Steve Weaver's Negotiating Exclusive Songwriting Agreements

I have been meaning for some time to write about my friend Steve Weaver’s book Negotiating Exclusive Songwriting Agreements.  This is not really meant to be a review because I am biased.  I reviewed Steve’s manuscript and was honored to write a blurb for the back of the book.

                What I said in my blurb is true.  There are so many worthless books on the music business and precious few books that tell you exactly what stuff means and how it works.  Steve’s book is a step-by-step analysis of an exclusive songwriting agreement,  meaning he analyzes each paragraph of the agreement from both the writer’s perspective and the publisher’s perspective and explains why each party asks for certain things and resists certain things.  This is really important information for anyone who is trying to get a handle on how these agreements are supposed to work.  One of the other things I said in my endorsement was that I wish this book had been available at the beginning of my career.   As a young lawyer, it really can be difficult figuring out how certain entertainment contracts are supposed to work and it can be difficult to know when you are asking for too much or too little. However, this book is not just for attorneys.  Anyone with more than a passing interest in music publishing can benefit from this book. The only other book that I have found as helpful as this is Randy Poe’s A Songwriter’s Guide to Music Publishing and I don’t know if it’s still in print.

                Steve has indicated that he hopes to write other books in this series “Entertainment Law Mentor” and I think he could do a great service  for the industry if he does write similar books on such topics as  recording agreements, producer agreements, manager agreements, etc.

                As Webb Wilder says “pick up on it.”. It’s available here as a Kindle edition: http://www.amazon.com/Entertainment-Law-Mentor-Negotiating-ebook/dp/B009INKQVS/ref=sr_1_1?s=books&ie=UTF8&qid=1353348800&sr=1-1&keywords=Negotiating+Exclusive+Songwriting+Agreements as well as in a physical format.

Read Those Old Contracts

I had a long conversation with a friend/client yesterday.  She mentioned that she had been reviewing some of her old publishing contracts and discovered that she was entitled to a reversion of some of the songs in her catalogs.  It is not unusual for songwriters, especially those who have been at this for awhile and have had multiple publishing deals to find out that there are elements of their contracts that they might not remember.

 Reversion clauses in contracts can be tricky because they are sometimes limited in terms of the amount of time the writer has to notify the publisher to exercise the reversion.

I can think of other types of reversions; for example some recording contracts may feature a reversion of masters and  all master license agreements essentially function the same way.  Again, the trick in all of these instances is that the artist has to take some affirmative action to get their materials back.

There are other dates to keep in mind. Old management contracts may contain sunset clauses-you don’t want to be paying commissions when it’s no longer required. Of course, all contracts have limitation periods after which one can no longer object to a statement or accounting.

Finally, as I have discussed before, with the coming onslaught of statutory terminations under the Copyright Act, keeping up with dates is going to be of more importance than ever before.

As a lawyer, I try to keep up with these important dates for my clients but it’s not always possible, especially when a client has changed attorneys, moved, etc.  Therefore, it is important for all artists to undertake this process-of going back through their old contracts.  You never know what you may discover.

The Indemnity Clause

Do you want to see a client’s eyes glaze over? Heck, do you want to see a lawyer’s eyes glaze over? Then spend a little time reviewing the indemnity cruise of a typical recording contract or music publishing agreement. Here’s an example:


Indemnity: Writer hereby indemnifies, saves and holds Publisher, its successors and assigns, and its parent, subsidiary and affiliated companies and its and their respective officers, employees and agents harmless from any and all liability, claims, demands, loss and damage (including, without limitation, reasonable attorneys' fees and court costs) arising from or connected with any claim, demand or action or by a third party which is inconsistent with any of the warranties, representations or agreements made or assumed by Writer in this Agreement which is reduced to a final adverse judgment or settled with Writer’s written consent. Pending the determination and/or settlement of any claim, demand or action which is inconsistent with any of the warranties, representations, covenants or agreements made or assumed by Writer in this Agreement, Publisher shall have the right, at Publisher's election, to withhold payment to Writer of any monies otherwise payable to Writer under this or any other agreement between the parties, and or any of their affiliates in an amount reasonably related to the amount of that claim, demand or action and the reasonably estimated amount of Publisher's costs, expenses or other damages in connection therewith (including, without limitation, legal costs and attorneys' fees). Upon the resolution of any claim, any monies withheld by Publisher as aforesaid may be used by Publisher to satisfy Writer's indemnity obligations hereunder and to the extent that the withheld sums exceed such indemnity obligations they shall be treated as additional Receipts. Publisher shall have the right, at Publisher's election and without limitation for any reason, to withhold and recoup and recover the amount of any and all costs and expenses (including, without limitation, legal costs and reasonable attorneys' fees) which are paid or incurred by Publisher or on Publisher's behalf to defend, respond to, negotiate or prosecute any claim, demand or action which is inconsistent with any of Writer's warranties, representations, covenants or agreements hereunder from any monies payable to Writer hereunder or under any other agreement to which Publisher or Publisher's affiliates are a party. Notwithstanding the forgoing, any amount so withheld shall be released if (and to the extent that) legal action shall not have been commenced with respect thereto in a court of competent jurisdiction within one (1) year following such withholding, it being agreed, however, that Publisher shall have the right to again withhold monies thereafter in the event such claim continues to be asserted, is reasserted or suit is later filed. Writer shall reimburse Publisher, on demand, for any payments made by Publisher at any time with respect to the actual amount of any claim, demand or action to which this indemnity applies. Writer shall have the right at Writer's expense, to participate in the defense of any such claim, demand or action with counsel of Writer's choice. The defense and settlement of that claim, demand or action, however, shall be controlled and determined in Publisher's sole discretion.


This is the clause, usually buried somewhere towards the end of the agreement that nobody wants to deal with but it is hugely important. Most people have some hazy idea of what indemnity means, informed perhaps by the classic film noir “Double Indemnity” rather than Black’s Law Dictionary. Nevertheless, here’s how Blacks’ defines indemnity “ A collateral contract or assurance by which one person engages to secure another against being damnified by the legal consequences of an act or forbearance on the part of one of the parties or some third person. Term pertains to liability for loss shifted from one person held legally responsible to another person”.

In plain English, this means that the indemnifying party assumes the responsibility for any legal consequences caused by their acts or warranties. The problem of course is that in its unmodified, un-negotiated form, the indemnifying party can be responsible for even all unsubstantiated or invalid claims asserted against the indemnified party. As everyone knows, anyone can sue anyone else for anything under the sun, so it is important to try and limit one’s exposure for all the various claims that can arise, especially those that are bogus.

I have always argued from an artist’s perspective that an artist should not be responsible for nuisance claims filed against a record company or a publishing company. At some basic level, those companies should be in a better position to absorb the cost of defending these claims as a cost of doing business. I have been involved in defending against many of these types of nuisance claims and while they are almost always dispensed with, the cost can be staggering.

The negotiation of this section of an agreement is always different and can head off in a multitude of directions. Very often, an artist can limit their liability to claims actually reduced to judgment or settled with their consent. The important part is to know what to ask for.

The Fray's Fray

I have been curious about the filing of a new lawsuit involving The Fray: King, Slade, Welsh and Wysocki v. Gregg Latterman and Gregg Alan Corp. in Federal Court in Colorado. The press reports made it seem as if the members of The Fray were suing their manager Gregg Latterman for somehow stealing all or part of their copyrights. However, after I reviewed the Complaint, I see that the cause of the action is much more subtle.

The manager in question is Gregg Latterman, a well-known entrepreneur, who, among other things, founded AWARE Records in 1993 and has been responsible for discovering and elevating a large number of talented artists over the past two decades. Apparently, Latterman had some sort of deal with EMI Music which gave him a share of EMI’s cut of income (and perhaps copyright interest) from any writer he brought to the company.

The suit alleges that Latterman entered into an oral management agreement with The Fray in November 2004 and helped sign the band to EMI in July of 2005. The suit claims that the oral management agreement was reduced to writing in 2007.

The suit DOES NOT claim that Latterman took any portion of the band’s publishing. Rather, it claims that as a manager, Latterman breached his fiduciary obligation to inform the band of his deal with EMI. The suit references a clause in the Management Agreement which prohibits the manager from commissioning any “engagement or agreement under which Artist is employed by or otherwise engaged by Manager or any firm or corporation owned by, controlled by or affiliated with Manager.”

As one would expect, the causes of action spelled out in the Complaint are fraud and misrepresentation, breach of fiduciary duty, unjust enrichment, fraud in the inducement and breach of contract.

As is often the case, I am sure the backstory is fascinating. It is rare that disputes break out in public involving people with profiles as high as this. I am sure that one of the real issues here is leverage. When The Fray entered into their agreement with Latterman in 2004, they had little bargaining power and were in need of someone connected enough to get them noticed by and then signed to a major label and major publisher. Once a certain level of success is reached, the dynamic often changes.

An interesting question raised by The Fray’s lawsuit is how much they really knew about the relationship between Latterman and EMI. In the pleadings, they claim they thought he was receiving a “finder’s fee” from the company, and that in fact may be the case, albeit a highly lucrative one. It does seem hard to believe that were not somehow on notice as to Latterman’s deal with EMI.

However, this is also a cautionary tale for managers who attempt to fill different roles in this new environment. Nearly every management agreement ever drafted contains the above-described language prohibiting “double dipping” and managers should not attempt to circumvent the effect of the clause; they should be upfront in disclosing these arrangements to their artists.

I am betting this case will settle quickly. But one never knows…