Music Artists Seeking Royalties

Recently, I had the opportunity of listening to a few podcasts on Entertainment law via iTunes U. If you’ve never tuned in, it’s a great resource to staying abreast on legal updates within the Entertainment industry.

In particular, I tuned in to Episode 36 of the Entertainment Law Update podcast by Gordon P. Firemark, esquire. This episode made me aware of a recently settled lawsuit with Universal Music Group and Eminem’s Producers. The case has been going on since 2007 where the court ruled that Eminem's digital songs should be treated as a sale rather than a license. Then in 2010 they returned to court with the outcome that digital music should be treated as a license, where the artist will receive 50% in royalties. The settlement terms aren’t available for the public eye, but this case is certainly progress for many other artists who are still seeking justice for their digital sales. This mainly includes artists who have signed a contract before 2003, such as The Temptations, Kenny Rogers, and Rick James.

My business plan is a music venue and restaurant, so of course this case stands relevant to my particular field of interest. For example, in my venue I plan to host karaoke nights that encourage customers to come out and take a stab at performing some of their favorite artists songs. The Temptations, Eminem, and Rick James are definitely some artists whose popular music can be found in a karaoke machine. The artists 50% will come from me paying a license fee through a performance rights organization like BMI, SESAC, or ASCAP, but it’s always good to know the artists are being paid correctly.

In Episode 38 of the Entertainment Law Update podcast, I found a similar case where Ray Charles’ children are fighting for the rights to their father’s songs. In 1978, Congress amended the Copyright Act for artists who signed away their song rights before they became stars, allowing them to possibly gain back those rights. The artist, or in this case the family would simply have to wait 35 years from the publication date, then follow a strict procedure. Charles’ 12 children crossed the first barrier of this process allowing them to reclaim copyrights on almost 60 of their father’s songs.

Like the UMG case, the outcome can be applied to my business plan in terms of the performance rights organization I plan to purchase my license from. Seeing that this case is fairly new, I want to make sure that my performance rights organization is distributing proper royalties to Charles’ family if his music is played in my venue. Throughout the rest of the year we can expect to see more artists go through similar disputes, hopefully their final ruling will come out just as good.