The Copyright Office is soliciting public comments about how things are going with the MLC to help the Office decide whether to permit The MLC, Inc. to continue to operate the Collective (see this post for more details on the “redesignation” requirement). We are impressed with the quality of many of the comments filed in the “Initial Comments” at the Copyright Office. As there will be an opportunity to comment again, including to comment on the comments, we will be posting selected Initial Comments to call to your attention. You can read all the comments at this link. If you are hearing about this for the first time, you have until June 28 to file a “reply comment” with the Copyright Office at this link.

You will see that there is a recurring theme with the comments. Many commenters say that they wish for The MLC, Inc. to be redesignated BUT…. They then list a number of items that they object to about the way the Collective has been managed by The MLC, Inc. usually accompanied by a request the The MLC, Inc. change the way it operates.

That structure seems to be inconsistent with a blanket ask for redesignation. Rather, the commenters seem to be making an “if/then” proposal that if The MLC, Inc. improves its operations, including in some cases operating in an opposite manner to its current policies and practices, then The MLC, Inc. should be redesignated. Not wishing to speak for any commenter, let it just be said that this appears to be a conditional proposal for redesignation. Maybe that is not what the commenters were thinking, but it does appear to be what many of them are saying. Perhaps this conditional aspect will be refined in the Reply Comments.

For purposes of these posts, we may quote sections of comments out of sequence but in context. We recommend that you read the comments in their entirety. Today’s featured comment is by Abby North, who owns the independent music publisher and administrator North Music Group. Abby was kind enough to participate as a panelist at the 3rd Annual Artist Rights Symposium that David hosts at the University of Georgia Terry College of Business, and also testified at the House Judiciary Committee IP Subcommittee hearing held in Nashville to grade the MLC, Inc. (read Emmanuel Legrand’s reporting on that hearing at this link).

Abby has a number of ideas about meaningful changes that the MLC, Inc. ought to make to its operations and its approach to its fundamental job–timely and accurately accounting for all the money it receives.

Read Abby’s full comment at this link.

MLC BUSINESS RULES THAT CONTRADICT LAW
During the IP Subcommittee hearing held by Chairman Issa,6 the Chairman cautioned MLC, Inc. CEO Kris Ahrend, “…no question at all, what you’ve been making looks a lot like rules.”

The US copyright law permits authors or their heirs, under certain circumstances, to terminate the exclusive or non-exclusive grant of a transfer or license of an author’s copyright in a work. The ability to recapture rights via the United States copyright termination system truly provides
composers, songwriters and recording artists and their heirs, a “second bite of the apple.” Many of my clients exercise this right and subsequently become the original publisher in the United States.

The MLC had made a unilateral determination that rights held at the inception of the new blanket license might remain, in perpetuity, with the original copyright grantee. The MLC initially ignored that the derivative work exception does not apply in the context of the mechanical blanket license.

Fortunately, the US Copyright Office stepped in to clarify that the appropriate payee under the mechanical blanket license to whom the MLC must distribute royalties in connection with a statutory termination is the copyright owner at the time the work is used. When The MLC envisions a new policy, members should be provided a mechanism to provide input related to this policy, prior to it being adopted.

Members must be given a greater voice in business rules and operations of The MLC. Hands-on music publishing administrators have deep insights into workflows, efficiencies and UI/UX. Members need to be consulted with and given opportunities to drive the future of The MLC’s
website and technologies.

The MLC has made unilateral decisions regarding how it treats public domain works. It invoices the DSPs for streams of recordings that embody these public domain works, but no publisher is entitled to these royalties. That means the MLC may collect money it may not pay out. What rule gives The MLC the right to collect but not distribute?

COMMITMENT TO ISWC AS GLOBALLY UNIQUE IDENTIFIER FOR MUSICAL
WORK
Recently, the PRS (the UK-based Performance Rights Organization) completed a proof of concept that allowed record labels to request assignment of an ISWC to identify a musical work embedded in that label’s recording.

This proof of concept provides a necessary step in helping CMOs identify musical works, contributing parties and recordings of these works.

It also firmly demonstrates the global CMO ecosystem’s commitment to the ISWC as the globally unique identifier for the musical work. Every music publisher and every CMO…other than The MLC…relies on the ISWC to identify a musical work.

Instead, The MLC relies on the HFA Song Code, now also known as the MLC Song Code. The only societies in the world that use these codes are HFA and The MLC. Every other society identifies musical works with an ISWC, which unlike the HFA Song Code or MLC Song Code,
functionally acts as a bridge to the International Party Identifier (IPI) and now, the International Standard Recording Code (ISRC).

For The MLC to some day truly be the gold standard in CMOs, it must follow the rest of the world’s lead and require and include the ISWC whenever the ISWC exists. The MLC Song Code may be used as a disambiguator, but it must be used in conjunction with an ISWC. This is how the other societies work: they have their own proprietary identifier, which accompanies the ISWC to allow positive identification of works.

In addition to ISWC as the work identifier shared by the world’s music publishing and rights management community, IPI is the global identifier for the songwriter and publisher. The MLC must commit to including the IPI for any writer or publisher that has been assigned an IPI.

SPEED OF CLAIMING AND MATCHING
According to The MLC in its redesignation comments, “Finally, The MLC has already established itself as a leader in the industry, setting high standards for speed, volume, transparency, efficiency, outreach and member support.”

As of this writing, works I claimed manually in the claiming portal 73 days ago still have not been processed.

Unless I am misunderstanding the process, this means The MLC has already missed two distribution periods.

This is too much time. If there is an issue with the claims, there should be some human communication from The MLC explaining the issues.

If there are no issues, what could possibly be the cause of such a delay?

The oversight body must provide guidelines for The MLC regarding reasonable times from delivery of a match or claim by a member to processing by The MLC.

I also recommend the addition of an interface in the MLC portal for communication between The MLC and the member. For example, if every time I log in, I see a red flag in the interface indicating action is required on my part, I could potentially assist in speeding up the time The MLC takes to process my data. I also would be aware of any potential issues.

SONGWRITER PORTAL
The MLC’s website says it has distributed to “publishers and songwriters.” However, it must be clarified that the only songwriters that directly receive royalties from The MLC are selfpublished, self-administered songwriters that a) are aware of The MLC; b) have become members; and c) have delivered data to The MLC regarding their works and recordings of their works.

Songwriters that are either published or administered by a publisher have no mechanism with which to deliver corrections or missing data regarding their works. Instead, a songwriter that may have had one or many previous deals typically has no relationship with the previous publishers. Even songwriters in current publishing deals may not be able to get their calls returned much less convince their publishers to add or correct data in a timely manner.

Consequently, as many advocates have suggested since the roundtables that occurred prior to the inception of The MLC, The MLC must provide a portal within its website for published and/or administered songwriters to deliver data regarding their works. This data must then be reviewed by The MLC for accuracy, and then The MLC must communicate with the publishers to confirm
accuracy and add the missing or corrected data to the public portal.

It is simply unfair that songwriters have no way to guarantee The MLC has the necessary data to pay these songwriters’ publishers if they are willing to do the matching work at their own expense.

According to the USCO’s website FAQs regarding Title 1 of The Musical Works Modernization Act, “Once established, the MLC will establish and administer a process by which copyright owners can claim ownership of musical works (and shares of such works).” In fact, even though an administered songwriter is the legal copyright owner of his/her musical works, The MLC provides no process by which that songwriter/copyright owner can claim ownership of musical
works.

OVERCLAIMS TOOL
The MLC recently added an Overclaims Tool – only for registrations made within the last 90 days. If you submit a registration and it conflicts with a work that’s older than 90 days, that conflict will not appear in your portal.

According to The MLC:

“Please note: A work can only go into overclaim if shares are added to the
work within 90 days of the work’s registration, based on the “Creation Date”
in the work details.

If you are attempting to claim shares over 100% on a work that was created
more than 90 days prior, you will need to reach out to The MLC Support
team here.”

As a publisher/administrator of works registered decades ago, how would I know if someone has attempted to claim my legacy work and created an overclaim?

I do not recall receiving any announcement seeking publishers to participate in working groups to provide input related to the Overclaims Tool. Experienced hands-on administrators should be given the opportunity to provide insights into functionalities of proposed additions to the MLC portal prior to development of the technology.