LEGAL BASICS FOR THE DIY WORLD: ARTISTS, AUTHORS, CREATORS AND MUSICIANS

Four Essentials:

1) Copyright Protection 
Under US copyright law, copyright (literally, the right to make and sell copies) automatically vests in the creator the moment the expression of an idea is "fixed in a tangible medium" (in other words, the moment you write it down, type it or record it on tape). With respect to music specifically, there are really two copyrights: a copyright in the musical composition owned by the songwriter and a sound recording copyright in the sound of the recording owned by the recording artist (but usually transferred to the record company when a record deal is signed). It is important to remember that you own the copyright in your work the moment you write it down or record it, and you can only transfer those rights by signing a written agreement to transfer them. Therefore, you must be wary of any agreement you are asked to sign. 

Although it is not necessary, it is advisable to place a notice of your copyright on all copies of the work. This consists of the symbol "c" or the word "copyright", the author's name, and the year in which the work was created (for example: "(c) John Doe 2017). The filing of a copyright registration form in Washington D.C. gives you additional protection in so far is it establishes a record of the existence of such copyright and gives you the presumption of validity in the event of a lawsuit. Registration also allows for lawsuits to be commenced in Federal court and, under Federal law, allows an award of costs and attorney's fees to the prevailing party (and you can register on-line or by mailing in forms with submissions). Currently, the filing fees are low enough to make registration well worth while. www.copyright.gov

2) Trademark Protection for Your Name 
Trademark rights are rights in a name or logo which indicate source or quality. Such rights are based on "use" of the mark and vest in the owner when the mark is first used in connection with goods or services. Although the title of a work is not protected by trademark, these rights are applicable to names used by actors, musical performers, DJs and companies. The more unique the name of your company, product or band is, the more easily protection is available for it as a trademark. 

The best way to protect yourself is to file a Federal trademark registration application, since registration will give you a presumption of ownership of the name nationwide. Before investing too much in your prospective trademark, however, it is a good idea to order a trademark search to make sure no one else has been using the same or a confusingly similar name before you. You can do this through a combination of on-line researches, through your lawyer, or by contacting a searching service. With respect to the name of a performer or band, keep in mind that a mere search of current Federal trademark registrations may be insufficient. It is best to conduct a full statewide search as well as a search of the copyright office records in order to find any songs which may be copyrighted in a band's name. This is important because trademark rights are based on "use." Therefore, even if another user does not file for Federal trademark registration, certain rights vest in that user under state law when they start using the name. This has led to problems in the past. For example, when you go to release your record or film worldwide you may find that someone else has been using the name of your band or film company in, say, Illinois. If they were using the name prior to when you first started using your name then, under state law, that user could prevent you from releasing your record in that state. The usual solution to such a problem is to buy out that users rights, but this can be costly, or enter into an agreement to alter and distinguish the names (e.g., Squeeze/Squeeze UK; Dreamworks, Dreamworks SKG. 

Once you have determined that no one else is using your name, the next step is to file an application for Federal trademark registration in the US Patent and Trademark Office. Registration provides nationwide protection as well as the presumption of validity for lawsuit purposes, as well as legal fees and additional damages for infringement. www.uspto.gov
  
3) To Incorporate or Not to Incorporate 
As a practical matter, sooner or later you may want to incorporate in order to limit your personal liability. When you incorporate your business you actually create an entity separate from yourself which will have its own bank account and tax identification number. If you operate properly as a corporation (i.e., signing documents as an officer of the corporation rather than as an individual, using a separate bank account, etc.), then, as a general rule, only the corporation is liable for the obligations of the agreements the corporation makes. The easiest example of how this protects you is if you imagine a situation where your corporation pays you a salary of several hundred thousand a year for several years. Over the years you use that salary to buy a house, a car, and a boat. Then one day catastrophe strikes and the corporation is sued for millions or goes bankrupt. Although the creditors could take the assets of the corporation, they could not pierce the corporate veil and force you to sell off your house, your car and your boat (Imagine: even when Chrysler went bankrupt Lee Iacocca did not give up any of the assets which he had purchased with his salary. In fact, he kept right on getting a salary from the corporation). If properly employed, a corporate entity can be used as a shield to protect you. In most cases, however, it is not really necessary to incorporate at the start of your artistic career. The law does require that, if you use a name professionally other than your personal name, then you should file a Business Certificate (or "DBA") in the County in which you reside or do business under that name. A DBA is necessary if you want to open a bank account in your professional pseudonym or group or company name. The DBA form is available in stationary stores or at the county clerk's office.

There are also tax advantages to operating as a corporation. As an individual making in excess of  a certain amount, as set by the IRS, even if your write-offs and deductions reduce your income substantially you will still be subject to the "alternative minimum tax' under current law. However, as a corporation, you are entitled to take the deductions and, as an individual, you are only subject to standard tax on the amount which passes through to you individually. Also, as a business matter, the individual members of a group or company may want to enter into a partnership agreement between and among themselves in order to spell out the particulars with respect to certain rights such as songwriting and ownership of the trademark rights in the name. Otherwise, any group of two or more persons operating a business for profit is considered a partnership for the purposes of applying the laws of partnership under the laws of most states. These laws generally employ a rule of sharing evenly in profits and losses, including all assets of the business
  
4) Signing Contracts 
Never sign any contract given to you without having your lawyer review it first. Do not rely on anyone else (or even their lawyer) to tell you what your contract says. And never let anyone rush you or pressure you into signing any agreement. There is really no such thing as a standard "form" contract. Any such contract was drafted by that party's attorney to protect that party's interests. Your lawyer can "translate" the deal and explain its terms to you, and then help negotiate more favorable terms for you. 

Keep in mind that it may, in fact, be in your best interest to "get it in writing" if you have an arrangement with someone. This is especially true in collaborative situations. Otherwise, you run the risk of a disagreement later over the actual terms of the oral agreement, and it becomes your word against that of the other party. That is not to say that an oral agreement is not a binding contract (as Kim Basinger recently found out). It is just that a contract is easier to prove if the terms of the arrangement are in writing. A simple contract may not necessarily require extensive involvement by lawyers. A contract can be as basic as a letter describing the details of your arrangement which is signed by both parties to the agreement.

As a general rule, you should consult with a lawyer if you are asked to sign anything other than an autograph. Too many aspiring artists want to get a record deal so badly they will sign almost anything that promises them a chance to do it. Even successful careers have a relatively short life span. Therefore, it is important for you to get maximum returns in the good years and not sign away rights to valuable income like publishing. Everyone needs someone to look out for his or her interests. That is why, at the end of the day, you may want to consult with an entertainment lawyer. Meet with several lawyers to find one whose vibe is right for you. If you believe in yourself and your talents, give yourself the benefit of the doubt, and invest in good legal representation.

Wallace Collins is an entertainment and intellectual property lawyer with more than 30 years of experience based in New York. He was a recording artist for Epic Records before receiving his law degree from Fordham Law School. Tel: (212) 661-3656; www.wallacecollins.com 

THE STEELY DAN LAWSUIT

Donald Fagen has filed a lawsuit against the estate of Walter Becker, Fagen's partner and band mate in Steely Dan for decades. At the heart of the legal action is control over the use of the "Steely Dan" band name and the ongoing continuity of Steely Dan itself.

Back in 1972 when the band became incorporated, Becker and Fagen entered into what is known as a Buy/Sell Agreement. Essentially what that means is that in the event someone quit the band or died, Steely Dan as an entity purchases all of that members shares. In this case, as the sole living member of the original Steely Dan, that would make Fagen the sole owner of the band itself.

However, shortly after Becker’s death, his estate sought to appoint his widow as an officer of Steely Dan while demanding 50 percent ownership. In Fagen’s view, this move violates the 1972 agreement.  The complaint alleges that Fagen and Becker were the only remaining shareholders and signatories to the Buy/Sell Agreement. Just four days after Becker’s death, on September 7, 2017, the Becker estate sent Fagen a letter stating that ‘We wanted to put you on notice that the Buy/Sell Agreement dated as of October 31, 1972 is of no force or effect.” As part of the legal action, Fagen is also suing the band’s business management firm claiming that they’ve been withholding records. 

Fagen is seeking upwards of $1 million in damages and a declaratory judgment by the Court that the buy/sell provision is valid and enforceable and that he is the sole owner of the Steely Dan name and all rights associated with it in order to maintain the continuity of Steely Dan. Declaratory Judgment is a legal process whereby one party seeks the Court's ruling in deciding uncertainties and defining the legal relationship between parties in a matter. 

From my professional experience with such matters, this case is essentially about a contract between the parties and enforcement of that contract in accordance with its terms. If the contract is clear and unambiguous on its face as Fagen alleges then I expect that the Court will enforce it as written. Courts generally enforce contracts as written since the words used in the contract are the best indicator of the intent of the parties. Despite the emotional circumstances and various human situations that may create a tug-of-war on what is right and what is wrong after the fact, enforcement of contracts as written is fundamental for markets - and society - to function properly.

Wallace Collins is a New York lawyer practicing primarily in the areas of entertainment, copyright, trademark and internet law. He was a recording artist for Epic Records before attending Fordham Law School. T:(212)661-3656; www.wallacecollins.com

CONTRACTING WITH MINORS REQUIRES JUDICIAL APPROVAL FOR BUSINESSES FROM MODELING AGENCIES TO TECH COMPANIES

Contracting with minors in the entertainment industry can be a legal minefield. From talent bookers and modeling agencies to technology start-ups and other computer software companies, the predicament of employing or contracting with a party under the age of eighteen has become an increasing problem. The minor is not bound by the contract and may disaffirm the contract at any time during minority or within a reasonable time after reaching majority. Without a valid written agreement the employment is “at will” under the law of most States which means the minor can depart at any time. The dilemma created by a minor’s ability to disaffirm a contract is that it may seriously jeopardize the employer’s financial investment in the services of the minor whether it is the ongoing efforts of an agency to develop the career of a young talent or the technology company’s expectation that is owns the copyright in the code created by the teenage whiz kid it employs.

The mere exercise of having the parent or guardian of the minor co-sign, approve or “guarantee” the contract does not resolve the problem. The minor may still repudiate the contract on the ground of infancy, asserting that the parent or guardian lacked authority to make the contract. In some jurisdictions, Courts deem it against public policy to even enforce such guarantee language against the parent or guardian since it would subvert the purpose of the laws concerning the judicial approval of contracts with minors. So-called “working papers” under State law might work for purposes of a fast food chain or similar hourly wage employment but are probably insufficient for talent agent, modeling agency or technology company purposes.

Several States, including New York and California, have laws specifically concerning judicial approval of contracts with minors. New York's Arts and Cultural Affairs Law §35.03 provides for judicial approval of certain contracts for services of "minors" under the age of 18. The procedure involved can be somewhat arduous to navigate, and may prove to be a difficult gauntlet to run for a lawyer inexperienced in this area. However, a company employing minors or contracting with minors should investigate the efficacy of pursuing court approval to protect their investment. Once the Court judicially approves the contract, the minor is held to a standard of adult responsibility for its contractual obligations assuring the employer company that it will get what it bargained for and that the contract is legally valid.

As a practical matter, a proceeding for judicial approval of a minor's contract in New York is commenced by the filing of a verified petition. It can be filed by a parent, the guardian, a relative of the minor or any interested person or entity such as the employer. The petition must contain a statement of the length of the employment term, compensation, and all other relevant, material terms of the agreement. A complete copy of the proposed contract must be annexed to the petition together with affidavits from the parents and/or guardians that consent to the petition and support the facts.

In addition to identifying the details of the nature of the minor's employment and the compensation to be paid, the petition must also contain a statement of who, other than the minor, is entitled to the minor's earnings and facts regarding the property and financial circumstances of the parent or parents so entitled. The petition may nominate a person to be appointed as limited guardian solely for purposes of establishing a trust account for the proceeding and should set forth the reasons why the person nominated would be proper and suitable. Although a lawyer is usually appointed, a parent or other petitioner is not precluded from being appointed as limited guardian by reason of his or her interest in any part of the minor's earnings or in the contract provided such interest is disclosed. The Court will designate how much is to be set aside and saved for the minor under guardianship until the minor becomes 18 years old. The court also has the option to appoint a special guardian to represent the interests of the minor at any time after the petition is filed.

As directed by the Court, before the time at which the petition is noticed to be heard, certain persons (other than the petitioner and anyone who has joined in the petition) must be served with an order to show cause why the petition should not be granted: (1) the minor; (2) the parents of the minor; (3) the minor's guardian(s); (4) each party to the contract; (5) any person having the care and custody of the minor; (6) the person with whom the minor resides; and, (7) the minor's spouse.

An order granting judicial approval of a contract for the services of a minor will rarely be granted on the papers alone. Usually a hearing is conducted at which the minor, the parent(s) and the various other interested parties may be questioned by the Judge regarding the contract. A Judge may require provisions in the Court’s order concerning how many hours the minor can work and may require that the employer provide tutors if regular schooling will be disrupted by the employment. Most terms and conditions of each arrangement will be affirmed as long as they are found by the Court to be reasonable and not contrary to the best interests of the minor. Once the court does grant approval, an order will be issued which will, in effect, declare the minor an adult for purposes of fulfilling his or her contractual obligations.

California law concerning the judicial approval of minors' contract for artistic or creative services (Ca. Family Code §6750, et seq.), although similar, differs in certain respects. For instance, under California law there is no limitation on the length of the term of a minor's contract where in New York the limit is seven years. A hearing is usually required in California as in New York but under California law a maximum of only 50% of net earnings will be set aside until the minor becomes 18 years old whereas New York has no limit on what portion the court can direct to be set aside.

Once a Court does grant approval, an order will be issued which will, in effect, declare the minor an adult for purposes of fulfilling his or her contractual obligations. Then all the results of the minor’s services, including commissions due on the bookings by a talent agent or modeling agency and any copyrights in code or apps created by a minor during employment by a tech company, will be properly transferred as bargained for by the employer.

 

WALLACE E.J. COLLINS III, ESQ. (Tel: 212 661 3656) is a New York lawyer practicing primarily in the areas of entertainment and intellectual property law. He was a songwriter and recording artist for Epic Records before receiving his law degree from Fordham Law School. T: (212) 661-3656; www.wallacecollins.com 

BEWARE THE "CONTROLLED COMPOSITION" CLAUSE IN RECORD CONTRACTS

Under U.S. Copyright law, Congress has seen fit to legislate a minimum statutory mechanical royalty rate for songwriters and their publishers.  Based on an upward-sliding scale tied to a cost-of-living index, the mechanical royalty rate is set by the Copyright Royalty Tribunal on a per song per record basis. The current rate in effective is $.091 per song.  However, most record companies use their substantial leverage over fledgling recording artists to cause them to enter into record contracts which purport to reduce this minimum rate pursuant to the "controlled composition" clause - and this provision might also be made to apply to producers and songwriters who do work for those artists.

The controlled composition clause is one of the most insidious of a plethora of royalty-reducing provisions in any record contract. It reduces the mechanical rate for a songwriter/recording artist and its publisher on songs written or otherwise "controlled" by the artist.  Most such clauses not only reduce the payment per song, but may also put a limit on the total number of songs on which such payment will be made and may fix the point in time at which such calculation will be made (thereby circumventing the cost of living index increase). This is an issue not only for the songwriter/recording artist but for the producer/songwriter and for non-contractual songwriters who may chose to collaborate with an artist who is signed to a recording agreement with a controlled composition clause.

A full analysis of a controlled composition clause is beyond the scope of this article.  However, for a simplified example of how it works, lets assume a typical clause where the songwriter/artist will receive 3/4 of the minimum statutory mechanical rate (assuming the minimum rate is 6 cents per song at the time) on a maximum of 10 songs per LP. The mechanical royalty on the artist's entire LP usually has a "cap" of 68.25 cents (3/4 of $.091x 10 songs) so that, even if the songwriter/artist writes 12 songs for its own album, the artist's publishing is not worth $1.09 per album ($.091 x 12 songs) but only 68.25 cents.

To further illustrate, assume the 12 song album has 6 songs written by the artist and 6 songs from outside publishers. Unless otherwise agreed, the outside publishers are not subject to the artist's 3/4 rate so the 6 outside songs get the full rate and are entitled to a total of 51 cents. Since the mechanical royalty on the entire LP has a "cap" of 68.25 cents, the songwriter/recording artist is limited to applying the remaining 13 cents to the songwriter/artist's 6 songs, so that the artist's publishing is worth a little more than 2 cents per song. And keep in mind, if the artist's producer agreement has language tying the record producer to the artist's controlled rate or an outside songwriter's mechanical license has similar language, then both the producer and the outside writer would also be subject to the reduced rate and the "cap."

To take it one step further, imagine a case where 8 of the 12 songs on the LP were from outside publishers. The outside publishers would be entitled to at least 72 cents in mechanical royalties ($.091 x 8 songs).  Since the artist's contractual cap is 68.25 cents, then for each LP sold the songwriter/record artist would actually lose mechanical royalties and owe its record company a few cents for each record that sells which would be deducted out of the songwriter/artist's recording royalties. The net effect is that the songwriter/artist's own 4 songs receive no mechanical royalties at all.

A controlled composition clause may also contain language which further reduces the mechanical rate on mid-priced and budget sales, etc., providing for a 3/4 rate on the 3/4 rate.  In addition, record contracts often contain several subparagraphs that eliminate royalty payments for free goods and records sold below wholesale price, etc.  Several of these categories would ordinarily be subject to mechanical royalties absent the controlled composition clause.  Moreover, although this provision reduces mechanical royalties on the artist's publishing, it does not reduce payments to outside publishers since they are not subject to the clause.

The most treacherous dilemma for the songwriter/artist is that, even if the record company does not acquire the artist's publishing in its contract, the value of the artist's publishing may so greatly be reduced by the controlled composition clause that the artist may find it difficult to get a publishing deal elsewhere.  This is especially true if the mechanical royalties are cross-collateralized with the artist royalties since, until the artist is recouped, no mechanical royalties will be payable to the songwriter/recording artist or its publisher.

The foregoing scenarios raise numerous legal issues including antitrust, interference with prospective financial advantage and restraint of trade.  Another issue raised is whether, under partnership law (where one partner can bind the partnership), a co-writer who is not actually a signatory to the record contract is subject to the 3/4 rate by virtue of being a "partner" in the song's creation.

These days almost every record contract contains a controlled composition clause.  Although certain aspects of a controlled composition clause can be made less onerous by some persistent negotiation (such as escalations of the rate based on sales thresholds), record companies are generally inflexible in their insistence *on this provision and their position can only be tempered by their desire to sign a particular artist or by an artist's importance and stature. This provision should be reviewed very carefully by an artist and his lawyer; any artist's lawyer who failed to discuss this clause and explain its ramifications to the client (under the assumption that it is "standard" in every record contract) would certainly be inadequately representing the client, and may suffer the consequences when the actual effect of the provision is eventually revealed to the artist.

In fairness to record companies, with the exorbitant cost and high risk of the record business, record companies need to cut costs where they can to try to make a profit on the few artists who do succeed.  However, the question is one of whether devaluing the artist's publishing is a fair way of doing it.  Record companies contend that, since they are financing the production and marketing of the artist's recordings, the artist should give them a break on the publishing royalties they would otherwise have to pay.

By way of analogy, imagine a particular record company, in order to cut costs, decided that, despite the Federally mandated minimum wage, any employee who wanted to work for that label would have to accept three-quarters of the minimum wage.  It is unlikely such a preposterous policy would hold up in court.  When it was tried by calling in an "internship program" the Courts did now permit it. Whether the contractual reduction by a record company of a Congressionally legislated minimum royalty rate would hold up in a court of law has yet to be tested.

Wallace Collins is an entertainment and intellectual property lawyer with more than 30 years of experience based in New York. He was a recording artist for Epic Records before receiving his law degree from Fordham Law School. Tel: (212) 661-3656; www.wallacecollins.com 

ENTERTAINMENT LAWYERS: WHO? WHAT? WHEN? WHERE? & HOW MUCH?

            As an artist or creator in the entertainment industry you do not need to know everything about the business in order to succeed, but you should hire people who do. When I was a teenage recording artist some years back, I can remember being intimidated by the "suits". Now that I am on the other side of the desk, I have a broader perspective. I am here to tell you that those "suits" can help you; provided, however, that like any other aspect of your life, you use your instincts in making your selection.

            The best place for you to start building your "team" of representatives is with a competent lawyer who specializes in entertainment law, which is a combination of contract, intellectual property (copyright and trademark) and licensing law. Eventually, your team could possibly include a personal manager, an agent and a business manager/accountant. Your lawyer can assist you in assembling your team. He may then function as the linchpin in coordinating the activities of your team and insuring that these people are acting in your best interests.

            A good lawyer will navigate you safely through the minefield that is the entertainment industry. Entertainment contracts can be extremely complicated. Proper negotiating and drafting requires superior legal skills as well as knowledge of entertainment business and intellectual property practice. Your lawyer can explain the concepts of copyright and trademark to you and assist you in securing proper protection for your work. In addition to structuring and documenting a deal to maximize the benefits to you, some lawyers also actively solicit deals for their clients. Moreover, if you are not properly compensated in accordance with your contract, you may look to your lawyer to commence a lawsuit to enforce the terms of your contract.

            When looking for a lawyer, you should not be afraid to speak with a few before retaining one. Some lawyers are with large firms but many are solo practitioners. Lawyers have various personalities and legal skills and you should seek out a situation where the "vibe" is right. Although your first contact may be on the telephone or online, most likely you will have an initial consultation for which there may be a modest charge, although some lawyers may not charge for that first meeting depending on the circumstances. Remember, your lawyer's time is money, so be prepared and be on time for your appointment.

            It is not necessary that your lawyer like or even understand your creative endeavors be it an app, a book, music, your film or TV pilot idea. It is more important that you feel he or she is a trustworthy and competent adviser. The lawyer/client relationship is known as a "fiduciary" relationship which means that a lawyer must always act in your best interest and not his own or that of anyone else. Your lawyer is also under a duty to keep your conversations with him confidential. It is often in your best interest that it stay that way.

            Keep in mind that a lawyer with other big name clients is not necessarily the best lawyer for you; if it comes down to taking your calls or those of a superstar, which do you think will get preference? 

             You are probably wondering, "How much will this cost?" Well, remember that the only thing a lawyer has to sell is his time. A lawyer, much like a doctor, is selling services, so if you go to him for advice you should expect to pay. With the odds of success in this business being what they are, very few lawyers will agree to work for you and wait for payment until you are successful and can pay your bills. A lawyer specializing in the entertainment field usually charges an hourly fee or a percentage of the money value of your deal. Hourly rates generally run from $300-$500 and up. Percentages on a pending deal are based on the "reasonable value of services rendered" in connection with a particular contract and generally run around 5-10% of the deal depending on how it is structured. A few lawyers may charge a set fee to review and negotiate certain documents. Check around to see if the fee arrangement proposed is competitive. Most lawyers will require a payment of money in advance or "retainer", which can range anywhere from $500 to $10,000 (and more for litigation matters). Even those who take a percentage of the deal as a legal fee may require that you pay some amount as a retainer deposit. In addition to the hourly fee or percentage, you are usually required to reimburse your lawyer for his out-of-pocket costs, including long distance telephone calls, photocopies, postage, fax, etc. 

            You should realize that in retaining a lawyer you are making a contract even if your agreement is not written. In return for a fee, the lawyer promises to render legal services on your behalf. However, some lawyers may want a fee arrangement in writing (specifically in connection with a percentage deal) and/or a payment direction letter. A cautious lawyer will advise you that you have the right to seek the advice of another lawyer as to the propriety of a percentage fee arrangement.

            You should consult a lawyer if you are asked to sign anything. Too many aspiring creative artists want to get a deal so badly they will sign almost anything that promises them a chance to do it. Even successful careers have a relatively short life span, especially when it comes to careers in music, movie and television. Therefore, it is important for you to get maximum returns in the good years and not sign away rights to valuable income.

            Do not rely on anyone else (or even their lawyer) to tell you what your contract says. Your lawyer will "translate" the deal for you and explain to you exactly what you are getting into. Do not let anyone rush you or pressure you into signing any agreement. There is really no such thing as a standard "form" contract. Any such contract was drafted by that party's attorney to protect that party's interests; your lawyer can help negotiate more favorable terms for you. Everyone needs someone to look out for his or her interests. That is why you need a lawyer. If you believe in yourself and your talents, give yourself the benefit of the doubt, invest in legal representation and do not sign anything without consulting your lawyer and making sure it is the right deal for you.

            As a final piece of free legal advice: never sign anything – other than an autograph - without having your own lawyer review it first.

Wallace E.J. Collins III is an entertainment and intellectual property lawyer. He was a songwriter and recording artist for Epic Records before receiving his law degree from Fordham Law School. Tel: (212) 661-3656; wallacecollins@gmail.com; www.wallacecollins.com 

WHAT’S THE SCORE WITH SYNCHRONIZATION RIGHTS

As the composer of a film or TV score or as a songwriter, artist or producer whose song is used in a movie, TV show, advertisement, or video game, under the copyright law you own 100% of the copyright in your work from the moment you create the work and "fix it in a tangible medium." However, you must be careful what you sign so that you do not assign those rights away without fair compensation for your work. 

When it comes to the use of music there are two copyrights: one in the musical composition or song and one in the sound recording which is the fixation of the sounds that make up the music. When music is used in synchronization with visual images, whether it is created especially for the particular score or whether it is a pre-existing song that the director wants to use in a scene in a TV show or a theatrical motion picture or film, this is referred to as the "synchronization" of music with visual images. Permission in the form of a synchronization license (sometimes referred to as a “synch license”) must be procured by the makers of the audio/visual production from both the owner of the sound recording (the artist or record company) and from the owner of the song copyright (the songwriter or publishing company) Sometimes these are one and the same person or entity, sometimes they are not.

A synchronization license may take various forms. If a show's producer, director or music supervisor decides that a certain pre-existing song is right for a particular scene in a film or TV show or commercial or video game, then a synch license covering the master and the composition would be requested. Depending on the length and prominence of the use, if limited solely to use in the show the amount paid can range from a few hundred dollars to tens of thousand of dollars, or more. If the company also wants the right to include the music on a soundtrack album, then additional provisions would be required for that use which would pay royalties for each record sold. Also, the song should be registered by the author with the performing rights society (e.g., ASCAP, BMI, SESAC, etc.) so that revenues from performances in foreign movie theaters (U.S. movie theaters do not pay performance royalties) and from television broadcast can be collected and paid to the author.

On the other hand, a songwriter may be specifically employed to write incidental music or underscore cues for a film or for a TV commercial or other audio/visual work. Such an arrangement may be structured as a "work made for hire" whereby the songwriter is employed to write specific music which may ultimately be owned by the producer of the film. There is no set fee for such an arrangement - it can range from a few hundred dollars for a small budget project to hundreds of thousands of dollars for a blockbuster film score. However, in such circumstances, since the production company would usually claim ownership of the copyright, the author needs to be sure to try to negotiate to receive the 50% "writer share" of performance monies and have producer only get the 50% "publisher" share - otherwise the author may not be entitled to performance royalties from his or her performing rights society and it would all go to the producer. Issues like this would depend on the careful negotiation of the contract between the parties and their legal counsel.

Since this is a complicated area the details of which are beyond the scope of this article, I would suggest that if such an offer is made to you, an experienced entertainment lawyer would be a good investment on your part.  My advice on such matters is always “don’t sign anything – other than an autograph – unless you have a lawyer review it first!”

Wallace Collins is an entertainment and intellectual property lawyer based in New York. He was a songwriter and recording artist for Epic Records before receiving his law degree from Fordham Law School. Tel: (212) 661-3656;  www.wallacecollins.com