and publicly accessible to anyone with an Internet connection. Anyone can become a Twitch broadcaster for free and earn money directly from viewers. Broadcasters that contract with Twitch to become a partner or affiliate will earn money from Twitch directly, as well as from viewers. All revenue streams are described in the next two sections.

Income Earned by Twitch and Twitch Partners/Affiliates

  1. Ad Revenue: Twitch serves ads on all video content, which includes video-on-demand and pre-rolls, and collects ad revenue from showing these ads.
  2. Subscriptions: Viewers can subscribe to a particular broadcaster’s channel at pricing tiers of $4.99, $9.99, and $24.99, with these charges recurring monthly.These subscriptions allow viewers to support broadcasters and use special emotes (chat icons like emojis) that are accessible only to subscribers of a particular broadcaster’s channel.
  3. Bits: Viewers can contribute “bits” to a broadcaster during a stream. Bits are a digital currency within Twitch bought by users for real money, and contributing these bits to a broadcaster is basically like adding money to that broadcaster’s tip jar.
  4. Amazon Prime: Because Twitch is owned by Amazon, Prime members can use “tokens” from their Prime membership to subscribe to broadcaster channels on Twitch. Tokens renew every month, so a Prime member can re-subscribe to a broadcaster’s channel on a monthly basis using Prime tokens.

Twitch and the broadcaster split all income from subscriptions, bits, and Prime tokens, usually on at least a 50/50 basis.

Income Earned Directly by Broadcasters

  1. Donations:Viewers can contribute money directly to a broadcaster through third party services like StreamLabs, Muxy or StreamElements without buying bits.
  2. Media Share: Viewers can make “media share requests” through StreamLabsand StreamElements, meaning viewers can request a broadcaster to play a certain song, YouTube video, or other media within a live stream (hereinafter “Media Share(s)”). Prices for Media Shares are set by the broadcaster, and some broadcasters will start their pricing at $5 per request.

A Twitch Broadcaster’s Earnings

Twitch’s most popular broadcaster is 26-year old Tyler Blevins, known on Twitch as “Ninja.” Ninja reportedly earns over $500,000 per month on Twitch revenue alone, not counting his recent sponsorship deals by Red Bull and Uber. A recent Forbes article reported Ninja’s earnings calculation: “160,000 subscribers at a higher $3.50 rate per sub means he’s pulling in $560,000 a month from that revenue stream alone. Not counting Twitch bits. Not counting donations. Not counting 4 million YouTube subscribers.”

Ninja and most other broadcasters also use music in their streams. None of this music is licensed and none of this money is going to the music creators or rights’ owners.

Music Licenses Required

Platforms with user-generated audiovisual content require performance licenses for the compositions from performance rights organizations ASCAP, BMI, SESAC and GMR. Music users must obtain synchronization and master use licenses from the music publishers and record labels, respectively, along with paying negotiated fees to “synchronize” the audio with the visual elements. Also, rights’ owners may share in ad revenue in addition to or in lieu of those fees.

It should also be considered whether a broadcaster who repeatedly uses a particular song as a theme song or channel staple (like when Ninja does a victory dance at every game win to the song, “Pon Pon Pon”, performed by Kyary Pamyu Pamyu) is implying an association with or (false) endorsement by an artist, similar to when political candidates use certain songs in their campaigns.

How Music Rights are Being Violated

First, there is no evidence that Twitch has valid performance licenses in place from ASCAP, BMI, SESAC, or GMR (although they may be working on it). Therefore, Twitch is not paying for the repeated performances of music to audiences of millions.

Second, it is not known that any broadcaster using music on Twitch obtains synchronization or master use licenses, or pays any fees for the use of music. Also, neither Twitch nor the broadcasters are sharing ad revenue with rights’ owners.

Third, Twitch does not have its own content ID system like YouTube to track and claim uses of music. Twitch leverages Audible Magic to track audio uses after a live stream is over and will mute infringing content in the on-demand re-broadcasts, but not all content is recognized and removed. Also, there is no system to flag these infringing uses or mute them during a live stream.

All of the money earned by Twitch and its partner/affiliate broadcasters for subscriptions, bits, and Prime membership is retained entirely by Twitch and its partners/affiliates, and money earned from donations and Media Share song requests is kept entirely by the broadcasters. None of these funds are allocated to music creators and rights’ owners whose music is being used in these broadcasts.

Current State of Affairs

On June 22, 2018, the Twitch community received a shock when a group of its most popular broadcasters were banned from Twitch for playing a leaked version of a new song by rapper Juice Wrld that was initiated via Media Share song requests. Interscope Records issued DMCA takedown notices, and per Twitch policy, each infringer was banned for 24-hours.

This incident has shed a light on the use of uncleared music by Twitch broadcasters, but many have either continued with playing uncleared content or will not include certain music in the broadcasts. Ninja has turned off music content so he can then repost videos to YouTube in order to avoid YouTube claims by rights’ owners and keep his YouTube ad revenue. Ninja has publicly stated, “I’ve already reached out about getting rights to music … you can still get screwed over for playing music that doesn’t belong to you. … It’s such a nightmare, that it’s just not worth it.”

Interscope later supposedly stated the DMCA takedowns were an accident and Juice Wrld apologized to the Twitch broadcasters, saying “I will do what I can to prevent it from happening again.”

The National Music Publisher’s Association (NMPA) is rumored to be in negotiations with Twitch for licensing, but has not confirmed or commented as to the details.

Furthermore, Twitch isn’t the only site on the market. There are other, similar sites such as Mixer (owned by Microsoft), Facebook Gaming, YouTube Gaming, and Caffeine. There are also other music-centric sites, like Smule, using music in audiovisual content purportedly without permission or payment. More of these websites, as well as phone apps, with user-generated content, continue to emerge and the rate at which more new platforms are introduced is unlikely to slow due to the prevalence of streaming.

The Real Problems

First, rights’ owners are not enforcing their rights and making sure they receive payment for uses of their content. As stated at the beginning of this article, many creators and rights’ owners do not even know about these infringements. Those rights owners’ that are aware, like Interscope, have allowed the rumors of “accidental” takedowns to be the last word on the subject instead of taking a stand to protect their rights.

Second, Juice Wrld is an example of at least one artist condoning the Twitch broadcasters’ unauthorized use of his work instead of getting paid. Artists and songwriters can and should benefit from these uses, and condoning the infringing behavior allows for more of it, as well as a further loss of income to the creators and rights’ owners.

Third, streamers are often ignorant of how to obtain permission. Noah Downs, a video game lawyer at McDonald, Sutton & DuVal in Richmond, VA observes, “Some broadcasters reach out to artists directly, thinking that if the artist tweets ‘Sure, use my music!’ then it must be okay to use. It does not matter if a broadcaster has that kind of permission from the artist – generally the decision is up to the label.”

Fourth, many streamers feel entitled to play music without permission under the belief they are actually helping artists by giving them exposure. Famous artists and songs do not need free promotion from Twitch broadcasters – they are already famous. While exposure might be helpful for new artists to gain fans, it still doesn’t need to be for free.  For example, music service Pretzel Rocks and music company Monstercat have agreements with artists allowing music to be played legally on Twitch broadcasts with compensation being paid to the artists and songwriters.

In an ironic twist, Twitch viewers and broadcasters frequently use and repurpose clips of other Twitch broadcasters’ content without permission. The broadcasters complain about this practice and will submit content claims when their content is used without permission, but they fail to realize that they are doing the same thing to music creators and rights’ owners. Downs agrees, stating, “In many ways, broadcasters and musical artists are the same, and both deserve to be paid fairly.”

The bottom line is that allcreators and rights’ owners need to be properly compensated for uses of their work. Rather than ignoring or condoning infringing behavior, creators and rights’ owners need to keep up with new uses of music and take a stand to protect the value of their music and their livelihoods.

It’s time creators stopped feeling entitled to steal from and deprive each other of the fruits of their labor. It’s time people realized that using music without permission or payment not only cheats the creator or performer, but also impacts everyone that works for them or with them. It’s time the culture of all creators shifts to one of respecting one’s own work enough to get paid for it and respecting the work of others enough to get the proper permissions and pay the proper compensation. It’s time that everyone gets serious about valuing music.

 

*This article does not constitute legal advice.

Click here to contact Erin M. Jacobson, Esq. if she can assist you in your career with this issue or other music industry issues. (Ms. Jacobson does not shop, litigate, or accept unsolicited material.)

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Major Record Labels Under The Gun In Sales v. Licensing, Carpenters Case

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Categories: Articles, Digital Distribution, Legal Disputes, Music Contracts, Music Industry, Record Labels, Royalties, Streaming, Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

By:  Erin M. Jacobson, Esq.

This article was originally published on Forbes.com.

The dispute between artists and labels over the income earned from digital downloads continues to rage.

Traditionally, record labels sold physical copies of music mediums, like CDs, and then would pay a royalty to the artist for each record sold. When iTunes came on the scene in 2001, the labels treated the sales of digital downloads the same as sales of physical CDs, and ever since have paid the artist a royalty on sales of those digital downloads. However, labels actually license the master recordings to digital distributors like iTunes and after a while artists began to make the argument that the income earned from digital downloads should be treated as licensing income and not sales income. The reason why artists want downloads to be treated as licensing income is because instead of getting a small percentage for a sales royalty (most commonly ranging from 11-20%, with an average of about 15% of the wholesale purchase price), licensing income is usually split 50-50 between the label and the artist. Therefore, artists stand to make a lot more money in royalties if a digital download is treated as a license rather than a sale.

This issue came to court starting in 2007 with the case FBT Productions v. Aftermath Records, a case involving royalties paid on Eminem recordings at the “sales” rate rather than the “licensing” rate. FBT won the lawsuit, establishing that income from digital downloads should be treated as licensing income rather than sales income, but Universal Music Group (owner of Aftermath Records) argued that this case should not set a precedent for all artist or record deals. Even though Universal tried not to set a precedent with this case, many artists renegotiated their deals behind closed doors to get better royalty rates for digital downloads than was originally provided for in their contracts.

Now the issue has once again arisen with classic group The Carpenters. Surviving member Richard Carpenter (fighting on behalf of his sister Karen Carpenter’s estate, as well) audited the band’s label, A&M Records/Universal Music. Artists often audit record label books to make sure that they are getting paid the proper royalties. Richard Carpenter’s audit showed that the label was under-reporting the number of downloads sold, was calculating the royalty on those downloads at a lower base price than they were supposed to, and that the label was paying a royalty on digital downloads at the sales rate instead of the licensing rate. Apparently, attempts to resolve the issue amicably were unsuccessful, and thus Richard Carpenter sued.

The Carpenters’ suit cites the FBT case as a precedent, and if the court follows FBT’s ruling then Carpenter has a good chance of success. Another case is currently pending between Sony Music and 19 Entertainment (the producers of American Idol) regarding how labels pay on digital streams. It’s the same argument as in the Carpenters’ case, but the position of a stream being treated as a license is even stronger than in the digital download scenario. However, it’s unclear at this point which way the court will side in both cases.

The labels make the argument that if they had to pay a 50-50 split on all digital download income, they would go out of business. However, the 50-50 split model is quite common with independent labels in the current marketplace and the indie labels are not necessarily going out of business. Both artists and labels often like the 50-50 split model because it creates more of a feeling of partnership between the label and the artist rather than an adversarial view of big company versus small artist.

What should be more of a concern to major labels’ fate than royalty rates is the fact that this digital age has made it much easier for artists to be independent and make a living off of making music without major label backing. Major labels can ensure their longevity by creating a new model that involves a deal that artists want to be a part of, that is advantageous to both the label and the artist, and provides for a long-standing working relationship, rather than one where artists are constantly concerned about being taken advantage of by the label. The tighter that major labels hold on to their traditional model, the more artists are going to look for alternative means of pursuing their musical careers — whether that be making direct relationships with distributors or other scenarios that benefit them financially and allow them to create a sustainable career off making music. This issue is not going away, especially with the growing popularity of streaming as a way of consuming music, and it’s time to adapt.

 

*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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Erin M. Jacobson featured on Forbes.com

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I am honored announce I am published on Forbes.com.  My first article for Forbes discusses Frank Ocean’s decision to go independent after his split from Def Jam.

Below is the text of the article and stay tuned as more will be published!

Checkmate:  Frank Ocean Goes Independent

By:  Erin M. Jacobson, Esq.

Originally published at Forbes.com.  Also reposted at Hypebot.com.

Frank Ocean has chosen the road less travelled for major label artists. He recently split with Def Jam, independently released his latest album, Blonde to chart success, and has refused to submit the album for Grammy voting consideration. While a major label deal was once the holy grail of industry success, what does it mean for artists in today’s industry?

Def Jam released Ocean from his deal in September 2016, a relationship described as “a bad marriage” by Spin magazine who also reported that Ocean’s release from his deal was negotiated. A condition of the split allowed Def Jam to distribute Ocean’s album Endless, while then freeing Ocean to release Blonde under his own imprint. In a recent interview for the New York Times, Ocean described his deal with Def Jam as “a seven-year chess game” and used his own money to buy himself out of his contract and reclaim his master recordings.

Ocean’s “seven-year chess game” refers to the seven-album deal structure typical for major labels. Major labels will sign an artist to a seven-album deal, meaning that the artist is obligated (often subject to pick-up options exercisable only by the label) to release seven albums with the label. This concept can be deceiving to those who don’t understand the structure because the length of the contract is tied to the number of albums released rather than a term of years. Fifty years ago the industry moved at a pace where an artist could release at least one album per year and then be done with the contract in seven years. However, artists today often take more than one year to write and record a new album, often not getting back in the studio until being on the road for almost a year after a prior album’s release. The reality of this schedule means that it often takes two years or more before a follow-up release and thus locks the artist into the contract for as long as it takes to complete the seven albums.

What is more unique about this situation is that Ocean not only bought himself out of the contract, but bought out the rights to his recordings as well. Major label (and most independent label) recording agreements stipulate that the label will own the artist’s recordings, as the label is usually fronting the money to make the recordings. Recording agreements don’t automatically come with the right to buy back masters; that clause is usually included via a good music attorney that knows to negotiate for it. However, many artists that have buy-back rights included in the contract don’t get to exercise those rights due to lack of funds. Ocean was in a privileged position in that he was able to accumulate enough of his own money to meet what was probably a hefty price for his freedom.

Ocean’s move towards independence echoes the increasing trend within the industry to control one’s own destiny and retain ownership of one’s work, a view shared by the majority of my artist clients. Today’s artists relish being independent, but the challenge is remembering that a music career is not only creative, it is also a business and needs to be run as such. Ocean seems to have that mentality. “I know exactly what the numbers are,” Ocean states. “I need to know how many records I’ve sold, how many album equivalents from streaming, which territories are playing my music more than others, because it helps me in conversations about where we’re gonna be playing shows, or where I might open a retail location, like a pop-up store or something.” This level of attention to detail is essential for independent artists looking to build a lasting career.

Ocean’s fame earned while he was backed by a major label puts him in an advantageous position because he has already accumulated a fanbase whose continued support will earn him a lucrative living as an independent artist. Artists in this position no longer need major labels because they have enough fame, opportunities, customer loyalty, and cash flow to finance their future efforts. It is much more difficult for artists still building their followings to achieve the same level of success outright, but many independent artists now look more towards making a living off of their music rather than superstardom. In today’s market, ownership and control of one’s work coupled with keeping a majority of the profits entice artists more than a major label’s deep pockets. As Ocean said:

It started to weigh on me that I was responsible for the moves that had made me successful, but I wasn’t reaping the lion’s share of the profits, and that was problematic for me.”

*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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Is It Ever Worth It to Give Up Copyright Ownership of Your Songs? A Music Lawyer Explains.

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Categories: Articles, Business, Copyright, Legal Issues, Music Contracts, Music Industry, Tags: , , , , , , , , , , , , , , , , , ,

ESQ-givingupownershipRetaining ownership of the copyrights may be one of the most important decisions in an artist or writer’s music career. The person who owns the copyrights is the one with the control over how those works are used and also the one entitled to the money earned from those uses.  However, sometimes holding on too tightly to copyright ownership may prevent an artist or writer from taking advantage of opportunities to grow his or her career. The age-old adage that sometimes you have to give a little to get a little is true, but one needs to look at the opportunity cost and decide if giving something in a specific situation is worth what will potentially be gained.

Here are a few instances when giving up copyright ownership may be permissible.

1.  When it will make you a lot of money.

I’m not suggesting one should sell out just for a hefty paycheck, as sometimes dollar signs can’t substitute for artistic integrity.  I’ve also seen a lot of deals (especially in music library situations) where an artist or writer is being offered just a few hundred to a few thousand dollars in exchange for full or partial copyright ownership of a song that is really valuable to the artist or writer’s catalogue and career.  In this instance, such a small amount of money may not be worth the control and potential revenues lost later if the song does well in the marketplace.

On the other hand, I have some clients that write consistently and don’t care about giving up ownership as long these songs will churn out money, especially for placements.  They feel they can always write another song and are more concerned with making their music earn money for them over crafting songs to define their careers.

2.  When it will give you opportunities you wouldn’t get otherwise.

This is a situation where working with a certain company, or in many cases a certain producer, will be able to propel an artist’s career forward and help that artist achieve notoriety that wouldn’t be achieved otherwise.  As mentioned, a typical example of this is working with a big producer who is considered to be a hit-maker in the industry.  Often these producers don’t even co-write on the compositions, but granting them a percentage of songwriting ownership is mandatory for being able to work with them. After all, one could retain 100% of a song that most people will never hear, or one could give up 20% and have the song hit top ten, make a lot of money, garner name recognition, and bring the artist more opportunities than the artist would have gotten otherwise. In this case, it seems like a small trade-off and can be used as a means to an end – one might have to give up some ownership in the beginning of a career, but that could lead to a level of status in the industry where one can retain ownership and call the shots on future projects.

3.  When it is in line with your goals.

A new artist seeking a label deal, especially a major label deal, will not own their masters.  An up-and-coming writer wanting a publishing deal will have to give up all or part of songwriter ownership.  This is what comes with the territory of growing one’s career via the traditional industry structures.  It also makes sense from a business standpoint because a label or a publisher is not going to invest time and money into an artist or writer without getting something in return , and part of their return on investment is ownership of intellectual property.

However, if an artist has a vision of making a living off of music in a completely DIY structure, or that the freedom of complete control is more important than working with others more established in the industry, then sharing ownership might not be the right choice.

Longevity and sustainability in the music business, especially in its current state, comes with catalogue ownership.   Giving up ownership comes with some loss of control, but that loss of control may lead to notoriety and other opportunities putting one in a position of control higher than would have ever been achieved otherwise.

Whether to give up copyright ownership is a big decision, and it is one that should be discussed with the artist’s advisors. The choice right for one artist may not be right for another.  The decision will come down to what is right for each artist’s career.

If you need help deciding whether to give up copyright ownership in a deal you’ve been offered, book a consultation now.

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.

This article was previously published on Sonicbids.com.

 

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“You Signed a Deal You Shouldn’t Have. Now What?” My New Article Published in Music Connection Magazine

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Categories: Articles, Legal Issues, Music Contracts, Music Industry, Tags: , , , , , , , , , , , , , , , , , , ,

I am extremely honored to have an article published in Music Connection magazine.  The article is entitled “You Signed a Deal You Shouldn’t Have. Now What?” and appears in the “Expert Advice” column on page 46 of the April 2016 issue.

Music Connection cover with Jimmy Page and Erin M. Jacobson, Esq. music attorney music lawyer los angeles

What’s more, the title is advertised on the cover of the magazine — a cover that features none other than Jimmy Page.

Here’s a link to the article online:  http://www.musicconnection.com/expert-advice-you-signed-a-deal-you-shouldnt-have-now-what/

Here’s a link to the PDF:

“You Signed a Deal You Shouldn’t Have, Now What?  by: Erin M. JacobsonPublished in Music ConnectionVol. 40, No. 4, April 2016 

Follow Music Connection:

Facebook: facebook.com/musicconnectionmagazine
Twitter: @musicconnection
Instagram: @music_connection

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