Why Songwriters And Their Heirs Are Often Underpaid
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Consumers are enjoying music in more ways than ever: in ringtones, videogames, digital downloads, CD reissues, remixes, and too many other formats to list. And with the proliferation of entertainment companies and low-cost editing equipment, there is a huge market for music to enhance films, TV shows, and advertisements.
Although there've been many media stories about widescale copyright infringement, it has been less reported that there are still numerous reputable companies paying the proper licensing fees to legally provide music to consumers. Yet many songwriters who've written hit songs, and many heirs of deceased songwriters, are not receiving their share of this money. This article will discuss some of the reasons why. Every songwriter and every song has unique attributes, so if you are a songwriter or songwriter's heir and have questions about your own situation, you should consult an attorney with experience in this area.
A songwriter who's written a hit song is often entitled to royalties from several different sources. Royalties for radio airplay and other public performances are collected from companies and paid to writers and heirs by performing rights organizations; in the United States, these are ASCAP, BMI and SESAC. Royalties for other types of uses are usually collected and paid by a music publishing company to which the songwriter originally sold his or her rights (or a successor of the original company). A songwriter can have different songs owned or administered by different publishers, and each song can have more than one publisher. So songwriters or heirs might be receiving income from one or a few sources, and not realize that they are entitled to royalties from other sources as well.
There are many reasons for such underpayments. Perhaps a writer moved and didn't provide a new address to each publisher, or perhaps a writer died and the publishers weren't provided with heir information. A songwriter or heir may not realize they're entitled to royalties because they mistakenly believe a song is public domain, when it's actually still protected by copyright. This is especially common with works by foreign songwriters: even songs that were public domain in the United States at one time may have had their copyrights restored under the (PDF link) 1994 Uruguay Round Agreements Act. Songs written as early as 1923 may still be protected in the United States, and even older songs may still be protected in foreign countries.
Also, any particular publisher might be underpaying based on territory (for example, paying royalties for U.S. but not foreign uses of a song) or based on type of use (for example, paying for use on CD's but not use in ringtones). Some music publishers may not be aware of new types of royalties they should be collecting and paying, such as for webcasting and other new formats.
Many music publishing companies are very large and process millions of royalty payments annually; if an employee enters a license fee or royalty rate incorrectly, the mistake may never be caught unless it's brought to the company's attention. Royalty statements can be confusing, and failure to review them carefully can let underpayments slip through.
Even if a songwriter or heir is being paid by all relevant companies at the correct rate, it may be possible to negotiate a better rate. To determine this, one must first ask if the original contracts signed by the writer are still in effect. If a songwriter signed a contract decades ago, it's quite possible that no one has looked at it in many years, and it may have expired without anyone being aware. If the contract had a limited term, or expired upon certain conditions (such as the song going out of print), the songwriter or heir can reclaim their rights and perhaps negotiate a better deal with a new publisher.
Also, the United States copyright law has provisions stating that songwriters and heirs can reclaim their songs at certain times if certain conditions are met, regardless of what the contract says. These so-called (PDF link);"renewal" and "termination" provisions are complex and beyond the scope of this article, but an attorney with experience in copyright law, or a music publishing company that's interested in obtaining the rights for itself, can do the research to determine whether a specific contract can be terminated.
Once the songwriters or heirs have re-acquired their songs, they're free to make a deal with a new company of their choice. If the songs are well-known ones, it should be possible to obtain an up-front payment and/or a higher royalty rate than that in the original contract.
Sometimes extensive research is required to determine all sources of income and the correct rate for each song, and even more work or even lawsuits to obtain the monies owed, but large sums of money can occasionally be found by doing so. Songwriters or heirs who don't know their rights may not be aware of underpayment. Ignorance may be bliss, but a large royalty check is even more blissful. If you're a songwriter who wrote a hit song, even decades ago, or the heir of one, it pays to know your rights.