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To Sing or Not to Sing, That Is the Question—
The Pitfalls of Copyright Disputes Creators Should Know About
Much discussion has arisen in recent years regarding the copyright dispute between Qing-feng Wu, frontman of Taiwan's Sodagreen, and former manager and mentor Will Lin. The two-year dispute temporarily came to an end in September 2021, with Lin’s decision to not appeal first instance criminal judgment after civil and criminal actions against Wu were dismissed by courts one after another. Many fans were disconcerted at the notion that singers could be prevented from performing their own songs. In order to bridge the gap between such an anomaly and legal reality, it is essential to understand the content, enjoyment and licensing practices of copyright rights.
You May Not Necessarily Own Your Work
According to the Taiwan Copyright Act, a song, lyrics, melody, or both, is considered a "musical work”. A musical arrangement thereof, however, is regarded as a “derivative work.” In addition, vocal or instrumental performance of their work in public is deemed a “public performance” protected by the Taiwan Copyright Act. Who, it could then be asked, is entitled to utilize the copyright of the resulting work and performance? In the following section, let’s see how an author is different from an economic rights holder with regard to a musical work:
Author: Who Created The Work?
The author of a work is the creator of the work. The creator can be an actual person or juristic entity (i.e. a legal organization that can become the subject of rights and obligations, such as a company, consortium, or association.)
In principle, the author is the creator (e.g., the singer) of the song/musical arrangement. If, however, an agreement (in the form of, for example, employment and commission) exists between the creator and a record label, management company, or other entity, terms thereof defining authorship during the effective period are critical. If the agreement makes no stipulation of how authorship is defined during the effective period, the provisions of the Copyright Act shall be considered to govern, specifically, the creator of the song is deemed the author.
According to Articles 15 to 17 of the Copyright Act, the author of a work shall enjoy the moral rights, including the “right of disclosure” (the right to decide whether and when the work is to be publicly released), the “right of attribution” (the right to decide whether and how to indicate their name in the credits) and the “right of integrity” (the right to prohibit others from distorting, mutilating, modifying, or otherwise changing the content, form, or name of the work).
Economic Rights Holder: Who Is Entitled to Economic Rights for a Work?
An economic rights holder is defined as the party entitled to exploit the economic rights of a work. In terms of a musical work, its derivative works and performance, the economic rights holder enjoys “right of reproduction,” “right of distribution,” “rental rights,” “right of broadcast,” “right of public performance,” and “right of public transmission.” When it comes to a creator performing their own songs, the “right of public performance” is invoked.
In principle, ownership of economic rights for a work is enjoyed by the author of the work. If the author is a singer, the principle is maintained. In, however, the presence of an agreement (for instance, in the forms of employment or commission) between the singer and a record label, management company, or other entity, attention should be paid to any stipulation in the agreement defining ownership of economic rights to work created by the author during the term of the agreement. If a singer is an employee, the employer, such as the record label or the management company, enjoys ownership of economic rights according to Article 11 of the Copyright Act, unless the agreement stipulates otherwise. Further, the economic rights holder is entitled to transfer or license the diverse economic rights in whole or part. It is thus entirely possible for economic rights to a work to be shared among multiple parties.
Accordingly, the author (creator) and economic rights holder (beneficiary) can be the same or different entities. Different economic rights may even be enjoyed by different entities. If a creator establishes any kind of agreement, it is important to clarify which parties will enjoy authorship and economic rights of the work.
Transfer vs. Licensing
A common doubt for creators in disputes over the enjoyment of copyright often arises in practice with sayings like: "I only allowed the company to use my work. I didn’t mean that I also wanted to give it to the company!” The practices of transfer and licensing are vastly different, with notably divergent legal effects arising therefrom.
Transfer (See Article 36 of the Copyright Act)
When it comes to "transfer," the ownership in a work may be transferred to other person(s). For example, A transfers to B the economic rights in the 20 musical works of his best-selling songs. Then B becomes the holder of new economic rights to those 20 musical works.
Licensing
When it comes to "licensing," the ownership does NOT transfer. To illustrate, if A licenses C the economic rights in the 20 musical works of his/her best-selling songs, while A remains the economic rights holder to his 20 musical works of his hit songs, C is the licensee of the foregoing musical works and may exploit them pursuant to the license agreement between A and C.
Accordingly, an author collaborating with others to make his/her works shine in the marketplace should identify whether he/she is “transferring” his/her works to others or just “licensing” others to exploit his/her musical works. When copyright has been transferred, the author will, obviously, have little or no control over how the work is exploited in the future. In the case of a license, the author retains copyright and the licensee is allowed to exploit the work only within the scope of the license, affording the author considerable control over exploitation of the work.
A Sole License and an Exclusive License Are Not the Same
Under the licensing structure, the author may choose to grant an exclusive or non-exclusive license to others for the economic rights in his works.
Exclusive License (See Article 37, Paragraph 4 of the Copyright Act)
When an economic rights holder A exclusively licenses his/her musical work to a licensee B, only B may exploit the licensed musical work, with even the original rights holder not allowed, unless the agreement states otherwise. As a result, within the scope of the exclusive license, only the licensee (e.g. a record label, a management company, a music collective management organization or a media or streaming media platform) may exploit the musical work, its derivative works and/or performances in the future unless otherwise stipulated by the author who enjoys the economic rights to the musical work and other parties (e.g. a record label, a management company, a music collective management organization or a media and streaming media platform). Neither any third party nor even the author A may be allowed to freely exploit the musical work (e.g. public performance), its derivative works and/or performances.
Non-exclusive License (See Article 37, Paragraph 3 of the Copyright Act)
Given that an economic rights holder A non-exclusively licenses his/her musical work to a licensee B, not only is B allowed to exploit the licensed musical work in the future, but the economic rights holder A is also entitled to exploit the licensed musical work himself/herself and may grant a non-exclusive license of the said licensed musical work to another licensee(s) other than B while B may not sublicense the rights under the license to any third party for exploitation without the consent of A. Consequently in the scope of the non-exclusive license, the author enjoying the economic rights to the musical work, the licensees (e.g. a record label, a management company, a music collective management organization or a media and streaming media platform) and any other third parties with non-exclusive license may exploit the musical work, its derivative works and/or performances. A non-exclusive license can serve as an option for singers who want to perform their own songs freely while making profits (in terms of royalties from licensing) from their songs at the same time.
Sole License
When creators decide how to collaborate with others, doubts often arises in practice with sayings like: "I’ve solely licensed my song to Company A. Does that mean I have to get permission from Company A in order to perform my own song?” In fact, “sole license” and “exclusive license” are not the same.
Sole licensing permits exploitation of a work by a single entity, with the original rights holder unable to license any third party to exploit the work, but allowed to also exploit it themselves. When the economic rights holder A solely licenses his/her musical work to a licensee B, not only is B allowed to exploit the licensed musical work in the future, but the economic rights holder A is also entitled to exploit the licensed musical work himself/herself, while A can no longer license the licensed musical work to any other third party.
Hence, a sole license is essentially a non-exclusive license, except that there can only be one licensee.
Advices for Creators
The pursuit of art and creation can be lonesome. It takes many years in obscurity and trials before the world pays attention finally. It takes lots of hard work and perseverance to crystallize the creative ideas in solitude and make them visible to all. To avoid the situation where a creator can't freely exploit his/her own creation, the following strategies are recommended for creators lest they fall into copyright dispute:
Know Yourself and Your Partners to Avoid Possible Disputes
When deciding how to collaborate with others, a creator should confirm the role they want to play in the collaboration (e.g. whether they retain full control over the work or authorize others to manage the work) and what they wish to achieve through the collaboration, whether profit matters, whether the emphasis should be put on wide exposure, and whether higher profits or collaboration with the company that comprehend your creative vision are most important. Such concerns are affected by various aspects of copyrights: the enjoyment of copyright, whether it is transferred or licensed, whether it is an exclusive license, a non-exclusive license, or a sole license. There are also the conditions for licensing and the design of profit-sharing. The more a creator understands their own needs, the more they can articulate their expectations and embody them in their collaboration.
A creator should also clarify whether there exists any form of contractual agreement between the creator and others regarding the copyright of his/her creation. It is important to note that a contract is not necessarily a written document signed by both parties only. Verbal discussions, faxes, messages on social media and others referencing intentions of involved parties can be considered to create a contractual relationship or serve to interpret doubtful terms of the contractual relationship under Taiwanese law.
If the economic rights to a creator’s work are to be enjoyed by another party, the creator shall check whether all economic rights to their work are enjoyed by the same person or by others as well, either by transferring or by licensing. For instance, rights to reproduction of lyrics and melody may be enjoyed by a record label while the derivative works of musical arrangement by a music production company and the right of broadcast, the right of public performance and the right of public transmission by a music collective management organization, in whole or in part. In this way, the creator can be fully aware of whether the exploitation of their work (e.g. performance of their original work) infringes on the economic rights of others.
Disputes can only be avoided when creators fully understand themselves and their collaborators.
Prevention Is Always Better Than Cure
A good agreement elevates the creator while a bad agreement results in discord and disputes.
Special items that creators should pay attention to when they negotiate with others include: the process of creation, how to retain the evidence of the communication with the partners during the negotiation, whether the wording of the agreement is clear enough to avoid any doubt of interpretation, whether there are conflicting or contradictory clauses that may cause future disputes, whether there are any difficulties or doubts in the implementation of the mechanism for calculation and payment of royalties, the mechanism for checking royalty books, and the mechanism for terminating the partnership. It is beneficial for creators and all the parties involved if all of them are able to agree with one another on any controversial item in advance and to reflect the negotiated solution on the text of the agreement.
In the event of a copyright dispute between a creator and others, it is important to set the stop loss point immediately. Subsequent actions include: identifying the possible rights involved and the scope of the dispute, confirming the object and duration of the dispute, collecting and preserving relevant evidences, estimating the possible damages and the amount of money involved, and assessing possible legal action. To minimize the loss, remedial actions must be quick, exact and flexible on a case-by-case basis.
Content is King, the saying goes. No matter how much technology advances and the market changes, creators are always the niche and hope of the music industry. When a creator knows how to fight for their own rights and interests, how to identify the possible pitfalls of copyright disputes, and how to create a win-win situation with partners and collaborators, the know-how serves as a key that enable work to be sung across space and time and heard around different media carriers, platforms and markets.