Not-So-Compulsory Licence: a Proposed (and Rejected) Solution to Copyright Infringement in Derivative Musical Works

Not-So-Compulsory Licence: a Proposed (and Rejected) Solution to Copyright Infringement in Derivative Musical Works

In a recent MTV news article, author Miles Raymer opined over the “hopelessly broken” state of the US copyright system. While such a sweeping statement clearly oversimplifies the state of copyright law in the digital era, there may be some truth to it. Raymer focuses particularly on the tension between an ever-increasing market for derivative works (i.e. remixes, mash-ups, and sample-based productions) and copyright law. Nowadays, more and more artists are making music using other people’s original material and, unsurprisingly, many are doing so without obtaining the proper licensing rights.

So what is the solution – crack down on artists caught infringing copyright, reform the system, or something in between? Berkeley Law professor Peter Menell, cited by Raymer as a "leading proponent" of reform, advocates for the introduction of compulsory sample licences, which would work similar to the compulsory licences already in place in the US for recording a cover version of another artist’s song. Under the compulsory licensing system, anyone wishing to record and distribute a cover version must simply send a notice of intention to the original copyright holder, make monthly royalty payments, and submit an annual accounting statement. Importantly, compulsory licences are currently only available for musical compositions and not sound recordings. This means that if an artist wants to use a sample from a sound recording of a drum break or an a cappella vocal hook they need to obtain the rights-holder’s permission.

Compulsory sample licensing could potentially solve tensions between copyright and the derivative works market. Artists would still have to pay royalties for any sampled material (artists presently negotiate sample clearances with rights-holders by way of one time fees, royalties or both). But the process for clearing samples would be less expensive and time-consuming and there would be no risk of rights-holders rejecting use. Menell posits that compulsory licensing for sound recording sampling would lead to a more inclusive music industry in which derivative works composers could more ably and legitimately participate. In his words: "so much of the creativity is getting put out into these gray channels, these areas that are not fully embraced by the market, and compulsory sample licenses(sic) could be a remedy for this situation."

But not everyone is convinced. For one, the US Department of Commerce Internet Policy Task Force, in a recent White Paper on Remixes, First Sale, and Statutory Damages, concluded that compulsory licences for remix use are not currently justified. According to the task force, compulsory licensing would break from precedent by giving rights-holders no control over how their original work is used. For this reason, the compulsory licence proposal has little support amongst stakeholders. There are also logistical challenges with respect to remix tracking, revenue distribution, and the creation of a universal music database that limit the practicality of the proposition. Thus the task force maintains that the current system of licensing and fair use successfully accommodates the interests of both creators and rights-holders.

What about Canadian musicians and copyright holders? Is there a need or desire for compulsory sample licensing here or is it even a possibility? As it currently stands in Canada, like the US, if an artist wants to legally sample another’s original sound recording they need to obtain permission from the copyright owner(s). This can be an expensive, time consuming, and confusing process for musicians, even if they retain a lawyer. But the consequences for illegally sampling copyrighted material can be severe. The Society of Composers, Authors and Music Publishers of Canada (SOCAN) prudently warns that “[u]sing any samples without permission of the original copyright owner may constitute copyright infringement”. Given the above, it is plausible that Menell's argument for sample licensing reform could be made here too.

The Canadian copyright system is not the same as that in the US though. For example, in Canada we do not have compulsory licences for cover versions of musical works. Rather, cover artists obtain a mechanical license through CMRRA (or other similar rights organizations). These licences are similar to US compulsory licences, in that rights-holders give their approval to the CMRRA beforehand and users pay a flat usage fee, but they are not identical. This is simply to say that the Canadian and US copyright systems are not mirror images of one another and, therefore, what one does is not necessarily indicative of what the other will or should do.

Thus the questions remains: what is there to be done? The previously mentioned US task force recommends two strategies, with respect to remixes, in their white paper; (1) provide greater clarity on what constitutes fair use and (2) improve voluntary licensing options for users of copyrighted material. Whether these strategies will help solve the issues that exist in the industry remains to be seen, as does the influence such strategies may have on our Canadian licensing system.

Stephen Cooley is an IPilogue Editor and a JD candidate at Osgoode Hall Law School.