Contract Legalese. Help!

[Mark Crozer]

Can anybody shed some light on the meaning of the following paragraph from a contract I am considering signing...

I am just not clear what this actually means!

7. Mechanical License; Performance Royalties. Licensor hereby waives (i) any mechanical
license fee which might otherwise be payable as the result of any use, including duplication, of
all or a part of the Masters by LIBRARY or by any User, in connection with auditioning of
Masters, and (ii) any performing rights fee which might otherwise be payable as the result of any
electronic transfer or transmission or other performance or distribution in connection with an
audition of all or a part of the Masters to any User by LIBRARY; provided, however, that
nothing contained in this Agreement shall be deemed to constitute a waiver of any fee which
shall become due and payable to the relevant performing or other rights society, such as ASCAP,
BMI, SESAC, or collection agency, as the result of any use of a Composition or Master by a
User, unless LIBRARY shall have issued a direct license with respect to certain of the public
performance rights in any Composition and related Master. Licensor hereby agrees that LIBRARY
may use all or a part of the Masters and Compositions in connection with the promotion of
LIBRARY and its artists without any payment to Licensor.

Thanks for advice. Would love to see a music lawyer but... who can afford one!??

Mark

[eeoo]

I'm not a lawyer and please correct me if I'm wrong everyone! That sounds to me like you won't get payed if someone looking to license music from this library streams your song in order to see if they are interested in licensing it, in other words they are "auditioning" it. That's what I got out of it but please don't take my word as gospel, there's not a grain of salt large enough...

eo

[Mark Crozer]

Hi Ethan

Thanks for the input! Yes, now that you mention it it does seem to make sense. (I won't hold you to it though - don't worry!)

Thanks

mark

[Casey H]

Yea, they are saying that you don't get royalties on activities associated with the pitching of your tracks for potential licensing. If they make CDs and send copies to music sups, no mechanicals, for example... If potential end users play or download your track (strictly for the purpose of deciding if they want to license it) from a website or weblink, no performance royalties.

Not something to really be concerned about IMHO.

BIG LEGAL DISCLAIMER

Casey

[Mark Crozer]

Thanks Casey. I appreciate your thoughts. I'm definitely less stressed about this now.

Best wishes

Mark

[simonparker]

What it says is the library will not pay you a mechanical license royalty should they burn a copy of your song (or add your song to a compilation of songs) and distribute it to their contacts or others who request music from the library for potential placement. Under the law, if you own the copyright, you are entitled to royaties on duplication of intellectual property. This clause gets the library out of that legal requirement. It makes sense, especially if the library makes thousands of copies of music to its contacts, that comes to be a lot of money in royalty payouts for duplicating music owned by songwriters.

Likewise, you're not getting a royalty if they put it out on the web or perform it live at a venue, etc. if the intention is to pitch it to music supervisors. Again, this makes sense.

[coachdebra]

OK - I'm not a lawyer - but I spent about 5 years as a legal secretary typing up these contracts! Here is my translation (this does not constitute legal advice yada yada yada disclaimer yada yada)

Mechanical License; Performance Royalties. Licensor hereby waives (i) any mechanical
license fee which might otherwise be payable as the result of any use, including duplication, of
all or a part of the Masters by LIBRARY or by any User, in connection with auditioning of
Masters, and (ii) any performing rights fee which might otherwise be payable as the result of any
electronic transfer or transmission or other performance or distribution in connection with an
audition of all or a part of the Masters to any User by LIBRARY;

Translation:
We won't pay you (or performing rights fees to anyone else with rights in the master) for the right to copy or stream your song in order to promote, pitch or audition your music so we can get your music placed and get you paid!

provided, however, that nothing contained in this Agreement shall be deemed to constitute a waiver of any fee which
shall become due and payable to the relevant performing or other rights society, such as ASCAP,
BMI, SESAC, or collection agency, as the result of any use of a Composition or Master by a
User,

Translation:
This doesn't waive your rights to get paid (via your PRO) for the USE of your music.

unless LIBRARY shall have issued a direct license with respect to certain of the public
performance rights in any Composition and related Master.

Translation:
With the exception of a direct license of the public performance rights.
(not sure of this part - maybe someone else can speak to the direct license piece?)

Licensor hereby agrees that LIBRARY
may use all or a part of the Masters and Compositions in connection with the promotion of
LIBRARY and its artists without any payment to Licensor.

Translation:
Oh, yeah, and we can use your music to promote ourselves and our stable of artists.

So they can say, "See aren't we a great library that we have such great music to offer you?" And they don't have to pay you for that and that doesn't guarantee that you will be Used, but it certainly means you'll be HEARD more, so that isn't a bad thing in my book.

HTH,
Debra

[Mark Crozer]

Debra and Simon, thanks so much for taking the time to look at this. Your thoughts are incredibly valuable and appreciated. It seems like there is e general consensus here on what this means. I did manage to get a lawyer friend of mine to take a quick look and he seems to think it means the same thing so... good!

Now then. Back to the fun part of this business... making some actual music!

Thanks everyone.

mark

[Casey H]

Translation:
With the exception of a direct license of the public performance rights.
(not sure of this part - maybe someone else can speak to the direct license piece?)

There is "direct licensing" which is outside the scope of performance royalties paid by PRO's. The performance royalties get paid with other rates and by other methods. I haven't been involved with direct licensing yet (so I can't say much more), but I assume this contract gives approval for the library do direct licenses. From my perspective, I would want the library to seek out whatever opportunites they could. It's important to remember that (most often) the more they make, the more you make so they should be seeking the best deals.

Someone with more knowldege about direct licensing should chime in.

Casey

[LeeAltman]

Mark,

keep in mind that this contract means that they can do these things but YOU CANNOT. You are reviewing the legalese for what you do now, the promotional uses that indies employ for themselves. You will not be able to stream or have downloads from your website without paying royalties, some of which will come back to you. But their admin of that will be a cost to you under a different clause. You will not be able to give out CDs at gigs unless they were made by the publisher. At Secret Studio, LLC, I designed a contract that gives artists a share of the publishing rights so we can BOTH promote the IP (intellectual property) that was assigned in our agreement.

don't swim with the sharks. You need a lawyer or a publishing solution that you control before they sign you.

Lee