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By Spencer Trowbridge, Swider Medeiros Haver LLP

If you play in a band or are involved in creating or performing music, an understanding of certain legal principles will (a) help you protect the rights you have, (b) help you stay out of trouble (by not infringing others’ rights), and (c) make you aware of steps you can take today that may prevent certain problems from arising in the future (or that may at least put you in a much better position to deal with those problems, should they arise).  This article highlights some of the legal issues that are relevant to members of music groups.

What You Own: Copyright Law

The Copyright Act of 1976 gives copyright holders certain exclusive rights in works.  Musicians should note that the Copyright Act provides protection for both sound recordings and musical compositions (these are two distinct copyrights).  The exclusive rights belonging to copyright holders under the Copyright Act include the right to reproduce the work, the right to distribute the work, and the right to prepare derivative works based on the work.  Subject to certain statutory exceptions, if you are the owner of a copyright, others will need to obtain your permission before using your work, and, conversely, if you want to use someone else’s work, you will generally need permission first. 

Once an original work of authorship is fixed in tangible form, it is automatically protected under the law.  But, there are a variety of benefits to registering a work with the United States Copyright Office, including: (1) a presumption of ownership, (2) the ability to seek statutory damages (these may be much higher than the actual damages sustained) against an infringer, and (3) the ability to seek recovery of attorney fees in actions against an infringer.  In addition, you must have a valid copyright registration in order to file a lawsuit for copyright infringement.  It is always a good idea to register your works, and registration can be done online.

Your Name and Brand: Trademark Law

The Lanham Act provides certain protections for words, marks, and symbols used in commerce to designate the origin of goods or services. Unlike the case with copyrights, trademark protection does not arise merely through the creation of a mark, but instead develops as and when the mark is actually used in commerce.  In addition, there is state-level protection for trademarks (and the registration is easy and inexpensive).  However, like in the case with copyrights, federal registration will afford the rights holder with certain additional benefits.  For instance, once your name acquires federal protection, you are given nationwide priority of use (other than in territories where someone else has previously acquired and continues to hold rights to the mark), even in states where your band has not yet performed, sold merchandise, or otherwise used the mark.

If your band name (or business name) is owned by you and subject to nationwide federal trademark protection, you will be better-positioned to prevent others from using that same name in a manner that is likely to cause confusion in the marketplace.  This is an important right that will help you protect the goodwill and recognition that your band’s name has acquired.  Additionally, with the prominence of nationwide online music sales, securing federal trademark protection is more important than ever before.

The Band: Business Entities and Band Agreements

If your band has never legally formed any kind of a limited liability entity (e.g., an LLC, a limited liability partnership, a corporation, etc.), your band would likely be considered a general partnership under the law (whether your band considers itself to be a partnership or not).  This has important legal consequences.  For example, each band member can bind the band to agreements with others. In addition, each band member is personally liable for actions of the band (and other members) in the course of the band’s business.  Forming a limited liability entity may help limit liability to the assets of the band (as opposed to personal assets), provided that the band continues to effectively operate as a separate legal entity.  A business attorney can help you decide which entity-type is most appropriate for your band (including whether to form a limited liability entity) given the facts and circumstances of your situation.

In any event, it is a very good idea for most bands to have some form of a written intra-band agreement setting forth rights and obligations of the band members.  An intra-band agreement can, for example, set forth the royalty percentage each band member receives, the number of votes required for a band action, a procedure for addressing the situation where a member quits, a provision governing ownership of the band name if the band breaks-up, etc.  It is important that you address these types of things in writing early on, since it is much easier to work through them when everyone is on friendly terms, and it can help avoid disputes later on down the line.

Registering with Performance Rights Organizations

For musicians there are two important public performance rights.  First, owners of musical compositions have the exclusive right to publicly perform their musical compositions.  Second, owners of sound recordings have the exclusive right to publicly perform their sound recordings by means of digital audio transmission (e.g., streaming).

If you are a songwriter, or music publisher, you should consider registering with a Performance Rights Organization in order to collect certain royalties that may be payable for the public performance of your musical compositions.  In the United States, the three main organizations representing performance rights in musical compositions are ASCAP, BMI, and SESAC.  In addition, performers and sound recording copyright holders should consider registering with SoundExchange, a performance rights organization that administers royalties for certain digital public performances of sound recordings (e.g., non-interactive Internet-radio).

Contracts

The music industry is built on contracts.  There are a variety of contracts that a band may be presented with over the course of its career.  Some of the contracts that you may encounter include management agreements, recording agreements, performance agreements, distribution agreements, and merchandising agreements.

You should always get your agreements with others in writing.  While contrary to popular belief, many oral contracts are enforceable, it is often very difficult to prove the existence of an oral contract.  It is best to have a formal agreement in writing, setting forth the rights and responsibilities of the parties.  However, even a brief email exchange, outlining basic terms, may be significantly more beneficial than having no written agreement at all.

The signing of a new agreement can mark the beginning of a new chapter of growth for a band’s career, and it is natural to get excited when a company expresses interest in your music.  However, signing a bad agreement – or even a good agreement with the wrong company – can have devastating consequences. Therefore, you should always have an experienced entertainment attorney look over any agreement that you are considering signing, and you should be cautious about the people or companies with whom you enter into agreements.  To that end, while a newer, less well-established company may in some cases be able to devote more time and energy towards your band, you should be especially cautious about entering into agreements with people or companies that do not have an established track record of success.

Conclusion

As illustrated by this article, there are a variety of legal issues that are relevant to members of music groups.  Addressing certain issues, such as those mentioned in this article, early can help prevent problems from arising later on (when they are generally much harder to deal with).  An experienced entertainment attorney can be of great assistance in helping you work through these issues.

NOTE:  The information in this, and any other article on this website, is for information, discussion and academic purposes only and should not be relied on as legal advice.  Seek legal and financial counsel in your jurisdiction before acting on any ideas presented in this website.  This article does not create an attorney-client relationship.