Collaborator/Songwriter Agreements

by Mark Halloran and Edward (Ned) R. Hearn

 

Welcome to the multiple songwriter world. Today, solo writers for hit songs are virtually extinct. In the October 24, 2015, Billboard Hot 100, only two songs were written by one writer. This statistic reflects the bottoming out of an inexorable recent trend on that chart: in mid-October 2005 there were fourteen solo writers; in 1995 there were thirty-two; in 1985, forty-one; and in 1975, fifty- one. Roughly 90% of the Billboard Hot 100 Top Ten in 2014 were written by two or more writers, and nearly half were written by at least four.

Most think this phenomenon has in large measure stemmed from the so-called “track and hook” method of songwriting, where basic tracks are initially recorded and different people add hooks, bridges, and choruses, a method championed by Swedish writer-producer Max Martin (Katy Perry, Britney Spears, Taylor Swift) as well as many rap artists. Another contributing factor is the recent shift of recording artists more frequently performing their songs with guest artists. In the July 23, 2016, Billboard Hot 100, half the Top ten Songs were done by artists together with credited featured performers, including the number 1, 2, 4, and 5 songs.

Another trend is the use of sampling and derivative songs. In his hit “Save Room” (2006), John Legend clearly borrowed the melody from the Classics IV hit song “Stormy” (1968). It was not an infringement—Legend gave songwriter credits to the original writers, as well as 50% of the publishing. There’s also a recent movement toward retroactively according songwriter credits/ share of the publishing, as with the Grammy-nominated song and 2014 smash hit “Stay with Me,” co-written and performed by Sam Smith. The publishers of the Tom Petty/Jeff Lynne song “Stay with Me” (1989) heard similarities in the melodies of the choruses between the same-named songs and contacted Smith’s publisher. The writers of Smith’s version of “Stay with Me” acknowledged the similarities and quickly reached a settlement with Petty and Lynne, who received retroactive songwriting credit with the other songwriters—Sam Smith, James Napier, and William Phillips—along with a share of their publishing.

Co-writers

Songwriting on your own is much simpler legally than writing with others. There is one unified copyright, one owner of the writer and publisher’s share of music publishing income, and one person getting credit. Given the radical shift toward co- writing discussed above it is more important than ever that you understand how co-writing songs works.

The essence of co-writing is writing together to create a single song, regardless of who contributes what. Your creative contributions don’t have to be equal in quality or quantity, nor must you work together in the same room at the same time, even though that’s a common experience. Technology now facilitates partners co-writing remotely and in different stages and at different times during the songwriting process. You also don’t need to have an express written collaboration agreement, although doing so is a good idea, given the myriad issues that can arise. (For simplicity’s sake, in most instances we’re going to refer to songwriters who collaborate on songs together as co-writers.)

Regardless, if you co-write a song with someone, both of you own the entire song as joint owners in what copyright law calls a joint work, which the Copyright Law defines as “a work prepared by two or more authors with the intention that their contributions be merged into inseparable or interdependent parts of a unitary whole.”

Since you and your co-writer intend to write the song together, whether one of you writes the music and the other the lyrics, or you both write music and lyrics, doesn’t matter. Both of you have an undivided equal ownership in the song—that is, you each own 50% of the whole song—and in the income from the song. One copyright covers both music and lyrics; there is not a separate copyright for each of the two.

One of the most famous co-writing teams is Bernie Taupin and Elton John. Bernie first writes the lyrics on his own. Then Elton writes the music to those lyrics on his own. Since both Bernie and Elton intend their work to be a united whole, the result is a joint work, which they co-own 50-50.

Of course the most prolific and commercially successful songwriting team of all time was John Lennon and Paul McCartney, who had a songwriting partnership that started in their teens, resulted in approximately 180 songs being published in the 1960s. Both Lennon and McCartney wrote melodies and lyrics. Earlier in their careers they wrote “nose to nose and eyeball to eyeball” (as Lennon said), but in later years they often wrote virtually completely separately, yet their deal provided shared credit (in the form “Written by John Lennon and Paul McCartney) and shared ownership—even if they wrote separately.

Percentage Ownership

As joint owners you and your co-writer can divide your song ownership in whatever proportion you want. In the absence of a written agreement you automatically share equally, even if your contributions clearly were not equal. Thus, with two songwriters, you own the song 50-50; three songwriters, one-third each; and so on. Dividing the ownership ratably is also the most common way to divide ownership in a written collaboration agreement. Some bands let the actual songwriters retain ownership of the songs; others (most notably Queen in their later years) shared credit and ownership among all the band members equally to encourage the creative songwriting process.

One common benchmark in dividing ownership is that the lyrics are worth 50% and the music 50%. For example, if two people write the music and one person writes the lyrics, they may agree to divide the ownership 25% each for the two music writers, with the lyricist retaining the remaining 50%. However, with no such agreement, each would own 33.3% of the song.

Grant of Rights

Once you determine who owns the song, you must consider who controls its use and commercialization. To efficiently exploit the song’s money-making potential, a central place to license the work and collect money is useful. But oftentimes songwriters have separate publishing companies with whom they like to work.

Songwriter Credits

The Copyright Law does not mandate the songwriting credits accorded to co-writers; they are almost always agreed to among the co-writers. Note that co-writing credits can be enforced in both state and federal courts under different laws.

To qualify as a co-writer (and own part of the copyright) and also be entitled to a songwriter credit, you must contribute a tangible part of the song, not just ideas (this notion applies to contributions to all copyrighted works). You are also not entitled to songwriter credit if you merely perform the song, either vocally or instrumentally, or mix it as a producer. Most songwriting credits are agreed to collegially with little or no rancor.

Just as the relative contributions don’t determine the proportion of copyright ownership, the size of songwriting credits are not proportional. For example, you may write 90% of a song with a songwriting partner who writes 10%—by custom both of you get equal credit, as opposed to your credit being nine times bigger than your partner’s! Relative contributions can of course be reflected by the order of credits, with those with the highest relative contribution coming first or being closer to the front.

Credits can be predetermined by oral contract, as with Lennon and McCartney (Lennon was always first). But after Lennon’s passing, in 2002, McCartney unilaterally reversed the songwriter credits on his album “Back in the U.S.,” putting his name first, causing a stir with Yoko Ono, and he eventually backed down. Still, there are few disputes regarding credits among co-writers.

Co-administration of Song Licenses

A license is limited permission to use a work. It is not a transfer of copyright ownership, which requires the written permission of all songwriters or other owners. Note that you could, however, transfer just your share to another without affecting the ownership interests of the other co-writers/co- owners. But you can’t sell what you don’t own.

However, as a joint owner in the United States, you may exploit the song yourself and also grant nonexclusive licenses for the use of the entire song, such as mechanical and synchronization licenses, either yourself or through your publisher or administrator (for more details on these kinds of licenses, see the chapter “Music Publishing.”) The United States copyright rule that all co-owners need not sign off on non- exclusive licenses is the exception, and in most territories all the owners must concur with all licenses, including nonexclusive ones.

With multiple co-writers, having one music publisher license the song and collect and divide all the song income usually is more convenient than using more than one publisher. Licensing can become complicated when a licensee has to seek the approval of, and document permission from, multiple publishers. The licensee customarily is seeking a license signed by those who own or control 100% of the song–the licensee does not want to deal with complaints from co-owners who did not approve, even if the licensee was only seeking a non-exclusive license. Even given the convenience of “one-stop shopping” for song administration many co-writers prefer that their respective publishing companies administer their share of the song because it gives each of them more control over the scope of the licenses, to whom licenses are granted, how much is charged, how the money is collected, and what costs are incurred. Still, your publisher must account to co-writers or their respective publishing companies for the money generated from the nonexclusive licenses you grant, and pay them their share.

Division of Income

Just as a contributing co-writer is entitled to a ratable share of ownership, that co-writer is also entitled to the same ratable share of income, absent an agreement to the contrary with his or her other co-writers.

Pursuit of Copyright Infringement

One obligation co-writers jointly share is protecting the song’s copyright, including pursuing copyright infringers. Can you sue even if a fellow co-writer doesn‘t want to sue? The answer appears to be yes, at least with respect to your interest in the copyright. However, the court may require that you bring in any other co-writer as a co-plaintiff, so it is advisable that you decide to sue together.

If you have to sue a co-writer, say, for failure to account to and pay you, you may bring in all the other co-owners as parties to your lawsuit, but do not have to in order to sue.

Copyright Duration

The basic rule in the United States is the copyright of a song written after January 1, 1976, lasts for the life of the author plus 70 years. In the case of a joint work, the copyright lasts for the life of the last surviving author plus 70 years.

Copyright Transfers

Each co-writer, independently of the other co-writers, has the right to transfer his or her copyright ownership in a song to another party. That transfer may be for the full copyright share of the co-writer to a publisher, or a partial copyright transfer to a co-publisher. A co-writer may also grant all administration and supervision rights of that share to a third party as the publishing administrator, while still retaining copyright ownership.

If one co-writer transfers his or her copyright interests to a third party, but the second co-writer does not, then the third party would co-own the copyright with the other co-writer and have the same rights as the transferring co-writer. At the same time, the second co-writer has the option to transfer his or her copyright interest, in whole or part, or just the administration rights, to the same new owner as the first co-writer did, or to a different party. However, many agreements provide that a co-writer wanting to transfer his or her interest must first offer the other co-writer/s the right to purchase the interest being transferred.

Unless either co-writer has granted the other co-writer the administration rights in the song’s copyright, the new co-owner will have to share decision-making and publisher’s income share with the co-writer who did not transfer his or her interests. The accounting can become cumbersome if income sharing and accounting procedures are not coordinated.

Different Performing Rights Organization Affiliations

Each co-writer also can belong to a different performing rights organization (PRO), namely ASCAP, BMI, SESAC, or Global Music Rights, the newest PRO. If that is the case, then a share of the performance income collection would be allocated to each co-writer’s affiliated PRO. For example, if the song is performed as part of a television program’s soundtrack, then, with the public performance rights for that song being divided between two different performing rights groups, the performance fee also would be similarly divided. Each PRO would receive its allocated share and distribute it to its affiliated co-writer. One co- writer, being paid by a different performing rights society, could potentially receive a different amount of writer and publisher performance income than a fellow co-writer, since each PRO uses a different value allocation, payment, and reporting mechanism.

Songwriters as Members of Different Bands

In the event one collaborating songwriter is a member of a band and the other is not, the co-writing band member has authority to allow the band to rehearse and perform the collaborated song in live concerts and to record the song for release on phonorecords, both in physical media and as digital downloads. Although technically speaking it’s best to have both co-writers approve and issue a combined use license; for example, a mechanical license to reproduce the song on phonorecords, each has the authority to do so, but must account to the co-writer for their share of writer and publisher income. Most record labels will want to both co-writers’ and co- publishers’ written authorization for the initial reproduction of that song on phonorecord. After the first release of phonorecords, a compulsory mechanical license procedure may apply to any future recordings of that song, whether by that same or any other artist or band.

Controlled Composition Clause

Of particular significance is the situation where one co- writer is a band member (while the other is not) and has a recording agreement with a record label that requires the writer/band member to agree to a controlled composition clause in the recording agreement. This clause authorizes the record company to pay a reduced mechanical royalty, usually 75% of the prevailing statutory mechanical rate, as the royalty fee for the right to reproduce the song on phonorecords sold to the public.

Generally, the record company requires the recording artist/collaborating writer to represent that he or she has obtained permission from the co-writer/non-band member and nonsignatory to the recording agreement to issue a mechanical license for the reduced rate. But often the recording artist/co- writer cannot guarantee to provide the record label with written authorization from the co-writer accepting a reduced mechanical royalty rate. In those situations, the record company has to pay the non-band member that co-writer’s share of mechanicals, both as writer and co-publisher, at the full statutory rate, while paying the co-writer, who is a signatory, the reduced rate. Given the need to pay the unsigned co-writer the higher amount, the recording artist/co-writer’s rate may be reduced even further, due to a reduction in the available amount to pay to the artist/ co-writer. Alternatively, sometimes the recording agreement will provide that amounts the record company pays in excess of the controlled rate are recoupable from master royalties and mechanical royalties otherwise payable to the recording artist/ collaborating writer.

By way of illustration, assume the maximum pool of mechanical royalties for all of the songs on the recording artist’s album is 68.25 cents (75% of 91.1 cents or 75% of 0.091 x 10 songs), as distinct from the current statutory rate of 9.1 cents per song for recordings of five minutes or less, which would earn 91 cents if ten songs are on the album. Note that, on a song recording of longer than five minutes and zero seconds, the rate is 1.75 cents per minute or fraction thereof. The current royalty rate for statutory mechanical is now under review for change by the Copyright Royalty Tribunal, which sets the rate. (You can check the websites of the U.S. Copyright Office and the Harry Fox Agency for information on the statutory mechanical royalty rates as they change over time.)

The payout to the collaborating co-writer who is not a signatory to the recording agreement reduces the overall pool available for mechanical royalties, causing the amount payableto the co-writer/band member to be even less than the 75% fractional statutory rate. For example, if that nonsignatory co- writer has contributed half of the material on four different songs, he or she will get full statutory for his or her share of those songs, 0.5 x 9.1 cents x 4 = 18.2 cents, which will be deducted from the maximum pool of 68.25 cents, leaving 50.05 cents to be allocated to the signatory collaborating songwriters for the other six songs that were fully written by them and for the other four co-written by them with the nonsignatory co-writer.

This situation and how to address it also would apply if each songwriter were a member of a different recording group and under contract with different record labels. The description provided above then would apply to each co-writer and in that case could lend itself to a reciprocal arrangement, with, for example, each co-writer on a parity basis willing to accept the reduced mechanical royalty rate formula in the agreement that the other has with his or her record label.

Co-accounting

Any income that either collaborating writer receives from the commercial exploitation of the song, whether it is from their own use or from use by an authorized third party, must be accounted for and apportioned to the other collaborating songwriter. Such payments should be made in a timely manner; for example, no less than thirty days after receipt. Also, statements that accompany the payments to the first co-writer should be copied and forwarded with the payment to the other co-writer.

Future Generations

The rights of each deceased co-writer will pass on to that person’s heirs and descendants, either by will (testate) or without (intestate). If there is no will, state statutes govern the distribution, usually made to surviving spouses and children, on a first priority basis, before other relatives. The heirs or executors of the deceased’s estate then have the authority to grant and make decisions with respect to the use of a co-written composition. By the same token, the surviving co-writer will have the authority to continue exploiting the song while having a reporting and payment sharing obligation to the deceased’s descendants or executors. The estate of the deceased co-writer can exploit the song too and must account to the surviving co-writer.

Record Producers as Co-writers

It is not unusual for a record producer working with an artist to record songs the artist wrote, or co-wrote with others, to become involved in making adjustments or changes to such songs while the artist is recording those songs under the producer’s guidance. In that context, the question often arises as to what the producer deserves for such involvement. For example, if the involvement constitutes the producer being a co-writer at that stage, is the producer then also considered as eligible for co-publisher, songwriter, and publisher credits and income participation? To the extent such contributions from the producer are treated as co-writing and thus co-publishing contributions, the result would be to vest in the producer a share of the ownership of the song’s copyright, and therefore a share of the publisher’s and the writer’s income participation. To minimize problems and disputes down the line, the producer and the artist/ writers must be extremely clear what such arrangements are, if made. At minimum, the producer and the artist/writers should sign off on song split memoranda identifying their respective percentage interests as co-publishers and co-writers. In that context, the comments made previously in this chapter would apply to the arrangements among the producer and the artist/co- writers and their respective publishers.

If the producer has no income participation, make that fact clear as well when everyone’s focus is on the matter at hand and not later when memories can become fuzzy and levels of self- interest can get in the way. Not all producers will require they be treated as co-writers and co-publishers in such situations, but many do, so being focused and clear on the respective, and sometimes competing, interests is an important step to take.

The matter and decision also can often be affected by the respective leverage of the producer and the artist/writers and how important it is to one or the other to be involved in the collaboration and in how the involvement is to be recognized and compensated.

Beats/Tracks

In the rap/hip hop music world, producers commonly take a co-interest in a song’s copyright and therefore a sharing of publisher’s and writer’s income in that song, for tracks or beats the producer contributes to the song’s recording.

Again, as with the case of producer contributions to lyrics or music for a song, the arrangements between the contributors to the beat track for rap/hip hop recordings should be clearly expressed with an agreement to articulate the arrangement’s details. The comments made above with respect to the producer contributions to music and lyrics in a song while it is being recorded and the comments in this chapter with respect to the rights and responsibilities between co-writers apply as well to the contributors of the beat tracks and the authors of the lyric and musical elements of the recorded song.

Also note that with respect to the contribution of the beat tracks, you need to be clear whether the track is being licensed on an exclusive or non-exclusive basis, which would require one element of documentation, or transferred on an exclusive basis, and whether the transfer is for a fixed fee with a waiver of any ongoing participation and co-ownership, or whether such transfer is with the intent to integrate the beat track to become part of the copyright of the song. Such elements should all be provided in at least the song split memoranda among all involved participants.

Phantom Co-writers

Some songwriters have complained they have been forced to acknowledge songwriters that did not make a significant (or in some cases any) contribution to a song. This group of “phantom” songwriters has allegedly included label heads, producers, and nonwriting band members. The exact contribution to a song is often a subjective measurement; once a songwriter acknowledges a co-writer, that acknowledgement is virtually impossible to undo. If the price to place a song on a record of a multiplatinum artist is sharing writing credit, this pressure is difficult if not impossible to resist. It is difficult to measure the prevalence of this practice, but most acknowledge, off the record, that it goes on. Prominent songwriters rarely if ever share credit in this context.

No matter the circumstances, surely your goal should not be to share credit with phantom co-writers, but rather that you can and should acknowledge real co-writers and contributors.

Conclusion

It’s clear that the trend in hit songwriting continues toward multiple co-writers dominating songwriting credits for the records on the Billboard 100. If you want to join that elite group, it’s more important than ever for you to have a grasp of the basic business and legal tenets that apply to song collaboration. The law is relatively simple and makes sense—if you co-write a song—whether you write together in the recording studio or remotely from different continents, and whether there are two co-writers or six, the same rules apply. You and your songwriters, regardless of your relative tangible contributions, are entitled to copyright ownership, income for the exploitation of the song, and songwriter credit. The law seems to work given how few disputes arise compared to how many songs continue to be written. It seems that the collaborative songwriting spirit has spilled over to the business and legal relationships among co-writers.


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