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Researching legal findings and Relevant Industry specific Podcasts. There have been many issues which pertain to my business aspirations which have been decided recently in courts around the country. As an artist who has been relying heavenly on the Internet and digital distribution and streaming, music royalty issues stand ant the forefront of my personal and entertainment company’s attention and portfolio. In my research of these issues I encounter legal blogs and newsfeeds which at times contribute valuable information. The Entertainment Law Update podcast series with Gordon P. Firemark has given me background on these issues. Episode 30 delves into Music Royalty Issues, Crowd funding and other interesting subjects.(http://www.entertainmentlawupdate.com)
NEWLY DECIDED MECHANICAL ROYALTY RATESThe music royalty issues decided recently in courtcases between the RIAA(Recording Industry Association of America) the trade group who represents recording distributors in the united states and the DiMA(Digital Media Associataion) a national trade organization devoted to the online audio and video industries, decided what would be the Mechanical Royalty rates paid to publishers by cloud services and digital storage services. The Labels will be paid certain statutory rates which they will pay royalties to publishers on. These issues pertain to section 115 of the Cumpulsory licenses section of this law creating new statutory rates which were the same as the previous Mechanical license rate of 9.1 cents. This is significant because there was not previously an established statutory rate for cloud services, streaming and ringtones. Licensing has been being issued since 2001 for these kinds of services but retro-active payments will be issued dating back from 2001 to July 1, 2009. New reports on license usages will be issued for every 45 days since then for accounting purposes. This is good for independent self published artists such as my self to account for and track usage, plays and mechanical royalty rate payments from distributors.
THE JOBS ACT The Jumpstart Our Business Startups Act makes it easier for emerging business to utilize crowd funding platforms, for investor equity stakes, which yield a return on investment as opposed to exclusive perks for campaign contributors. Some think the new act also creates a greater opportunity for abuse on behalf of these Investors and groups. There are five modules which are included in this act, three of which I will discuss here.
Module 1 pertains to crowd funding and Investrors being allowed to contribute 10% of their gross adjusted income(up to One Million dollars) to activities like this for various returns.Module 2 addresses changes to Regulation D Rule 506 of the previous code pertaining to fundraising securities for film. The previous rule only allowed fundraising solicitation to individuals which had relationships with those seeking funds,the changes now allow fundraisers to post public notices of fundraising opportunities for film securities online and in print. It also raises the amount investors can contribute to these securities without reporting to the SEC(Securities and Exchange Comission) from 5% million to 50 million dollars.Module 3 is in reference to the IPO-Onramp. This section applies to emerging business grossing under 1 billion dollars a year. This provision allows these business to embark on and IPO(Initial Public Offering) activity more economically than ever before. In addition Businesses who have up to 500 private shareholder investors were previously required to become public companies. The limit has been raised to 2000 private shareholder investors provided they are not accredited investors.These issues pertain to emerging companies such as my own ,some sections more than others, The crowd funding section especially pertains to some of the projects my company is developing in film.These new developments may enable fundraising for my projects.
Episode 32 Lawyers, Libel Logos and Lollipops-Actual Knowledge Vs. Redflag knowledgeIn The case of UMG VS. VEOH (that is Universal Music Group versus the online video platform VEOH) in the ninth circuit court in 2010 it was decided that in order for their to be actual knowledge of infringement of copyrighted material on the ISP(Internet Service Provider) video site, the Copyright holder must notify the ISP of the infringement on their site. In light of the recent decision in another case, (Viacom VS YouTube) the ninth circuit has asked the parties to determine whether the second circuit court (which has decided the case in the YouTube dispute) is utilizing the same definition for infringement in terms of actual knowledge? The other issue is if there is no actual knowledge of the infringement does the copy right holder need to show that the video site has more than the ability to block, take down or control the access to the infringing material? The answers were given via supplemental briefs. The decision has since been made proving VEOH was legal and not–infringing. This however did not save their business due to legal fees and bankruptcy.The point is to establish aligning decisions in cases to establish what makes a video site liable for hosting infringing materials under safe harbor in the DMCA(Digital Millennium Copyrights Act.). If in one court they decide the case based on different criteria than the other, then the precedents are in conflict and the case can be taken to the supreme court. Not having correlating decisions doesn’t establish clear precedent and can enable infringement on different sites.I follow this issue because when you are a Copyright holder such as myself it behooves you to know how others may infringe on your rights and how you may infringe on the rights of others. When artists publish material and expect compensation for the use of the material, honoring copyright is imperative to the argument and principle. These issues and court cases are all relevant to my business and future projects. I encourage any aspiring entertainment entrepreneurs to regularly research and educate themselves on the issues relevant to their industry.
Additional References:http://www.aimp.org/education/articles/1/Librarian_of_Congress_Publishes_New_Digital_Era_Mechanical_Royalty_Rateshttps://www.eff.org/cases/umg-v-veoh IMAGES: http://forum.belmont.edu/muzzbuzz/2012/04/11/heads-up-entertainment-law-counseling-professionalism-coaching/
http://www.safemusiclist.com/article/how-can-i-legally-use-copyrighted-music-in-my-film/
http://techcrunch.com/2009/02/04/judge-tells-umg-no-you-cannot-sue-veohs-investors-for-copyright-infringement/
http://www.vanderbilt.edu/vumix/
http://ventureburn.com/2012/02/crowd-funding-pushes-lon-startup-into-spotlight/
