CMU Daily 30.09.16: Streaming deals too ambiguous for summary judgement in 19 v Sony, Ole buys Compact, Deftones launch a beer

Too much ambiguity in Sony's streaming deals for summary judgement on 19's sales v licence litigation, says judge
The long running sales v licence debate will continue in the US after a judge this week refused (in the main) to provide a summary judgement in either side's favour in the ongoing dispute between 19 Entertainment and Sony Music.

As previously reported, 19, which reps various 'American Idol' winners whose music was subsequently distributed by Sony, sued the major with various gripes about the way it was paying and reporting royalties. One of those gripes was the way Sony pays royalties on digital income, and how pre-streaming contracts are interpreted when it comes to sharing monies paid over by Spotify et al.

The way digital royalties are paid on pre-digital record contracts has been a long-running bugbear of the artist community that originally went legal as iTunes revenues started to boom ten years ago. Record contracts often pay different royalties to artists on different revenue streams, a common distinction being between sales income and licensing income, the latter often getting artists a 50% royalty, while on the former the label will pay out much less, often 15% on later pre-digital contracts, and even less on older deals.

Most labels treated downloads as sales, even though the record industry's contracts with the download stores were clearly licensing deals. Some labels argued that downloads were simply a digital replacement of physical discs, and should be treated as such in royalty terms, whatever the semantics of legacy deals may be. Others insisted that their arrangements with the likes of iTunes were distribution deals, or some other agreement that didn't use the word 'licence'. But, generally unconvinced by all that, a plethora of heritage artists - mainly in the US - sued for a licence royalty to be paid on downloads.

The landmark case in this domain was between Universal Music and early Eminem collaborators FBT Productions, in which the latter basically won the argument. A number of class actions against the majors followed, though these were in the main settled, with most artists accepting just nominal increases in the royalties they received on downloads, a long way off the 50% that would be paid on a true licence.

The fact that so many heritage acts seemingly accepted those slight increases arguably demonstrates a common problem for the wider artist community, which is that big rights owners will always be better equipped and better resourced to fight long and tedious legal battles, making lacklustre but quick-win settlements attractive on the artist side. Meanwhile, the assumption is that big name artists with the resources to go to court are usually offered more preferential deals behind closed doors that are then NDA-ed to the sky.

But that was downloads, what about streams? Isn't the argument that streams should be treated as a licence rather than a sale even stronger? Well, that's what 19 reckons, hence it included the sales v licence debate in its wider dispute with Sony Music.

This litigation has been working its way through the courts for a couple of years now. The judge overseeing the case said that 19's argument that the higher royalty should be paid on streams depended entirely on the wording of those secret agreements struck between Sony and the various streaming companies. To that end Sony was told to share those agreements with 19's lawyers.

At first 19 argued that the paperwork provided by the major was so heavily redacted, the matter couldn't be resolved. But after getting a second round of documents, 19 returned to court with refined arguments as to why a higher royalty should be paid on streams, while Sony again argued that streams are clearly a sale. Both sides then wanted a summary judgement in its favour based on those arguments.

Judge Ronnie Abrams denied those requests, in the main, in a ruling this week, concluding that most of Sony's streaming deals were sufficiently ambiguous in their wording that this dispute requires more court time. Which could, in theory, result in the specifics of 19's deals with Sony and, more importantly, Sony's deals with various streaming services being analysed in public at trial.

In this specific case the exact terminology under the spotlight isn't sales v licence. The question is whether or not Sony's streaming deals are about the sale or distribution of music - which would result in the artist getting the lower royalty - or the transmission or broadcast of music - which would result in the higher royalty.

The ambiguities often come from the fact that both sets of terms are used in the streaming deals. Sony argues that its deals only need to be in part about the sale or distribution of music for the lower artist royalty to be paid. Though there is then a debate over whether the word 'distribution' has been used in streaming deals in a specific copyright sense, or in a more general sense, especially if it mainly appears in section headers rather than specific contract terms. Basically, it's all a bit complicated, hence Abrams' reluctance to reach a summary judgement based on the submissions made by both parties to date.

There is seemingly less ambiguity in a small number of the stack of streaming contracts that have been reviewed by 19 and the judge, resulting in a few summary judgements being granted, some in Sony's favour and some to the advantage of 19. The latter includes one of Sony's deals with Apple, though it's unclear what that relates to - it could be the old iTunes Radio service rather than Apple Music.

Either way, it will be interesting to see how the core elements of this case now proceed. Whether or not any precedent can be set here that could apply to other artists will depend on whether there are any peculiarities in the wording of the deals between Sony and 19. Though if the dispute ever properly gets to court, just as interesting would be whether or not we would learn anything about the labels' streaming deals, so much of which has been hidden from the artists who are key beneficiaries of the agreements.

MIC says Congressional letter in support of BMI and ASCAP fails to deal with DoJ arguments around 100% licensing
The consent decrees debate continues. The MIC Coalition, which brings together trade groups representing American tech, broadcast and hospitality companies, has criticised the previously reported letter signed by eighteen members of US Congress urging the country's Department Of Justice to reconsider its position on 100% licensing.

As much previously reported, after reviewing the consent decrees that regulate US collecting societies BMI and ASCAP, the DoJ said that - under existing rules - the two performing rights organisations were obliged to operate a 100% or full work licensing system, as opposed to the so called fractional licensing approach they currently employ.

That would mean that where a song is co-owned by an ASCAP member and a BMI member, a licensee could make use of that song with either an ASCAP licence or a BMI licence, whereas previously a licence would be required from both. The licensee would then pay one society any royalties that are due, and it would be for the PRO to ensure both rights owners got paid their respective share of that money.

The music industry believes that the DoJ got it wrong on the 100% licensing point, and BMI took the matter to court, quickly winning a judgement in its favour. And this week, eighteen members of Congress signed an open letter urging the DoJ to alter its position on this issue, noting both the ruling in the BMI court action, and the fact the US Copyright Office disagrees with the DoJ on its interpretation of the consent decrees.

The letter concluded: "DoJ should take prompt action to limit the confusion and chaos [its ruling] creates in the market, and restore certainty to the efficient licensing by ASCAP and BMI of public performing rights for the benefit of all songwriters, composers and music publishers as well as music users".

But the MIC, which has already criticised the ruling in the BMI court case, says the Congress members who have signed this week's letter haven't countered any of the specific arguments put forward by the DoJ as to why it concluded 100% licensing is required under the current wording of the BMI and ASCAP consent decrees.

Says the Coalition: "After conducting a two year investigation, the Justice Department issued a meticulous closing statement setting out several pro-competitive arguments justifying its clarification that the ASCAP and BMI consent decrees require full-work licensing. Many of these pro-competitive outcomes serve to directly benefit songwriters, music licensees, and constituents in districts across America alike. Unfortunately, the member letter dispatched today fails to respond to any of those arguments".

This debate, we are sure, will continue.

Ole uses some of its new cash to expand audio-visual rights business
Fresh from securing that $500 million credit facility, Canadian music rights firm Ole has announced another acquisition, though this one expands the company's activities elsewhere in intellectual property, with new buy Compact Media mainly operating in the TV and movie space, albeit with a little bit of music royalties work on the side.

London-based Compact offers a range of services to rights owners, principally in the audio-visual domain, with particular expertise in the management of so called secondary or retransmission rights. The acquisition, says Ole, will bring it "added commercial, data and systems expertise in the space and complements our substantial, existing business in audio visual IP and AV secondary rights".

Compact will remain under its own brand following the acquisition, and will continue to be led by its CEO David Johnson. Compact employees in London, the US and Australia will become members of the Ole team.

Says Ole chief Robert Ott: "Ole is very excited to be adding Compact's global capabilities as a leader in the AV rights management space, and we look forward to bringing the increased benefits to our mutual clients around the world. David and his team have built a formidable business and we welcome them to Ole".

For his part, Johnson added: "Compact Media is delighted to be joining Ole. Over the last few years we have built up a loyal and varied customer base which we believe will benefit greatly from this new combination with Ole. The team at Ole has impressed us with the quality and breadth of their service offering which we think will provide an even better platform for us to serve our client base with the personal and expert levels of service they are used to".

Deftones to launch ale with Belching Beaver Brewery
Deftones have teamed up with the Belching Beaver Brewery in San Diego to create their own brand of beer, like all the bands do now.

Belching Beaver though. I really want to try a beer made by Deftones. But the brewery is called Belching Beaver. Even by ale standards, that's an off putting name, isn't it? Belching Beaver. "Hey guys! Come drink our beer - it tastes like a beaver belching straight into your mouth!" You might as well call it Farting Racoon.

OK, I think I've put us all off drinking any sort of beer ever again, but the fact remains that Deftones have brewed an ale with Sneezing Badger, or whatever it's called. It contains the following hops: mosaic, amarillo, simcoe and citra. All of them were hand selected by Deftones frontman Chino Moreno. Not sure what the rest of the band were up to while he was doing that. Stirring it with a drumstick, maybe.

The ale itself is called Phantom Bride IPA. Possibly because it will haunt you afterwards and make your vision look like you're seeing the world from behind a vale. Who can say? We're never going to try it, cos of that whole association with vomiting wildlife, or whatever.

Despite this, Moreno has tried to put a positive spin on the whole affair by saying: "Really excited to see our Phantom Bride IPA hit the shelves. As a huge beer connoisseur it was a privilege collaborating with Belching Beaver on the flavour profiles and coming out with a beer that I would put right up with any of my favourites. Good stuff!"

Nope. Well, if you fancy sampling the feeling of having an unwell beaver build a dam of twigs in front of your intestines, while a ghost lightly flicks lace at the back of your neck, and you happen to be in Fullerton, California at 8pm on 5 Oct, you can go along to the launch party at the Slidebar and try it yourself. Deftones will not be present. They know the consequences already.

BBC Radio 3 celebrates 70th anniversary looking to the past, present and future
BBC Radio 3 has launched a series of programmes and events to mark its 70th anniversary - having been launched as The Third Programme way back in 1946. The season will run for 70 days into December, kicking off with various broadcasts and live events at London's Southbank Centre.

As well as celebrating key moments from the station's history, the 70th Season will also hail where Radio 3 is today. In one such example of this, the station will have a composer in residence, Matthew Kaner, working on new music and talking about the process behind it for the full duration. It will also commission various composers to create new works based on the life of the station.

Commenting on the significance of BBC Radio 3 in 2016, and after 70 years of life, Controller Alan Davey told CMU: "Radio 3 remains a source of innovation and inspiration in music and culture, now more than ever. We are constantly seeking ways to connect our audience to pioneering music, to find what is new, whether it's new jazz, new classical, new world music, new poetry/spoken word, new drama or new ways of talking about music that was pioneering and innovative in its day. As music genres increasingly blur it offers us a chance to bring people to different forms of music in new ways and through other routes".

"As well as launching new shows and examining the music scene on the ground, we commission more new classical music than any other organisation", he continues. "We also have a huge commitment to jazz with four dedicated shows, and a world music show. Plus there's 'Late Junction', which offers a broad eclectic range of contemporary music, and was recently at the Serpentine Pavilion with a mix of accordion soul, post-punk and electronic music. Another key part of Radio 3's role is supporting new talent through schemes like BBC Introducing and New Generation Artists. But our commitment to music and new talent is not new, it's in our DNA and has been true of all of our 70 years".

Asked what pieces of archive material being revisited as part of the 70th anniversary might surprise listeners, he says: "I hope they'll be surprised at the constant questing for the new that we've displayed throughout our 70 years, and our playing about with the radio form - producing remarkable things like 'Under Milk Wood' through to the fact that many composers were given their first airing on The Third Programme/Radio 3. We've been constantly commissioning and broadcasting new work".

Other highlights from the anniversary programme include new radio dramas, a new show called 'Exposure' showcasing new music from various locations around the UK, and a whole day focussed on the BBC's various performing groups on 27 Nov.

For more on BBC Radio 3's 70th Season, click here.

Cliff Richard "pleased" with CPS decision not to prosecute him, announces new album
Cliff Richard has said that the final ruling not to prosecute him over allegations of sexual abuse is like "a cloud lifted". He commented on the Crown Prosecution Service's recent statement on the matter as he announced that he will release a new album in November.

As previously reported, earlier this week the CPS upheld its decision not to prosecute Richard over allegations of sexual abuse. The initial outcome of the investigation into claims made against the singer - that there was insufficient evidence to proceed - was challenged by two of his accusers.

Speaking on BBC Radio 2, he said that he was "pleased" with the decision and hopes it "brings this matter to a close".

Moving on, he announced that he will release his 101st album, 'Just... Fabulous Rock N Roll', on 11 Nov. The record features a 'duet' with Elvis Presley on 'Blue Suede Shoes', created using archive material approved by the Presley estate, and reflects, he says, "a happy, creative, and in many ways an innocent time".

Other covers on the album include songs made famous by Jerry Lee Lewis, Chuck Berry, Sam Cooke, The Everly Brothers and John Lee Hooker.

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Babymetal to star in animated series
Babymetal are to star in their own animated series, further adding to their continued awesomeness.

According to Deadline, the show will tell the story of a band (the band is Babymetal) fighting to save heavy metal from opposing forces. The show will also feature live-action performances from the band (still Babymetal), who enter the animated heavy metal world through a secret portal.

The show will be a co-production between Warner Bros Animation, and its Blue Ribbon Content studio, and Babymetal's management company Amuse Inc.

"Babymetal have to be seen to believed", says Sam Register at Warner Bros. "A mind-blowing, fun combination of pop vocals, heavy metal music and dance choreography brought to life by three incredibly talented teenage stars. We are huge fans here at Blue Ribbon Content and are extremely excited to help bring the Babymetal phenomenon to US audiences through this upcoming digital series".

I'm pretty sure Babymetal have already brought themselves to US audiences, but I guess there's always room for more. As previously reported, they'll be bringing themselves back to UK audiences by upstaging the Red Hot Chili Peppers repeatedly in venues across the British Isles in December.

Kate Bush to release 'Before The Dawn' live album
Remember when Kate Bush played all those shows at the Hammersmith Apollo back in 2014? Oh sure, yeah, I remember that it was a thing that happened. I have no recollection of any of the shows themselves though, as I didn't go. Maybe I should have, but by the time I decided that, there were only tickets for over £100 left. And given that no one has ever put on a live show worth more than £35, I didn't bother.

Anyway, I'll soon be able to get basically the full experience by listening to the live album that's about to come out. Titled 'Before The Dawn' - because that was the name of the show, and why would you change it now? - the record will be out on 25 Nov. People who like CDs will be able to buy it spread across three discs. On vinyl it will span four. Discs are fun.

You can see the full tracklist, listen to a song, and read a more aggrandising blurb here.

Katy Perry, DHP, The Voice, more

Other notable announcements and developments today...

• Katy Perry and Lionel Richie have renewed their agreements with US collecting society ASCAP. "ASCAP was in my corner before anyone knew who I was", says Perry. "Hello?" adds Richie.

• Live firm DHP Family has hired Ed Lilo, formerly Head Of Venues & Events for VICE UK, to be its Head Of Venue Programming for London. As previously reported, DHP now operates The Garage and Borderline venues as well as its original base in the capital, Oslo in Hackney.

• Tom Jones has confirmed that he will return to 'The Voice' as it makes its jump to ITV, having been replaced by Boy George on the last BBC series. Joining him on the judging panel will be Will.i.am, Jennifer Hudson and Gavin Rossdale.

• A surprise debut solo release from One Directioner Niall Horan called 'This Town' available to stream from your streaming stream of choice? Yes. Click here if your streaming stream of choice is Vevo.

• Producer Nevada has done what none of the rest of you have managed to and got Fetty Wap on a track with Leicester legend Mark Morrison. Here's 'The Mack'.

• Nick Cave And The Bad Seeds film 'One More Time With Feeling' will be screening in cinemas again from 1 Dec. Tickets will go on sale next Thursday.

• Fucked Up have released a new two track, 45 minute EP called 'This Mother Forever'. Check it out on Bandcamp here.

• A documentary about Japanese rock group X Japan, 'We Are X', will get its UK premiere at the London Film Festival next month. It was funded by the producers of the shittest music documentary of all time, 'Searching For Sugarman', but was directed by Stephen Kijak, who made 'Stones In Exile', 'Scott Walker: 30 Century Man' and 'Backstreet Boys: Show'em What You're Made Of', so it'll probably be alright.

• Ahead of her upcoming tour supporting Swans on tour in Europe, Anna Von Hausswolff has released a video for 'Come Wander With Me/Deliverance'. So that's the next eleven minutes of your life sorted.

• The previously reported gig organised by the Music Venue Trust to raise money for an 'Emergency Response' initiative to offer legal advice to grass roots venues now has a line up led by Everything Everything, Public Service Broadcasting and Ed Harcourt. It's on at The Roundhouse on 18 Oct. Now there's a line-up, tickets have gone up to £30. Tickets here.

• The annual Felabration celebration of Fela Kuti will take place on 7 Oct at the Electric Ballroom in Camden. Performing will be Afrikan Boy, Tiggs Da Author, Terri Walker and more, all backed by the Dele Sosimi Afrobeat Orchestra.

• Today in 'musicians doing things to try and get young Americans to register to vote', Pusha T is offering the chance to meet him backstage if you sign up to stop Donald Trump getting the keys to the US. Unlike Katy Perry and Madonna, he has not got naked. Though I suppose he might be naked when you meet him.

CMU Beef Of The Week #325: The Wolfhounds v Warner/Chappell
Everyone likes a good David v Goliath tale, right? Yes. Good. Well, here's one. Eighties indie band The Wolfhounds have been ripped off by Warner/Chappell for nearly 30 years. That's what the band say, anyway. And this week they launched a petition calling on the Warner music publisher to bloody well stop it.

Back in 1987, the band explain, they signed a publishing deal with Working Music, which promptly went out of business. Its catalogue - including their songs - was then absorbed into parent company Warner/Chappell.

Since then, the band claim, the publisher hasn't handed over any money or any royalty statements to any member of the band (all of whom were credited as writers), and at some point the major allegedly removed lead songwriters David Callahan and Andrew Golding from the credits of seven of their songs - including their biggest hit, 'The Anti-Midas Touch'.

Back in 1989, the band continue, they asked their solicitor to notify Warner/Chappell that they believed the publisher had breached their contract, and therefore they were demanding the song rights be returned to the band members. Though I assume you've all guessed by now that that did not happen.

"Through their own solicitors, Warner/Chappell claimed that none of our songs had ever earned any money", say the band of the 1989 correspondence. "Despite the fact that we had received payments from the Performing Rights Society for the songs, been played on the radio numerous times and played hundreds of gigs, all of which meant that royalties were coming in. The band has irrefutable documentary proof of this".

Still, the band split the following year and it all fell by the wayside. Then Callahan and Golding reformed the band with a new line-up in 2005 and started to question what the hell happened to their publishing all over again. In 2013, Callahan started trying to engage the publisher himself, to little avail. He then managed to get some legal advice last year, but that has come to nothing. Hence this here petition.

I'm not sure what good a petition is likely to do, but anything's worth a try, I guess. It might convince Warner/Chappell to at least clarify exactly what's gone on here.

A search of the publisher's database does show that Callahan and Golding's names appear on all but seven of their songs, as they say. Though, of course, we have no way of knowing if the duo were ever officially listed as co-writers on those seven works.

There could, for example, have been a data error from the start that only subsequently came to light, rather than Callahan and Golding actually having their names removed in hindsight. Look at me, being all reasonable and providing Warner/Chappell with an excuse.

And of course, just because the band received money from PRS doesn't mean they were due actual payments from the publisher yet. 50% of PRS income always goes direct to the songwriter, while the other 50% plus all MCPS money goes to the publisher for signed writers.

The publisher then shares that money with the writers subject to contract, and there's usually the matter of an advance to be paid off first. So when Warner/Chappell allegedly said the songs hadn't earned any money, they possibly meant enough money, ie to pay off the original advance.

Look at me, being all reasonable again and providing Warner/Chappell with yet another excuse. I should invoice for my time. Though none of that explains the alleged lack of royalty statements, which should set out how much income had come in (the publisher should have received at least the same PRS income as the writers) and therefore how much of any advance was still to be recouped.

But hey, I'm speculating here. Warner/Chappell have as yet not responded about the petition, so I'm relying wholly on the band's version of events and some very basic knowledge of how music publishing contracts usually work. Either way, the band are again demanding the return of their songs, as well the reinstatement of Callahan and Golding as writers on those seven tunes, and any unpaid royalties.

Though, alas, few of those things usually happen via a mere petition. It would be a simpler world if all disputes between artists and labels/publishers could be resolved by simply getting enough fans to sign a form, wouldn't it?

You know what petitions can achieve though? They can force people like me to tell you that The Wolfhounds have a new album coming out next month that you can pre-order now. Perhaps Warner/Chappell could start a petition demanding they assign the rights in those songs to the publisher too.