The very well funded Michael Geist and the US-backed Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic are really seriously barking up the wrong tree if Geist’s most recent op-ed is to be believed–although he’s already acknowledged “an embarassing math error“–but it seems that there is an embarassing copyright law error as well.
Apparently, there is a class action suit brewing in Canada against the major labels over pending and unmatched mechanical royalties, and class action counsel are—you guessed it, the US-backed Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic, the Alcan of IP. (Followers of the trade will recognize “Samuelson-Glushko” as a cabal of anti-copyright academics in the States that has recently begun exporting their brand to Canada.)
As Geist acknowledges “[He is] adviser to the Canadian Internet Policy and Public Interest Clinic, which is co-counsel [to the class action], but [he has] no involvement in the case. (I wonder if the “Canadian Internet Policy and Public Interest Clinic” is the same thing as the “Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic”? Why wouldn’t Geist use the full, glorious title in this important op-ed?)
Geist, like many others before him, makes a fundamental mischaracterization, or perhaps…a mistake. He seems to be confounding the “song” with the “sound recording”, that is the musical composition (©) copyright, controlled by publishers or songwriters, with the sound recording ((P) copyright), usually controlled by record companies but sometimes by artists.
Here it is: “[T]he names of the songs on the CDs are placed on a “pending list,” which signifies that approval and payment is pending. The pending list dates back to the late 1980s, when Canada changed its copyright law by replacing a compulsory licence [for songs] with the need for specific authorization for each use [of the song]…. Over the years, the size of the pending list has grown dramatically, now containing more than 300,000 songs.” (emphasis mine)
So far so good. Geist is still comparing apples to apples.
But now here come the oranges: “From Beyonce to Bruce Springsteen [who I don’t believe is even represented by CMRRA], the artists waiting for payment are far from obscure, as thousands of Canadian and foreign artists have seen their copyrights used without permission and payment…. After years of claiming Canadian consumers disrespect copyright, the irony of having the recording industry face a massive lawsuit will not be lost on anyone, least of all the artists still waiting to be paid.”
Notice what just happened—Geist just switched from talking about the copyright in the songs to the copyright in the sound recordings—songs have writers, recordings have artists. Totally different sets of rights. The compulsory license Geist refers to? Song not sound recording. Repeat after me: Songs have writers. Recordings have artists. Songs have writers. Recordings have artists. Songs have writers….
The point isn’t that the artists are obscure, the point is that for some reason—usually because the publisher hasn’t come forward—the label hasn’t paid the royalties they have accrued for the songs. This is, of course, a very important plank for the anti-copyright crowd to sustain because their “two wrongs make a right” attack on artists frees them to rob artists blind because “Hollywood” is already doing it. So once Hollywood has finished raking artists over the coals, it’s OK if file sharers and the Alcan of IP finish them off. Boy, that makes sense.
And here it comes: “[The potential for statutory damages] may sound outrageous, yet they are based on the same rules that led the recording industry to claim a single file sharer is liable for millions in damages.”They actually are not based on the same rules at all. Because of the bad advice that file sharers got from Geist’s fellow travelers, these people got no license at all and were defiant about whether they even were subject to licensing laws. Again, apples and oranges.
Yet, Geist doesn’t seem to care enough about his subject to actually get it right. I simply cannot believe that he doesn’t know better. That would such a shallow level of research that it is beneath the very well funded Canada Research Chair that he holds. Yet like so many other academics—starting with both Samuelson and Glushko–Geist has no idea how the business operates—and doesn’t take the time to find out. Geist’s lack of curiosity about the way things work also causes him to mischaracterize the number of pending tracks and also the number that have been paid.
This dynamic process causes the total number of pending tracks to change on a daily basis, and can only be determined on a snapshot basis with access to the actual accounts–which Geist doesn’t have.
Record companies and publishers just settled this issue in the US without incident, by the way–and also without the help of the US-backed Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic.
One can’t help but think that if the settlement is extended to Canada (which these things usually are), that’s going to knock a big hole in the plaintiff class which probably isn’t so good for whatever the US-backed Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic is getting out of the deal. So maybe that explains why Geist is getting worked up about the issue now.
Let’s remember that the issue in the case is the “pending and unmatched” mechanical royalties for songwriters that are sitting on the record company’s books. Here’s what actually happens:
Artists typically have the contractual obligation to obtain mechanical licenses for every song they record. Record companies pay the mechanicals for the records they sell under the terms of these mechanical licenses. As an accommodation to their artists, record companies usually undertake the licensing process, but the obligation lies with the artist in 99% of the cases.
Artists also grant mechanical licenses in songs they write, and those licenses are granted under their artist agreements. However—artists frequently co-write with others who “outside” (meaning not a member of a group artist) and may “cover” songs written entirely by others. The artist may or may not provide their record company with complete information (percentage ownership, name of co-writer and contact information for the co-writer). This is the inception of the pending and unmatched mechanical royalties.
The way these matters typically get resolved is when the big licensing authorities—CMRRA in this case—review payments from the record companies, make demands and/or settle these claims. (CMRRA also exercises its audit rights occasionally.) This is particularly appropriate in the case of CMRRA because unlike the Harry Fox Agency, CMRRA represents 90% or so of all writers and publishers in Canada.
That’s really it. If the pending songs become millions of dollars, there’s really only one entity to look to—the publishers. The pending doesn’t get to be millions because publishers are diligently looking for the money. Not only should the publishers look for their money, the writers who are not published can rely on CMRRA to collect their money, or they can go after it themselves.
Here are some typical reasons why songs end up in the “pending and unmatched”:
Some but not all of the writers have been identified by the artist and the producer;
One of the writers has agreed to license 100% of their undivided interest;
The artist has identified all of their co-writers but one or more of the co-writers have not responded to a request for a license;
The artist has identified all of the writers, but a writer’s publisher has not yet responded to a request for a license;
The artist’s co-writers have not responded to an advice letter;
The writer cannot be found (particularly true with songs that are old but are in-copyright);
There is a sample that was discovered after the release and the owners of the copyright cannot be found; and
Publisher disputes over splits or ownership (big publishers may have as many as 100 subpublishing groups (not to mention co-publishers).
If the artist’s recording is released on a major label and many independent labels, the label accrues a royalty at the statutory rate or the music publishing mechanical in Canada and when the writer is found or the agent for the writer settles an audit covering the pending work, the writer is paid.
This is essentially what just happened in the US.
The idea that Michael Geist—someone who works tirelessly to undermine copyright everywhere he can—is somehow a friend to artists or to songwriters is simply a pathetic joke.
The idea that Geist is trying to twist David Basskin’s testimony around to feather his own anti-copyright nest makes about as much sense as Charles Nesson’s defense tactics.
As Professor Richard Epstein said of the U.S. Supreme Court’s review of In re Bilski, “If intellectual property is going to be put in the hands of a bunch of stand up comics, we are in serious trouble.”
Somebody get the hook.