Nashville Entertainment Law

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Obviously with with so much of the music industry centered around Nashville, entertainment law is an important concern in Tennessee.  Here's a brief outline of how entertainment law is structured:
 
BASIC FORMS OF DOING BUSINESS
 
Sole Proprietorship:  A sole proprietorship means that one person (and one person alone) is calling all the shots and has all the tax liabilities and other responsibilities of a business.  Some refer to a sole proprietorship as a DBA, but that's a misnomer -- there's no legal term called a DBA, it's an abbreviation the same as "AKA" or "PKA."  Some solo acts or songwriters will declare themelves sole proprietors for some business purposes, while incorporating other areas of their business (touring, record sales or publishing). 
 
Partnership:  A partnership is an association of any two or more presons working together to make a profit in a business.  A band, duo or other lineup is de facto considered a partnership unless other papers have been drawn up to declare the band an LLC or corporation.  That will mean that every member of the band is liable for taxes, tort or any other business obligations.  If a band is going to remain a partnership, a partnership agreement should be put down on paper, at which certain issues should be cleared up such as:
 
  • What's the percentage of ownership for each partner?
  • How can a partner leave, or be removed?
  • What restrictions should there be on partners selling their interest to someone else?
  • If the partnership ends, who owns the name?  Can the name be used in the future?
 
Corporation:  While a corporation retains many of the rights and responsibilities of an individual, it's an artificial structure of the law.  The chief advantage of a corporation is the concept of limited liability; unlike a partnership or sole proprietorship, individuals (owners and shareholders) are not liable for corporate debts, torts, tax bills or other obligations.  Again, a band or artist may find it advantageous to incorporate for aspects like touring, record sales or publishing while keeping a sole proprietorship or partnership for other areas of their business.
 
Limited Liability Company:  The LLC is a relatively new construct in business ownership.  Limited liability companies offer the limits of exposure of a corporation, but the owners can choose to be taxed as a corporation without meeting the guidelines of a Subchapter S corporation.  An LLC's profits can go directly to the owners and declared on their individiual tax returns.  This is an advantage in states where corporate tax rates are greater than individual tax rates.  Unlike corporations, LLC's offer much more flexibility and simplicity; owners can structure their profit sharing and voting interest as they like, and there is no requirement for an annual meeting of shareholders.  These are just a few of the advantages of an LLC.
 
COPYRIGHT ISSUES
 
When a song, play, book, poem, story or other work is written down, it is, by law, copyrighted.  It doesn't matter if it's written on a cocktail napkin; as soon as it's committed to paper (or recorded), it becomes the property of the author or publisher. 
 
However...
 
...you cannot file for copyright infringement until the work has been registered with the Copyright Office. 
 
Form PA (for songs) and Form SR (for recordings) are required, along with a fee and the number of copies or records issued.  At that time, a Certificate of Copyright Registration will be "stamped" and sent back to you.  That registration entitles you to the validity of the copyright itself and the veracity of the facts stated in the Certificate.  At that point, in an infringement complaint, the burden of proof is on the other party to show that you are not the writer.
 
As a general rule, a copyright lasts for the writer's lifetime plus 70 years.  To save money, many people will group several songs together and register them with the Copyright Office with the same copyright protection for all of them together.  Remember that for songs that were co-written, both writers must be included on the form.  Their copyright protection will be equal; there will be no individual copyright for each writer. 
 
Some things cannot be copyrighted:
 
  • song titles
  • phrases
  • song ideas
 
It's the entire expression that can be copyrighted; the idea of "love gone wrong" cannot enjoy copyright protection, but your completed take on love gone wrong is copyrightable.  The exception would be for a song with a phrase or title that's so well-known by the general public that it's associated with one particular song.
 
 
PERSONAL MANAGEMENT
 
Of all the issues in entertainment law, artist management often becomes one of the most contentious and fraught with problems.  These are the bare minimums that a management contract should specify:
 
  • Manager's duties, i.e. representation, booking issues, pay issues, availability for consultation, etc.
  • Length of the management agreement itself.  Typically an agreement will consist of an "initial period" (usually one year) with "option periods" to follow.  The option period protects the artist if things go badly, and gives the manager a chance to stay on board if things go well. 
  • Escape clause that lays out specific, measurable goals, with options if those goals aren't met (by the artist or manager either one)
  • The manager's commission on the artist's gross earnings (usually 15 to 20%). 
  • Items that the manager is not entitled to by commission (i.e. record company advance money or recording money, or publishing money)
  • Areas of the artist's career that are off-limits to the manager's decision-making power
 
EXCLUSIVE SONGWRITER AGREEMENTS
 
The following are usually entailed in a songwriter agreement:
 
  • Ownership interest in the songs themselves
  • Delivery requirement (the number of songs expected by the publisher, usually a minimum of 8 to 12 songs a year)
  • Specifics of royalties
  • Specifics of monetary advances
  • Specifics of how advances will be recouped
  • Specifics of song demos (i.e. how they'll be paid for) 

 


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