Disco-era artists able to take back track rights

If you lived through the disco era of the late 1970s, like I did, you probably recall it as a period that came and went in a flash. Some music we’d rather forget: “The Hustle” was that generation’s Macarena.

But in truth, a lot of music from then never really disappeared — bands still cover it, movies and TV shows license it and, if you’ve been to any recent wedding reception, you know that a lot of people still enjoy a disco groove. In the next few years, we’ll be seeing just how valuable that music is as a provision of the Copyright Act kicks in that allows creators of sound recordings to get their rights back from the record labels.

Specifically, Section 203 of the act permits authors, i.e. artists, to terminate grants of copyrights of recordings that were made on or after Jan. 1, 1978. The copyright grant can be terminated after 35 years, meaning that the first recordings will come available starting in 2013. The catch is that the rights don’t revert automatically: There are some complicated legal hoops to jump through, including a five-year window from which to get the rights back.

So why is this a big deal now?

Artists can start sending out notices anywhere from two to 10 years before they intend to terminate. You may have heard that the recording industry hasn’t had a great decade, so this stands to be a bit alarming. In a shrinking business, they are looking for all the revenue streams they can find, so catalog sales are all the more lucrative.

But musicians also have to grapple with the speed of change in the business, more so if they were are among the many one- or two-hit wonders of a generation ago.

The first termination notice to go out was for 1980 Lipps Inc. album that featured the song “Funkytown,” an end-of-the-disco era hit that sold more than 10 million copies. It’s lived on in the cultural firmament, through movies like “Shrek 2,” commercials for FedEx and Nissan and even a Shakespeare production in Sydney. An Areva Energy ad campaign was launched last month in which the London Symphony re-orchestrates the song.

Lipps performer and founder Steve Greenberg, who wrote and produced “Funkytown,” has a separate copyright stake as the song’s composer, so he naturally has an interest in obtaining the rights to the master recording, with notice served two years ago to Universal Music Group, the successor to Lipps’ label back then, Universal Music.

“At the time I didn’t know ‘Funkytown’ was going to be ‘Funkytown,'” says Greenberg, who recalls getting paid about $25,000 to produce the album that it was part of, “Mouth to Mouth.” He does remember being aware then that “sometime we will get it back, but that is pretty forward thinking for a young kid.”

Greenberg has helped keep the music out there: For the song’s 30th anniversary, for instance, he produced a “What the Funkytown” iPhone app.

His attorney, Kenneth Abdo of Lommen Abdo in Minneapolis, says that they have not received a response from the label, but “I’m not surprised,” noting that the labels have many other issues on their plate. His firm is helping other artists, like Kool & the Gang, discern their termination rights.

Yet many music attorneys with clients looking to exercise their termination right expect the issue to end up in court. While Abdo says that the case of “Funkytown” is relatively clear cut, given that Greenberg played such a central role in the song, it gets murkier when you try to define just who is as the “author” of a recording. Does that include all members of a band, the background singers, even instrumentalists?

“In and of itself it is complicated,” notes Lee Phillips of Manatt, Phelps & Phillips, whose clients include the Eagles, Barbra Streisand and Kenny Loggins. “It is much easier to deal with a case where it is a singer-songwriter. But you can have cases where there’s a whole band with eight people, where some members have died or the band has broken up.”The labels also aren’t expected to just fold and say goodbye to their trove, and instead may make the arguments that the recordings were “works for hire,” which are excluded from the termination rights. In 1999, the recording industry slipped in a provision to a piece of legislation that would have explicitly defined all recordings as “works for hire,” but after an outcry from artists, it was repealed. So just what defines a “work for hire” may be left to litigation.

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