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Indie Label Signing Practices OR Oral Contracts Are Bad But Oral Sex Is Still OK

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pilsner:

--- Quote from: a pack of wolves on 17 Feb 2010, 22:57 ---An artist's releases still being financially viable even after they're dead is extremely rare. The chances of those records still being viable to keep in print and the death happening before the label has recouped its costs and the albums are perceived by relatives to be worth enough to take the label to court over them in the hope of making more money are so small that it really isn't worth worrying about.

...

It's absolutely a matter of pride that people will work hard and do the right thing without needing to be forced into it by law or even monetary incentive. Personally, I think that's unequivocally a good thing, and it works without lawyers policing people's relationships. It's rather telling that the bands who are signed to major labels with contracts drawn up by lawyers are the ones that are the most exploited.

--- End quote ---

Extremely rare is a gross overstatement given that we are talking about essentially every band signed with a label which was selling enough records to justify pressing them and had a member die young.  Why would you even make such a statement? Do you have personal experience with the recording industry such that you have a grasp of how often signed artists die, or have you done a personal survey in your free time perhaps?  If so would you care to share the results?  It sounds like you are making things up for the sake of an argument.

In the absence of a written agreement assigning the copyright (the situation under discussion), in the United States and Canada, the copyright for performance of the song will belong to the writer of the song, whereas the copyright for the recording of the song will belong all members of the band.  Ah, but what if one of the members of the band dies?  What happens to royalties of the song -- are they to be split among each member of the band with the deceased member getting an equal share via their beneficiary?  Partnership law, which in likelihood none of the musicians will have any idea about, will decide these issues if they are not explicitly decided through an agreement, and given the complexities and modalities of the situation, not to mention the fact that it deals with copyright, that agreement has to be written.  Hence websites like this one.  Now of course, a Band Partnership Agreement isn't a recording contract, but they do cover a lot of the same ground.

The idea that "lawyers would police people's relationships" once a written agreement is signed is unfortunate, particularly because the converse is closer to the truth.  When a right, say the right to a portion of the royalties of a recording in perpetuity, is clearly defined in a written contract, it is worth a lot more than a right that is hazily defined in an oral agreement, lawyers or no lawyers.  Artists who decline to delineate their rights to their own music with written agreements therefore impoverish themselves in two ways.  First, should they ever want to sell their copyright, it will be worth a lot more if there is a document rendering explicit exactly what portion of the proceeds that copyright amounts to.  This is true even if neither side ever sues.  It's the difference between selling a car you have clear title to, and selling a car you claim to have been given by your uncle to a guy with scrap yard dogs.

Second, failing to ratify a written agreement creates ambiguities which are essentially cracks through which the lawyers (who are rats in this metaphor) come in and make the transaction exponentially more expensive.  As a general rule, if rights are clearly defined, even if one side sues the situation can usually be settled quickly because it is clear who is entitled to what.  Instead, lawyers get wealthy off of situations exactly like the one in T&G v. Butthole Surfers, where there is a ton of ambiguity, one side acts unilaterally, and next thing you know you've gone through two trials and your Federal Court of Appeals case has set new precedent.  By that point, you've spent upwards of $100k in legal fees.  This is a situation most people want to avoid.

Ptommydski:
Arguably the two biggest labels to use the handshake agreement are Touch & Go and Dischord and only on one occasion did a band have the audacity to try to renege on a deal with either label, which was why it was considered so offensive to anybody who holds those labels in high regard.

No offence to anybody likely to post in this thread but the desire to create, manufacture and distribute records in a fair, honest way was born of a need to act in a way which was completely unlike the big businesses/major labels. The idea was to keep out all of this legalese and assume everybody would hold up their end of the deal on the basis that they understood and believed in the need for honesty and autonomy in independent music. An overwhelming majority of those who made deals like this understood that and wouldn't think to go back on their own word. Sure, it would be best practices to plug all the gaps which could be exploited given existing laws but that would be the antithesis of everything said labels stood for. By design, they have to cut out the complicated contractual issues or they stand to be placed in situations whereby they would resemble the very organs they were trying to surpass in terms of ethical business practices. I accept that it's an ambiguous system which is rife with potential legal issues but that's essentially the way it has to be. The one occasion where it didn't work shouldn't override the thousands of occasions in which it did.

I can't really put it better than Ian Mackaye (co-owner of Dischord) did -


--- Quote from: Ian Mackaye ---"Conceptually [the Copyright Act] is a good law," says MacKaye. "It happens that in this perverse situation it was used against something that's right. It doesn't surprise me. Courts don't understand this--it's outside of their domain. Courts are the domain of lawyers. If you have an oral contract, lawyers don't get paid. It's kind of perfect that a court would be offended by that."
--- End quote ---

So yeah, it does seem ridiculous by most people's standards but that's what made and makes these labels so incredible. That's why they stand out against the majors/less than honest smaller labels and why I'll always support them as long as they continue to exist. They took an idealistic, seemingly naive set up and somehow made it work against all logical thinking.

tricia kidd:
as i understand it the point of the informal, handshake agreement is that it can be cancelled by either party when they become dissatisfied with it, without having to resort to lawyers.

according to the article:

"The legal battle started officially in December 1995 when the Buttholes sent Rusk a letter demanding that their share of the net profit be increased to 80 percent. When Rusk refused their proposal in writing, they sent him another letter demanding that he stop selling their records and give back the master tapes. When Rusk again refused, the Buttholes sued him and Touch and Go"

in what part of this battle is it supposed to be clear that Rusk had the right to refuse to honor the band's wishes to have their intellectual property returned to them?  it seems a bit odd that someone would assume they have the right to own a band's property in perpetuity without a formal, clear agreement that this was the case.

Ptommydski:

--- Quote from: tricia kidd on 18 Feb 2010, 07:27 ---in what part of this battle is it supposed to be clear that Rusk had the right to refuse to honor the band's wishes to have their intellectual property returned to them?  it seems a bit odd that someone would assume they have the right to own a band's property in perpetuity without a formal, clear agreement that this was the case.
--- End quote ---

It's already on the record in the other thread that you don't understand this and I'm very glad that you don't. Hopefully this will keep you and your kind away from Touch & Go and indeed any label who works using their system. That's exactly how it should be.

Given your other posts and what we can glean from them about you as an individual, it makes perfect sense that you would side with the BH Surfers on this matter. Absolutely perfect sense. Since this is now assured, we can happily assume this will always be the case.

tricia kidd:
i'm not siding with the Surfers or Touch and Go.  i wasn't there when the initial agreement was made 25 years ago, and given that nothing was put into writing, it's entirely possible that the Surfers, Rusk, or both have incomplete or distorted memories of what their agreement was.

i still don't know why it is in keeping with the ethics of this community for a record label to refuse to surrender a band's master tapes to them when asked.  keeping intellectual property against someone's wishes is what major labels with lawyers do - this has happened to several bands, who recorded albums that the label refused to release, but also refused to surrender the rights to, leading to an album that the people who want to release it can't, and the people who can release it won't.

i thought you agreed to be civil if people were civil to you, Ptommy?  your last post was not civil.  who exactly are "me and my kind"?  what is "my kind"?  the kind who believe that an artist has the right to own their work?  i was trying to post in this thread in a neutral way, as Inlander requested.  let's not go down this road again, because i know for a fact that nobody likes reading either of our posts when the discussion starts going this way.  and this time, you started it down that path.  this thread was supposed to be a fresh start.

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