Artists blast record biz in Senate hearings

NEW YORK — Singer Patti Austin left little room for ambiguity in her opinion of the way musicians are treated by their record companies under current California law.

“I was always taught that Lincoln freed the slaves,” Austin said. “I didn’t realize that recording artists were excluded from that group.”

Austin was one of a clutch of artists, lawyers and music industry execs testifying Wednesday before the California state Senate’s Select Committee on the Entertainment Industry in a hearing to vet what has become one of the biggest hot-button issues in the history of the music biz: the treatment of recording artists under the state’s “seven-year law” governing the lifetime of service contracts.

The debate, moderated in Sacramento by state Sen. Kevin Murray (D-Los Angeles), became a rallying point for a few musicians and singers, including Don Henley and Courtney Love, who have been battling what they perceive as systematic exploitation of artists by a rapidly consolidating music industry.

Recording Industry Assn. of America general counsel Cary Sherman, however, said the key issue was about honoring contracts.

“The bottom line of (artists’) testimony is that they want to be able to walk away from the contracts they negotiated and renege on the commitments they made,” Sherman said. “If that sounds unfair, it’s because it is.”

At the core of Wednesday’s debate was a change in the labor code made 14 years ago that artists say puts musicians at an unfair disadvantage to their labels in contract negotiations.

Amendment at issue

Under California’s labor code, someone contracted to perform a service cannot be bound to an employment contract for more than seven years. But in 1987, thanks in part to intense lobbying by the RIAA, the state penned an amendment to the law that allows labels to sue for damages if an artist doesn’t deliver the number of albums agreed upon within those seven years.

But artists and their advocates argued that such an amendment can tie an artist to a label deal for decades as he or she attempts to deliver albums on a grueling time schedule.

Henley, who co-founded the Recording Artists Coalition with fellow rocker Sheryl Crow, said that making, promoting and distributing a single album can often take up to three years, making it all but impossible to deliver the contractually standard six to eight albums in a seven-year span.

Love lost

Love, who is embroiled in a lawsuit with her label, Universal Music, agreed. “In seven years, I cannot make seven albums, because (the labels) will not let me,” she said.

Added Michael Greene, head of the National Academy of Recording Arts and Sciences, in his testimony: “I don’t know how you call it anything other than discrimination. While artists in other fields enjoy the protection of this code, we are left out.”

From the industry’s perspective, however, artists are hardly the only ones contributing and making sacrifices in a recording agreement. Roy Lott, deputy president of EMI Recorded Music’s North American operations, maintained that labels take on a crucial burden when putting their faith — and their money — behind an unproven act.

“Record companies promise to bear the entire financial risk for signing, developing and marketing artists. … The size of that risk is enormous,” Lott testified. “We pay significant advances to unknown talent, and still larger advances to established artists.”

Still, Love said the amount of profit a label can reap from a blockbuster act often dwarfs what the artist herself takes in.

“I’ve made more money for Universal than ‘Titanic,'” she claimed. “But are they even nice to me? No, they’re rude!”

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