Why You Should Hire a Music Contract Lawyer

The Ins and Outs of a Music Contract

As an artist, songwriter, producer, or label, you are likely familiar with the different types of music contracts that exist in the industry. Recording contracts, publishing agreements, management contracts, performance contracts, merchandising licenses — it can all be overwhelming. These contracts are essential for creating the legal framework for the rights and obligations of all parties involved in a recording or other musical transaction. These contracts detail topics including , but not limited to, how royalties are calculated, who retains copyright ownership, who is entitled to income from merchandising, how expensive certain recorded costs are going to be, who is responsible for what level of expense, which party supervises in-studio recording, who has creative control over music and lyrics, deadlines for recording and release, as well as many other issues.

What Does Music Contract Lawyer Do?

The most important role of a music contract lawyer is to review contracts before you sign anything. Typically, the attorney will provide you with a written analysis of the contract, highlighting sections that are particularly favorable or unfavorable to you. If there are sections of the contract that are confusing, ambiguous, or vague, or if you simply don’t fully understand portions of the contract, then the attorney will also provide you with an explanation so you understand what the contract actually says. It is not uncommon for an attorney to negotiate on your behalf. Your lawyer will typically draft an addendum to insert desired terms into the contract or a rejection letter in response to the initial contract. In some circumstances, it may be appropriate for your lawyer to engage in more aggressive steps, like drafting a formal counter-offer. This may be especially important if you are involved in merger talks with another company or with the potential sale of your music catalog, as strong representation is essential. In certain circumstances, the attorney may negotiate other legal forms, such as a confidentiality agreement or a non-disclosure agreement, either on your behalf or with your company’s signed approval for the attorney to be authorized to act for your company. Of course, the terms of the contract analysis will vary from deal to deal. There is always a risk in making any legal agreement. A good attorney helps you avoid unnecessary risk. It is advisable to work with an experienced music contract lawyer to create a legally binding and enforceable contract that will stand the test of time.

Common Music Contract Problems

One of the primary issues that arises in music contracts is the definition of ownership and rights to songs. A song may be co-written and then, as the parties proceed, they forget to clarify the allocation of rights. This leads to disputes, particularly where one party has business connections that would allow them to profit more off the song than the other authors would. Settlements are usually worked out at the last minute, with the less experienced party coming to the table at a disadvantage. If both parties have music contract lawyers, this cannot happen. In addition, if one party tries to pocket the money from the song without sharing with the authors, a music contract lawyer can help resolve the dispute or take legal action to receive the necessary compensation.
A related issue is the selection of a particular arrangement of the song. A composer may expect that the initial arrangement is what will be used whereas the artist may have a different idea in mind. If these arrangements are not explicitly defined, then the composer may be left with no rights over their work.
Publishing rights are also a common source of dispute. When a song is copied, an original songwriter may be entitled to rights over the royalties. An artist may then have to profit off it or be forced to pay a fine.
Even in situations where two parties are working together to write a piece of music, they may later disagree about ownership. The parties may disagree about how much of the work was contributed. They may also have different expectations of compensation; one may expect more than the other and therefore pursue them after the fact.
With publishing rights, an artist may have background singers or musicians. Their relationship may be casual but the composer may demand royalties nevertheless.
Even with signed contracts, disputes can arise through misunderstanding. A music contract lawyer can then help get a better settlement.

Choosing the Best Music Contract Lawyer

The process for choosing the best music contract lawyer is not as cut and dry as you may think. Most of the criteria for other various types of lawyers does not apply to music lawyers in the same way. For example, music lawyers should always specialize in music industry, rather than entertainment law in general. Entertainment law touches on many different industries which may not even have anything to do with music, such as sports or television and movies. A lawyer that practices primarily in one of those areas probably won’t be as effective in negotiations or dispute resolutions has a lawyer that has focused solely on music.
Experience has a lot to do with how effective a music lawyer can be. As with most other lawyers, clients want to sign with someone who has proven themselves in the industry and shown the ability to negotiate well on their behalf. Probably the best way to find out if a music lawyer is right for you, or qualified to do the job, is through word-of-mouth and testimonials from other satisfied clients. You don’t just want to interview a music contract lawyer and go off of his or her word alone. Hiring a music contract lawyer can be risky, so taking the time to scope out a few referrals is crucial.

Music Contract Success Stories: Case Studies

In 2018, an independent artist approached our firm looking for help in reviewing a recording contract before signing. He was a relatively unknown and had agreed to a $100,000 advance from a major label for a new album. Our music contract lawyer reviewed the terms of the deal and made a few changes. When the artist insisted on retaining the rights to his first album that he recorded independently with another label, the label was agreeable to negotiating the point. Within that same year, out of nowhere the artist’s first independent album began gaining traction on streaming platforms and social media, quickly amassing a large following and garnering a record deal from an entirely different label. Had the artist moved forward with the first deal, the proposed agreement required him to write, record, and produce six albums over an eight-year term, essentially stealing away the rights to his extremely successful album. What is the takeaway? As your career continues to grow, so will your salaries. It is imperative to establish a strong foundation early on to ensure sure you are compensated fairly down the line.
We also worked on a case where a new record label sought out the services of a music contract lawyer to negotiate its first recording contract with an artist. The artist company was in the process of signing a contract with a different label when they met the new label. That new label made a better offer with more flexibility . The new label knew this, so the lawyer used this to negotiate a $100,000 signing bonus for the new artist – all because they had the foresight to hire a music contract lawyer. The label lawyer secured the client’s best interest by knowing exactly how to turn what some would see as a bad situation into a great deal.
Just a few years ago, an up-and-coming artist came into our offices to discuss her first recording contract. She was just coming off the Tour de France after being one of the main performers for a majority of the tour. This artist realized very quickly that she lacked the experience and acumen to negotiate a long-term deal with the record label. Her contract included all of the big issues: rights to distribute, exclusive performances, ninth-album right of termination (the list goes on). The artist came into our offices expecting to go through a lot of changes who we could protect her from the record company. However, after a few consultations we were able to turn her contract around in just two meetings. After these two meetings, the record company agreed to remove all non-negotiable clauses from the contract, which saved the artist from a lot of future financial stress (not to mention lawsuits), and the anxiety that comes with signing a contract that has no hope of being changed. Three other record companies expressed interest after our law firm made the agreed changes. The artist was ecstatic and became the next top bill board artist of the year.

What To Expect When Hiring A Music Contract Lawyer

The cost of hiring a music contract lawyer varies depending on the complexity of the project. Some lawyers charge by the project, while others charge by the hour. For less complex agreements, the cost might be between $300-$1,000 for the project. However, if you’re hiring a lawyer to draft or review a recording contract for a major record deal, the cost could reach up to $5,000 or more. Of course, trial or litigation work tends to be even more expensive than drafting work, particularly for a small case.
The most commonly used payment structure for agreements is an hourly rate. If you suspect you will need a lawyer’ help with any number of different projects in the short-term (i.e., you are working on releasing an album, but also negotiating a film licensing deal for your song), you may want to consider paying up front for what is known as a retainer. A retainer is a set sum of money given to the lawyer, from which the firm will deduct its hourly charges. The lawyer should provide monthly accounting of services performed and costs deducted from the retainer. Once a retainer drops below the amount agreed upon, the lawyer can require that the retainer be replenished at once. If you deposit too much money into the account, you may not receive it back.
Another option in music contract law cases is a contingency. In these cases, the lawyer receives a percentage of the recovered amount (usually 1/3) after his or her services are paid. Makeup artists and stylists generally work on a contingency basis, so even if a trial extends over several months or years, you will not be required to pay them until the end. However, if you lose the case, stylists generally require you to pay for at least one or two hours of their attorneys’ fees.
Multiple factors can impact the price of legal services. One factor is the location and reputation of the law firm or attorney representing you. A highly sought-after lawyer practicing in the heart of Los Angeles or New York, two of rock and hip-hop’s main hubs, is going to be more expensive than a Cowboys’ fan in Dallas. In this same vein, a small firm is not going to be able to keep up with a big firm’s rates.

Music Contract Law: What’s On The Horizon?

As technology progresses at an exponential rate, music contract law is adapting to emerging trends in the industry. With the rise of digital distribution, streaming services and social media promotion, the way artists and labels enter in their various contracts is changing, making it imperative to stay informed on all recent developments in the field. A music contract lawyer can help in explaining and navigating these artistic mergers more clearly.
While traditional music contracts have long been the gold standard from which deals are worked, these contracts represent the scattered revenue streams of the industry’s past. Streaming platforms such as Spotify, Pandora and Apple Music are already taking over aspects of music distribution previously relegated to the record labels. For example, Spotify largely handles its own marketing for up and coming artists. As a result, traditional marketing stipulations become less of a necessity as time goes on, leaving record labels to focus on their distribution roots.
The future of music contract law may also see a move away from asking for physical distribution rights to albums sold, as digital downloads become increasingly rare . For example, indie label Dashboard Records has broken ground on a new kind of music contract between a label and an artist. In this new contract, the label doesn’t ask for any revenue streams outside of licensing rights for the album’s music videos and background music compositions for TV and films and the band’s merchandise.
With the rise of social media, some indie labels are now focusing more on an artist’s online following than their physical album sales to determine how much they will invest in an artist and their marketing. This means that stipulations concerning an artist’s social media account may be far more common in contracts than they were only a decade ago.
In addition, music contracts are evolving to account for the widespread dissemination of music through social media. In many cases, creatives undervalue their rights in order to freely promote themselves through sites such as Facebook and Twitter, thinking they’ll get paid later. However, as music becomes more easily distributed through the internet, artists’ rights are becoming increasingly important, making it critical for many to consider protecting their rights where appropriate.