David Lowery sits down with John Patrick Gatta at Jambands for a wide-ranging conversation that threads 40 years of Camper Van Beethoven and Cracker through the stories behind David’s 3 disc release Fathers, Sons and Brothers and how artists survive the modern music economy. Songwriter rights, road-tested bands, or why records still matter. Read it here.
David Lowery toured this year with a mix of shows celebrating the 40th anniversary of Camper Van Beethoven’s debut, Telephone Free Landslide Victory, duo and band gigs with Cracker, as well as solo dates promoting his recently-released Fathers, Sons and Brothers.
Fathers, the 28-track musical memoir of Lowery’s personal life explored childhood memories, drugs at Disneyland and broken relationships. Of course, it tackles his lengthy career as an indie and major label artist who catalog highlights include the alt-rock classic “Take the Skinheads Bowling” and commercial breakthrough of “Teen Angst” and “Low.” The album works as a selection of songs that encapsulate much of his musical history— folk, country and rock—as well as an illuminating narrative that relates the ups, downs, tenacity, reflection and resolve of more than four decades as a musician.
Songwriter and publisher Cyril Vetter is at the center of a high-stakes copyright case over his song “Double Shot of My Baby’s Love” with massive implications for authors’ termination rights under U.S. law. His challenge to Resnik Music Group has reached the Fifth Circuit Court of Appeals, and creators across the country are showing up in force—with a wave of amicus briefs filed in support including Artist Rights Institute. Let’s consider the case on appeal.
At the heart of Vetter’s case is a crucial question: When a U.S. author signs a U.S. contract governed by U.S. law and then later the author (or the author’s heirs) invokes their 35-year termination right under Sections 203 and 304 of the U.S. Copyright Act, does that termination recover only U.S. rights (the conventional wisdom)—or the entire copyright, including worldwide rights? Vetter argued for the worldwide rights at trial. And the trial judge agreed over strenuous objections by the music publisher opposing Cyril.
Judge Shelly Dick of the U.S. District Court for the Middle District of Louisiana agreed. Her ruling made clear that a grant of worldwide rights under a U.S. contract is subject to U.S. termination. To hold otherwise would defeat the statute’s purpose which seems obvious.
I’ve known Vetter’s counsel Tim Kappel since he was a law student and have followed this case closely. Tim built a strong record in the District Court and secured a win against tough odds. MTP readers may recall our interviews with him about the case, which attracted considerable attention. Tim’s work with Cyril has energized a creator community long skeptical of the industry’s ‘U.S. rights only’ narrative—a narrative more tradition than law, an artifact of smoke filled rooms and backroom lawyers.
The Artist Rights Institute (David Lowery, Nikki Rowling, and Chris Castle), along with allies including Abby North (daughter-in-law of the late film composer Alex North), Blake Morgan (#IRespectMusic), and Angela Rose White (daughter of the late television composer and music director David Rose), filed a brief supporting Vetter. The message is simple: Congress did not grant a second bite at half the apple. Termination rights are meant to restore the full copyright—not just fragments.
As we explained in our brief, Vetter’s original grant of rights was typical: worldwide and perpetual, sometimes described as ‘throughout the universe.’ The idea that termination lets an author reclaim only U.S. rights—leaving the rest with the publisher—is both absurd and dangerous.
This case is a wake-up call. Artists shouldn’t belong to the ‘torturable class’—doomed to accept one-sided deals as normal. Termination was Congress’s way of correcting those imbalances. Terminations are designed by Congress to give a second bite at the whole apple, not the half.
Stay tuned—we’ll spotlight more briefs soon. Until then, here’s ours for your review.
The Artist Rights Institute filed a comment in the UK Intellectual Property Office’s consultation on Copyright and AI that we drafted. The Trichordist will be posting excerpts from that comment from time to time.
Confounding culture with data to confuse both the public and lawmakers requires a vulpine lust that we haven’t seen since the breathless Dot Bomb assault on both copyright and the public financial markets.
We strongly disagree that all the world’s culture can be squeezed through the keyhole of “data” to be “mined” as a matter of legal definitions. In fact, a recent study by leading European scholars have found that data mining exceptions were never intended to excuse copyright infringement:
Generative AI is transforming creative fields by rapidly producing texts, images, music, and videos. These AI creations often seem as impressive as human-made works but require extensive training on vast amounts of data, much of which are copyright protected. This dependency on copyrighted material has sparked legal debates, as AI training involves “copying” and “reproducing” these works, actions that could potentially infringe on copyrights. In defense, AI proponents in the United States invoke “fair use” under Section 107 of the [US] Copyright Act [a losing argument in the one reported case on point[1]], while in Europe, they cite Article 4(1) of the 2019 DSM Directive, which allows certain uses of copyrighted works for “text and data mining.”
This study challenges the prevailing European legal stance, presenting several arguments:
1. The exception for text and data mining should not apply to generative AI training because the technologies differ fundamentally – one processes semantic information only, while the other also extracts syntactic information.
2. There is no suitable copyright exception or limitation to justify the massive infringements occurring during the training of generative AI. This concerns the copying of protected works during data collection, the full or partial replication inside the AI model, and the reproduction of works from the training data initiated by the end-users of AI systems like ChatGPT….[2]
Moreover, the existing text and data mining exception in European law was never intended to address AI scraping and training:
Axel Voss, a German centre-right member of the European parliament, who played a key role in writing the EU’s 2019 copyright directive, said that law was not conceived to deal with generative AI models: systems that can generate text, images or music with a simple text prompt.[3]
Confounding culture with data to confuse both the public and lawmakers requires a vulpine lust that we haven’t seen since the breathless Dot Bomb assault on both copyright and the public financial markets. This lust for data, control and money will drive lobbyists and Big Tech’s amen corner to seek copyright exceptions under the banner of “innovation.” Any country that appeases AI platforms in the hope of cashing in on tech at the expense of culture will be appeasing their way towards an inevitable race to the bottom. More countries can be predictably expected to offer ever more accommodating terms in the face of Silicon Valley’s army of lobbyists who mean to engage in a lightning strike across the world. The fight for the survival of culture is on. The fight for survival of humanity may literally be the next one up.
We are far beyond any reasonable definition of “text and data mining.” What we can expect is for Big Tech to seek to distract both creators and lawmakers with inapt legal diversions such as trying to pretend that snarfing down all with world’s creations is mere “text and data mining”. The ensuing delay will allow AI platforms to enlarge their training databases, raise more money, and further the AI narrative as they profit from the delay and capital formation.
[1]Thomson-Reuters Enterprise Centre GMBH v. Ross Intelligence, Inc., (Case No. 1:20-cv-00613 U.S.D.C. Del. Feb. 11, 2025) (Memorandum Opinion, Doc. 770 rejecting fair use asserted by defendant AI platform) available at https://storage.courtlistener.com/recap/gov.uscourts.ded.72109/gov.uscourts.ded.72109.770.0.pdf (“[The AI platform]’s use is not transformative because it does not have a ‘further purpose or different character’ from [the copyright owner]’s [citations omitted]…I consider the “likely effect [of the AI platform’s copying]”….The original market is obvious: legal-research platforms. And at least one potential derivative market is also obvious: data to train legal AIs…..Copyrights encourage people to develop things that help society, like [the copyright owner’s] good legal-research tools. Their builders earn the right to be paid accordingly.” Id. at 19-23). See also Kevin Madigan, First of Its Kind Decision Finds AI Training Is Not Fair Use, Copyright Alliance (Feb. 12, 2025) available at https://copyrightalliance.org/ai-training-not-fair-use/ (discussion of AI platform’s landmark loss on fair use defense).
[2] Professor Tim W. Dornis and Professor Sebastian Stober, Copyright Law and Generative AI Training – Technological and Legal Foundations, Recht und Digitalisierung/Digitization and the Law (Dec. 20, 2024)(Abstract) available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4946214.
Yes, it’s kismet in the legislature–the sketchy ticket resellers are redoubling their efforts to normalize “speculative tickets.” They have found a willing partner in gaslighting with an organization called “ALEC”.
The American Legislative Exchange Council (hence “ALEC“) is a nonprofit organization that brings together private sector representatives and relatively conservative state legislators to draft (and pass) “model legislation” that pushes a particular narrative. (That private sector representation is led by Netchoice, aka, Big Tech.) Unlike other model legislation with a social benefit like say the Uniform Partnership Act, ALEC’s “model legislation” pushes a particular agenda. Examples would be “stand your ground” gun laws, Voter ID laws, and “right to work” laws.
Netchoice Members (Netchoice leads ALEC’s Private Enterprise Advisory Council)
ALEC’s many successfully-passed “model” laws are intended to be passed by state legislatures as-written. Like Al Capone’s green beer, it ain’t meant to be good it’s meant to be drunk. A cynic–not mentioning the names of any particular cynics–might say that the ALEC strategy is an end-run around federal legislation (like the fake library legislation that was shot down in New York). If ALEC can get a critical mass of states to pass one of their “model bills” as-drafted on any particular subject, then the need for federal legislation on that topic may become more muted. In fact, if federal legislation becomes inevitable, the ALEC model bills then provide guidance for federal legislation, or new federal legislation has to draft around the states that adopt the model bill.
So much for Justice Louis Brandeis’ concept of states as laboratories of democracy (New State Ice Co. v. Liebmann, 285 U.S. 262 (1932)), unless that lab belongs to Dr. Frankenstein. ALEC’s mission claims to promote principles of limited government, free markets, and federalism; I will leave you to decide if it’s more about checkbook federalism.
Ticketing Panel, Artist Rights Symposium 11/20/24, Washington DC L-R: Chris Castle (Artist Rights Institute), Dr. David Lowery (Univ. of Georgia, Terry College of Business), Mala Sharma (Georgia Music Partners), Stephen Parker (National Independent Venue Association), Kevin Erickson (Future of Music Coalition)
Like so many of these bills, ALEC’s Live Event Ticketing Consumer Protection & Reform Act disguises its true objective with a bunch of gaslighting bromides that they evidently believe to be persuasive and then when you’re not looking they slip in the knife. Then when the knife is protruding from your back you discover the true purpose. I think this section of the bill is the true purpose:
This is an odd construct. The model bill starts out by requiring positive behavior of a primary seller (which would be the band on fan club sales or other direct to fan sales). That positive behavior immediately turns to using the ticket purchaser into an enforcer of the values beneficial to the ticket reseller. This is done by forcing a purchaser to be able to resell their ticket without regard to any restrictions placed on reselling by the artist.
And you know that’s the intention because the section also requires there to be no maximum or minimum price. While the model bill doesn’t require any particular restriction on the platforms, it has enough in it that it can look like a consumer protection bill, but what it is really doing and apparently was designed to accomplish is eliminate an artist’s a ability to set prices.
ALEC is serious about violations of the act, including civil penalties. Their model ticketing legislation can be enforced by both the Federal Trade Commission and state attorneys general. Penalties can include fines of up to $15,000 per day of violation and $1,000 per event ticket advertised or sold. One problem with the model bill is that it appropriates jurisdiction already available to federal agencies like the FTC which is already failing to enforce the existing BOTS Act and other property theft laws.
The main targets seem to be Stubhub’s competitors like “Primary Ticket Merchants,” These are the original sellers of event tickets, such as event organizers or venues. “Secondary Ticket Merchants” may also be prosecuted as well as individuals.
We continue to study the proposed model legislation, but I tend to agree with Stephen Parker (NIVA) and Kevin Erickson (Future of Music) on my Artist Rights Institute panel in DC yesterday. The better model bill may be their bill passed in Maryland, recently signed into law by Maryland governor Wes More.
Key differences between Maryland and the ALEC bill I could spot:
Scope of Penalties: The Maryland bill specifies fines for speculative ticket sales, while the ALEC bill includes broader penalties for various violations.
Refund Policies: The Maryland bill explicitly requires refunds for counterfeit tickets, canceled events, or mismatched tickets, whereas the ALEC bill focuses more on transparency and restrictive practices.
Study on Resale Impact: The Maryland bill includes a provision for studying the impact of resale price caps, which is not present in the ALEC bill.
It appears that the Live Event Ticketing Consumer Protection & Reform Act will be introduced at the ALEC meeting on December 5, 2024. This is where ALEC members, including state legislators and private sector representatives, will discuss and vote on the model policy.
We are announcing the time schedule and speakers for the 4th annual Artist Rights Symposium on November 20. The symposium is supported by the Artist Rights Institute and was founded by Dr. David C. Lowery, Lecturer at the University of Georgia Terry College of Business.
This year the symposium is hosted in Washington, DC, by American University’s Kogod School of Business at American’s Constitution Hall, 4400 Massachusetts Avenue, NW, Washington, DC 20016. We are also pleased to have a Kogod student presentation on speculative ticketing as part of the speaker lineup.
The symposium starts at 8:30 am and ends with a reception at 4:30pm. The symposium will be recorded as an audiovisual presentation for distribution at a later date, but will not be live-streamed. If you attend, understand that you may be filmed in any audience shots, questions from the floor or still images. The symposium social media hashtag is #ArtistRightsKogod.
10:15-10:30: NIVA Speculative Ticketing Project Presentation by Kogod students
10:30-10:45: Coffee break
10:45-11:00: OVERVIEW OF CURRENT ISSUES IN ARTIFICIAL INTELLIGENCE LITIGATION: Kevin Madigan, Vice President, Legal Policy and Copyright Counsel, Copyright Alliance
11:00-12 pm: SHOW ME THE CREATOR – Transparency Requirements for AI Technology:
2:45-3:15: Reconvene across street to International Service Founders Room for concluding speakers and reception
3:15-3:30: OVERVIEW OF INTERNATIONAL ARTIFICIAL INTELLIGENCE LEGISLATION: George York, Senior Vice President International Policy from RIAA.
3:30-4:30: NAME, IMAGE AND LIKENESS RIGHTS IN THE AGE OF AI: Current initiatives to protect creator rights and attribution
Jeffrey Bennett, General Counsel, SAG-AFTRA, Washington, DC Jen Jacobsen, Executive Director, Artist Rights Alliance, Washington DC Jalyce E. Mangum, Attorney-Advisor, U.S. Copyright Office, Washington DC Moderator: John Simson, Program Director Emeritus, Business & Entertainment, Kogod School of Business, American University
4:30-5:30: Concluding remarks by Linda Bloss-Baum, Director of the Kogod School of Business’s Business & Entertainment Program and reception.
We are announcing more topics and new speakers for the 4th annual Artist Rights Symposium on November 20, this year hosted in Washington, DC, by American University’s Kogod School of Business at American’s Constitution Hall, 4400 Massachusetts Avenue, NW, Washington, DC 20016. The symposium is also supported by the Artist Rights Institute and was founded by Dr. David Lowery, Lecturer at the University of Georgia Terry College of Business.
We’re pleased to add an overview of artificial intelligence litigation in the US by Kevin Madigan, Vice President, Legal Policy and Copyright Counsel from the Copyright Alliance and an overview of international artificial intelligence-related legislation by George York, Senior Vice President International Policy from RIAA. We’re also announcing our fourth panel and speaker line up:
NAME, IMAGE AND LIKENESS RIGHTS IN THE AGE OF AI: Current initiatives to protect creator rights and attribution
Jeffrey Bennett, General Counsel, SAG-AFTRA, Washington, DC Jen Jacobson, Executive Director, Artist Rights Alliance, Washington DC Jalyce E. Mangum, Attorney-Advisor, U.S. Copyright Office, Washington DC Moderator: John Simson, Program Director Emeritus, Business & Entertainment, Kogod School of Business, American University
Panels will begin at 8:30 am and end by 5 pm, with lunch and refreshments. More details to follow. Contact the Artist Rights Institute for any questions.
We’re pleased to announce more speakers for the 4th annual Artist Rights Symposium on November 20, this year hosted in Washington, DC, by American University’s Kogod School of Business at American’s Constitution Hall, 4400 Massachusetts Avenue, NW, Washington, DC 20016. The symposium is also supported by the Artist Rights Institute and was founded by Dr. David Lowery, Lecturer at the University of Georgia Terry College of Business.
The four panels will begin at 8:30 am and end by 5 pm, with lunch and refreshments. More details to follow. Contact the Artist Rights Institute for any questions.
All the true promise of AI does not require violating writers, artists, photographers, voice actors etc copyrights and rights of publicity. You know, stuff like reading MRIs and X-rays, developing pharmaceuticals, advanced compounds, new industrial processes, etc.
All the true promise of AI does not require violating writers, artists, photographers, voice actors etc copyrights and rights of publicity. You know, stuff like reading MRIs and X-rays, developing pharmaceuticals, advanced compounds, new industrial processes, etc.
All the shitty aspects of AI DO require intentional mass copyright infringement (a RICO predicate BTW). You know stuff like bots, deep fakes, autogenerated “yoga mat” music, SEO manipulation, autogenerated sports coverage, commercial chat bots, fake student papers, graphic artist knockoffs, robot voice actors etc. But that’s where the no-value-add-parasitic-free-rider-easy-money is to be made. That’s why the parasitic free-riding VCs and private equity want to get a “fair use” copyright exemption.
Policy makers should understand that if they want to reduce the potential harms of AI they need to protect and reinforce intellectual property rights of individuals. It is a natural (and already existing) brake on harmful AI. What we don’t need is legislative intervention that makes it easier to infringe IP rights and then try to mitigate (the easily predictable and obvious) harms with additional regulation.
This is what happened with Napster and internet 1.0. The DMCA copyright infringement safe harbor for platforms unleashed all sorts of negative externalities that were never fairly mitigated by subsequent regulation.
Why do songwriters get 0.0009 a stream on streaming platforms? Because the platforms used the threat of the DMCA copyright safe harbor by “bad actors” (often connected to the “good actors” via shared board members and investors*) to create a market failure that destroyed the value of songs. To “fix” the problem federal legislation tasks the Copyright Royalty Board in LOC to set royalty rates and forced songwriters to license to the digital platforms (songwriters can not opt out). The royalty setting process was inevitably captured by the tech companies and that’s how you end up with 0.0009 per stream.
TBF the DMCA safe harbor requires the platforms to set up “technical measures” to prevent unlicensed use of copyrights, but this part of the DMCA safe harbor were never implemented and the federal government never bothered to enforce this part of the law. This is the Napster playbook all over again.
1. Unleash a technology that you know will be exploited by bad actors**.
2. Ask for federal intervention that essentially legalizes the infringing behavior.
3. The federal legislation effectively creates private monopoly or duopoly.
4. Trillions of dollars in wealth transferred from creators to a tiny cabal of no-value-add-parasitic-free-rider-easy-money VCs in silicon valley.
5. Lots of handwringing about the plight of creators.
6. Bullshit legislation that claims to help creators but actually mandates a below market rate for creators.
The funny thing is Lars Ulrich was right about Napster. [See our 2012 post Lars Was First and Lars Was Right.] At the time he was vilified by what in reality was a coordinated DC communication firm (working for Silicon Valley VCs) that masqueraded as grassroots operation.
But go back and watch the Charlie Rose debate between Lars Ulrich and Chuck D, everything Lars Ulrich said was gonna happen happened.
If Lars Ulrich hadn’t been cowed by a coordinated campaign by no-value-add-parasitic-free-rider-easy-money Silicon Valley VCs, he’d probably say the same thing about AI.
If you had a chance to watch the CLE panel that David Lowery, Mala Sharma and Chris Castle did for the University of Texas School of Law CLE last week, you’ll remember that the panel spent a good deal of time talking about “speculative tickets”. In fact, the title of the panel was “When is Ticketing Like Pork Bellies?” which was a direct reference to the similarities between speculative tickets and commodities futures contracts (like pork bellies).
The way this grift works is that somebody (or some thing in the case of bots) offers to sell a promise to sell a ticket in the future. The trick is that the ticket is not yet on sale anywhere but certain dates have been announced so it will be on sale. This could be any ticket, like a concert tour or a sporting event like the Super Bowl, the Rose Bowl, the World Series, and so on.
This is actually worse than a pork belly contract, because you know that the pork bellies exist when you buy the contract, you just don’t know the price. Market events could cause the price to fluctuate, but there will be some pork belly available somewhere. So to even call it a ticket is a misnomer. It’s a promise to sell something that may exist to get all Cartesian about it.
The grifter prices the speculative ticket promise at a premium, naturally. Some of them actually promise an actual seat, some promise a certain section or block of seats. They then list that ticket on a ticket reseller market place like Stubhub which was most definitely lobbying in force for the nonsensical Georgia ticketing bill that failed and which we assume is behind all these bills that keep popping up like syphilitic warts.
After the ticket is listed, a fan buys the speculative ticket promise and waits to get their actual tickets. And this is the really insidious part. As David noted on our panel, the grifter’s transaction is like covering on a naked short in short selling. Naked shorts are a very risky thing because unlike with speculative tickets, the market enforces the trade. You will pay on that bet unlike speculative tickets where there is no market enforcement except the occasional prosecution by a state attorney general or the FTC.
It seems impossible for the speculative ticket short seller to obtain the actual tickets without using bots. Plausible, perhaps, but seems very unlikely. Thanks to Senator Marsha Blackburn and Richard Blumenthal and their BOTS Act, federal law prohibits using bots, but again, it’s a science of getting caught. Senator Blackburn recently complained quite rightly that the FTC is not sufficiently enforcing the BOTS Act.
If the grifter cannot come up with the tickets, it is apparently very rare that the fan gets their money back. The fan will be offered all manner of things other than cash or maybe the grifter just slithers off into the night. Awful stuff, right?
The grifter is preying on the buyer’s love of the artist or the team (or the family member of the buyer) which is so great that they are willing to spend the money because they are made to believe they have a sure bet that will pay off with a real ticket. What kind of a heartless dickweed would do that to someone?
And here’s where Jared Polis comes in. If you’ve never heard of him, Jared Polis is the governor of Colorado. The Colorado legislature recently passed SB60 that would have joined other states in banning speculative tickets. But–on June 6, 2023 Jared Polis vetoed the bill.
So how did StubHub get to Jared Polis? Remember, Jared Polis is a 99er who made a fortune on the Internet before the Internet repriced itself. He also founded TechStars, so he’s a VC, too. So he knows all about grifters and could not give a rip about artists–as he has demonstrated many times. But his veto letter is worth reading because of its complete head up the ass approach to speculative tickets.
Polis goes through the “if you only had a brain” analysis saying there are some good things in SB60 which he could support but then there are the bad things which he, Polis the Lawmaker, simply cannot abide–like a prohibition on speculative tickets. Except he doesn’t call them speculative tickets like the Federal Trade Commission does, or the Attorney General of New York. Oh, no. In his veto letter, he calls them “innovative products that address existing market failures, such as online ticket waiting services“.
Wait a minute–are we talking about the same thing here?
The bill prohibits anyone that “Advertises, offers for sale, or contracts for the resale of a ticket unless the person has possession or constructive possession of the ticket and the person has an agreement with the rights holder.”
Somehow the bill language got transformed from protecting consumers against speculative ticketing to a whole new thing, an innovative product that a VC might invest in and even take that company public. Or could have in 1999.
Sure seems like Polis is in on the grift, don’t it? You can’t call it a conspiracy theory because there’s nothing theoretical about it.
Congress is considering whether to renew The MLC, Inc.‘s designation as the mechanical licensing collective. If that sentence seems contradictory, remember those are two different things: the mechanical licensing collective is the statutory body that administers the compulsory license under Section 115. The MLC, Inc. is the private company that was “designated” by Congress through its Copyright Office to do the work of the mechanical licensing collective. This is like the form of a body that performs a function (the mechanical licensing collective) and having to animate that form with actual humans (The MLC, Inc.), kind of like Plato’s allegory of the cave, shadows on the wall being what they are.
Congress reviews the work product of The MLC, Inc. every five years (17 USC §115(d)(3)(B)(ii)) to decide if The MLC, Inc. should be allowed to continue another five years. In its recent guidance to The MLC, Inc. about artificial intelligence, the Copyright Office correctly took pains to make that distinction in a footnote (footnote 2 to be precise. Remember–always read the footnotes, it’s often where the action is.). This is why it is important that we be clear that The MLC, Inc. does not “own” the data it collects (and that HFA as its vendor doesn’t own it either, a point I raised to Spotify’s lobbyist several years ago). Although it may be a blessing if Congress fired The MLC, Inc. and the new collective had to start from scratch.
But Congress likely would only re-up The MLC, Inc. if it had already decided to extend the statutory license and all its cumbersome and byzantine procedures, proceedings and prohibitions on the freedom of songwriters to collectively bargain. Not to mention an extraordinarily huge thumbs down on the scales in favor of the music user and against the interest of the songwriters. The compulsory license is so labyrinthine and Kafka-esque it is actually an insult to Byzantium, but that’s another story.
Rather than just deciding about who is going to get the job of administering the revenues for every songwriter in the world, maybe there should be a vote. Particularly because songwriters cannot be members of the mechanical licensing collective as currently operated. Congress did not ask songwriters what they thought when the whole mechanical licensing scheme was established, so how about now?
Before the Congress decides to continue The MLC, Inc. many believe strongly that the body should reconsider the compulsory license itself. It is the compulsory license that is the real issue that plagues songwriters and blocks a free market. The compulsory license really has passed its sell by date and it’s pretty easy to understand why its gone so sour. Eliminating the Section 115 license will have many implications and we should tread carefully, but purposefully.
Party Like it’s 1909
First of all, consider the actual history of the compulsory license. It’s over 100 years old, and it was established at a time, believe it or not, when the goal of Congress was to even the playing field between, music users and copyright owners. They were worried about music users being hard done by because of the anticompetitive efforts of songwriters and copyright owners. As the late Register Marybeth Peters told Congress, when Congress created the exclusive right to control reproduction and distribution in 1909, “…due to concerns about potential monopolistic behavior [by the copyright owners], Congress also created a compulsory license to allow anyone to make and distribute a mechanical reproduction of a nondramatic musical work without the consent of the copyright owner provided that the person adhered to the provisions of the license, most notably paying a statutorily established royalty to the copyright owner.”
Well, that ship has sailed, don’t you think?
This is kind of incredible when you think about it today because the biggest users of the compulsory license are those who torture the bejesus out of songwriters by conducting lawfare at the Copyright Royalty Board–the richest corporations in commercial history that dominate practically every moment of American life. In fact, the statutory license was hardly used at all before these fictional persons arrived on the scene and have been on a decades-long crusade to hack the Copyright Act through lawfare ever since. This is particularly true since about 2007 when Big Tech discovered Section 115. (And they’re about to do it again with AI–first they send the missionaries.)
If the purpose of the statutory scheme was to create a win-win situation that floats all boats, you would have expected to see songwriters profiting like never before, right? If the compulsory was so great, what we really needed was for everyone to use Section 115, right? Actually, the opposite has happened, even with decades of price fixing at 2¢ by the federal government. When hardly anyone used the compulsory license, songwriters prospered. When its use became widespread, songwriters suffered, and suffered badly.
Songwriters have been relegated to the bottom of the pile in compensation, a sure sign of no leverage because whatever leverage songwriters may have is taken–there’s that word again–by the compulsory license. I don’t think Google, a revanchist Microsoft, Apple, Amazon or Spotify need any protection from the anticompetitive efforts of songwriters. Google, Amazon, Apple, Microsoft, Spotify are only worried about “monopolistic behavior” when one of them does it to one of the others. The Five Families would tell you its nothing personal, it’s just business.
Yet these corporate neo-colonialists would have you believe that the first thing that happens when the writing room door closes is that songwriters collude against them. (Sounding very much like the Radio Music Licensing Committee–so similar it makes you wonder, speaking of collusion.)
The Five Year Plan
Merck Mercuriadis makes the good point that there is no time like the present to evolve: “In the United States, we have a position of stability for the next five years – at the highest rates paid to songwriters to date – in the evolution of the streaming economy. We are now working towards improving the songwriters’ share of the streaming revenue ‘pie’ yet further and, eventually, getting to a free market.” The clock is ticking on the next five years, a reference to the rate period set by the Copyright Royalty Board in the Phonorecords IV proceeding. (And that five years is a different clock than the five years clock on the MLC which is itself an example of the unnecessary confusion in the compulsory license.)
What would happen if the compulsory license vanished? Very likely the industry would continue its easily documented history of voluntary catalog licenses. The evidence is readily apparent for how the industry and music users handled services that did not qualify for a compulsory license like YouTube or TikTok. However stupid the deals were doesn’t change the fact that they happened in the absence of a compulsory license. That Invisible Hand thing, dunno could be good. Seems to work out fine for other people.
Let’s also understand that there is a cottage industry complete with very nice offices, pensions and rich salaries that has grown up around the compulsory license (or consent decrees for that matter). A cottage industry where collecting the songwriters’ money results in dozens of jobs paying more in a year than probably 95% of songwriters will make, maybe ever. (The Trichordist published an excerpt from a recent MLC tax return showing the highest compensated MLC employees.) Generations of lawyers and lobbyists have put generations of children through college and law school from legal fees charged in the pursuit of something that has never existed in the contemporary music business–a willing buyer and a willing seller. Those people will not want to abandon the very government policy that puts food on their tables, but both sides are very, very good at manufacturing excuses why the compulsory license really must be continued to further humanity.
The even sadder reality is that as much as we would like to simply terminate the compulsory license, there is a certain legitimacy to being clear-eyed about a transition. (An example is the proposals for transitioning from PRO consent decrees–ASCAP’s consent decree has been around a long time, too.) There would likely need to be a certain grandfathering in of services that were pre or post the elimination of the compulsory, but that’s easily done, albeit not without a last hurrah of legal fees and lobbyist invoices. Register Pallante noted in the well-received 2015 Copyright Office study (Copyright and the Music Marketplace at 5) “The Office thus believes that, rather than eliminating section 115 altogether, section 115 should instead become the basis of a more flexible collective licensing system that will presumptively cover all mechanical uses except to the extent individual music publishers choose to opt out.” An opt out is another acceptable stop along the way to liberation, or even perhaps a destination itself. David Lowery had a very well thought-out idea along these lines in the pre-MLC era that should be revisited.
X Day
However, while there is a certain attractiveness to having a plan that the dreaded “stakeholders” and their legions of lobbyists and lawyers agree with, it is crucially important for Congress to fix a date certain by which the compulsory license will expire. Rain or shine, plan or no plan, it goes away on the X Day, say five years from now as Merck suggests. So wakey, wakey.
That transparency drives a wedge into the process because otherwise millions will be spent in fees for profiting from moral hazard and surely the praetorians protecting the cottage industry wouldn’t want that. If you doubt that asking for a plan before establishing X Day would fail as a plan, just look at the Copyright Royalty Board and in particular the Phonorecords III remand. Years and years, multiple court rulings, and the rates still are not in effect. Perseveration is not perseverance, it’s compulsive repetition when you know the same unacceptable result will occur.
But don’t let people tell you that the sky will fall if Congress liberates songwriters from the government mandate. The sky will not fall and songwriters will have a generational opportunity to organize a collective bargaining unit with the right to say no to a deal.
Who can forget Sally Fields in Norma Rae?
The closest that Congress has come to a meaningful “vote” in the songwriting world is inviting public comments through interventions, rule makings, roundtables and the like–information gathering that is not controlled by the lobbyists. Indeed, it was this very process at the Copyright Royalty Board that resulted in many articulate comments by songwriters and publishers themselves that were clearly quite at odds with what the CRB was being fed by the lobbyists and lawyers. So much so that the Copyright Royalty Judges rejected not only the “Subpart B” settlement reached by the insiders but the very premise of that settlement. Imagine what might happen if the issue of the compulsory license itself was placed upon the table?
Now that songwriters have had a taste of how The MLC, Inc. has been handling their money, maybe this would be a good time to ask them what they think about how things are going. And whether they want to be liberated from the entire sinking ship that is designed to help Big Tech. And you can start by asking how they feel about the $500 million in black box money that is still sitting in the bank account of The MLC, Inc. and has not been paid–with an infuriating lack of transparency. Yet is being “invested” by The MLC, Inc. with less transparency than many banks with smaller net assets.
This “investment” is another result of the compulsory license which has no transparency requirements for such “investments” of other peoples’ money, perhaps “invested” in the very Big Tech companies that fund the The MLC, Inc. That wasn’t a question that was on the minds of Congress in 1909 but it should be today.
Attention Must Be Paid
Let’s face facts. The compulsory license has coexisted in the decimation of songwriting as a profession. That destruction has increased at an increasing rate roughly coincident with the time the Big Tech discovered Section 115 and sent their legions of lawyers to the Copyright Royalty Board to grind down publishers, and very successfully. That success is in large part due to the very mismatch that the compulsory license was designed to prevent back in 1909 except stood on its head waiting for loophole seekers to notice the potential arbitrage opportunity.
The Phonorecords III and IV proceedings at the Copyright Royalty Board tell Congress all they need to know about how the game is played today and how it has changed since 1909, or the 1976 revision of the Copyright Act for that matter. The compulsory license is no longer fit for purpose and songwriters should have a say in whether it is to be continued or abandoned.
We see the Writers Guild striking and SAG-AFTRA taking a strike authorization vote. When was the last time any songwriters voted on their compensation? Maybe never? Voting, hmm. There’s a concept. Now where have I heard that before?
The Trichordist 
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