Music Law: Words Matter
A single word or two can have a huge impact on the meaning of a contract (Mighty 1 Music)
By: Jeff Brown
A single word or two can have a huge impact on the meaning of a contract that you or your band might be asked to sign. Case in point - one of your band?s songs has been selected to appear on a promotional compilation CD that will be included with a forthcoming issue of a lifestyle magazine; the magazine?s twenty-and thirty-something subscribers number in the six figures. This is a great opportunity for your band.
A promotions staffer with the lifestyle product company that is producing the CD in conjunction with the magazine e-mails you the one-page contract that you and your bandmates must sign in order for your song to make the CD. You read through it, and for the most part don?t see anything that appears unfair or one-sided. Your attention is drawn, however, to a section of the contract that says that by signing the contract you and your bandmates grant the magazine and the lifestyle product company ?a worldwide and perpetual license to incorporate the song . . . to be distributed on a promotional basis.?
The words ?worldwide and perpetual? give you pause; they seem very broad and permanent, and you worry that by allowing the song to be used on the promotional CD you may be unable to take advantage of other opportunities to exploit the song. The song has consistently proved to be a fan favorite, and you?ve already licensed it for use in a popular TV show.
Your lawyer reviews the contract. He concludes that is a fairly standard contract as far as promotional CDs go; he tells you that ideally, you wouldn?t be asked to grant a worldwide and perpetual license, but that given the promotional opportunities inherent in including the song on the promotional CD it?s probably worth signing. Your lawyer is aware of the song?s potential, however, having helped you license it previously; he cautions that unless the worldwide and perpetual license that you grant the magazine is non-exclusive, you may be unable to exploit the song if you agree to allow it to appear on the promotional CD.
The license is silent on the issue of exclusivity; the words ?non-exclusive? or ?exclusive? appear nowhere in the contract. In the event of a dispute (for instance, if you sign the contract and the song appears on the promotional CD and you then license the song to appear in next year?s hottest indie film) a court might construe the contract to be non-exclusive; but a court might also construe the contract as exclusive, which could mean that the song has to come out of the film, depriving you of promotional opportunities and additional revenue.
Your lawyer calls the magazine?s lawyer, who indicates that the contract is intended to be non-exclusive. After your lawyer receives an e-mail from the magazine?s lawyer confirming the phone conversation and instructs you to write the words ?non-exclusive? before the words ?worldwide? on the face of the contract, you and your bandmates sign the contract and submit it to the magazine.
The presence or absence of certain terms, or their placement within a sentence, can have a huge impact on the meaning of a contract provision. Additionally, entertainment law is a very complex area of law that involves many specialized and hard-to understand terms. A variety of potentially bad outcomes await the artist who fails to have a lawyer with experience in the entertainment industry carefully and thoroughly review anything that he or she is asked to sign that relates to their art.
This column is nothing more than commentary, and does not constitute legal advice. If you have a question about a music law/biz issue, e-mail me [email protected].