The Art of Collaboration: Understanding Joint Ownership

What’s on the same level of greatness as a cheesesteak from Philly’s Pat’s King of Steaks or a pastrami sandwich from NY’s Katz’s Deli?  You know, that eye-rolling “oh yaa” moment right when you take your first bite.  How about a perfectly crafted song, one where the music, lyrics, and delivery create something that you not only hear, but feel?  If you have, chances are you experienced what we like to call a sexy collaboration (at least that’s what us lawyers call it as an attempt to be cool!).  The same way a chef uses the reputation of great dishes to generate business, so do musicians with great collaborations.  It’s the reason why some writers and producers are highly sought after, and others are…well not.  Throughout history, the act (or art) of collaborating has resulted in many of the most revered recordings (like Ella Fitzgerald and Louis Armstrong’s album Ella and Louis; David Bowie and Queen’s hit Under Pressure; and Kayne West and Jay-Z’s 2011 album Watch the Throne).  However, with any business venture (“they”, not us, call it the music business for a reason) there are caveats.  A big caveat, and the topic of this post, concerns the default rules provided by U.S. Copyright law and the need for well-drafted joint ownership agreements.

Relying on Default Rules

When working with other musicians, joint ownership agreements are not necessarily required.  U.S. Copyright law speaks to collaborations and offers insight (i.e. default rules) on the relationship between collaborators and their rights to the collaborated (or joint) work.  Section 101 of Copyright Act of 1976 defines a “joint work” as “a work prepared by two or more authors with the intention that their contribution be merged into inseparable or interdependent parts of a unitary whole.”  A common example would be a collaboration between a lyricist and a composer (the “authors”) in order to create a musical composition (the “work”).  Let’s apply some copyright default rules to this example and see what results.

  1. Ownership Rights: Under these rules, each author owns an undivided equal share in the joint work without regards to actual contribution.  In other words, both authors would own the work 50/50, even if the breakdown of contribution were different (say 25/75 lyricist/composer).
  2. Licensing Rights: These rules also allow one author the ability to license the joint work on a non-exclusive basis (i.e. the licensee cannot have exclusive rights to the work) without the permission of any co-author.  As a result, and provided that the licensee isn’t given exclusive rights to the work, one author can license the work for whatever use that author wants so long as it doesn’t disparage the work or decrease the works market value (even if a co-author is adamantly opposed!).
  3. Undivided Interest: Lastly, default rules provide that once the authors create a joint work, both will own an undivided interest in the work.  The practical consequences of this is if, for example, the composer wants to take his contribution from the existing joint work and use it to create a new work with new lyricist (a common practice in remixing), the original lyricist will have a claim (and potential ownership interest) in the new, derivative work. This is because the original lyricist owns a share of the composer’s contribution too, even though said lyricist didn’t contribute to that portion of the overall song.

These are pretty unforgiving rules that can create unintended consequences for the parties involved. For these reasons, we always strongly advise songwriters to draft a songwriter collaboration agreement…

Lose The Uncertainty, Draft A Songwriter Collaboration Agreement

If you’re a musician, who often collaborates, does what you just read make you a bit nervous about your next collaboration?  It should.  Default rules are meant to be just that: default.  They govern only when a written agreement is lacking.  As a result, they can easily be overridden.  One of the most common joint ownership agreements used between collaborators to override default copyright law is called a Songwriter Collaboration Agreement.  The following are some of the key terms to be negotiated within one of these agreements.

Division Of Income

Not all collaborations are created equal.  That being said, contributions made by each party can vary greatly.  Copyright law provides each author with an equal share, regardless of how much they contributed.  That shouldn’t sit well with you.  Let’s account for these variations, and negotiate and draft provisions that divide income according to each author’s contribution.

Rights To Exploit The Work

As mentioned above, under copyright law, each party has an undivided interest in the work, and can license out the work without the permission of any co-authors.  This default provision has the potential to lead to a variety of issues, especially when one author is firmly against a use for which another author is licensing the work.  A Songwriters Collaboration Agreement is the perfect place to address these issues and implement, for example, an “approval clause”, where one author cannot exploit the work without a majority or unanimous approval.

Use Of Individual Contribution

Similar to exploiting the work, the use of one’s own contribution is an area that might cause some problems.  As shown above, under default rules, a composer couldn’t take his contribution in an existing joint work and use it in new work without the possibility of the original lyricist claiming partial ownership in the new work.  In an agreement, this scenario can be discussed and provisions can be added that will protect (and potentially allow) an author to utilize its contribution to the original work in a derivative work and not account to any of the original co-authors.

Credit

Although not governed under copyright default rules, a joint ownership agreement is a great place to talk about credit.  Whether it is in promotions, closing credits, or reproductions (physical and digital), you should negotiate that you receive credit where is it appropriate and applicable. For example, credit can appear as “Co-written by ‘Your Name Here’”.

Work Made For Hire

This is the big-daddy provision.  The game changer.  If you are the main writer, are paying the other writers, or simply want to own the final product free and clear from any third party claims, a work made for hire is the best solution. It provides that any party, who agrees to provide their contribution as a “work made for hire”, relinquishes all rights to their contribution (and the joint work), and the entire work is owned outright by another.  Let’s look at an example.  Say you have a lyricist, a composer, band members, and a performing artist.  In this scenario, if the performing artist had all of the other parties sign a work made for hire agreement, the performing artist will be the sole owner of the work.

Collaborating will continue to be a medium through which great music is made, and copyright law will remain to fill in the blanks.  However, that doesn’t mean you should sit back and be content with default options.  The law allows you to tailor an agreement to your benefit.  So why wouldn’t you?  Take the time to recognize, negotiate, and enforce your rights.  You’ll be happy you did.

Written by Justin Traino, Summer Associate

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