Music Modernization Act

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Orrin G. Hatch–Bob Goodlatte Music Modernization Act
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Long titleTo modernize copyright law, and for other purposes.
NicknamesMusic Modernization Act
Announced inthe 115th United States Congress
Sponsored by Bob Goodlatte
Number of co-sponsors49
Citations
Public law Pub. L.   115–264 (text) (PDF)
Statutes at Large 132  Stat.   3676
Codification
Titles affected17
U.S.C. sections affected 17 U.S.C.   § 101 note
Legislative history

The Orrin G. Hatch–Bob Goodlatte Music Modernization Act, or Music Modernization Act or MMA (H.R. 1551, Pub. L.   115–264 (text) (PDF)) is United States legislation signed into law on October 11, 2018 aimed to modernize copyright-related issues for music and audio recordings due to new forms of technology such as digital streaming. It is a consolidation of three separate bills introduced during the 115th United States Congress.

Contents

Enjoined bills

The MMA is a combination of three bills previously introduced in Congress. [1] The three bills became the three titles of the final act.

Title I: Music Modernization Act

The Musical Works Modernization Act (MWMA) is the Act first introduced into the House by Rep. Bob Goodlatte on December 17, 2017 (H.R. 4706), and later to the Senate by Sen. Orrin Hatch on January 24, 2018. Both versions of the bill looked to improve how music licensing and royalties would be paid in consideration of streaming media services. The bill established three major provisions: [2]

  1. It would set up a non-profit governing agency that would create a database related to the owners of the mechanical license of musical works - the copyright that covers the music and lyrics of a musical composition; the actual performance and recording is typically held under a different license. This musical works database would be completed with help of the major music publishers. The new agency would establish blanket royalty rates that would be used to pay the composers and lyricists when used by streaming services using this database, eliminating the difficulty previously faced by streaming services to properly identify the mechanical license holder. These royalties would be paid to the non-profit agency as a compulsory license, not requiring the mechanical license holder's permission; the agency would then be responsible for distributing the royalties. Streaming services would still be able to negotiate other royalty rates directly with the mechanical license owner if they so chose.
  2. It ensures that composers and lyricists are paid a portion of mechanical license royalties for either physical or digital reproduction of musical compositions, at a rate set by contract.
  3. It revamps the rate court process when disagreements over royalty rates arise. Previously, a single judge in the United States District Court for the Southern District of New York was assigned to handle all cases; the bill would assign a random judge in this Court to oversee these cases.

In addition, elements of the "Fair Play Fair Pay Act", H.R. 1836, introduced on March 30, 2017, by Rep. Jerrold Nadler, were added to this Title. The Fair Play Fair Pay Act had been designed to harmonize how royalties were paid by terrestrial radio broadcasters and Internet streaming services. Under previous law, songwriters and composers would receive mechanical license royalties for radio play, but the performing artists would not be paid as the use of songs on the radio was considered "promotional". The Fair Play Fair Pay Act had included language that would allow recording artists to receive performance royalties. However, these parts of the Fair Play Fair Pay Act were not included in the combined Music Modernization Act. [3]

Title II: CLASSICS Act

The Compensating Legacy Artists for their Songs, Service, and Important Contributions to Society (CLASSICS) Act was originally introduced in the House as H.R. 3301 in July 2017. In US copyright law, sound recordings made prior to February 15, 1972, were not covered under federal copyright law, leaving them up to the individual states to pass laws for recording protection. This had created a complex series of laws that made it difficult for copyright enforcement and royalty payments. The CLASSICS Act established that sound recordings before 1972 are covered by copyright until February 15, 2067, with additional language to grandfather older recordings into the public domain at an earlier time.

Recordings prior to 1923 entered the public domain three years from passage, which equates to January 1, 2022 (see note). [4] Recordings from 1923 to 1956 enter the public domain on January 1 the year after they turn 100 years old. For example, a work published on June 1, 1925, enters the public domain on January 1, 2026. Every January 1 following 2022, [5] works will enter the public domain, until the final date occurring on January 1, 2047, which concludes the entire corpus of works published between 1923 and 1946. Following a 10 year break, recordings from 1947 to 1956 will enter every year until the final date occurring on January 1, 2067. All recordings from 1957 to February 14, 1972, will be protected until February 15, 2067.

Title III: Allocation for Music Producers Act

The Allocation for Music Producers (AMP) Act was introduced by Rep. Joseph Crowley on February 6, 2017 as H.R. 881. The bill designates that SoundExchange, the non-profit organization established by Congress to distribute royalties on sound recordings, will also distribute part of those royalties to "a producer, mixer, or sound engineer who was part of the creative process that created [the] sound recording".

Lobbying from the recording industry

On April 1, 2014, Neil Portnow, the President and CEO of The Recording Academy, began calling for the music industry to combine lobbying efforts with the goal of passing new legislation and regulatory reform. [6] The following day he gave a speech to lawmakers at Grammys on the Hill calling for unity legislation. On June 10, 2014, Portnow testified before the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet. On January 8, 2018, representatives from numerous sections of the music industry united to join The Recording Academy's push for comprehensive music reform, including RIAA, NMPA, NSAI, and ASCAP. [7]

Passage

President Donald Trump signs the act on October 11, 2018. President Donald J. Trump signs the Music Modernization Act (45200025962).jpg
President Donald Trump signs the act on October 11, 2018.

The three bills were consolidated in the House by Goodlatte on April 10, 2018, as H.R. 5447 , which passed the bill on April 25, 2018. Hatch introduced the combined bill in the Senate as S. 2823 on May 10, 2018. During the Senate's review, the body voted to move the bill to an existing, unrelated bill, H.R. 1551, which the House agreed to. The Senate voted in favor of the bill on September 19, 2018, and was subsequently signed into law by President Donald Trump on October 11, 2018. [1] Among those in attendance at the signing were musicians Kid Rock, Mike Love, Sam Moore, John Rich, Craig Morgan and Jeff Baxter, and the Christian band MercyMe. While Kanye West had been reported to be attending the signing, he was not present though had a luncheon with President Trump later that day. [8] [9]

Reactions

The bills in both House and Senate had bipartisan support, as well as strong support from numerous music industry groups representing musicians, producers, and publishers, as well as from digital streaming media services and related industry groups. [10] Digital streaming platforms Apple Music and Spotify had both come under prior separate legal actions for unpaid royalties for streaming music in part due to a lack of a central database with which to track down songwriters and composers, and had even set aside part of their working capital to deal with legal issues in order to offer full music catalogs, in contrast to Amazon.com's music selection. [11] [12] [13]

There was a last-minute conflict in the Senate, brought up by SESAC and SiriusXM, relating to royalties for pre-1972 sound recordings, but a deal was made between SiriusXM, the National Music Publishers Association and the Recording Industry Association of America which allowed the bill to be passed by the Senate by a unanimous vote, allowing the bill to quickly pass through Congress via "hotlining" before the end of the session. [10]

When the House MMA bill was introduced in December 2017, it included a provision that liabilities for streaming companies would be limited to infractions after January 1, 2018, a clause that remained through the final passed bill. On December 31, 2017, Wixen Music Publishing, representing artists like Tom Petty and Neil Young, filed a lawsuit against Spotify to seek unpaid royalties for their artists' songs, asking for US$1.6 billion in damages. The suit was filed to be able to recover damages for infractions that occurred before the MMA's January 1, 2018 date. [11] [12] [14] This suit was ultimately settled out of court by December 2018 for an undisclosed sum. [15]

The Internet Archive opposed an earlier version of the bill. [16] After it passed, they used a provision allowing libraries to offer recordings that are not commercially available, to digitize and offer public downloads of some long-playing records that are not commercially available. [17] [18]

In 2021, in response to the MMA, the Mechanical Licensing Collective began paying out unmatched mechanical royalties to songwriters and their publishers.

One of the first high-profile legal challenges to the MMA was raised in a lawsuit from Eminem's publisher Eight Mile Style against Spotify, asserting that Spotify has allowed Eminem's music to be streamed without paying the proper royalties, as the service lists some of these works under "Copyright control" with no known owner. While the suit's primary complaint is with Spotify, the suit further argued that part of the law, limiting liabilities to those after January 1, 2018, was unconstitutional since it provides no proper compensation for the work that was taken from the publisher, against the Takings Clause of the Fifth Amendment. [19] [14] [ needs update ]

Related Research Articles

Copyrights can either be licensed or assigned by the owner of the copyright. A copyright collective is a non-governmental body created by copyright law or private agreement which licenses copyrighted works on behalf of the authors and engages in collective rights management. Copyright societies track all the events and venues where copyrighted works are used and ensure that the copyright holders listed with the society are remunerated for such usage. The copyright society publishes its own tariff scheme on its websites and collects a nominal administrative fee on every transaction.

<span class="mw-page-title-main">PRS for Music</span> British music rights society

PRS for Music Limited is a British music copyright collective, made up of two collection societies: the Mechanical-Copyright Protection Society (MCPS) and the Performing Right Society (PRS). It undertakes collective rights management for musical works on behalf of its 160,000 members. PRS for Music was formed in 1997 following the MCPS-PRS Alliance. In 2009, PRS and MCPS-PRS Alliance realigned their brands and became PRS for Music.

A royalty payment is a payment made by one party to another that owns a particular asset, for the right to ongoing use of that asset. Royalties are typically agreed upon as a percentage of gross or net revenues derived from the use of an asset or a fixed price per unit sold of an item of such, but there are also other modes and metrics of compensation. A royalty interest is the right to collect a stream of future royalty payments.

<span class="mw-page-title-main">Copyright law of Canada</span> Canadian statutes controlling copyright

The copyright law of Canada governs the legally enforceable rights to creative and artistic works under the laws of Canada. Canada passed its first colonial copyright statute in 1832 but was subject to imperial copyright law established by Britain until 1921. Current copyright law was established by the Copyright Act of Canada which was first passed in 1921 and substantially amended in 1988, 1997, and 2012. All powers to legislate copyright law are in the jurisdiction of the Parliament of Canada by virtue of section 91(23) of the Constitution Act, 1867.

The Copyright Act of Canada is the federal statute governing copyright law in Canada. It is jointly administered by the Department of Industry Canada and the Department of Canadian Heritage. The Copyright Act was first passed in 1921 and substantially amended in 1988 and 1997. Several attempts were made between 2005 and 2011 to amend the Act, but each of the bills failed to pass due to political opposition. In 2011, with a majority in the House of Commons, the Conservative Party introduced Bill C-11, titled the Copyright Modernization Act. Bill C-11 was passed and received Royal Assent on June 29, 2012.

<span class="mw-page-title-main">Audio Home Recording Act</span>

The Audio Home Recording Act of 1992 (AHRA) amended the United States copyright law by adding Chapter 10, "Digital Audio Recording Devices and Media". The act enabled the release of recordable digital formats such as Sony and Philips' Digital Audio Tape without fear of contributory infringement lawsuits.

APRA AMCOS consists of Australasian Performing Right Association (APRA) and Australasian Mechanical Copyright Owners Society (AMCOS), both copyright management organisations or copyright collectives which jointly represent over 100,000 songwriters, composers and music publishers in Australia and New Zealand. The two organisations work together to license public performances and administer performance, communication and reproduction rights on behalf of their members, who are creators of musical works, aiming to ensure fair payments to members and to defend their rights under the Australian Copyright Act (1968).

In copyright law, a mechanical license is a license from the holder of a copyright of a composition or musical work, to another party to create a "cover song", reproduce, or sample a portion of the original composition. It applies to copyrighted work that is neither a free/open source item nor in the public domain.

The Section 115 Reform Act of 2006 was a bill introduced June 8, 2006 in the 109th United States Congress by Howard Berman (California-D) and Lamar Smith (Texas-R) as part of. It is one of several recent attempts to modify Section 115 of the United States Copyright Act to accommodate digital delivery of musical works.

Public domain music is music to which no exclusive intellectual property rights apply.

SoundExchange is an American non-profit collective rights management organization founded in 2003. It is the sole organization designated by the U.S. Congress to collect and distribute digital performance royalties for sound recordings. It pays featured and non-featured artists and master rights owners for the non-interactive use of sound recordings under the statutory licenses set forth in 17 U.S.C. § 112 and 17 U.S.C. § 114.

The Internet Radio Equality Act (IREA), originally introduced as H.R. 2060, is proposed legislation by Rep Jay Inslee (D) WA to nullify the May 1, 2007, determination of the Copyright Royalty Board (CRB) modifying the current webcast radio royalties and fees retroactively to January 1, 2006. The previous system charged radio stations a per performance rate of $0.000768, and it was that same rate from 1998-2005. The new system, effective May 1, 2007, increased that per-performance rate to the following levels: 2006=$0.0008, 2007=$0.0011, 2008=$0.0014, 2009=$0.0018, and 2010=$0.0019. This bill was introduced on April 26, 2007 by Rep. Jay Inslee (D-WA) and Rep. Donald Manzullo (R-IL) and has been cosponsored by over 100 members of the Congress. It was introduced in the Senate as S. 1353 on May 10 by Ron Wyden (D-OR) and Sam Brownback (R-KS). The bill's proponents claim that "the majority of webcasters will go bankrupt and silent" when the Copyright Royalty Board's decision takes effect unless the bill passes.

<span class="mw-page-title-main">Copyright Term Extension Act</span> United States copyright law

The Sonny Bono Copyright Term Extension Act – also known as the Copyright Term Extension Act, Sonny Bono Act, or (derisively) the Mickey Mouse Protection Act – extended copyright terms in the United States in 1998. It is one of several acts extending the terms of copyright.

<span class="mw-page-title-main">Copyright Act of 1976</span> United States law

The Copyright Act of 1976 is a United States copyright law and remains the primary basis of copyright law in the United States, as amended by several later enacted copyright provisions. The Act spells out the basic rights of copyright holders, codified the doctrine of "fair use", and for most new copyrights adopted a unitary term based on the date of the author's death rather than the prior scheme of fixed initial and renewal terms. It became Public Law number 94-553 on October 19, 1976 and went into effect on January 1, 1978.

A music streaming service is a type of streaming media service that focuses primarily on music, and sometimes other forms of digital audio content such as podcasts. These services are usually subscription-based services allowing users to stream digital copyright restricted songs on-demand from a centralized library provided by the service. Some services may offer free tiers with limitations, such as advertising and limits on use. They typically incorporate a recommender system to help users discover other songs they may enjoy based on their listening history and other factors, as well as the ability to create and share public playlists with other users.

The Copyright Alliance is a nonprofit, nonpartisan 501(c)(4) organization representing artistic creators across a broad range of copyright disciplines.

<span class="mw-page-title-main">David Israelite</span> American music executive

David Israelite is an American music executive. He has been president of the National Music Publishers Association since 2005.

<span class="mw-page-title-main">CLASSICS Act</span>

The CLASSICS Act or Compensating Legacy Artists for their Songs, Service, and Important Contributions to Society Act is Title II of the Music Modernization Act and was proposed legislation as H.R. 3301 of the 115th United States Congress to amend title 17 of the United States Code, to provide Federal protection to the digital audio transmission of a sound recording fixed before February 15, 1972, and for other purposes.

<span class="mw-page-title-main">Copyright Alternative in Small-Claims Enforcement Act of 2020</span> United States law on copyright remedies

The Copyright Alternative in Small-Claims Enforcement Act of 2020 is a United States law that establishes a small claims court-type system within the United States Copyright Office, known as the Copyright Claims Board, for copyright owners to seek damages under US$30,000 for copyright violations.

The Mechanical Licensing Collective (MLC) is a nonprofit organization established under the Music Modernization Act of 2018. It was created to issue blanket mechanical licences for qualified streaming services in the United States, such as Spotify, Apple Music, Amazon Music, and Tidal. 

References

  1. 1 2 Deahl, Dani (October 11, 2018). "The Music Modernization Act has been signed into law". The Verge . Retrieved October 11, 2018.
  2. ↑ Singleton, Micah (January 26, 2018). "Congress may actually fix music royalties". The Verge . Retrieved October 11, 2018.
  3. ↑ Parisi, Paula (April 9, 2018). "Music Modernization Act to Be Introduced Tuesday". Variety . Retrieved October 11, 2018.
  4. ↑ The bill passed on October 11, 2018, however three years later does not equate to October 11, 2021, because all U.S. copyright terms extend to the end of the year, December 31, thus they entered the public domain on the first day of the following year.
  5. ↑ No works entered the public domain on January 1, 2023, to give time for the one year offset to catch up. After the reprieve of 2022, the next year works became eligible was January 1, 2024.
  6. ↑ Sisario, Ben (April 1, 2014). "Music Industry Pushes Unified Message on Compensation". New York Times . Retrieved April 1, 2014.
  7. ↑ "Music Modernization Act". The Recording Academy . July 16, 2018. Retrieved October 11, 2018.
  8. ↑ Wang, Amy (October 11, 2018). "Trump Signs Landmark Music Bill Into Law". Rolling Stone . Retrieved October 11, 2018.
  9. ↑ Johnson, Ted (October 11, 2018). "Trump Signs Sweeping New Music Licensing Legislation". Variety . Retrieved October 11, 2018.
  10. 1 2 "Senate Passes Music Modernization Act". Variety . September 18, 2018. Retrieved October 11, 2018.
  11. 1 2 Kreps, Daniel (January 3, 2018). "Wixen's $1.6 Billion Spotify Lawsuit: What You Need to Know". Rolling Stone . Retrieved October 11, 2018.
  12. 1 2 Jeong, Sarah (March 14, 2018). "A $1.6 Billion Spotify Lawsuit Is Based On A Law Made For Player Pianos". The Verge . Retrieved October 11, 2018.
  13. ↑ Patel, Nilay (October 2, 2018). "How the Music Modernization Act will help artists get paid more from streaming". The Verge . Retrieved October 21, 2018.
  14. 1 2 Gardner, Eriq (January 2, 2018). "Spotify Hit With $1.6B Copyright Lawsuit Over Tom Petty, Weezer, Neil Young Songs". The Hollywood Reporter . Retrieved August 22, 2019.
  15. ↑ Aswad, Jem (December 20, 2018). "Spotify Settles $1.6 Billion Lawsuit From Wixen Publishing". Variety . Retrieved August 22, 2019.
  16. ↑ Lila Bailey (March 30, 2018). "The Music Modernization Act is Bad for the Preservation of Sound Recordings". Internet Archive . Retrieved October 17, 2021.
  17. ↑ Jeff Kaplan (October 15, 2018). "The Music Modernization Act is now law which means some pre-1972 music goes public". Internet Archive . Retrieved October 17, 2021.
  18. ↑ A. Rossi, Archivist (October 24, 2018). "Unlocked Recordings". Internet Archive . Retrieved October 17, 2021.
  19. ↑ Gardner, Eriq (August 21, 2019). "Eminem Publisher Sues Spotify Claiming Massive Copyright Breach, "Unconstitutional" Law". The Hollywood Reporter . Retrieved August 22, 2019.
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