Pat Benatar, Journey, Tom Petty, Bob Dylan, Billy Joel… these are just some of the artists that may be able to reclaim the rights to their music. How? The 1976 United States Copyright Act (“Copyright Act”) has a provision that allows “authors” (such as recording artists) to recapture the rights to work that they had previously licensed or assigned. The reversion of rights back to the original creator is done by filing notices of termination to the current rights holders. The catch is that there’s a 35 year waiting period before the rights can revert back to the artists.
Since the 1976 Copyright Act didn’t go into effect until 1978, 2013 marked the first year that copyrights could be reclaimed by their creators. The “norm” for copyright termination is still to be determined, because many of the copyright licenses and assignments are just becoming eligible for termination now.
If artists can recapture their copyrights, what will this mean for musicians, labels and music publishers?
Right of Termination and Work for Hire
The amendments made in the 1976 Copyright Act sought to address deficiencies of previous versions of the legislation under which artists had generally weaker rights. Section 203 of the Copyright Act gives the author of a work the ability to terminate an “exclusive or nonexclusive grant of a transfer or license…executed by the author on or after January 1, 1978.” Termination may be granted at any time during a five year period beginning at the end of thirty-five years from the date of the original assignment. The right to terminate is optional, but to effect a termination, the creator of the work must serve written notice to the copyright holder which includes the date the termination will be effective. Notice must give at least two years, but not more than ten years, before the effective date.
While artists may benefit from this ability to terminate and recapture their copyrights, it’s safe to say that publishers and labels are not enthusiastic about potentially losing these rights, especially for successful big-name artists. However, the Copyright Act provides for a few exceptions to termination. Most notably, the right to terminate does not extend to work made for hire, a work created by an employee within the scope of their job, or when the work is specially commissioned by a third party. Many record companies have taken the position that the master recordings belong to them in perpetuity, claiming the recordings were created by musicians who were essentially the record company’s employees.
If the master recordings were recorded as a work for hire by the artist for the label, the label owns the copyrights and there would be no reversionary right that the artist could demand. However, if an artist could successfully challenge the work for hire clause in court, proving they were not an employee of the record company, it could be ground-breaking for artists and their ability to more easily reclaim the rights to their songs. While many artists have already filed termination notices, no artist has challenged this in court … yet.
Looks like … It’s Fun to Stay at the Y.M.C.A.
One of the first high-profile artists to make use of this termination provision was Victor Willis, former lead singer of the Village People.
After six years of “legal wrangling,” Willis gained control of his share of the copyright to the hit song “Y.M.C.A.,” in 2013, among others he wrote while with the Village People. Stewart L. Levy, a lawyer that represented the companies that controlled the Village People song catalog, initially argued the work for hire defense in court. However, that argument was eventually withdrawn. This could be a good sign for artists looking to reclaim the rights to their recordings. It would appear this defense may not be strong enough to hold up in court.
No longer a ‘Slave’ to the Label
If Prince’s reported deal with Warner Bros. Records is any indication of what may come, artists could be better off negotiating a private deal directly with the record label, rather than fighting a legal battle in court. In his deal, Prince agreed to a new partnership with the company, which gives him ownership of the master recordings in the Warner catalog. The deal also includes the re-release of a re-mastered deluxe version of Purple Rain, in time for the 30th anniversary of both the album and the movie.
Although the full details of the deal were not released, it appears to have provided Prince with enough incentive to avoid litigation, despite his tumultuous history with the label. It’s also good news for Warner who is “very excited about the release of new and re-mastered music from one of [Prince’s] greatest masterpieces” and will likely profit handsomely.
What’s to Come?
As the right to terminate is entirely optional, artists have a decision to make. Generally, they can either:
(a) choose not to terminate the transfer of their copyright, do nothing and allow the termination window to pass;
(b) file a termination notice to try and recapture the rights to their work; or
(c) attempt to negotiate a deal with the holder of their copyright.
It will be up to each individual artist to decide. If the artist is open to engaging in a potentially lengthy legal battle, filing for termination to reclaim control of their music may be worth it. It seems to have worked for Willis. However, striking a potentially lucrative Prince-like deal with a record label may be more enticing.
Would you fight for the rights to regain your creative works or try to strike a deal with the label?
Contributing Authors: Domenic Romano & Shaliz Sadig