YouTube, Facebook and Moral Rights

In much of the rest of the world, artists are extended “moral rights.” These rights are mostly quite non-controversial, things like attribution and credit for a work. The US does not fully recognize these rights despite the fact we are signatories to international treaties that seem to require us to implement these rights.

MUSIC • TECHNOLOGY • POLICY

I was honored last year to have been asked to participate in a symposium on moral rights co-sponsored by the U.S. Copyright Office and the Center for the Protection of Intellectual Property at the George Mason University School of Law.  The symposium relates to the Copyright Office Study on the Moral Rights of Attribution and Integrity.

Moral rights is a key area of the law of copyright that is sadly lacking in the United States and an important legal tool to protect the rights of artists.

Moral rights (or for the fancy people, droit moral) are largely statutory rights that maintain and protect the connection between an author and their work.  (As I highlighted in Artist Rights are Human Rights, moral rights are not economic rights like copyright, but transcend those rights.  This is why you see language in the human rights documents, like the Universal Declaration of…

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Did @EFF Properly Disclose “Relationship” to Google in Supreme Court Case?


Yesterday we broke a story that iit appears Google senior copyright counsel and EFF executive director were married.  Aside from the obvious conflicts of interest this is also relevant because if true there is likely to be community property and that community property could be Google stock or options.   We wonder if the defendants and Supreme Court Justices were informed of this relationship? I am not a lawyer nor an expert in legal ethics, but in my humble opinion this is the sort of conflict that should have been disclosed especially to the defendants.

Update:: Google senior counsel  tweeted they were divorced “years ago.”  Von Lohmann provided no month or year when asked.  It’s thus not clear which amicus briefs were filed during marriage. Regardless courts and opposing counsel should reexamine what was disclosed by EFF, and ask EFF to further clarify.  

Google and EFF Sitting in a Tree K-I-S-S-I-N-G

 (Photo credit Cory Doctorow 2006 Creative Commons License Attribution-ShareAlike 2.0 Generic CC BY-SA 2.0) 

Update:: Google senior counsel Von Lohmann  tweeted they were divorced “years ago.”  

About a month ago I was scouring the web for linkable or CC photos of senior copyright counsel at Google Fred Von Lohmann.  Lo and behold look what I found? It appears to be a picture of Cindy Cohn (former senior counsel now executive director of the EFF) and Fred Von Lohmann.  I found it in the public Flickr feed of Cory Doctorow the infamous anti-copyright demagoue (and creepy adult disneyland goer).   After asking around for a couple of weeks, I’ve concluded this apparent marriage does not seem to be common knowledge in tech, music industry or copyright circles.

Why is this important? Well if in fact Cindy Cohn and Fred Von Lohmann are were married this puts an entirely different spin on dozens of amicus briefs in which EFF has purported to “independently” represent the public interest while siding with Google. And in many of these cases the EFF was arguing for “the public” and against the rights of artists.

I am not an expert on disclosure requirements and ethics for lawyers, but shouldn’t this relationship be disclosed? Certainly withholding this information seems odd.  Look at the footnote in the Oracle v Google amicus brief below;

The EFF appears to be going out of it’s way to disclose every possible conflict. Except this one?  Even if the apparently secretly  married couple did not discuss the Oracle v Google amicus brief, shouldn’t the possible appearance of impropriety have been disclosed? Further if they are were married can one assume there is was at some point community property? And if that community property includes Google stock or options isn’t wasn’t this a conflict of interest? This begs the question, was the EFF looking out for the financial interests of their director rather than the public?

If there is anyone out there that has more information on what exactly is going on here, and the legal/ethical implications, I am all ears.

 

@MykiAngeline: @The_WIMN: Front And Center: @SoundExchange Senior Director Of Industry And Artist Relations, @LindaBlossBaum

Linda Bloss Baum has been a great behind the seems advocate for artists and songwriters for years. We all owe her a great debt.

Artist Rights Watch

[Editor Charlie sez:  Must read interview with a true artist rights advocate, Linda Bloss-Baum.]

Music has come a long way since the age of vinyl records and cassette tapes. It wasn’t that long ago when the only way to listen to music was either attending a live performance, tune in to your favorite radio station, or purchase hard copies from your local music store. Now with the ability to stream music from the internet, listening to our favorite artist is readily at our finger tips. Anyone with a laptop or smart phone can access almost any artist and song.

It also became increasingly harder for music artists to get paid for their creations.

This is where companies like SoundExchange come into play, working at the center of digital music to develop business solutions that benefit the entire music industry. As the Senior Director of Industry and Artist Relations, Linda Bloss-Buam…

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Global Songwriter and Composer Organizations Send Open Letter to RIAA Proposing Solution to Massive Failures to Accord Credit and Respect International Laws of Moral Rights

Songwriters have taken exception with the RIAA’s opposition to “the right of attribution.” Opposing attribution plays right into the hands of those seek to weaken copyright. It feeds the narrative that record labels are evil, hurt creators and should be broken up. Why? as the letter forcefully points out, even the Creative Commons foundation, which is generally against stronger copyright, acknowledges attribution as a fundamental right of authors. I believe this is a major strategic mistake by record labels. It is a needlessly divisive position to take at a time when copyright reformers in congress are expecting the creative community to speak with a single voice. As the Brits would say this is an “own goal.’ Geez, where are the grownups?

MUSIC • TECHNOLOGY • POLICY

[For more information go to BASCA website.]

An Open Letter

15thAugust 2017

Mr. Cary Sherman
Mr. Mitch Glazier
RIAA

Via email

Dear Messrs. Sherman and Glazier,

It was with great disappointment that we read the recent RIAA comments to the Copyright Office in connection with moral rights; in particular, with regard to the right of attribution. The RIAA’s argument prioritizes the inconvenience of dealing with accurate metadata over the principle of the protection of the rights of the people upon whose work the music business is built. In our view, and the view of many in the creator community, this is not only irresponsible, it represents a betrayal of the ‘greater common purpose’ to which so many of us are committed—a purpose with which the RIAA claims to agree.

While music creators have greatly appreciated the RIAA’s leadership on, for example, the Music Community submission on…

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@RobertBLevine_: Federal ‘Transparency’ Bill Endangers Songwriters’ Leverage for Getting Paid — Artist Rights Watch

On the surface, at least, the “Transparency in Music Licensing Ownership Act,” introduced in the House of Representatives on July 20 by Congressman Jim Sensenbrenner (R-WI), seems like a copyright bill that could help untangle the online music business….but the devil is in the details.

via @RobertBLevine_: Federal ‘Transparency’ Bill Endangers Songwriters’ Leverage for Getting Paid — Artist Rights Watch

Understanding Music and Blockchain Without the Hype : Revisited

A Guest Post By Alan Graham of OCL.

Two years ago, this month, I wrote an article here called “Understanding Music and Blockchain Without The Hype“. As with any nascent technology that shows a great deal of promise, there’s generally a tremendous amount of hyperbole as to what’s possible. A lot can happen in two years and frankly a lot has happened since my original piece ran. I felt this would be an excellent time to revisit that article and see where we are. This is a long one, but if you really want the skinny, no BS on music and blockchain, you’ll stay until the end.

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The Recap

As a blockchain pragmatist, I’ve always been a supporter of many ideas proposed (better data/improved efficiencies), but skeptical of whether or not any of them actually improve the current situation, exacerbate it, or are in fact possible. Every study I read has clearly been approached from the foregone conclusion that blockchain is the future, without any critical pushback. For two years I’ve been trying to dispel some of the hype.

We’ve seen the hyperbole hit new seemingly impossible heights, promising unicorn dreams of fantasy technologies, improbable cost savings, impossible business models, and instantaneous payments direct to artists without any “middlemen”. Ah the dreaded all encompassing, yet nebulous middlemen. Financial death by a thousand cuts.

The idea that’s been pushed from Day One is that with blockchain we can eliminate all those parties in the middle that take their commissions and cuts and replace it with a world computer using “smart contracts” that automatically just make money, and know who to pay…instantly. Huzzah, problems solved!

IMG_0069Detecting a theme here

Granted, there are many layers of third parties who create inefficiencies in systems, but there are also many useful middlemen, like service providers, the people who build and run things so stuff works. But what I’ve seen proposed the past two years for blockchain is actually the elimination of one set of middlemen for another set of middlemen.

Blockchains are not autonomous god computers that just do your bidding. They require service providers to make things happen (core programmers, hosted nodes, miners, wallets, etc). You can’t just eliminate companies that provide services and expect there to be some universal user interface that will handle all of your needs. Someone needs to build and run this stuff, and they will surprisingly want to be paid. As for cutting costs, those costs can only go so low. There’s this perception that blockchain companies provide cheaper solutions, but we’re talking fractional cost savings. These savings may eventually cost more, not less over time. Building world class technology and then running it costs money. If your royalties vanish in a hack, you’ll want to be able to call someone, not talk to a bot.

Capto_Capture 2017-08-08_02-50-20_PMIdeal, but unlikely

Back in my original article I said that those working in the blockchain space would have to solve five critical issues for creative industries, or the whole exercise would be a complete waste of time and money. Those included Authority, Immutability, Scalability, Legacy, and Privacy. I’m going to touch on a few, and ad two new ones. Let’s recap with some commentary:

Immutability: this is one of the most misunderstood, yet more actively promoted ideas of blockchain, the idea you can and should write a permanent record of data that no one can alter ever, into a giant sky god database. It is an idea being pushed and sold because it isn’t fully understood. I’ve yet to see one single necessary music data use case for this.

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Except the music industry isn’t a trust-less system

Ask yourself, is immutability really the most important aspect for data or better yet a fluid, yet documentable series of committed changes (history) backed by a proven authority? Because the later can still tell you everything about an asset, as well as who owns it and how to pay them “instantly“.

Gideon Greenspan, an expert on blockchain technology, has the following to say about Immutability (I also recommend watching this video on blockchains vs databases):

In the raucous arena of blockchain debate, immutability has become a quasi-religious doctrine – a core belief that must not be shaken or questioned. And just like the doctrines in mainstream religions, members of opposing camps use immutability as a weapon of derision and ridicule.

In blockchains, there is no such thing as perfect immutability. The real question is: What are the conditions under which a particular blockchain can and cannot be changed? And do those conditions match the problem we’re trying to solve?

To put it another way, a blockchain’s transactions are not written into the mind of God (with apologies to Augustine above). Instead, the chain’s behavior depends on a network of corporeal computer systems, which will always be vulnerable to destruction or corruption.

The Blockchain Immutability Myth

Gideon Greenspan PhD Computer Science

CEO Coin Science

 

Ever since this idea popped up, I’ve been saying that the problem with immutable data is that human beings are illogical and therefore business logic tends to change rapidly based on the nuance of human behavior. This isn’t just because people fight over money, territory, or credit for something…it is because the behavior of how citizens interact with technology changes so fast, you need something flexible and fluid that can always change with the immediacy of how we change our habits. Especially when it comes to media.

Devices like Alexa, Google Home, and Apple’s HomePod have seemingly come out of nowhere to become digital hubs, and their long term impact has yet to be felt, but markets are already moving. And in 3 years, we’ll have something new. Therefore there’s zero practical logic for immutable business logic, especially if we consider that we’re just beginning to start a digital journey into a future where we don’t know how we’ll be interacting with media or the systems that will exist 5-10 years from now. This is why locking things with DRM is a bad idea. You can’t plan for obsolescence these days because it comes at you fast, so seemingly good ideas turn horribly bad when suddenly 1B people can’t access things they legitimately paid for because an app goes out of business.

A lot of blockchain development is trying to force blockchain what it isn’t designed to do, what it was never intended to do. Square peg, round hole.

The Zen approach is to build systems that aren’t rigid, but can bend. Systems that are rigid are systems that break. You know whose really good at dealing with stuff like this? Programmers!

Instead of thinking about metadata and ownership information of creative assets as just this data/file problem to solve when we release them, perhaps in our current world, we should be taking a cue from programmers and thinking about dealing with media in the way programmers write and deploy code, particularly what’s called version control systems:

“In computer software engineering, revision control is any kind of practice that tracks and provides control over changes to source code. Software developers sometimes use revision control software to maintain documentation and configuration files as well as source code.”

For example, let’s look at something called Git, a very popular system of revision control that was created by Linus Torvald, you know, the guy whose code is the foundation for some things you may have heard of, like Linux and Android.

Projects that have thousands or millions of lines of code with many people contributing to that code from all over the world requires a way to track the changes made to the project, who made those changes, and be able to see all of this historically (see branches). Sound familiar?

If we were to think about the release of a creative work (like an album) in the Git Model, you’d find that much of what’s desired to solve the music industries issues of data, negotiations, contracts, ownership, regulation, laws, rates, regions, etc. are things that have already been worked out before, for massive software projects that run on billions of devices. The data necessary to describe a piece of media is tricky, but no more tricky than the code in your average iPhone app. Git is scalable, battle tested (12 years), can have many authorized and trusted parties, has elements of immutability, and is fluid enough to allow for the nuance of business logic and human behavior, while also allowing for the verifiable truth of data. For example, let’s look at how Git handles changes to data:

Cryptographic authentication of history

The Git history is stored in such a way that the ID of a particular version (a commit in Git terms) depends upon the complete development history leading up to that commit. Once it is published, it is not possible to change the old versions without it being noticed. The structure is similar to a Merkle tree, but with added data at the nodes and leaves.

This history of changes and all of the related data and files can be distributed, so you have mirrored repositories of the same data. Every clone of this repository is a full back up of all the data, so if one server fails, you can access others, while using the mirrors to restore the failed copy.

When “the industry” (labels, publishers, artists, PROs, DSPs, etc.) ask for a global database, besides the practical issues of the identifiable metadata and who to pay, they don’t necessarily want a global database, and actually that’s okay. What’s not okay, as has been reported here (see Shiv Act) is trying to force a singular truth on a system and a planet that can’t have a singular truth. What “the industry” really wants and needs is potentially infinite different versions of the truth. This sounds counterintuitive to what everyone is screaming about these days, so let me explain.

There are basic core truths that should be consistent across the world, like what is this file and who is connected to it? Yet beyond that, whoever you are and wherever you are in “the industry”, what you really want is to have Deal A with one party and Deal B with another. Those two truths must be able to co-exist at the same time, and it would be helpful if they weren’t simply trapped in paper contracts. In a Git model this is possible, and therefore Deal A and Deal B can both be true, but would never meet anywhere else than in the view of the deal maker. This means the identification of the asset may remain a constant, but the details of ownership, regions, rates, etc. can always be fluid and changing, because that’s the world we live in. You don’t need a blockchain and smart contracts to express all of these truths. In fact, managing these truths with smart contracts would be a nightmare and could cause cascading failures in mission critical media systems. No matter what anyone is telling you about how we’ll just have “smart contracts” that know how to do all these things, that is a level of complexity I don’t think anyone has ever seen before and it will open up entirely new security risks. We’re already seeing exploits in smart contracts that have lost over a hundred million dollars.

All around the world, everyone, programmer or not, uses revision control every day. You, yes you reading this, you are already familiar with it. Every word processing document, spreadsheet, collaborative web document, blog, and even Wikipedia page history uses version control technology. It’s how we can collaborate and commit changes to documents locally and remotely, while also knowing the history of the who, how, where, and what.

You know who also uses revision control systems? Blockchain developers.

So do not release music…deploy it.

Scalability: Can you run a robust music industry on any of the current blockchain technologies? The answer is no. Don’t just take my word for it, let’s hear from John Palfreyman, Director – Blockchain – National Security CTO at IBM, in his May 2017 blog entry “Ten Things Blockchain is NOT”.

Blockchain is not (yet) mature:  Gartner stated in their 2016 report that blockchain is at the peak of inflated expectations on their hype cycle. They say it’s some 5 to 10 years from the plateau of productivity, which I regard as conservative for some use cases. Problem is, with all the hype, it’s easier to think blockchain for business is more mature than it is. A sense of reality must be maintained, especially when seeking out the use case for a blockchain first project.

Blockchain is not a distributed database replacement: blockchain complements distributed database technology, with appropriate information partitioning between the two.

Blockchain is not usually suited for high volume, low value transactions: as blockchain for business matures, fabric developers will turn to non-functional requirements including transaction throughput. In the near term, the technology remains better suited to low volume high value transactions

I could say more, but I think that encapsulates it well.

Now on to the new issues:

Legal: My company employs one of the best legal firms in the UK when it comes to media and technology, and the legal issues surrounding running a “normal” technology company dealing in media is incredibly complex. Now take that up a notch with decentralized or distributed companies that don’t care about regions or borders or rights. Frankly, I see a lot of these blockchain startups ignoring these facts (See Opus below). The current SEC ruling on Initial Coin Offerings (ICOs) is really a global red flag towards other regulatory shoes dropping. If the SEC and other government agencies around the globe can force compliance on ICOs, it is a short hop to privacy and data security issues. Regulation (like winter) is coming, and blockchain solutions will have to be compliant with these laws, and none are ready because they thought they could operate outside of it.

Disruption: Blockchain proponents seem to think they are the answer to giant corporate control of data and technology services, capable of disrupting the dominant players (Amazon, Airbnb, Uber, Google, Microsoft, Facebook, etc.), but the reality is that giant corporations aren’t always the first to jump into a marketplace until it is established. Sometimes they get caught up in the hype phase, jump the gun, and it goes sideways. What’s likely to happen is that blockchain companies will begin to offer services that have lower costs than giant centralized providers. However, corporations like Amazon (Amazon Web Services), are not likely to just let you take their business from them, so they’ll first begin by cutting prices to match blockchain startups, but providing a more mature service (maybe losing money to outpace competition) with more features (compete on value). Then, after these startups have established the blockchain marketplace, they’ll step right in and compete by offering more for less, or buying up these smaller companies one at a time. Meet the new boss…

Capto_Capture 2017-08-08_01-24-38_PM

Blockchain data storage vs traditional. Pretty sure Amazon could shave off $.07 just to win

Remember, we thought the Internet was going to be the great equalizer. Maybe we should remember the past and learn from it if the belief is that blockchain will be the great equalizer, Part II.

So Where Are We Now, Anywhere, Nowhere?

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As I see it, if we look past the multi-million dollar losses from hacks and exploits (imagine they were your royalties), the infighting, the rip offs, and the ICO’s for dumb ideas at crazy valuations, I would say the scalability and legal aspects alone are likely going to be the anchor that weighs the whole thing down. From a cursory glance, if blockchain is the future for the music business, we are many many years from realizing this.

Capto_Capture 2017-08-08_03-30-11_PMHacks, ICO’s, Infighting, Exploits, Rip-Offs. I think we were better off two years ago with fantasy vs reality.

 

That means if you are planning to jump in head first now, you might want to rethink and check to see there’s water in the pool before you go all mission critical. Things are a bit of a shit show at the moment.

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One of the Ethereum blockchain projects lead developers

What I currently see is a lot of “Me Too” solutions. In fact, as of writing this, I count no fewer than 20 blockchain music data/streaming solutions all vying for their position as leader in a market no one is ready for and frankly, consumers (the ones who drive the market) don’t want it. It’s like being homeschooled and running for Class President. There’s a lot of pitching and giving talks at conferences with lots of promises, by many people who have limited understanding of technology, or more importantly, the history of it. Yet so far, there’s nothing of real value. Many of the “Me Too’s” are based on whitepapers with the promise of building a new music industry, seemingly with no idea that what they are building is sometimes immoral or at the very least definitely illegal. Some of them are jaw droppingly dumb.

Finally!

Look, I don’t expect any of these blockchain issues to be worked out over night. In fact I’ve been saying that on panels and in articles and interviews for two years. Many of the people I highly respect who are working on these projects and pushing these ideas are 100% coming at this from the right place and for that reason I hope they succeed. The music industry is a enigma wrapped in another enigma wrapped inside a ball of rubber bands. This is going to take some time, so some slack needs to be given. But we are in a nascent stage where there are going to be a lot of ideas floated, and a lot of technology pitched, and frankly most of it will fail. Benji Rogers, founder of dotblockchain, and a huge proponent of blockchain technology, was recently quoted as saying:

“If you’re in the music industry and you’re not looking at how this is going to affect your business, you’re going to be in trouble. But we can’t rush this. It’s worth getting right rather than just blundering into it.

I could not agree more. You should be thinking about how it could affect your business, because it could in fact destroy the entire music business (my next article – piracy perfected). I also agree with the that last part, and it is why I’ve been pushing against this rapid jump to step onto a new world without any forethought or planning as to how we’ll adapt and survive there. You can’t just go to Mars without a supply of potatoes. We need to be asking much tougher questions, and frankly I’ve been very easy on these ideas without even touching on Authority and Privacy issues.

The questions we should all be asking ourselves when we’re being sold something so hard is, are there other possibilities we’re not exploring? Could we be approaching this incorrectly? Are there other options and ideas? If we aren’t asking those questions, then we’ll fail to transform the old creaky machine we have now, into the sleek machine we need for the future. We have little time to fix this, but that doesn’t mean we should fail to really think through where this may take us in 2-5-10 years. And on that note, I’ll see you in another two years.

The 21st Century Marketing Restriction: No licensing for Artificial Intelligence — Artist Rights Watch

If you let your record company license your recording for AI algorithmic music a la Orwell’s “versificator”, it’s like Silicon Valley making you train your replacement.

By Chris Castle

After the money, one of the most important parts of a recording artist negotiation is the “marketing restrictions”.  These are restrictions on what the record company or music publisher can do with your work–what type of licenses they can, or more frequently cannot, grant to third parties, for example.  Essentially, whatever is not prohibited is permitted.

Marketing restrictions also have a temporal element–during or after the term, recouped or not recouped.  There are some restrictions that are acknowledged to be verboten and are usually easy and unrestricted concessions.  An example of these would be licensing for certain types of commercials such as tobacco, firearms, grooming or hygiene products and alcohol.

Stewart Dredge has an excellent article this week in the Guardian which brings to mind Laura Kobylecky‘s post on MusicTechPolicy drawing comparisons between Spotify’s “fake artist” problem and “The Next Rembrandt” with echoes of the fictional  “versificator” operated by Big Brother’s “Music Department” in 1984.  According to Stewart, there are dozens of AI music startups getting funded that all essentially do the same thing.  Using a library of recordings (sometimes called a “corpus”), the algorithms “create” new recordings based on the songs and recordings in the corpus.  Google is, of course, a leader in the space (not that different from how they used Google Books to train their translation algorithm, a process called “corpus machine translation”–the librarians will be next).

Those recordings can then be sold or licensed at a very low price which, as Laura and others have noted, can be used to drive down the royalties payable to all other artists on digital music services.

This is, of course, not dissimilar to Silicon Valley companies hiring lower paid foreign workers and ordering the employees who they are to replace participate in training their replacements.  The difference is, of course, that those recordings have to come from somewhere.

It’s time to start adding to the list of marketing restrictions that the song or recording cannot be licensed for AI purposes of any kind.

via The 21st Century Marketing Restriction: No licensing for AI — Artist Rights Watch

Just Watch, “Shiv Act” Advisory Panel Will Be Stacked With Google Backed Organizations

Prediction: Public Interest groups that are “married” to Google’s views on copyright will be used to stack the Shiv Act advisory panel in favor of Google and broadcasters.  (Photo credit Cory Doctorow 2006 Creative Commons License Attribution-ShareAlike 2.0 Generic CC BY-SA 2.0) 

Sen Sensenbrenner (R-WI) has introduced an extremely regressive bill that would essentially eliminate songwriters right to take legal action against services that use their works without a license. In effect this rewards infringing services like Spotify and Google while punishing the victims (songwriters).  Read more here, here, here and here.

We just want to point out one more thing.  The bill sets up an “advisory panel” appointed by the highly problematic Google backed  Librarian of Congress.   There is a curious clause that states that”public interest” groups will be members of this advisory group.   The idea is that the panel is “balanced” by having technology companies, entities that represent songwriters and then groups that purport to represent the public.

The problem is, that everyone knows which kind of public interest groups will likely be picked. Our prediction is it will be EFF and Public Knowledge.  Both of these groups  have received significant funds from Google and methodically file amicus briefs in support of Google or Google’s legal positions, such as the EFF’s supporting Backpage in the well-known Jane Doe human trafficking of minors case. 

These two groups have essentially become a crucial part of Google’s legal and lobbying efforts. You could even say they are “married” to Google’s positions on copyright 🙂  The appointment of these public interest groups or similar groups will tilt the advisory panel n favor of tech and against songwriters.

RICO SUAVE: Does the Sensenbrenner Bill Mean It’s Time For A Grand Jury?

 

What appears to be a backdated NOI sent to the author. If this was intentionally backdated this is fraud. Note MRI is simply a third party that sent the notice on behalf of the service.  All legal responsibility rests with the service. 

 

Digital music services are trying to end songwriters ability to ever sue broadcasters and digital music services for copyright infringement with this bill.   In order to sue for copyright infringement you have to mount a case in a federal court.  Not your local district court.  This is extremely expensive.   I would estimate you need about $250,000 to effectively fight a case.   This bill takes away statutory penalties and legal fees, even when the songwriter prevails.  This makes it impossible for independent songwriters to exercise their legal rights. NAB Broadcasters and digital services like YouTube and Spotify can safely ignore songwriters, especially independent songwriters with no resources. Songwriters and publishers would have never been able to achieve the recent settlements against Spotify, without statutory penalties and legal fees.

So this may surprise you but I say “fine!” Take away our ability to mount copyright infringement lawsuits?  We still have plenty of other (sometimes much more severe) remedies available.  Most songwriters don’t really care about the money.  The royalties are pretty paltry to begin with.  This is really about the principle. This is about justice.

I’m no lawyer but the more I learn about the predicament of songwriters in the US, it feels like something more than just copyright infringement seems to be going on.  My layman’s reading of the situation makes me wonder if this isn’t exactly what the authors of the RICO laws had in mind. Imagine a digital music executive in the next season of Orange is the New Black!  Not saying that’s what is going on happen here.  Just saying something like that would restore creators faith in the fairness of the system.  And that kind of outcome in my mine really matches the severity of the problem.

Let me reiterate I am not an expert and I am not saying a criminal prosecution is really warranted but there are enough questions here that it seems like someone should at least look at it.  My knowledge is limited, but it looks like lots of wrongdoing spread across many interrelated businesses, advised by a small group of consultants and lawyers with conflicted interests.  Its very complicated.  But isn’t this the kind of complex situation that a Grand Jury is designed to investigate?

To be clear I’m not intending to mount a case myself,  I’m just saying going forward rights holders should consult someone more knowledgable than myself and then consider whether conspiracy, fraud or other complaints are more applicable.  Especially those songwriters that suspect they have received backdated or somehow falsified “notices of intent” from digital services or others. Backdated notices are key cause they clearly don’t pass the smell test. There is no honest reason to do that.  Even without “smoking gun” evidence songwriters should not be shy about complaining to federal and state authorities that “something just doesn’t seem right.”  And really what’s the harm in looking?  Similarly lawyers and accountants who are involved (or have been involved) with this licensing mess, should perform a gut check: Is what I’m doing (I did) legal?  What are the consequences for my career? Am I following the ethical guidelines of the organization that licenses my profession?

LETS REVIEW:

Here are some definitions from an online dictionary.  I am not a legal expert. I am using these terms as a layman. These definitions seem to match my understanding of the words “conspiracy,” “collusion,” “fraud,” “mail fraud,” “accounting fraud”  and “false advertising.” There are probably legal interpretations that may be different and vary from one jurisdiction to another. 

Streaming services and broadcasters have a problem.  It’s a problem they created.  They failed to take the basic steps to secure licenses for millions of songwriters.  And then willfully used the songs anyway.  Once class action lawsuits were launched some of the parties involved took actions that suggest collusion and cover up.  The evidence to support these statements is all publicly accessible on the web. Lets go through it.

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First check this page on the US Copyright Office website.  Digital services have filed 45 million “address unknown” notices in the last 15 months. This means for these recordings they don’t know who owns the rights to the songs.  If they don’t know who owns the songs, they haven’t cleared licenses and paid royalties.  In order for this copyright infringement dodge to maybe  (just maybe) work the services would also have to file yearly “certified statements of account” with someone.  Who?  The address unknown loophole doesn’t appear to have been intended for anything but a temporary reprieve.  A year has passed since the first of the  “address unknown” NOIs were filed.

Mass copyright infringement?

Can you imagine if  any other business had 45 million unlicensed anything?  And they told the federal government about it?  Wouldn’t someone investigate?

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As we demonstrated in an earlier post many of the songs which are listed as “address unknown” are pretty well known songs.  The services thus appear to fail any sort of good faith test.  Should services be filing millions of notices with the federal government claiming they can’t find a copyright holder, when they clearly have not conducted a proper search?

Misrepresentation?

 If there is a lawsuit in the works maybe Bad Faith?

Are these things filed under oath or with some promise of accuracy? Not a rhetorical question, I don’t actually know.

Perjury?

Can you imagine if oil companies didn’t bother to check and filed 45 million inaccurate notices with a regulatory agency? There would be howls of outrage.  Wouldn’t someone investigate?

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Almost all services are filing these notices.  This was an obscure rarely invoked procedure until last year.  The entire decade 2006-2016 there were less than 6000 such notices filed.   Suddenly in the Spring of 2015 nearly all services, notably Google, Amazon, Spotify and Pandora started filing millions of notices.

Appearance of collusion, conspiracy or coordination?  

Can you imagine if Verizon, AT&T, Sprint and T-Mobile all simultaneously  arrived at a very novel interpretation of a FCC rule and began exploiting it in order to avoid paying suppliers? Wouldn’t this raise eyebrows? Wouldn’t someone investigate?

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All these services at various times have explicitly or implicitly claimed their catalogues were fully licensed.

Misrepresentation?  False advertising?

Imagine if a large grocery chain purported to sell only organic chicken.   But then it turned out that 45 million of those chickens were not organic?  Wouldn’t someone investigate?

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Various streaming services have admitted that they have a problem with unlicensed songs.  Here is a quote from Billboard magazine:

“Unfortunately, especially in the United States, the data necessary to confirm the appropriate rightsholders is often missing, wrong, or incomplete. When rightsholders are not immediately clear, we set aside the royalties we owe until we are able to confirm their identities.”  Spotify spokesperson Billboard 2015

Willful mass copyright infringement? 

Can you imagine if several of the largest insurance companies admitted publicly they were not complying with the law.  Wouldn’t someone investigate?

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Some streaming services have loudly proclaimed the problem is the fault of songwriters or record labels.  This is untrue and the services know this is untrue. The problem started when streaming services started “ingesting” recordings. They often didn’t include a field to collect songwriter/publisher information, despite the fact the law is very clear that streaming services are responsible for notifying songwriters and paying royalties.  This sure walks and talks like a “lie.” Whether by design or error these sorts of statements have likely misled the public and investors.

Negligence?
Failure of fiduciary responsibility to shareholders?

Can you imagine if a large publicly traded company claimed that they couldn’t pay suppliers because the suppliers didn’t supply billing information?  But it turned out the company didn’t ask for billing information and provided no way for suppliers to submit billing information.  And it wasn’t the suppliers responsibility anyway to provide the information. Wouldn’t this firm be guilty of misleading public and investors?  Wouldn’t someone investigate?

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Then when the lawsuits hit, many services began sending to songwriters what would appear to be fraudulent “notices of intent.”  See example above.  I have dozens of these from dozens  of companies. I can’t imagine I am the only songwriter to receive such notices.  These were sent to me via the US Mail.  These notices seem designed to trick me into believing that I no longer have the right to make a potentially much more valuable direct license with the streaming service since the window on the compulsory license has passed.

Mail/Wire Fraud?

Can you imagine if lawyers from a large record label sent out letters to songwriters which misled them into thinking they had licensed their song to that record label?   Wouldn’t someone investigate? (Ed note: Surely Spitzer would have investigated. Schneiderman?)

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What about the accountants that prepared royalty statements and checks sent to me.  If I have no license how did they come up with a royalty rate with which to prepare these statements?  They know they don’t meet the conditions for the compulsory license?  So someone knows there is no royalty rate from which to compute this check, yet send it anyway?  How is this not an effort to mislead me, and trick me into thinking they have a valid license? Or tricking one of my employees into depositing the check so they could argue an “implicit license.”  This smells to high heaven.

Mail Fraud?

Accounting Fraud? 

Remember what happened to Arthur Andersen?  Enron’s accounting firm?  It went bankrupt and and many people lost their licenses. Didn’t someone investigate that? Isn’t that how that happened?

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Why did more than one firm engage in this exact same practice?  It is a very odd and risky strategy.  How did two companies separately come to the conclusion that this was the best course to take?

Conspiracy? Collusion? 

Since it is more than one firm attempting to mislead songwriters, isn’t this more like the tobacco lawsuits?   Why wouldn’t someone investigate this for the same reasons.

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This check was received during the time the class action lawsuit against Spotify was active.  Despite being told to communicate with my attorney. They sent these notices directly to me.  How many class members received similar checks during this time?

Improper communication with plaintiff and class members?

Suppose there was a class action directed at a large pharmaceutical company like Pfizer for overcharging customers. Can you imagine what would happen if Pfizer had started sending refund checks directly to plaintiffs and potential class members?  Surely someone would investigate this.

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Finally lets go back to the public accounting firms that certify the royalty statements and financials of the streaming services. How can they possibly claim to have fulfilled there legal obligation by certifying streaming statements from companies that lacked a significant number of valid licenses.   Surely these public accounting firms were aware that the services had large numbers of unlicensed tracks.  The key point here is if a track is unlicensed there is no agreement as to what the royalty rate should be.   Since songwriter royalties are a pro-rata from a pool of revenue, this calculation is based on the false assumptions that the unlicensed tracks receive the same rate that the licensed tracks receive. The statements are ALL incorrectly calculated. Further, did these firms disclose to the investors the extent of the infringement liabilities?   Clearly the services know exactly how many tracks are unlicensed.  Did the accountants?  Did the shareholders?

Accounting fraud? 

Again look at Enron.  Someone investigated that.

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While this may all just be smoke and no fire,  federal, state and local authorities have investigated suspicious situations with a lot less compelling