Guest Post by Wallace Collins
As an artist in the entertainment industry, you do not need to know everything about the music business in order to succeed. But because it is a business, you should try to learn whatever you can about your basic legal rights so you can protect yourself.
When a prospective new client calls me, before we even arrange for an initial consultation, I usually send them a flyer that outlines certain basic information that I think they need to know. I am writing this article so that you can have this information too.
When I was a teenage recording artist back in the late 70's, I can remember being intimidated by the lawyers who I thought of as "suits". Now that I am on the other side of the desk, I have a broader perspective and I am here to tell you that some of those "suits" can help you; provided, however, that like any other aspect of your life, you use your instincts in making your selection. However, until such time as you need or can afford an entertainment lawyer, there are many things you can do for yourself to protect your legal rights.
Most simply, it is important to understand the basic concepts of copyright, trademark and contract law in order to properly protect your work. A full discussion of these issues may be beyond the scope of this article, but the following are certain aspects of these matters which you can understand and handle on your own.
1) What is Copyright and How Does it Protect You?
Copyright is, most simply, the right to make and sell copies of your work. Under the U.S. Copyright Law, a copyright automatically vests in the creator of a work the moment the expression of an idea is "fixed in a tangible medium"; in other words, the moment you write it down or record it on tape.
With respect to music, there are really two copyrights: a copyright in the musical composition owned by the songwriter and a copyright in the sound recording which is owned by the recording artist (but is usually transferred to the record company when a record deal is signed).
It is important to remember that you own 100% of 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. The U.S. Copyright Law requires that all transfers of copyright be in writing. Therefore, it is very important to be wary of anything you are asked to sign regarding your work.
Although it is not necessary, it is advisable to place a notice of your copyright on all copies of the work that you distribute. This consists of the symbol "c" or the word "copyright", the author's name, and the year in which the work was created or its creation was completed. For example: "(c) John Doe, 2017."
The filing of a copyright registration form with the Registrar of Copyrights in Washington D.C. gives you additional protection, in so far as it establishes a record of the existence of such copyright and gives you the legal presumption of validity in the event of a lawsuit. Registration is also a prerequisite for a copyright infringement lawsuit to be commenced in Federal court and, under Federal law, allows an award of attorney's fees to the prevailing party, provided the form is filed within 90 days of when the work is first offered for sale or before the infringement occurs.
You can register your copyright online or by mail (although the fees are lower if you file online: www.copyright.gov).
2) "Publishing", Mechanical Royalties", "Writer's Share", "Co-Publishing” ...and all those words?!
The term "publishing," simply put, means the business of copyrights. As defined by the U.S. Copyright law, "publishing" has several meanings. It is the "distribution of copies of a work to the public by sale or other transfer of ownership, or by rental lease, or lending". A work can also be considered published if there has been an "offering to distribute copies of a work to a group of persons for purposes of further distributions, public performance or public display." In other words, publishing occurs when there has been an offering to distribute copies of the work.
As a songwriter or recording artist, you own 100% of the copyright (and the related publishing rights) in your work when you create it. Under the copyright law, such rights can only be transferred in a signed writing, so you own 100% of the copyright and the related publishing until you sign those rights away. Many artists send recordings of their songs to publishing companies. In the event that a publisher hears something he likes, he or she may approach you about becoming your publisher. In effect, what it really means is that the publisher will invest in you by purchasing a portion of the rights in your copyright.
As a practical matter, music publishing consists primarily of all administrative duties, exploitation of copyrights, and collection of monies generated from the exploitation of those copyrights. If a publisher takes on these responsibilities it "administers" the compositions. Administrative duties range from filing all the necessary registrations (i.e. copyright forms) to answering inquiries regarding the musical compositions.
One of the most important functions of both songwriters and music publishers is exploitation of a composition or "plugging" a song. Exploitation simply means seeking out different uses for musical compositions. Music publishers have professional quality demos prepared and send them to artists and producers to try to secure recordings. They also use these tapes to secure usage in the television, film and advertising industries.
Equally important as exploitation is the collection of monies earned by these musical usages. There are two primary sources of income for a music publisher: earnings that come from record sales (i.e., mechanical royalties) and revenues that come from broadcast performances (i.e., performance royalties).
Mechanical royalties are collected directly from the record companies and paid to the publisher. Performance royalties are collected by performing rights organizations - ASCAP, BMI, and SESAC - and then distributed proportionally to the publisher and to the songwriter.
In addition to plugging and administrative functions, it is also important to know that there is a creative side to music publishing. Since producing hit songs is in the best interest of both the writer and the publisher, good music publishers have whole departments devoted to helping writers grow and develop.
The creative staff finds and signs new writers, works with them to improve their songs, pairs them up creatively with co-writers, and hopes the outcome will be hit records.
Although a writer can be his own publisher (and, in fact, owns his or her own publishing rights until they are signed away), the larger publishing companies in the music business usually pay substantial advance payments to writers in order to induce them to sign a portion of their publishing rights to the publisher. Keep in mind that, since every music publisher is different, it is important for the songwriter to assess both the business and the creative sides of a music publisher before signing a deal.
3) Trademark Protection for Your Name
Trademark rights are rights in a name, phrase, slogan or logo which indicate source or quality. Such rights are based on "use" of the mark and vest in the owner of a mark when the mark is first used in connection with goods or services.
These rights are applicable to names used by musical performers, groups, DJs and companies.
The more unique your name is, the more easily protection is available for it as a trademark. The highest level of protection is granted to "unique" or "arbitrary" names, which means words that are invented for a particular product or service (e.g., "Nike", "Rolex", "Microsoft"), or existing words arbitrarily attached to a product or service (e.g., "Smashing Pumpkins": for a musical group).
A high level of protection is also granted to "suggestive" marks, which means a word or slogan that hints at what something is, but does not describe it (e.g., "Meow Mix" for pet food or "Miracle-Gro" for plant food). Terms that are too descriptive or generic may not be eligible for much, if any, trademark protection.
The best way to ensure that you properly protect yourself is to file a Federal trademark registration application, since registration will give you a presumption of priority 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 name or a confusingly similar name before you. 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 order 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 a band does not file for Federal trademark registration, certain rights vest in that band 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 worldwide, you may find that a band has been using the name in, say, Illinois. If they were using the name prior to when you first started using your name then, under state law, that band could prevent you from releasing your record in that state (which happens to include Chicago!). The usual solution to such a problem is to buy out that local band's rights, but this can be costly.
You may be able to do a trademark search on the Internet, through the computer services of certain public libraries, through your lawyer, or by contacting a searching service. The least expensive searching service I know of is called Government Liaisons at (800) 642-6564.
Once you have determined that nobody else is using your name, the next step is to file an application for trademark registration in the 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 the prevailing party in an infringement action. The filing fees vary depending on how you chose to register and how many categories you will file. For more information, go to www.uspto.gov.
4) 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. 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 career. The law of most States 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 stationery stores or at the county clerk's office.
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, under the laws of most states, 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. These laws generally employ a rule of sharing evenly in profits and losses, including all assets of the business.
5) Signing Contracts and Getting Legal Advice
Never sign any contract given to you without having a knowledgeable entertainment lawyer who you retain to represent you and 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 on 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.
Now that I have told you all about the things you can do for yourself, I should say a word about the need to get a lawyer under certain circumstances. Everyone needs someone to look out for his or her interests. That is why, at the end of the day, when it comes to contracts you really should consult with a reputable entertainment lawyer. Too many musicians invest a lot of their money on instruments and on demo recordings, but then risk it all by skimping on legal advice.
A good lawyer will navigate you safely through the minefield that is the entertainment industry. It is not that everyone is trying to rip you off - but this is a business, and there are no rules governing what is fair in a music business deal. It is all a matter of leverage and negotiation.
Record contracts, publishing agreements, and licensing arrangements can be extremely complicated. Proper negotiating and drafting require superior legal skills, as well as knowledge of the entertainment business and intellectual property practice.
When looking for a lawyer, you should not be afraid to interview a few before retaining one. Check around or ask friends for suggestions - or call your local Bar Association for a referral. Some entertainment 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, most likely you will have an initial interview for which, if you so request in advance, there may be little or no charge. 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 creation. It is more important that you feel he or she is a trustworthy and competent advisor.
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 stays 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. Some lawyers may charge a set fee, such as $1,000 or $1,500, to set up a corporation or to prepare an agreement for you. Check around to see if the fee arrangement proposed is competitive.
As a general rule, I advise my clients not to sign anything – other than an autograph – unless your lawyer reviews it first! 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 lifespan. 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. If you believe in yourself and your talent, give yourself the benefit of the doubt, invest in legal representation and do not sign anything without consulting your lawyer.
Wallace Collins is a New York Lawyer with 30-plus years specializing in entertainment, copyright, trademark, and internet law, who is handling copyright terminations for many legacy artists and songwriters. He was a recording artist for Epic Records before attending Fordham Law School. Website: www.wallacecollins.com; Tel:(212) 661-3656. Disclaimer: Please note that the views expressed here do not necessarily reflect those of Tunedly. « return to blog