@hypebot: @bandcamp Reports ‘Stellar’ 2017, Indie Revenue Up 73%

[Editor Charlie sez:  Songwriters should note the increase in digital and physical sales and remember that the last rate hearing continued to freeze mechanical royalties on physical and permanent downloads at 9.1 cents minimum statutory–where it has been set since 2009 and will remain until 2022.  Inflation alone would peg that rate at 11 cents  today, if it hadn’t been frozen and increases for inflation just keeps the rate the same.  So what that really means is by freezing the rate at 9.1 cents in 2009, the rate has actually decreased for inflation.  That means that the mechanical rate has actually decreased by approximately 20% since 2009.]

Bandcamp is reporting a record year for 2017.  Here are some highlights:

  • Digital album sales were up 16% vs. a 20% industry decline)
  • Track sales up 33% vs. a 23% industry decline
  • Merch sales up 36%.
  • Growth in physical sales was led by vinyl (up 54%)  and CD sales up 18%

“Meanwhile, standalone music streaming companies continued to lose money in 2017,” the company wrote in a blog post chronicling its “stellar” year. ” The seemingly inevitable upshot of these two trends is that the majority of music consumption will eventually take place within the subscription rental services of two or three enormous corporations, who can afford to lose money on music because it attracts customers to the parts of their businesses that are profitable.”

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@robertblevine_: Legacy Artists File Brief in Lawsuit Against Pandora Over Pre-’72 Recordings

[Editor Charlie sez: Failing to pay pre-72 artists the digital royalties they are entitled to is another example of how Big Tech forces wasteful lawsuits–and cons the industry into false choices on “omnibus” legislation!]

A veritable supergroup’s worth of sixties musicians on Friday (Jan. 12) filed an amicus brief in a California lawsuit against Pandora for its use of sound recordings made before 1972, and thus not covered by federal law. Although the issue in the case — originally brought by Flo & Eddie, Inc., which owns the Turtlesrecordings, and currently before the California Supreme Court — is fairly obscure, the artists are anything but. The amici artists include Carole King, Melissa Etheridge and Doors drummer John Densmore; the estates of Hank Williams and Judy Garland; and companies like the Beatles’ Apple Corps., Grateful Dead Productions and Experience Hendrix.

At stake is whether, and how, non-interactive streaming services like Pandora need to compensate performers and labels for their use of older recordings that are still covered by state law. The music industry has also been lobbying for a legislative answer to the question, and the recently introduced CLASSICS Act (Compensating Legacy Artists for their Songs, Service, & Important Contributions to Society Act) would require digital services to pay for the use of recordings made before 1972. On Jan. 26, the Friday before the Grammy Awards, the House Judiciary Committee will hold a “field hearing” in New York on this and other copyright issues, according to multiple sources.

Read the post on Billboard

Nicole Haff & Cassie Daum: Timed Out and Tuned Out: The Forfeiture of Unclaimed Royalties and the Loss of Meaningful Access to Litigation Under the Music Modernization Act

[It was only a matter of time–the controversial Music Modernization Act is producing new legal analysis showing it’s not what it’s cracked up to be!]

On December 21, 2017, the Music Modernization Act of 2017 (H.R. 4706) was introduced in the House of Representatives.  The bill seeks to modernize the U.S. music licensing system by (1) creating a not-for-profit mechanical licensing and royalty collective to collect and distribute mechanical royalties from interactive streaming services, such as Spotify, Apple Music, Pandora, Google Play Music, Tidal, and others, (2) requiring Copyright Royalty Judges to establish rates and terms that would have been negotiated in the free market between a willing buyer and willing seller by examining economic, competitive and programming information, such as the rates that recording artists earn, and (3) changing the rate court procedure for ASCAP and BMI, the two largest performing rights organizations in the U.S., by randomly assigning federal court judges from Southern District of New York to each rate setting proceeding.

While many in the music industry welcome this bill, smaller publishers and musicians may be surprised to learn that several of the provisions in the Music Modernization Act may harm their interests.

Read the post on SGR Law

@musictechpolicy: Shocker: Is Spotify Lawyer Leading “Scholarly” Project to Create Fake Treatise?

The anti-copyright crowd have a few different ways to turn astroturf into deceptively scholarly work product.  One way is to take over otherwise credible brands to insert their own truthiness.

In a highly predictable move, the American Law Institute, a reliable old brand in the law, appears to have had some sudden interest in writing up a “Restatement of Copyright” treatise.  The ALI’s restatements of the law have been around a very long time, but they mostly deal with bodies of law that rely heavily on judge-made law such as agency, property or contracts.

The advantage of having a Restatement that says what you want it to say is that those toiling against artists and songwriters can cite it as an authoritative source in legal briefs, scholarly writings, amicus briefs, etc.  Handy, eh?

The ALI Restatement of Copyright seems to have been the brainchild of one Pamela Samuelson, she of the Samuelson-Glushko technology and policy legal academic centers–Silicon Valley’s answer to the Confucious Institutes.  The project is nominally under the watchful eye of Professor Christopher Sprigman, from whose intellectual loins sprang Spotify’s defense of “sorry just kidding” in the Bluewater lawsuit for Spotify’s alleged nonpayment of mechanical royalties.  Sprigman is trying to convince the court that mechanical royalties don’t exist, don’t you know.

The Restatement of Copyright has been on the horizon for quite some time as it takes a lot of effort to produce one of these treatises.  So naturally, one must ask–why the sudden interest at the American Law Institute in such a costly project that we’ve struggled along without for a hundred years or so?  You don’t suppose someone is…paying for the costs of this work?  And who might be interested in picking up the tab for the project?

Perhaps the same company that paid for five–count ’em–five–research projects by Professor Sprigman.  That we know of.

According to the useful “Google Academics, Inc.” database created by the Google Transparency Project, Google funded these articles co-written by Sprigman (two of which criticize moral rights):

Valuing Publication And Attribution In Intellectual Property: Sprigman, Christopher, Christopher Buccafusco, and Zachary Burns. “Valuing Publication and Attribution in Intellectual Property.” (2012)

What’s A Name Worth?: Experimental Tests Of The Value Of Attribution In Intellectual Property:  Sprigman, Christopher Jon, Christopher Buccafusco, and Zachary C. Burns. “What’s a name worth?: Experimental tests of the value of attribution in Intellectual Property.” (2013)

What’s In, And What’S Out: How IP’s Boundary Rules Shape Innovation:  McKenna, Mark P., and Christopher Jon Sprigman. “What’s In, and What’s Out: How IP’s Boundary Rules Shape Innovation.” (2016)

Experimental Tests Of Intellectual Property Laws’ Creativity Thresholds, Buccafusco, Christopher, Zachary C. Burns, Jeanne C. Fromer, and Christopher Jon Sprigman. “Experimental tests of Intellectual Property laws‰Ûª creativity thresholds.” (2014)

Innovation Heuristics: Experiments On Sequential Creativity In Intellectual Property:  Bechtold, Stefan, Christopher Buccafusco, and Christopher Jon Sprigman. “Innovation heuristics: experiments on sequential creativity in Intellectual Property.” Ind. LJ 91 (2015): 1251

And speaking of astroturf, what’s also interesting is that Sprigman appears to have filed comments in Copyright Office moral rights study that incorporated concepts in Google-funded papers and cited to one of them without disclosing Google’s funding as far as I can tell. (https://www.regulations.gov/document?D=COLC-2017-0003-0019).

So a perfect lawyer to advance the interests of Spotify, the savior of the music business and to gift the legal community with the Restatement of Copyright, a crystalization of his genius.

Lucky us.

Is it Time for the Inspector General to Review the Copyright Office’s Administration of Address Unknown NOIs?

If you haven’t been following the address unknown NOI debacle, you can get up to speed with my recent article on the subject for the American Bar Association Entertainment & Sports Lawyer.  If you have been following, you’ll know that the Copyright Office has accepted millions upon millions of address unknown NOIs that implicate repertoire from all over the world.

The punchline–if all a digital music service needs to do in order to claim they have a license to reproduce and distribute a song is send a notice to the Copyright Office is send a notice saying they can’t find the song copyright owner, how hard do you think they’ll look?  Particularly if they know that the Copyright Office won’t check?

And that is where the Inspector General comes in.  Formed by the Inspector General Act of 1978, there are 73 Inspectors General in the US government, including the Library of Congress (which is where the Copyright Office is currently housed).  There are also inspector generals for the Department of Commerce and the Department of Justice, two other branches where the Copyright Office might end up some day.

If there were ever a situation that cried out for review and investigation by the Inspector General, it is the address unknown NOI filings where Big Tech is running roughshod over songwriters.

For example, we did some spot checking on the NOI filings.  Remember, the address unknown NOI is only available if the copyright owner is not identifiable in the public records of the Copyright Office, notwithstanding the CO’s own position by regulation (for service of termination notices) that a search of the Copyright Office records and the ASCAP, BMI, GMR or SESAC databases would also suffice.

For example, here is an address unknown from Google for Sting’s song “Fragile” which supposedly was not identifiable in the public records of the Copyright Office:

Sting Fragile Google NOI

and here is the registration for “Fragile” in the public records of the Copyright Office:

Fragile Song Registration

Not only has the NOI for “Fragile” been served improperly, it raises the question of just how many other of the address unknown NOIs have been improperly served.  Even if we were to assume a 1% error rate (and I for one firmly believe it is much, much higher), that is 550,000 songs that have been improperly served.  While the assumption might be that only the obscure works would be included in these filings, the Sting example suggests that is not the case.

But–because no one is checking to confirm proper notice, that means that there is no protection against moral hazard and loophole seeking behavior by some of the biggest corporations in the world, including monopolists like Google and Spotify.  Since the Copyright Office refuses to do this work by fiat (see 37 C.F.R. § 201.18(g)), it logically falls to the Inspector General to determine both if the Copyright Office has behaved properly and also if the law is being properly administered to allow 55,000,000 (plus) songs to be exploited without compensation.

 

@neilturkewitz: Disruption, Fear and Slippery Slopes: Baby Steps in Building a Better Internet

The biggest story of 2017? To my mind, there is no contest — the broad emergence of an awareness that the irresponsibility masquerading as Internet freedom represented a threat to global societies and to cherished aspects of our humanity, and that a course correction was badly needed.

While recognition of the fact that rewarding lack of accountability would likely incentivize anti-social and illegal conduct took longer than it should have, such an awareness came to fruition throughout 2017. Whether motivated by concerns about sex trafficking or the prevalence of other internet-enabled crimes, fake news, foreign government interference in elections, monopoly or monopsony power, or the perceived political or cultural biases of platforms, the question at the end of 2017 wasn’t whether the current legal framework for platform responsibility should be amended, but how.

It became clear that the twin pillars upholding the current lack of accountability in the internet ecosystem — Section 230 of the Communications Decency Act and Section 512 of the DMCA, each of which was adopted at the dawn of the commercial internet, would need to be reexamined and a new framework established.

Read the post on Medium

Must Read: @zvirosen Critiques Florida Flo & Eddie Ruling: Another Season, Another Common-Law Copyright Opinion

This one from the Supreme Court of Florida, finding that Florida common law does does not recognize an exclusive right of public performers for the holders of common-law copyrights in sound recordings made before February 15, 1972.  The 11th Circuit certified a series of questions to the Florida Supreme Court…Instead of addressing these questions, the Court chose to address a reformulated question of its own, “Does Florida common law recognize the exclusive right of public performance in pre-1972 sound recordings?”

The obvious problem with this is that it fails to address whether pre-72 sound recordings are protected under Florida law more generally.  The Court notes (pp. 19-20) that Florida criminal law provides penalties against commercial bootleggers of sound recordings, but those criminal provisions do not impact a range of activity including noncommercial infringement.

This could be excused as judicial minimalism if it wasn’t central to the case – Flo & Eddie sued in Florida specifically because SiriusXM has servers there, and alleged that copying was ongoing on those servers in violation of their exclusive right of reproduction.

Read the post on Mostly IP History