Wow - this has opened up quite the can of multi-million dollar worms!
As we've reported, the Supreme Court may not want to get involved in the current legal dispute between Eminem's former production company and Universal Music Group regarding the way royalties are distributed for digital music - basically, whether or not a song sold on-line she be categorized as a license or a sale (Slim gets 50% royalties for a license, but 12% for a sale) - but apparently, the rapper isn't even the one set to benefit from the drama the most, because it would help out thousands of older artists not recording music anymore!
While the lower court ruling that digital music should be treated as a license, this won't affect new performers, because their contracts have been revised since 2000 or so to include digital sales among royalties - BUT many older artists' contracts predate that, and now have the opportunity to ca$h in on the decision BIG TIME!
Lawyer Richard S. Busch, who represented Eminem's company, F.B.T. says:
“Unlike physical sales, where the record company manufactures each disc and has incremental costs, when they license to iTunes, all they do is turn over one master. It’s only fair that the artist should receive 50 percent of the receipts.”
And lawyer Fred Wilhelms, who specializes in collecting music royalties for clients, elaborates:
“The labels make tens of millions of dollars a year from the deep catalog without paying a penny in promotion costs. Anybody who ended their recording career before 1978, and probably before 1992, is in the decision. For people who had a single hit, who couldn’t afford to chase $100 in owed royalties, they are now looking at a couple thousand. It’s worth a couple phone calls and an angry letter or two.”
However, Universal counters:
“The case has always been about one agreement with very unique language. As it has been made clear during this case, the ruling has no bearing on any other recording agreement and does not create any legal precedent.”
Hmm…that sounds like wishful thinking on their part, seeing as most lawyers seem to think that a lot of people are legally obligated to a whole lotta money that they've been missing out on for quite some time!
What do U think?? Should one-hit wonders and older artists be getting royalties for their music?
[Image via WENN.]