There is a powerful law causing quiet yet uneasy waves in the music industry, and it’s something the record companies would rather recording artists not know about.
For recordings released after 1977, the law is a section of the Copyright Act that allows recording artists to terminate their record contracts after 35 years. It also allows songwriters to terminate their music publishing deals after 35 years. It’s usually called copyright termination, but it’s not the copyrights that are being terminated, it’s the grant of rights to the record company that is being terminated. That old, awful record contract from 1980? Gone — at least as the contract applies to the United States. On the first day of the 36th year, the band owns the recording, free and clear. That is a very powerful position, to say the least.
The law is very particular – it only affects the U.S. copyright, and there are some notice forms that must be drafted carefully, signed by the proper persons, and sent correctly to the current record company or music publisher. Then the notice must be recorded in the U.S. Copyright Office in Washington, D.C. If done correctly, it can be a life-changing event for recording artists and songwriters, at least financially.
There is, however, a limited time to act. The artist must send a notice for a termination date within a five-year window (starting at the end of the 35 years), or the right to terminate is lost forever. That means that the record company keeps the U.S. copyright in the recording for the artist’s life plus 70 years. And the same is true of songwriters and music publishers. One chance, but sadly, many miss it. Why? Because the music industry wants to keep this law quiet.
Widely respected artists, including Todd Rundgren, The Turtles, Stephen Bishop and more, have used this law. This is because established artists, for the most part, have good music lawyers who know about this law and are taking full advantage of it. They use it as strong leverage to get a better deal going forward (and some cash up front, of course). And record companies are happy to make those deals, because they just can’t lose certain artists.
But other recording artists (perhaps, a rung or two below “major” artists), and, especially, foreign artists, do not take advantage of this law. Many have been left in the dark and do not have music lawyers on call, most do not have lawyers at all. Some are out of the business, and have moved on to other things. For instance, this law is practically unknown in the United Kingdom, home of countless beloved bands from the late 1970s and early 1980s. The right of termination is unknown outside of the U.S., even as a concept. No other country has copyright termination like the U.S. law, and British solicitors are particularly ignorant of this law or its effect. But the law applies equally to everyone, worldwide. It doesn’t matter if it’s a British band and signed a British record deal, or a German band signed to a French deal, they can still terminate the contract, as it applies to the U.S. copyright. And that is true regardless if the record was released in the U.S. at all.
The vast majority of recording artists and songwriters we’ve been in contact with have never heard anything about it. Some, however, do not believe it is real, and, remarkably, some even think it is some sort of scam. This can be expected; some artists have been not been treated well by record companies, and many feel powerless to do anything. Some have large, unrecouped balances – even after 35 years! – and currently do not receive a penny in royalties, and they never will. Fortunately, terminations wipe out those balances, and post-termination, the artists have the right to do what they want with recordings; they can sell them, license them to a label, or they can put the music out on their own. This is especially valuable with the rise of digital media platforms like iTunes, Spotify, and Pandora.
It is fairly obvious why the record companies and music publishers want this law to be kept quiet. ASCAP, BMI, and SESAC — the associations of songwriters and publishers — have done little to educate their members. In our research, we found one lonely article on the BMI site about the law, posted quite some time ago. There is no comparable organization acting on behalf of recording artists, unless one counts The Recording Academy. These groups say nothing because major labels and music publishers dominate their interests. Even many music lawyers, who are beholden to major labels and publishers for future deals, do not want to “rock the boat,” pun intended.
Time is short, for many recordings and songs. Currently, in mid-2017, we are losing the right to terminate for everything prior to mid-1979. On the other hand, we are coming up to some great music from the early 1980s for which termination is still an option. And we are just getting started. For many recording artists, members of a band, or songwriters, from that era, the time to act is now. This is the last chance to stick it to the Man.
Evan S. Cohen is a music and copyright lawyer in Los Angeles. Since 1985, he has represented recording artists, songwriters, heirs of songwriters, music publishers, and independent record labels, in a wide variety of litigation and contractual matters. He currently specializes in copyright terminations. He may be reached at http://www.copyrightterminationexperts.com.