This is a reposting of an original 2009 blog post. This post was the start of a project exploring songwriter contracts. I never finished the project and am reposting this original post to kick start the project anew.
Today I had the pleasure to meet with a few Nashville Songwriters at the Country Music Hall of Fame. I was there to offer my services in a pro bono clinic as part of the For All campaign of the Tennessee Bar Association (TBA). This clinic was co-sponsored by the TBA's Entertainment and Sports Law Committee and the Arts & Business Council of Greater Nashville's Volunteer Lawyers and Professionals for the Arts (formerly the Tennessee Volunteer Lawyers for the Arts).
One of the questions I received regarded the distinctions between the types of songwriter contracts. That got me thinking that I should post a quick outline regarding the the different types of songwriter contracts. This just scraches the surface. But I plan on building on this post in the weeks to come.
When a person speaks of a “songwriter agreement” or “songwriter contract” they are referring to a contract entered into between a songwriter and a music publisher. Music publishers, as many of you know, act on behalf of songwriters to get their written songs “cut” (i.e., recorded on an album). This is known as “plugging.” Publishers also take care of all the administrative work related to plugging. This can include registering songs with the U.S. Copyright Office, issuing licenses, and accounting for royalties.
There are several types of songwriter agreements. Generally they are
1. Single Song Agreements
2. Exclusive Songwriting Agreements
3. Co-Publishing Agreements and
4. Administration Agreements
Single Song Agreements
Under a Single-Song Agreement, the songwriter transfers copyright ownership of specifically identified song(s) to the publisher. These are “non-exclusive” agreements because there is no term. In other words, these agreements are simply a one-time “sale” where the copyright is transferred from the Songwriter to the Publisher. The songs must already be in existence and are specifically identified in the contract.
Exclusive Songwriter Agreements
The main difference between exclusive songwriter agreements and single song agreements is that in an exclusive songwriter agreement the songwriter is transferring to the publisher copyright ownership of all songs written during the duration of the contract. Further distinguishing these types of agreements from single song agreements is that under an exclusive songwriter agreement the songwriter usually receives an advance that is recoupable from future royalties.
Co-Publishing Agreements
Under a co-publishing agreement, two or more parties (usually the songwriter and their publisher) share ownership of songs. In the typical co-publishing agreement, the songwriter transfers partial copyright ownership to the publisher and retain part ownership either in themselves or in their own publishing company. The songwriter’s independent publisher will have administration duties under this type of contract. The provisions of co-publishing agreements are usually very similar to those of exclusive songwriting agreements.
The main difference is that the songwriter will receive both the songwriter’s share of royalties (usually 50% of net royalties) and a cut of the publisher’s share the royalties (usually 25% of the net royalties).
Administration Agreements
Administration agreements are service contracts between the songwriter (or writer’s publishing company) and a publisher or administrator. These type of agreements are usually, although not always, reserved for established songwriters. In an administrative agreement a songwriter will pay up to 25% of net royalties for the administrative services of a music publisher. The important distinction between this type of agreement and the other types above is that the songwriter does not transfer any copyright ownership to the publisher.
On and off over the next few months I will be highlighting issues and pitfalls regarding these songwriter contracts. For those of you who are unfamiliar with songwriters and music publishers I suggest you check out the Nashville Songwriters Association International.
Showing posts with label License. Show all posts
Showing posts with label License. Show all posts
Friday, December 16, 2011
Monday, September 21, 2009
Click Lit
This weekend I was listening to "Weekend Edition Saturday" on National Public Radio (NPR). Scott Simon was interviewing Slate Magazine's Dahlia Lithwick (click here for the full transcript). Ms. Lithwick, a lawyer by trade, is taking time off of her day job covering the U.S. Supreme Court at Slate to co-author a fiction novel in the "mommy lit" genre.
Besides the fact that I have long admired Ms. Lithwick's writing and reporting, there is nothing particularly noteworthy about an attorney writing a fiction novel, even an attorney of Ms. Lithwick's considerable writing prowess. What makes this work of authorship newsworthy is that Ms. Lithwick's collaborators--her numerous "friends" on the social networking site Facebook. According to her interview, she sends out Facebook posts asking for help and her Facebook friends to chime in and collaborate on the story. Their input ranges from naming central characters to plot development. She also posts each chapter for review and comment.
This is such an interesting new way to write a novel. It is like having a focus group help you write every chapter, every plot twist, every detail. As intrigued as I was by this new model of writing, I was drawn in more by the potential conundrum of who might own the copyright to the work.
According to the U.S. Copyright Act, 17 U.S.C.A. Sec. 101, a joint work is “a work prepared by two or more authors with the intention that their contributions be merged into inseparable or interdependent parts of a unitary whole.” When analyzing joint authorship, we typically apply the two-pronged joint authorship test where we look to (1) contribution and (2) intent.
Under the contribution prong of the joint authorship test each author claiming to be a co-author must have contributed sufficient independent original expression that could stand on its own as copyrightable subject matter. Therefore, those who helped name the protagonist's husband would not be considered a joint author.
The next prong of the joint authorship test is mutual intent: a joint author must intend that his or her contribution be a part of a joint work (i.e., they must be a willing collaborator with other joint authors). Because of the collaborative nature of asking for input, posting chapters for review and input, and editing based on these contributions it would seem that the application of this prong of the test favors joint authorship for those Facebook "friends" who are contributing some significant content that on its own would garner copyright protection.
Lastly, because the Facebook terms of use require each user to issue a license to all intellectual property posted, can Facebook publish this work?
This is a very interesting experiment indeed.
Wednesday, April 29, 2009
Pitfalls in Single Song Agreements
To continue my series of songwriter contract posts, I thought it would be helpful to discuss some of the pitfalls a songwriter might encounter when entering into a single song agreement.
As I stated last week, a single song agreement is the sale of a song or songs (in spite of the name, single song agreements can be for more than a single song) that are already written. Therefore, a single song agreement should contain a list of the title or titles of the song or songs that are governed by the agreement; this is the no-brainer part of these agreements and usually does not pose a problem. The corollary pitfall, however, is often not as easy to spot in a multi-page legal contract.
This corollary pitfall is usually found in a words like option, term, and exclusive. If a single song agreement is the transfer of songs that have already been composed, there should not be any options for yet-to-be-composed songs or songs that are not specifically enumerated in the agreement or addendum. It, therefore, seems to clearly follow that there should not be a term (the word "term" in the world of legal contracts refers to the length of time a contract lasts) or options for additional songs. Lastly, there should never be any language in the agreement that would make the songwriter's services provided exclusively to the publisher.
As I stated last week, a single song agreement is the sale of a song or songs (in spite of the name, single song agreements can be for more than a single song) that are already written. Therefore, a single song agreement should contain a list of the title or titles of the song or songs that are governed by the agreement; this is the no-brainer part of these agreements and usually does not pose a problem. The corollary pitfall, however, is often not as easy to spot in a multi-page legal contract.
This corollary pitfall is usually found in a words like option, term, and exclusive. If a single song agreement is the transfer of songs that have already been composed, there should not be any options for yet-to-be-composed songs or songs that are not specifically enumerated in the agreement or addendum. It, therefore, seems to clearly follow that there should not be a term (the word "term" in the world of legal contracts refers to the length of time a contract lasts) or options for additional songs. Lastly, there should never be any language in the agreement that would make the songwriter's services provided exclusively to the publisher.
Friday, April 10, 2009
Are Digital Downloads Worth More Than CD's?
The music industry watched with rapt attention the recent legal skirmish between musicians and their record labels over the payment of royalties. At issue in the Eminem royalty battle was the definition of digital distributions of music and what royalties should record labels pay to their musicians when consumers download digital recordings or ringtones. According to the pleadings filed in the case, the contract for the rap artist Eminem set royalty rates payable by Universal Music Group and several other labels for “records sold” at twelve to twenty percent of net proceeds and set royalty rates for “masters licensed” at a royalty rate of fifty percent of net proceeds.
The plaintiffs claimed that Universal Music Group failed to pay the full fifty percent of net proceeds from the digital downloads and ringtones of the Eminem catalogue of recordings. According to the plaintiff’s auditor, Universal owed them at least $650,000.00 in back royalties as a result of this breach of the contract. The jury disagreed and found in favor of Universal Music Group. Many in the industry have, therefore, declared the issue settled and began moving forward with the belief that a digital download is a record sale for the purposes of calculating royalties.
In spite of all of the attention the Eminem case has garnered, it is a relatively insignificant case. It has no precedential value for other courts, does not solve the definitional problem of whether a download or ringtone is a sale or license of music, and has done little in the way of adding contractual clarity or consistency to this issue.
New York entertainment attorney Brian Caplan, of Caplan and Ross, LLP, knows firsthand about the issues involved in defining a download or ringtone for the calculation of a musician’s royalty. Mr. Caplan is pursuing the same royalty claims found in the Eminem case in the class action lawsuit he filed on April 27, 2006 against Sony Music Entertainment. In Allman v. Sony BMG Music Entertainment Mr. Caplan is asking for damages in excess of $25,000,000.00 for clients such as the Allman Brothers and Cheap Trick among others.
In appraising his chances of success in light of the Eminem defeat, Mr. Caplan focused on two important points. “In the Eminem case, there was an amendment in 2004 to the recording artist contract that defined downloads as sales of albums.” According to Mr. Caplan no such language exists in any of the contracts at issue in his case. “You simply need to look at the agreements record labels have with companies like Apple. The consumer signs a contract with iTunes saying ‘I am a licensee and I acknowledge that iTunes does not own the master,’ and iTunes has stated that it is a licensee of major record labels granting to you, the consumer, a sublicense. If this is the case, then the musicians whose contracts do not specifically define a download as a sale, like in the Eminem case, are entitled to 50% of the net proceeds from downloads pursuant to their contracts.”
Mr. Caplan points to the February 6, 2007 press release from Steve Jobs, CEO of Apple Computers, Inc. In that press release Mr. Jobs stated that “[s]ince Apple does not own or control any music itself, it must license the rights to distribute music from others, primarily the “big four” music companies: Universal, Sony BMG, Warner and EMI.” In reviewing the agreement between Universal Music Group and Apple Computer, Inc. the trial court in the Eminem case stated that the facts suggest “that the agreement was a license.”
Mr. Caplan also points to the fact that “the jury verdict in the Eminem case, or any jury verdict for that matter, is not binding on other juries or other courts.” Precedents are “set by higher courts, not by juries” Mr. Caplan reminds us.
While the skirmish over Eminem’s royalties was not a defining moment in the music business, it was the opening salvo of what looks to be a protracted campaign on the part of musicians to collect more significant digital royalties from their financially strapped labels.
Due to the substantial amount of money at stake in this case, it will very likely go to trial and then be appealed. The resulting appellate ruling would create a legally binding precedent defining the parameters of the digital distribution model for a majority of recording artists for years to come. An appellate ruling of that magnitude would tip the balance of power in the recording industry in favor of the successful side of this dispute. If the musicians were to succeed, combined with the financial vulnerability of the record labels, this case could change the face of the recording industry to a more artist driven business model for years to come.
The plaintiffs claimed that Universal Music Group failed to pay the full fifty percent of net proceeds from the digital downloads and ringtones of the Eminem catalogue of recordings. According to the plaintiff’s auditor, Universal owed them at least $650,000.00 in back royalties as a result of this breach of the contract. The jury disagreed and found in favor of Universal Music Group. Many in the industry have, therefore, declared the issue settled and began moving forward with the belief that a digital download is a record sale for the purposes of calculating royalties.
In spite of all of the attention the Eminem case has garnered, it is a relatively insignificant case. It has no precedential value for other courts, does not solve the definitional problem of whether a download or ringtone is a sale or license of music, and has done little in the way of adding contractual clarity or consistency to this issue.
New York entertainment attorney Brian Caplan, of Caplan and Ross, LLP, knows firsthand about the issues involved in defining a download or ringtone for the calculation of a musician’s royalty. Mr. Caplan is pursuing the same royalty claims found in the Eminem case in the class action lawsuit he filed on April 27, 2006 against Sony Music Entertainment. In Allman v. Sony BMG Music Entertainment Mr. Caplan is asking for damages in excess of $25,000,000.00 for clients such as the Allman Brothers and Cheap Trick among others.
In appraising his chances of success in light of the Eminem defeat, Mr. Caplan focused on two important points. “In the Eminem case, there was an amendment in 2004 to the recording artist contract that defined downloads as sales of albums.” According to Mr. Caplan no such language exists in any of the contracts at issue in his case. “You simply need to look at the agreements record labels have with companies like Apple. The consumer signs a contract with iTunes saying ‘I am a licensee and I acknowledge that iTunes does not own the master,’ and iTunes has stated that it is a licensee of major record labels granting to you, the consumer, a sublicense. If this is the case, then the musicians whose contracts do not specifically define a download as a sale, like in the Eminem case, are entitled to 50% of the net proceeds from downloads pursuant to their contracts.”
Mr. Caplan points to the February 6, 2007 press release from Steve Jobs, CEO of Apple Computers, Inc. In that press release Mr. Jobs stated that “[s]ince Apple does not own or control any music itself, it must license the rights to distribute music from others, primarily the “big four” music companies: Universal, Sony BMG, Warner and EMI.” In reviewing the agreement between Universal Music Group and Apple Computer, Inc. the trial court in the Eminem case stated that the facts suggest “that the agreement was a license.”
Mr. Caplan also points to the fact that “the jury verdict in the Eminem case, or any jury verdict for that matter, is not binding on other juries or other courts.” Precedents are “set by higher courts, not by juries” Mr. Caplan reminds us.
While the skirmish over Eminem’s royalties was not a defining moment in the music business, it was the opening salvo of what looks to be a protracted campaign on the part of musicians to collect more significant digital royalties from their financially strapped labels.
Due to the substantial amount of money at stake in this case, it will very likely go to trial and then be appealed. The resulting appellate ruling would create a legally binding precedent defining the parameters of the digital distribution model for a majority of recording artists for years to come. An appellate ruling of that magnitude would tip the balance of power in the recording industry in favor of the successful side of this dispute. If the musicians were to succeed, combined with the financial vulnerability of the record labels, this case could change the face of the recording industry to a more artist driven business model for years to come.
Thursday, February 26, 2009
Statutory Warranty of Title and Copyright Grants
In my last two blogs I discussed contractual copyright warranties and their impact on everything from posting photos on Facebook to a singer/songwriter’s contract with their label and publisher. Contracts, however, are not the only place to find such dangerous warranty language regarding copyrights.
Article 2, § 312 of the Uniform Commercial Code (UCC), entitled “Warranty of Title and Against Infringement; Buyer’s Obligation Against Infringement”, creates a statutory warranty that “the title conveyed [in copyrighted works] shall be good, and its transfer rightful; and the [copyright] shall be delivered free from any security interest or other lien or encumbrance of which the buyer at the time of contracting has no knowledge.” The legislature of every state has passed a version of this provision. In Tennessee it can be found at T.C.A. § 47-2-312.
My first inclination upon reading this statute was to think that it was preempted by the Federal Copyright Act. But, upon further research I found several cases that state that neither the copyright act nor any other of the federal intellectual property laws preempts such application of state law to the grant of a copyright. See Pure Country Weavers, Inc. v. Bristar, Inc., 410 F.Supp.2d 439 (W.D.N.C.2006). Therefore, even if you are successful in eliminating such contractual language from an agreement, you may still face a state claim for breach of warranty.
Since all such exclusive grants of copyright must be in writing, the way to protect yourself or your clients from such a claim of breach of warranty based on § 312, is to include language in the written instrument that excludes such warranties. Article 2, §312(2) of the UCC allows for such warranties to be “excluded or modified only by specific language or by circumstances which give the buyer reason to know that the person selling does not claim title in himself or that he is purporting to sell only such right or title as he or a third person may have.”
Article 2, § 312 of the Uniform Commercial Code (UCC), entitled “Warranty of Title and Against Infringement; Buyer’s Obligation Against Infringement”, creates a statutory warranty that “the title conveyed [in copyrighted works] shall be good, and its transfer rightful; and the [copyright] shall be delivered free from any security interest or other lien or encumbrance of which the buyer at the time of contracting has no knowledge.” The legislature of every state has passed a version of this provision. In Tennessee it can be found at T.C.A. § 47-2-312.
My first inclination upon reading this statute was to think that it was preempted by the Federal Copyright Act. But, upon further research I found several cases that state that neither the copyright act nor any other of the federal intellectual property laws preempts such application of state law to the grant of a copyright. See Pure Country Weavers, Inc. v. Bristar, Inc., 410 F.Supp.2d 439 (W.D.N.C.2006). Therefore, even if you are successful in eliminating such contractual language from an agreement, you may still face a state claim for breach of warranty.
Since all such exclusive grants of copyright must be in writing, the way to protect yourself or your clients from such a claim of breach of warranty based on § 312, is to include language in the written instrument that excludes such warranties. Article 2, §312(2) of the UCC allows for such warranties to be “excluded or modified only by specific language or by circumstances which give the buyer reason to know that the person selling does not claim title in himself or that he is purporting to sell only such right or title as he or a third person may have.”
Monday, February 23, 2009
Warranties and Indemnification Language in Entertainment and Intellectual Property Agreements
To build on my previous post, I thought I would write about warranties and indemnity language in entertainment and intellectual property agreements. Many of my clients do not understand the significance of the warranty and indemnity language that is inevitably placed in recording artist contracts, exclusive songwriter agreements, and the myriad of other intellectual property and entertainment agreements. Many more don't know that indemnity clauses creates a duty to pay any losses or damages of the other party based on the warranty language.
I always advise my clients and teach my students that such language is an effective means of risk management. Smart people and well run business entities enter contractual relationships with slight trepidation. They conduct risk assessments and balance those risks against the possible rewards of the relationship. As we have all heard before, such a balancing of risk and reward requires us to ask ourselves: does the reward outweigh the risk? This question, however, is too vague to be of any real use. As any attorney has experienced, the masterful debater can always convince themselves of the answer they emotionally want to reach.
The better question to ask oneself is: Am I able and willing to absorb the loss? You must look to both your emotional position and your resources. That is why your investment adviser makes you plan your retirement strategy by deciding your (emotional) willingness and (financial) ability to tolerate market fluctuations.
So what does this have to do with warranty and indemnification language? Warranty and indemnification language directly impacts each contracting parties’ answer to the question “am I able and willing to absorb the loss” of this transaction.
Let’s look at this from a record label’s point of view. If a record label is going to invest in a band, provide them with A&R services, pay them an advance, spend money producing and shipping their albums, they want to limit the level of risk in all the areas they have control. Since they can’t control with any degree of certainty what the consumers will purchase, they will focus on all the variables of risk they can control. Warranty language allows the record label to allocate the risk to the band for such things as copyright and trademark infringements.
From the Band’s perspective this can be uncharted water. Let’s say that you are a member (say the drummer) in the band. Your band is about to sign a recording artist contract with a major record label. You want to record some of the songs your lead singer brought with him from his previous band. The label is insisting that you provide them with a license to these songs and warrant that such songs are free and clear of any copyright claims. The label also wants language in the contract that if they get sued for infringement on these songs, the band will be required to pay the label’s attorney fees and pay any judgment.
If your lead singer co-wrote the songs with another person and then granted the copyright to those songs to a music publisher in an exclusive songwriter agreement, you and your band mates had no right to give the label a license to property to which none of you, not even your lead singer, properly owns. You could be on the hook for any possible copyright infringement claims brought by the music publisher against the label. Indeed, you could be liable even if you did not have knowledge of who owned the copyright to the songs.
Can you see now how your answer to the question “am I able and willing to absorb the loss” of entering into a contract is impacted by the warranty and indemnity language?
The trepidation I spoke of before should lead you to ask questions of your lead singer before agreeing to any such contractual language. I would also ask to see the copyright registration or look it up myself on the U.S. Copyright Office’s website. If you don’t do your research, you are answering the question “am I able and willing to absorb the loss” of this transaction without the necessary information. Without the proper information, you might as well not even ask yourself the question in the first place.
I always advise my clients and teach my students that such language is an effective means of risk management. Smart people and well run business entities enter contractual relationships with slight trepidation. They conduct risk assessments and balance those risks against the possible rewards of the relationship. As we have all heard before, such a balancing of risk and reward requires us to ask ourselves: does the reward outweigh the risk? This question, however, is too vague to be of any real use. As any attorney has experienced, the masterful debater can always convince themselves of the answer they emotionally want to reach.
The better question to ask oneself is: Am I able and willing to absorb the loss? You must look to both your emotional position and your resources. That is why your investment adviser makes you plan your retirement strategy by deciding your (emotional) willingness and (financial) ability to tolerate market fluctuations.
So what does this have to do with warranty and indemnification language? Warranty and indemnification language directly impacts each contracting parties’ answer to the question “am I able and willing to absorb the loss” of this transaction.
Let’s look at this from a record label’s point of view. If a record label is going to invest in a band, provide them with A&R services, pay them an advance, spend money producing and shipping their albums, they want to limit the level of risk in all the areas they have control. Since they can’t control with any degree of certainty what the consumers will purchase, they will focus on all the variables of risk they can control. Warranty language allows the record label to allocate the risk to the band for such things as copyright and trademark infringements.
From the Band’s perspective this can be uncharted water. Let’s say that you are a member (say the drummer) in the band. Your band is about to sign a recording artist contract with a major record label. You want to record some of the songs your lead singer brought with him from his previous band. The label is insisting that you provide them with a license to these songs and warrant that such songs are free and clear of any copyright claims. The label also wants language in the contract that if they get sued for infringement on these songs, the band will be required to pay the label’s attorney fees and pay any judgment.
If your lead singer co-wrote the songs with another person and then granted the copyright to those songs to a music publisher in an exclusive songwriter agreement, you and your band mates had no right to give the label a license to property to which none of you, not even your lead singer, properly owns. You could be on the hook for any possible copyright infringement claims brought by the music publisher against the label. Indeed, you could be liable even if you did not have knowledge of who owned the copyright to the songs.
Can you see now how your answer to the question “am I able and willing to absorb the loss” of entering into a contract is impacted by the warranty and indemnity language?
The trepidation I spoke of before should lead you to ask questions of your lead singer before agreeing to any such contractual language. I would also ask to see the copyright registration or look it up myself on the U.S. Copyright Office’s website. If you don’t do your research, you are answering the question “am I able and willing to absorb the loss” of this transaction without the necessary information. Without the proper information, you might as well not even ask yourself the question in the first place.
Wednesday, February 18, 2009
Facebook Terms of Use
Welcome to my inaugural post. I hope you find my blog entertaining, informative, and interactive. My desire is not just to send my thoughts out into the world. I look forward to many engaging exchanges with those of you who are similarly interested in copyright and the music industry. As a practicing lawyer and professor of music business and law, I do not intend this blog to be geared exclusively toward lawyers or those with legal problems. I hope to draw many of my non-attorney colleagues from academia, the music industry, as well as all the other persons who own or use copyrights. That last group, as I will point out often, includes almost everyone--whether they know it or not.
This week I was drawn into a very interesting new event: a mass uprising of the Facebook nation. I have found Facebook users to be an extremely devoted (read obsessed) group. I was entertained to read and hear about how many of them became incensed at Facebook’s decision to take away their right to revoke the dangerously broad license they willingly granted Facebook to their photos,text posts, and even music. Facebook, being the responsive company that it is, immediately relented and reinstated such revocation rights.
To give you some contextual background, let me briefly explain. Prior to the change in its terms of use, Facebook members could revoke the license they granted to Facebook simply by removing the content from the member's Facebook page. That system, however, created a major problem for Facebook. You see, when a member removes their content from their Facebook page, the content very often remains as postings on other members' Facebook pages. The removal of such content by the member, while terminating the license, does not remove the content from the entire Facebook system. This creates unlicensed displays and reproductions of copyrighted material, both of which constitute possible copyright infringement.
Yet, what intrigued me most in the surge of dissent that followed this change was that the very same members seem to be perfectly happy to continue to grant a license that is overly broad and exposes them to possible copyright infringement suits. This is, in my opinion, just further proof of the obvious: people don’t read terms of use on the internet—even when they are protesting such terms. Considering the stakes of defending a copyright infringement suit (if you are unaware of such stakes Google “Capitol Records v. Jammie Thomas”) you ignore such legal agreements at your own peril.
My biggest issue with Facebook has always been that the terms of use are both too narrow and too broad to meet their expressed needs. The narrowness issue can now easily be seen in the current problem Facebook was attempting to address by taking away members’ rights to revoke the license. The problem of the content's license being revoked even when the content still exists on other members' Facebook pages clearly demonstrates the inadequacies of the Facebook terms of use.
What I have been waiting for, however, is the protest to extend to the breadth of the license and the warranty language. For example, many aspiring recording artists (both bands and solo artists) are now marketing their music on Facebook by posting their recorded songs. If such artist is also a songwriter who happens to have an exclusive songwriter agreement with a publisher, they do not own the copyright to the musical compositions they just licensed to Facebook. If you have done this, you have breached your contract with your publisher and your contract with Facebook
A more common example of this problem I have seen on many of my friends Facebook pages is when they post their wedding, graduation, and other event photos. Many of these photos were taken by professional photographers who retain their copyrights to the photos. Many of these photographers grant a license to post such photos on the Internet. But that is it--such licenses only allow the person to post the photographs for personal use on the Internet. Those licenses are very narrow. I have reviewed and drafted several such licenses and never have I seen or included the right to create derivative works or use such works for third-party advertising purposes.
Facebook, however, has always reserved the rights "to use, copy, publicly perform, publicly display, reformat, translate, excerpt (in whole or in part) and distribute such User Content for any purpose, commercial, advertising, or otherwise, on or in connection with the Site or the promotion thereof, to prepare derivative works of, or incorporate into other works, such User Content, and to grant and authorize sublicenses of the foregoing."
Facebook also requires members to warrant that they, the member, have the right to grant such broad rights to Facebook--and of course, often they do not. This creates potentially disastrous exposure to substantial liability for members. In the two examples above those members could face multiple copyright infringement and breach of contract suits from both their music publisher or photographer and also Facebook. All simply to market their music or share their wedding photos with some friends. Facebook needs to narrow their licensing language to meet the needs of the business's purpose.
Considering that the Copyright Act allows a plaintiff to recover statutory damages of $150,000.00 plus attorney's fees for willful infringement of a copyright, members should insist on a more tailored licensing regime.
This week I was drawn into a very interesting new event: a mass uprising of the Facebook nation. I have found Facebook users to be an extremely devoted (read obsessed) group. I was entertained to read and hear about how many of them became incensed at Facebook’s decision to take away their right to revoke the dangerously broad license they willingly granted Facebook to their photos,text posts, and even music. Facebook, being the responsive company that it is, immediately relented and reinstated such revocation rights.
To give you some contextual background, let me briefly explain. Prior to the change in its terms of use, Facebook members could revoke the license they granted to Facebook simply by removing the content from the member's Facebook page. That system, however, created a major problem for Facebook. You see, when a member removes their content from their Facebook page, the content very often remains as postings on other members' Facebook pages. The removal of such content by the member, while terminating the license, does not remove the content from the entire Facebook system. This creates unlicensed displays and reproductions of copyrighted material, both of which constitute possible copyright infringement.
Yet, what intrigued me most in the surge of dissent that followed this change was that the very same members seem to be perfectly happy to continue to grant a license that is overly broad and exposes them to possible copyright infringement suits. This is, in my opinion, just further proof of the obvious: people don’t read terms of use on the internet—even when they are protesting such terms. Considering the stakes of defending a copyright infringement suit (if you are unaware of such stakes Google “Capitol Records v. Jammie Thomas”) you ignore such legal agreements at your own peril.
My biggest issue with Facebook has always been that the terms of use are both too narrow and too broad to meet their expressed needs. The narrowness issue can now easily be seen in the current problem Facebook was attempting to address by taking away members’ rights to revoke the license. The problem of the content's license being revoked even when the content still exists on other members' Facebook pages clearly demonstrates the inadequacies of the Facebook terms of use.
What I have been waiting for, however, is the protest to extend to the breadth of the license and the warranty language. For example, many aspiring recording artists (both bands and solo artists) are now marketing their music on Facebook by posting their recorded songs. If such artist is also a songwriter who happens to have an exclusive songwriter agreement with a publisher, they do not own the copyright to the musical compositions they just licensed to Facebook. If you have done this, you have breached your contract with your publisher and your contract with Facebook
A more common example of this problem I have seen on many of my friends Facebook pages is when they post their wedding, graduation, and other event photos. Many of these photos were taken by professional photographers who retain their copyrights to the photos. Many of these photographers grant a license to post such photos on the Internet. But that is it--such licenses only allow the person to post the photographs for personal use on the Internet. Those licenses are very narrow. I have reviewed and drafted several such licenses and never have I seen or included the right to create derivative works or use such works for third-party advertising purposes.
Facebook, however, has always reserved the rights "to use, copy, publicly perform, publicly display, reformat, translate, excerpt (in whole or in part) and distribute such User Content for any purpose, commercial, advertising, or otherwise, on or in connection with the Site or the promotion thereof, to prepare derivative works of, or incorporate into other works, such User Content, and to grant and authorize sublicenses of the foregoing."
Facebook also requires members to warrant that they, the member, have the right to grant such broad rights to Facebook--and of course, often they do not. This creates potentially disastrous exposure to substantial liability for members. In the two examples above those members could face multiple copyright infringement and breach of contract suits from both their music publisher or photographer and also Facebook. All simply to market their music or share their wedding photos with some friends. Facebook needs to narrow their licensing language to meet the needs of the business's purpose.
Considering that the Copyright Act allows a plaintiff to recover statutory damages of $150,000.00 plus attorney's fees for willful infringement of a copyright, members should insist on a more tailored licensing regime.
Subscribe to:
Posts (Atom)