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Headliner Musicians Push A California Law To Equalize Bargaining Power

Thursday, Jan. 31, 2002

Copyright is the vehicle that makes it possible for an author or artist to sell his or her work as a commodity on the market. Without it, the artist risks losing all rights in the work by its mere publication.

But copyright and other rights in a work also present a risk to the artist, for they can easily be shifted by contract or operation of federal law to an employer instead. Thus, the problem plaguing print and music artists from the beginning has been how to obtain a fair price in the marketplace for their work, so that if copyright in the work must be shifted to an employer or corporation, proper compensation is paid to the artist for all of a work's exploitation.

Print authors have not done terribly well in finding such a balance; the publishing industry has the edge. Music artists, however, are on the move and may be able to fare better in the tug-of-war between artists and the industry. Measures such as a California bill that would end long-term recording contracts could give recording artists more of the bargaining power they deserve.

The Expansion of Work-Made-For-Hire

When I was in law school at the University of Pennsylvania in the late 80s, I had to choose a topic for my law review "note." A fiction writer as well as a law student at the time, I regularly attended various writers' gatherings and at one, I asked if anyone was having any legal problems that I might write about. The response was decided: work-made-for-hire contracts were the source of the writers' legal headaches.

I chose the topic and later learned that the 1976 Copyright Act had created a category of "commissioned" works made for hire. The earlier work-made-for-hire doctrine meant that an employer could gain all rights in its regular employees' creative works. But this new category went further: It meant that an artist could lose all rights in a work to one who was not an employer but simply someone who commissioned the artists to do a single work.

By 1987 when I was writing my note, the door that was opened by the 1976 Act had turned into a huge portal through which every freelance writer was being led to sign work-made-for-hire agreements for every contribution. This meant they lost all rights to the work in perpetuity. Meanwhile, publishers could simply stockpile such works, exploiting them or not at will. Even if the publisher never did anything with the work, the artist had no remedy.

The irony was that authors and artists had negotiated the deal for the relevant Copyright Act provisions. They had fought to keep the "commissioned" category out altogether, but they lost the fight; the industries succeeded in obtaining nine categories of commissioned works that could be designated as works made for hire. Unfortunately for freelance writers -- an amorphous, unorganized group -- the list consumes almost everything they do.

One might have thought this story would only repeat itself with musicians -- but it did not. The story of why recording artists have fared better than print authors in protecting their rights is an interesting one.

Mass Distribution and Its Consequences

Mass distribution is a positive good: it permits the artist to reach a greater and more geographically dispersed audience, and it provides creative goods to a wider community. Before the Internet, an individual artist simply could not achieve mass distribution without the intervening assistance of a music publisher. Artists were forced to enter into deals that were better for the record companies than themselves because it was the only way to touch the larger market. But times changed.

Enter the Internet, and then Napster -- and mass distribution with no intermediary was suddenly possible for virtually any artist. But unfortunately, artists could not benefit financially, because downloads were being taken for free.

In short, once the problem of mass distribution without intermediaries was solved, the problem of compensating artists arose. Artists now need to find ways to achieve mass distribution themselves, and slip out of the hammerhold of the industry.

A California Bill That Could Stop Long-Term Recording Contracts

These realities have not been lost on savvy music artists, including the likes of Sheryl Crow, Don Henley, and Carole King. All three were present this week to tout a bill recently introduced in the California legislature that would make it impossible for recording companies to insist on long-term contracts with recording artists.

Artists like Crow, Henley and King hope to break the grip of the recording industry just as actors and actresses broke the grip of the studio system -- through a rule that permits artists to be free agents, rather than, in their words, "indentured servants." They need this, because copyright law by itself is not enough to level the playing field, as print authors know only too well.

Copyright law gives artists a commodity, but it does not by itself create equality in bargaining power. Indeed, to the contrary, copyright law has been a tool for the recording industry to tilt bargaining in its direction. For example, the industry has imposed odious work-made-for-hire contracts that force even featured artists to bear the expense and burden of producing an album -- and it has done so even when it was clear such contracts should not be legally enforceable.

In 1999, the industry finally went too far -- enraging recording artists so much that they began to organize. That year, it managed to slip into the federal copyright amendments a provision stating that "sound recordings" could be commissioned works made for hire. Print authors know full well what this means: a swift shift of rights from artists to industry, with ever expanding numbers of works eligible for work-made-for-hire.

The Recording Artists Coalition and Its Agenda

As soon as recording artists understood what had happened, they took action. For recording artists, this dramatic change in the substantive law, made behind their backs, lit up opposition. Soon the "Recording Artists Coalition" was founded, which includes Crow, Henley, and King, among others.

The organization began with a strong success: It overturned the "sound recording" work-made-for-hire amendment. After that, it looked for other means of finding a better balance of power for the exercise of artists' rights. The California bill is their latest attempt, and a perfectly reasonable proposal. I'm sure the recording industry is regretting that it ever bothered to grab the apple of work-made-for-hire, a move that turned artists into activists against them.

Recording Artists as Free Agents

Given the Internet's capacity for mass distribution, making recording artists free agents should go a long way towards righting the wrongs of yesterday. But challenges still lie ahead. It is not enough for it to be possible for artists to mass-distribute their work as free agents; it must be profitable, too, and profitable for the artists, not just for industry.

The key question is whether artists can secure sufficient control and understanding of copyright-protection technologies to prevent free downloads and make pay downloads widespread. The recording industry is already trying out its version of Napster-for-pay, and it may work, but for artists to truly gain power, they should probably own a Napster-for-pay site themselves and run it without industry control or intervention -- and with their own copyright-protection technologies

Fortunately, artists have some time to organize, incorporate, and potentially start their own site or sites. The music industry's two recently introduced pay-for-play systems smell of antitrust violations. They are therefore likely to be caught up in litigation for years, if not decades.

There is no reason why copyright-protection technology must be in the hands of industry, and certainly no reason for the government to construct the market, either. Rather, artists ought to gain access to the technology to protect the copyrights that are rightfully theirs on work they have created in the first place.

The moment is now -- if recording artists can only mobilize and organize to seize it. And if they do, perhaps their example could lead the way for print writers who are still wandering in the desert of work-made-for-hire to mobilize, organize, and mass-distribute, too.

Marci A. Hamilton is the Paul R. Verkuil Chair in Public Law and Director of the Intellectual Property Law Program, Benjamin N. Cardozo School of Law, Yeshiva University. Her other columns on copyright issues may be found in the archive of her columns on this site.

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