Article: 2011 – A Review Of The Year
Articles / December 2011

Click here to download this article as a PDF file (.pdf) By Ben Challis This is my (personal) take on copyright and the business of music in 2011. A number of threads emerged, most notably the battleground over what (if any) responsibility Internet Service Providers (ISPs) and another web intermediaries should have for the infringing acts of their users – something considered by the US Ninth Circuit Court of Appeals in UMG v Veoh, by the British High Court in Newzbin2, The Australian Full Federal Court in the iiNet case and by the European Court of Justice in Scarlet v SABAM with legislation pending in Spain and the UK. A second thread was the future role of collection societies in monetising music copyrights and the potential for enhanced but streamlined societies – at least on a pan-European basis, And finally, IF music copyrights can be monetised in the digital age with the “can pay won’t pay” generation of users, then battles remain over who gets what share of the pie with artistes beginning to challenge the accounting practices of the recorded music sector in particular. It is no secret that music is important in almost everyone’s life, but the music…

Article: A Guide To Becoming A Lawyer In England & Wales
Articles / December 2011

A rough guide on how to become a lawyer written by Music Law Updates editor, Ben Challis. The ‘normal’ route to qualify as a lawyer in the UK – as a barrister or as a solicitor – is to firstly take a UK or other recognised university degree. A lot of students will take a law degree, but some students decide to become lawyers later on during their university course – this isn’t a huge problem, but those students who haven’t studied law have to complete an additional year studying for the ‘Graduate Diploma in Law’ (GDL) accredited by the College of Law. A degree takes THREE years. The Graduate Diploma in law would take a further ONE year for students who are not law graduates. So, providing you have a law degree – either a Bachelor of Laws (LLB), Bachelor of Arts in Law (BA), Bachelor of Civil Law (BCL) OR a Diploma in Law – you can then try to qualify either as a solicitor or a barrister: In very general terms, solicitors work in practices. Many solicitors work in ‘high street’ firms looking after legal matters such as family law, conveyancing, wills, property, trusts and criminal matters. Some…

Artist’s digital royalty beef with Universal will go to court
Artists , Contract , Record Labels / December 2011

CONTRACT Record labels, artistes A class action between a number of recording artistes and Universal Music over how digital royalties are calculated will go to court. A federal judge in California has given the green light for a class action lawsuit against Universal Music by a number of long established artists, led by White Zombie, Whitesnake, and the estate of Rick James. The music major had requested the case be dismissed.  The case will be a major test of how artiste digital royalties are calculated by record labels in the absence of specific contract wording:  The label would like to calculate the royalty based on the same accounting process as a normal (physical) sale – whilst artistes want a share of the income which will almost certainly be a substantially greater share of the revenues.  Almost all pre-internet contracts make no mention of digital releases beyond CD (and many predate CDs) let alone downloads and streaming and artistes have argued that because digital removes label’s manufacturing and distribution costs, the risks of sales are almost non-existent, and when a label makes its catalogue available to a service such as iTunes, it is actually a licensing deal and therefore the higher…

Calculating music live tariffs – did GEMA get it right?
Copyright , Live Events / December 2011

COPYRIGHT Live events industry By Monika Bruss writing on the 1709 Blog The press office of the Bundesgerichtshof (BGH) informs us that the copyright senate of the BGH has issued a judgment on the calculation of collecting society tariffs (BGH, 27 October 2011 – I ZR 25/10). In respect of indoor events, it is the established practice of German music collecting society GEMA to calculate the royalties it collects based on the size of the room where the music is played. To GEMA at least, it seemed logical enough to apply the same to outdoor events such as street fairs and Christmas markets. Accordingly, it took the size of the entire venue as reference point, from the first to the last stall or from the first to the last wall enclosing the space where the event took place. As such things go, the organisers of a number of such outdoor events disagreed with GEMA’s calculation methods. In their view, only the space where the sound from the stage can actually be heard should be taken into account. From that space, one should deduct the areas where visitors could not go, i.e. the stalls, the areas where they could not stay for more…

First ‘three strikes’ warnings go out in New Zealand
Copyright , Internet , Record Labels / December 2011

COPYRIGHT Internet, record labels The Copyright notices have been sent to internet services providers in New Zealand, with Telecom confirming it received 42 infringement notices. The notices were all sent out by the Recording Industry Association of New Zealand (RIANZ). Of the 42 notices received by Telecom, 35 were for the download of songs by Rhianna, six were for Lady Gaga tunes and one was for UK recording artist Taio Cruz. ISP TelstraClear has also confirmed that it received 27 notices from RIANZ, although the company would not say what copyrighted material the notices covered. Again, Internet provider Orcon received its first copyright notices, two months after controversial anti-piracy laws came into effect. The “three strikes” law requires internet companies to issue warning notices to customers suspected of illegally downloading copyright content – such as movies or music – if a rights holder requests it. After a third notice, rights holders can bring a case before the Copyright Tribunal, which can fine an offender up to $15,000. The law was passed in April and came into effect on September 1st 2011. http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10763131

STOP starts a war of words
Copyright , Internet / December 2011

COPYRIGHT Internet New cross party US legislation, The STOP Online Piracy Act, has set off heated arguments both for and against the new proposals. The entertainment industry is broadly on one side, supporting the law’s provisions. Against are an array of groups including advocates on behalf of individual and civil liberties, the technology industry and other pressure groups. The Bill was introduced by House Judiciary Committee chairman Lamar Smith (R-Texas). The draft legislation is set out as a bill “To promote prosperity, creativity, entrepreneurship, and innovation by combating the theft of U.S. property, and for other purposes.” SOPA (HR 3261) is an attempt to tackle websites and addresses that violate U.S. copyright laws but have no physical presence in the country. They key is to make offending sites invisible to US internet users – and to strangle their income. It requires Internet Service Providers block access to offending sites, and ensure search engines omit them from results. It will also require credit card and other financial services to block payments to them, and US firms from advertising with them. But opponents say that what SOPA doesn’t do is require is any kind of verification that the site is actually infringing…

Phonepayplus joins fight against online piracy
Copyright , Internet / December 2011

COPYRIGHT Internet PhonepayPlus, the body that regulates premium rate services (PRS) in the UK, is working with the City of London Police and IFPI, which represents the recording industry worldwide, to proactively prevent online copyright infringement. Under the arrangement, PhonepayPlus will be informed of named websites that are selling unlicensed music so it can inform the trade bodies representing phone paid services who will then distribute the details to their members.  This ensures individual phone paid operators will be aware of the illegal nature of any unlicensed websites that may approach them to provide payment services. Where PhonepayPlus is asked directly by IFPI or CoLP to assist with their investigations or preventative activity in relation to pirated music downloads offered using PRS, PhonepayPlus will act on such requests to the full extent of their powers. The details of these unlicensed services will be obtained by IFPI anti-piracy investigators who will supply the City of London Police’s Economic Crime Directorate with evidence of illegal downloads made from infringing sites.  The police will review this evidence and if a case is proven against a service they will notify PhonepayPlus of its details. Police officers have passed on the details of 24 infringing…

EMI v MP3 case judge clarifies his position
Copyright , Internet , Record Labels / December 2011

COPYRIGHT Record labels, internet The judge who oversaw EMI’s litigation against Michael Robertson and his MP3tunes.com service has responded to EMI’s response it submitted to his original ruling where he held that operating (or using) an MP3 locker wasn’t in itself an infringement of copyright and that MP3’s services were covered by the DCMA’s safe harbour provisions, providing MP3tunes.com operated a takedown system, blocking uses from sharing links to unlicensed content whenever a copyright owner complained although  Judge William Pauley was critical about the way MP3tunes.com’s takedown system operated, and of the fact Robertson himself had posted links to clearly unlicensed content.  EMI responded by asking the judge to reconsider some points, where the company argued he had got it wrong, and also to consider more fully what the deal was with pre-1972 recordings which are covered by state laws rather than federal law, and therefore arguably not subject to the DMCA safe harbor provisions. Pauley’s response rejects all of the major’s criticisms. On the pre-1972 issue, Judge Pauley says the safe harbor principles of the DMCA apply to all copyright works in America, oblivious of age, and even when the copyright protection comes from state and not federal law. …

Insane Crowd Posse face multiple sampling claims
Artists , Copyright , Record Labels / December 2011

COPYRIGHT Artistes, record labels CMU Daily reports that Insane Clown Posse are being sued by a company called Entity Productions, which controls the catalogue of Midnight Syndicate, an American group who specialise in gothic-esque instrumental music, often said to soundtrack horror films that never existed. Entity claims that ICP have used uncleared samples of Midnight Syndicate’s music on several of their tracks across three albums. CMU says that the music company first contacted the Insane Clown Posse and their Psychopathic Records label in 2009, after discovering Midnight Syndicate’s music had been used in a number of tracks on two albums by the hip hop duo’s side projects Dark Lotus and Twiztid, as well as on 2004 ICP album ‘Hell’s Pit’, but that it never received a response. Entity is seeking $2.1 million in damages.   www.thecmuwebsite.com

RIAA wants DCMA clarity from Congress

COPYRIGHT Internet, recorded music The USA’s The Digital Millennium Copyright Act (DCMA) has been criticised by many for being slanted far too much in favour of content providers, with the underlying suspicion that film, television, publishing and recording companies were effective in influencing the passage of the Bill. But now the Recording Industry Association of America is taking issue with the DCMA – or rather the US Court’s interpretation of the legislation – saying judges are far too favourable to Internet Service Providers, websites and even consumers. Jennifer Pariser, the RIAA’s litigation chief, told a US law conference: “I think Congress got it right, but I think the courts are getting it wrong,” adding “I think the courts are interpreting Congress’ statute in a manner that is entirely too restrictive of content owners’ rights and too open to [Internet] service providers. “We might need to go to Congress at some point for a fix,” Pariser added. “Not because the statute was badly drafted but because the interpretation has been so hamstrung by court decisions.” RIAA President Cary Sherman complained that the DMCA “isn’t working for content people at all” saying “You cannot monitor all the infringements on the Internet. It’s simply…

Indies look at EMI sale implications

COMPETITION Recorded music Pan-European indie label trade body IMPALA has announced it will formally oppose any attempt by Sony to buy the EMI music publishing company and/or Universal to buy the EMI record labels . Vivendi-owned Universal and the Sony Corp’s combined music assets – including wholly owned Sony Music and publishing JV Sony/ATV – are the two biggest music companies in the world, and IMPALA argues that the move would be detrimental to the music industry as a whole. Interestingly IMPALA seems less resistant to a Warners takeover, saying here that ‘remedies’ could solve any competition issues. The trade body has confirmed that it has asked the European Commission to investigate “all possible options to intervene” should Sony or Universal be successful in bidding for a sizable slice of the EMI business. IMPALA’s Executive Chair Helen Smith said “We have always said our position is no mergers without remedies and we know from 2007 that it is possible to find a solution which is far-reaching enough. Our problem with Universal, however, is that we believe it is simply too big already to be allowed to gain more power and we have the same concerns over Sony buying EMI publishing….

Saban looks for download compensation
Copyright , Internet / December 2011

COPYRIGHT Internet Torrrentfreak reports that the Belgian music royalty collecting agency SABAM has said that it will bill Internet Service Providers for allowing subscribers to play and download copyrighted songs. SABAM claims it is entitled to charge ISPs for compensation for illegal downloading by their users based on existing 1994 copyright law, and is demanding 3.4% percent of the monthly fee paid by subscribers. The legislation provides that authors should be paid for any “public broadcast” of a song – although whether a download is a ‘public broadcast’ is a moot point. In a recent blog o 1709 (4th October) we examined the US position, where the Courts have recently held that a download is NOT a public performance of a recorded work. Belgian ISPs, who are also involved in a longstanding legal battle with Sabam over a network piracy filter (Sabam v Tiscali), believe the demands of the music rights group make little sense with Torrentfreak reporting Belgacom spokesperson saying “It’s their interpretation of the law, but that is not legally justified http://torrentfreak.com/music-rights-group-bills-internet-providers-for-piracy-licence-11110/

Scarlet Extended SA v Société belge des auteurs, compositeurs et éditeurs SCRL (SABAM); Belgian Entertainment Association Video ASBL (BEA Video), Belgian Entertainment Association Music ASBL (BEA Music) and Internet Service Provider Association ASBL (ISPA) intervening
Copyright , Internet / December 2011

COPYRIGHT Internet “EU law precludes the imposition of an injunction by a national court which requires an internet service provider to install a filtering system with a view to preventing the illegal downloading of files.  “Such an injunction does not comply with the prohibition on imposing a general monitoring obligation on such a provider, or with the requirement to strike a fair balance between, on the one hand, the right to intellectual property, and, on the other, the freedom to conduct business, the right to protection of personal data and the freedom to receive or impart information”  Read more on the IPKat here  http://ipkitten.blogspot.com/2011/11/study-in-scarlet-todays-court-of.html  where Jeremy says “This blogger suspects that SABAM and other agencies will not shrink from seeking injunctive relief which requires filtering until they have first noted how carefully and narrowly the active part of the judgment has been drawn, how many invitations it appears to make in order to accommodate those who seek to modify their enforcement demands, and how the fate of the enforcement action may be contrasted with the approach taken in the British courts in Newzbin 2”  and the 1709 Blog here  http://the1709blog.blogspot.com/2011/11/will-copyright-owners-see-red-over.html Will it effect the decision of the High Court in London in Newzbin2? Maybe!…

Universal take on Grooveshark
Copyright , Internet , Record Labels / December 2011

COPYRIGHT Internet, record labels Wikipedia describes the US based Grooveshark as the “international online music search engine, music streaming service and  and music recommendation web software application, allowing users to search for, stream, and upload music that can be played immediately or added to a playlist”. But is it legal? Well, the World’s biggest record company thinks not. Universal Music Group has reportedly filed a lawsuit against music service Grooveshark over alleged copyright violations, saying that records show that senior management at Escape Media Group, the company which operates Grooveshark, had led an effort to upload more than 100,000 songs to the music service and claims to have supporting emails and documents, including evidence showing that staff members Sam Tarantino, Paul Geller and Ben Westermann-Clark uploaded 1,791, 3,452 and 4,600 unlicensed songs respectively. Many of those tacks would be presumed to be Universal tracks given the major’s market share in the recorded music sector. Universal is reported to be seeking the maximum in damages of $150,000 per infringing act. Whilst Grooveshark has negotiated direct licenses with EMI and numerous independent labels and aggregators it has no deal with Universal – but as the service allows user to upload music so UMG tracks…

PRS say “no change” to live rates
Copyright , Live Events / December 2011

COPYRIGHT Live events industry PRS For Music has announced that it has closed its consultation on the live music royalty rate, and that the royalties charged for popular music events in the UK will remain unchanged at 3% of ticket receipts. The society’s Director Of Public Performance Keith Gilbert said “As the organisation that represents the creators behind the music, it is right that we continually review our charges and approach, ensuring there is a fair balance between music users and creators. From the outset we made it clear that this was an open consultation, allowing us to genuinely evaluate if the current tariff structure was still relevant for today’s live scene. We received many helpful responses with feedback largely supporting the consultation process, regarding it as sensible to review after 20 years”. He continued: “Responses showed that since the last review the live industry had changed significantly with live music becoming a more professional enterprise and thriving mainstream leisure activity. However as the market has grown, so have the costs associated with putting on events. After a number of discussions and reviews it was agreed that that no changes should be made at present. We will continue to work…

German promoters look to neighbouring rights
Copyright , Live Events / December 2011

COPYRIGHT Live events industry The German Association of Concert Promoters (bdv) has said that it has applied to the German Patent & Trade Mark Office to set up a new collection society, Verwertungsgsgesellschaft fur Wahrnehmung von Veranstalterrecheten, to collect revenues it believes its members are due as a ‘neighbouring right’ under Section 81 of the German Copyright Act arising from recordings made at live events. It plans to negotiate with broadcasters, record labels and other users of live recordings to set tariffs to compensate event promoters. In January 2011 IQ magazine published an article by Dr Johannes Ulbricht, a German lawyer in Hamburg at Michow and Partner, about the German ‘neighbouring rights of the concert promoter’ – identifying these an overlooked potential revenue source from Germany where it seems possible that those who stage events which are filmed or recorded (anywhere in the World) could collect a payment if the recording of that concert is then exploited in Germany. http://issuu.com/gregiq/docs/iq_issue_33?mode=embed&layout=http%3A//skin.issuu.com/v/dark/layout.xml&showFlipBtn=true  and Audience: Issue 142  November 2011

Rhythmix spat ends amicably
Artists , Trade Mark / December 2011

TRADE MARK Artists So the X-Factors “Rhythmix” are now “Little Mix” and all is between the registered charity Rhythmix and Simon Cowell’s SyCo after the latter paid over £8,000 to compensate for the costs the charity incurred defending its registered UK Trade Mark and withdrew its Trade Mark application for the same name. http://www.bbc.co.uk/news/uk-england-15810194

Sugarland named in law suit after weather disaster
Health & Safety , Live Events / December 2011

HEALTH & SAFETY Live events industry Country duo Sugarland have been named as defendants in a lawsuit in the US relating to the stage collapse tragedy that occurred at the Indiana State Fair back in August when freak 60mph gusts of wind blew over the State Fair’s site just before the country act were due to perform in the event’s main arena, bringing stage rigging crashing to the ground on top of waiting audience members. In total, seven people died and over 40 were injured. USA Today had previously reported that over 90 people made claims against the State of Indiana, whose liability under State law is limited to $5 million in total. A handful of other legal claims have been against various other parties linked to the fair and the Sugarland performance, though the new lawsuit represents 48 parties and specifically targets the band and others associated with their show.  Interestingly the lawsuit notes that Sugarland’s contract with the State Fair’s organisers, negotiated by the Creative Artists Agency, specifically gave them the power to cancel their performance if there were weather concerns, and therefore the band and their associates are being held liable for failing to do so. One…