Tuesday, September 16, 2008

History Repeats Itself in Recording Contracts

I'm reviewing a long history of agreements for a client who had a stellar career that spanned some sixty years. It's been very interesting to see how recording agreements evolved from the forties. This artist spent a significant amount of time with one label and I'm tempted to write a long article on the history of the recording contract - when and how royalty calculations evolved and how far many modern provisions have departed from their original intent.

However, another interesting thing I just noticed is how certain language dropped out for decades, only to reappear in our modern landscape. One particular agreement, dated from 1976, includes the following provision (I've substituted the label name with "Label"):
If, during the Term hereof, Label shall become entitled by law to receive royalties (or the like) on account of the public performance in the United States of records made from master recording recorded hereunder, then (unless such law shall provide for the direct payment to you, from a third party source, of any related royalties (or the like); or unless such law shall provide for Label to allocate such royalties as between Label and you in any specified manner, in which latter event, of course, Label shall comply therewith) one-half (1/2) of all such royalties received by Label with respect to (or attributable to) such records shall be retained by Label for its own account, and the remaining one-half (1/2) thereof shall be added to (and deemed to be) royalties accruing to you by Label hereunder.
In 1976, there was a hope that labels might get a performance royalty for sound recordings. It took nearly 30 years to get a performance royalty in digital performances, and the fight continues for terrestrial radio performances. However, it's interesting how this language from over three decades ago is once again relevant.