Co-Writing, Works Made for Hire and Happy Birthday Bob

(collage by Gwil Owen)

 It's Bob Dylan's 80^th birthday, and I wanted to mark the occasion by reviewing the complaint in one of the strangest lawsuits I have seen in some time. 

 Late last year, it was announced that Bob Dylan had sold his catalog (including the writer's share of income) to Universal Music Publishing Group for approximately $300 million, one of the highlights in  the recent frenzy of catalog acquisitions.  Shortly thereafter, on January 20, 2021, Claudia Levy, the widow of songwriter/psychoanalyst/theater director Jacques Levy, filed suit against Dylan and Universal for breach of contract, alleging that the Levy estate was somehow due some part of the proceeds that Dylan received from the sale because of the fact that Levy co-wrote ten songs with Dylan, including the majority of the songs on Desire ("Isis" is a personal favorite).

 

None of that is surprising; contractual disputes occur all the time.  What intrigued me is that Dylan's co-writing arrangement with Levy was a "work made for hire" agreement where Dylan not only owned Levy's share of the copyright, but that for copyright purposes, Levy was Dylan's employee – with no ability to ever recapture his share of the copyright.  Even more surprising is the fact that the contract specified that Levy would receive only 35 percent of the writer’s share of income from the songs, rather than the traditional 50/50 co-writer's share.

 

  The complaint goes on to list a litany of complaints against Dylan and his associates, but I remain most fascinated by the whole work-made-for-hire concept.  It seems so foreign to any traditional notion of co-writing – although the history of the music business is full of examples of artists and performers making "unique" deals with their collaborators – this one is fairly new to me.  Oddly, Dylan's Motion to Dismiss the claim, which was filed in March, refers to the work-made-for-hire arrangement as "standard." Maybe these deals made more sense back in 1975.  I wonder if he had a similar arrangement with Sam Shepard? I will say that I agree with Dylan's attorneys that the complaint is without merit – the contract clearly gave Dylan the right to assign the copyrights and the deal doesn’t disturb Levy’s continued income stream.  It doesn't look as if the court has ruled on the. Motion  yet.  

 

 Anyway, happy birthday, Bob.  We're lucky to be living in the same time as you.  

 

 

 

 

 

Termination of Assignments in Sound Recordings, Works Made for Hire and The Need For Certainty

We are all looking for certainty in a world full of chaos.  One of the resources that I often turn to for reassurance is the 1976 Copyright Act, a roadmap to  a world where everything makes sense and if it doesn't make sense, at least it has a definition.  Except for Sections 203 and 302.

 

When the Copyright Act was amended in 1976, it provided for the first time for a termination provision which allowed authors to terminate earlier assignments of their works.  This right of termination is deemed inalienable (i.e. you can’t sign it away)  except in the case of a so-called "work made for hire," in which case the employer is deemed to be the author of the work for copyright purposes.  Like all important terms "work made for hire" is specifically defined by the Copyright Act: 

        (1) a work prepared by an employee within the scope of his or her employment; or

(2) a work specially ordered or commissioned for use as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation , as an instructional text , as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire. For the purpose of the foregoing sentence, a “supplementary work” is a work prepared for publication as a secondary adjunct to a work by another author for the purpose of introducing, concluding, illustrating, explaining, revising, commenting upon, or assisting in the use of the other work, such as forewords, afterwords, pictorial illustrations, maps, charts, tables, editorial notes, musical arrangements, answer material for tests, bibliographies, appendixes, and indexes, and an instructional text is a literary, pictorial, or graphic work prepared for publication and with the purpose of use in systematic instructional activities

Notice  that you don’t see the words “sound recordings”  in there. The big issue for years has been whether or not sound recordings can be deemed to be "works made for hire" and therefore, incapable of termination of assignment.  Every  recording agreement drafted after January 1, 1978 states that the sound recordings being assigned thereunder are, in fact, works made for hire.  But copyright practitioners have assumed that because the Copyright Act does not include sound recordings under the definition of works  made for hire, then they are no such animal.  The problem is that we have had no court decision on the issue-only anecdotal stories and rumors.  

That may be about to change. 

Recently, lawyers in New York have filed two class action lawsuits, one in which my friend, John Waite, is the lead plaintiff.  This is a suit against Universal Music Group.  There is a companion case filed against Sony which lists Southside Johnny as one of the lead plaintiffs.  In each case, the facts are similar.  The record artist sought to exercise their statutory termination rights only to be rebuffed by the record companies for a number of reasons.  

This caused the plaintiffs to seek declaratory relief from the court--  essentially asking the question "whether sound recordings can ever be considered 'works made for hire' as that term is defined by the Copyright Act because the definition set forth in Section 101 of the Copyright Act does not include sound recordings as being one of the types of works that can be a work made for hire."   and “whether the release of sound recordings that were created by a particular recording artist in "album" form, as is typical in the musical industry, constitutes a contribution to a collective work-or creates a "compilation" as that term is used in Section 101 of the Copyright Act, thereby transforming these sound recordings into "works make for hire".  

There are several important issues poised by these lawsuits but these are the most important.  I don't know the status of these cases but they appear to have major implications for the United States recording industry (it being understood that this is a function of U.S. Law and has no real application to the rest of the world).  I look forward to having a little more certainty and clarity on the issue regardless of the outcome.  

Sound Recordings: Termination of Assignments and Works Made For Hire

Attorney Wallace Collins wrote a great opinion piece in a recent issue of Billboard about the looming effect of Section 203 of the Copyright Act. This “obscure” section of the law recognizes an author’s right to terminate an assignment of copyright 35 years after the initial grant. The reason that it has been obscure up until now is that it won’t have an effect until 2013. The 1976 Copyright Act did not become law until January 1, 1978. Of course songwriters have been exploring termination issues with respect to old copyrights under the revised Section 204 (which applies to grants of copyright completed prior to January 1, 1978) for some time now.

The termination of assignments with respect to music publishing agreements will no doubt be handled in a fairly straight-forward manner, again, because publishers are used to creating fairly sophisticated arrangements with respect to the termination of pre-1978 copyrights. What promises to be more complex is the application of Section 203 to sound recordings. Anyone who has ever read a major label recording agreement (or a recording agreement modeled on a major label agreement) will recall that there is language in the agreement that states that every recording created under the agreement shall be deemed a “work made for hire.” Most people seem to know that a work made for hire is a work in which the “employer” is deemed to be the author of the work for copyright purposes and the original author has no right to ever terminate the assignment of the work. However, it is less well known that under the copyright act, the “work made for hire” doctrine applies to a limited number of works, and sound recordings are not part of this group. (Although for a brief period of time about a decade ago the recording industry managed to amend the Copyright Act to include sound recordings under this definition.) In other words, presumably, just because a record contract says that masters created under the deal are deemed works made for hire, this does not make it so.

The somewhat uncomfortable part is that none of this has been tested in Court yet, and won’t be tested for several years.

Section 203 provides that the author shall send a Notice of Termination “at any time during a period of five years beginning at the end of thirty-five years from the date of execution of the grant; or, if the grant covers the right of publication of the work, the period begins at the end of thirty-five years from the date of publication of the work under the grant or at the end of forty years from the date of execution of the grant, whichever term ends earlier.”

All of this seems extremely civilized, and as stated above, there is some precedent for this under the industry custom with respect to copyright in musical compositions. However, it is unclear how the record companies will react given their stated position that master recordings are works made for hire.

It is also unclear how the concept of derivative works and joint authorship will apply. For example, producers might begin to assert an authorship right in the sound recording at issue. Also, as many commentators have noted, U.S. law will not apply to exploitation of the recording outside of the United States.

Nobody really knows how this will all play out, but it will be an interesting time to practice law in the music business.