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Here we'll explore the nexus of legal rulings, Capitol Hill policy-making, technical standards development, and technological innovation that creates -- and will recreate -- the networked world as we know it. Among the topics we'll touch on: intellectual property conflicts, technical architecture and innovation, the evolution of copyright, private vs. public interests in Net policy-making, lobbying and the law, and more.

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August 15, 2011

Springsteen, Kool, Henley et al vs The RIAA

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Posted by Alan Wexelblat

On one side: a raft of the biggest names in recording in the late '70s. Everyone from Bruce Springsteen and Don Henley to Kool And The Gang to Kris Kristofferson. On the other side: the RIAA. Let us pause a moment to appreciate and remember all the work this fine organization has done... OK that was fast. What the hell are they doing fighting not their customers this time but household names in music?

According to Larry Rohter for the NY Times, they're about to fight those musicians over something known as "termination rights." These rights were written into copyright law in the mid-1970s and they give the current owners of albums 35 years to profit from it - which they have done handsomely. But after that time, musicians who want to reclaim the rights can do so by giving the Cartel at least two years' notice that they intend to exercise their termination rights.

If you get out a calendar and do a little math 1978+35 = 2012, which is next year. So starting last year some forward-thinking musicians such as Bob Dylan and others assisted by Don Henley's Recording Artists Coalition began making their applications and would like to get their music back please and thank you.

Not so fast! says the RIAA (you have to imagine Frank Morgan as the Wizard voice here). The Cartel claims that these rights don't apply to those recordings and they aren't going to give them up without a fight. Instead, says the RIAA, the albums were made as works for hire and belong to us in perpetuity sort of like copyright and certainly you can't get them back, like, ever nyah nyah. OK maybe I made that last bit up, a little.

The 'work for hire' claim seems to rise (or fall) on whether or not you think that the musicians were employees of the record companies at the time the recordings were made. That's some pretty thin legal ice because if they were employees then things like Social Security withholding and regular paychecks would have been the order of the day. In fact, they were not. Records were made (as they most often are today) based on advances given to artists against future royalties and an arrangement like that leans heavily toward considering those artists as independent contractors who are then entitled to exercise their termination rights.

Much as I'd like to see the RIAA get another black eye here, I doubt it's going to happen. The artists have huge incentive to negotiate a settlement well before it goes to court, let alone the Supreme Court as Rohter writes. In addition, there will be other interested parties such as producers, sound engineers, session musicians and so on who will want to put in for their share of the rights once the Cartel's grip is loosened. Allowing that whole snarl to go to court would likely cost everyone more millions than they want to spend, and would result in confused and probably contradictory rulings. A much better arrangement will be worked out that will allow major labels to continue making hefty sums off the albums while giving musicians some rights to do other things with the music, or to get a larger cut of the profits from new technologies such as ringtones, digital downloads, and music streams.

I don't know of anyone who has tallied the multi-decade profits of the labels from the albums threatened with rights termination, but it has to be billions of dollars. As with the NFL lock-out, the pot of money on the table is too big for anyone to walk away or let it go to waste; a split is in everyone's best interest.

Comments (1) + TrackBacks (0) | Category: IP Markets and Monopolies


COMMENTS

1. fujow on August 22, 2011 2:44 PM writes...

I am a law librarian and i asked an IP partner what she thought about what Steven Marks said about riaa fighting the termination rights issue, and was told the RIAA will loose big.

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