Blood-sucking Universal pissed at musicians who want to reclaim ownership rights – after 35 years

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06 May 2019 | Eriq Gardner | The Hollywood Reporter

Universal Music Group has a ticking time bomb on its hands. The Copyright Act gives authors the ability to terminate a grant after a 35-year wait, and now there are hundreds of recording artists from the early 1980s who are looking to take advantage of this statutory provision to reclaim ownership rights.

Soon will come artists from the late 1980s aiming to do the same. And after that, artists from the 1990s will want to cancel copyright grants so as to enjoy more financial rewards from digitally distributed music.

On Friday, UMG set in motion its plan to defuse this bomb.

John Waite and Joe Ely are leading an attempted class action against UMG. They contend that in the face of termination notices, the music giant “routinely and systematically refused to honor them.”

The lawsuit aims to get a judge to reject all roadblocks and force UMG to stand down.

UMG has now submitted a motion to dismiss.

In a memorandum filed on Friday, the music company brings forth a series of contentions that will have the judge exploring largely untested ground.

For instance, take the fact that some recording artists including Waite and Ely do business through loan-out corporations. Doing so may have had tax advantages, but now UMG argues that plaintiffs can’t terminate copyright grants because technically, they aren’t the grantors.

Or take the issue of the clock.

It may be 35 years until a grantor terminates, but is that from the time the original contract was signed or is it from the time the work was published? When is the grant actually executed?

This so-called “gap grant” issue comes up when the contracts predate 1978 as that is when the termination provisions of copyright law went into effect. So UMG’s position is that since an artist like Ely made his deal in 1976, his later sound recordings are ineligible to be terminated.

The U.S. Copyright Office came to the conclusion that artists should still be able to terminate these gap works, but UMG asserts that as a matter of statutory interpretation, courts should decide and should hew to how the law was written.

UMG even invokes a recent Supreme Court opinion involving copyright registration to make the point that courts must follow the “plain meaning” of statutes. In other words, this is precisely the sort of issue that could spend years being litigated all the way up to the high court.

And that’s not the end of UMG’s bid to doom mass termination.

Many sound recordings were registered decades ago with “work for hire” notations. Under copyright law, if an employee creates something as a work for hire, that means the employer is deemed the author of the work. The work is thus ineligible to be terminated.

Here, UMG isn’t directly yet arguing just yet that these older sound recordings are work for hire. Rather, UMG says that the agreements provide that the sound recordings are works for hire, and true or not, any dispute over ownership is untimely. UMG invokes the Copyright Act’s three-year statute of limitations.

Here’s the full memorandum, which also gets into the question of whether there are defects in the termination notices in that they allegedly fail to fully identify what’s been terminated. This may also set up the next round of the fight. If the plaintiffs are able to get past the initial motion to dismiss, UMG will surely oppose class certification on the grounds that every instance of termination requires an independent factual analysis.

Original Link: UMG Fights Musicians Who Wish to Terminate Copyright Grants

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Universal Music Group (UMG) Posted Over $3 Billion in Streaming Revenue Last Year

Streaming continues to strengthen Universal Music Group’s bottom line.

Ahead of its proposed sale, Vivendi has posted a great profit from its subsidiary, Universal Music Group (UMG).  Now, the only question for would-be buyers is how long the soaring profits continue.

Across labels, record sales, publishing, merchandising, tours, and more, the company posted €6 billion ($7.2 billion) in revenue for the full year of 2018.  This represents a 10% increase over 2017 at constant currency.

Looking at the company’s 2018 EBITA (earnings before interest, taxes, and amortization), UMG posted €902 million ($1.1 billion).  This represents a 22.1% growth year-over-year at constant currency.

Breaking down key figures, the company’s record music revenue grew 9.8% to €4.8 billion ($5.5 billion).  Streaming and subscriptions accounted for the majority of this revenue, jumping 37.3% to €2.6 billion ($3.1 billion).

Other digital sales – mainly downloads – and physical sales plummeted 26.6% and 16.1% to €479 million ($541 million) and €949 million ($1.1 billion), respectively.  Licensing revenue rose 10.7% to €804 million ($908 million).

Music publishing revenue increased 14.5% to €941 million ($1.1 billion).  Revenue from merchandising and other decreased 1.5% year-over-year to €273 million ($303 million).

Vivendi also confirmed that it is working toward the sale of up to 50% of UMG.  At the start of 2019, the media conglomerate launched ‘due diligence’.  It will soon set a floor price.

Globally, UMG had every one of the top five tracks, the top four artists, and the top three albums on Spotify last year.  In addition, UMG artists occupied the top five positions and 14 of the top 20 positions on Apple Music’s Global Top 100 Songs 2018.

Drake, Post Malone, The Beatles, and XXXTentacion emerged as UMG’s top sellers last year.

Breaking down recorded music revenue, UMG brought in €2.2 billion ($2.5 billion) in North America, up 11.5% year-over-year.  The company brought in €1.6 billion ($1.8 billion) in Europe, up 5.5%.  UMG brought in €618 million ($698 million) from Asia and €153 million ($173 million) from Latin America, up 13% and 14.5%, respectively.  From the rest of the world, the company brought in €253 million ($286 million).

You can view the earnings release here.


06 Feb 2019 | Daniel Sanchez | Digital Music News

Will Sony Music and Universal Music Group willingly return copyrights to artists?

Two major labels have now come under fire in a New York courtroom.

Five musicians have filed two separate class-action lawsuits against Sony Music Entertainment and Universal Music Group (UMG) at the US District Court in the Southern District of New York.

The New York Dolls’ David Johansen along with John Lyon and Paul Collins filed the lawsuit against Sony Music.  John Waite and Joe Ely are taking UMG to court.

According to both lawsuits, Sony and UMG have violated Section 203 of the Copyright Act, better known as the ’35-Year-Law.’  The termination law states that creators who assign their copyright to a company or person have the right to reclaim their rights after 35 years.

In violation of that law, enacted in 1976, both major labels have allegedly refused to acknowledge Notices of Termination sent by the artists.

The actions, if successful, could seriously impact the catalog cash-cows enjoyed by the major recording labels.

Evan S. Cohen, an LA music attorney representing the artists, explained,

Our copyright law provides recording artists and songwriters with a valuable, once-in-a-lifetime chance to terminate old deals and regain their creative works after 35 years.  This ‘second chance’ has always been a part of our copyright law.

“Sony and UMG have refused to acknowledge the validity of any of the Notices, and have completely disregarded the artists’ ownership rights by continuing to exploit those recordings and infringing upon our clients’ copyrights.

“This behavior must stop.  The legal issues in these class action suits have never been decided by a court, and are of paramount importance to the music industry.”

Cohen also represents over one hundred recording artists who have sent major labels similar Notices of Termination along with Maryann R. Marzano, the LA attorney who successfully brought class-action lawsuits against SiriusXM and Spotify.  In addition, Blank Rome LLP’s Gregory M. Bordo, David C. Kistler, and David M. Perry will represent the artists against the major labels.

 

1970s-era musicians sue Sony, UMG to reclaim song rights

05 Feb 2019 |Jonathan Stempel| Reuters

NEW YORK (Reuters) – David Johansen, John Waite and other prominent 1970s musicians filed lawsuits on Tuesday accusing Sony Music Entertainment Inc and UMG Recordings Inc of improperly refusing to let them reclaim rights to songs they had long ago signed away.

The proposed class actions filed in Manhattan federal court said U.S. copyright law gives songwriters who bargained away their works on unfavorable terms a “second chance” to reclaim their rights by filing termination notices after 35 years.

But they said Sony and UMG have “routinely and systematically” ignored hundreds of notices, mainly because they deemed the songs “works made for hire” under their recording contracts and therefore not subject to being reclaimed.

The named plaintiffs in the Sony case are Johansen, formerly of the New York Dolls and who as Buster Poindexter recorded “Hot Hot Hot;” John Lyon, who performs as Southside Johnny; and Paul Collins, known for the Paul Collins Beat.

 

Plaintiffs suing UMG, a unit of France’s Vivendi SA, include Waite, formerly of The Babys and later known for his 1984 hit “Missing You;” and Joe Ely, a guitarist who has performed with The Clash, Bruce Springsteen and others.

Sony and UMG did not immediately respond to requests for comment.

The plaintiffs are represented by the law firm Blank Rome and by Evan Cohen, a Los Angeles lawyer.

“We represent well over 100 artists from the late ‘70s and early ‘80s who want to own their U.S. copyrights, but are being stonewalled by Sony and Universal after sending notices,” Cohen said in an interview. “In many cases, we are talking about artists who have never received royalties from the recordings.”

 

Both lawsuits cover recording artists who served termination notices effective Jan. 1, 2013 or later.

They seek injunctions requiring that the notices be honored, monetary damages and other remedies.

The cases are Waite et al v UMG Recordings Inc, U.S. District Court, Southern District of New York, No. 19-01091; and Johansen et al v Sony Music Entertainment Inc in the same court, No. 19-01094.

Reporting by Jonathan Stempel in New York; Editing by Tom Brown

 

 

 

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