What to think about unfair record deals

by Koka Tarini Siddhartha and feat. Charita Arora

Talent is not the only prerequisite to become a successful artist. The combined efforts of a manager, publisher, record label, licensing bodies and fans, help artists reach the pinnacle of their careers. We’re not here to tell you if you, as an artist, need a manager or agent, or to discuss the pros and cons of music streaming – we’ve covered those topics here and here. Instead, we’re going to highlight some controversial record deals in the past.

Most artists are apprehensive about signing a formal legal agreement with a label or management company as the legal jargon can sometimes be confusing, and also because they fear they might surrender their rights unintentionally. Several famous artists have had terrible luck with their labels and have been forced to release an album as they are contractually bound.

Artists and Record Labels at Loggerheads:

The following are instances of artists having signed unfair and arbitrary contracts with their record labels, and their attempts in opting out of the contract due to reasons including poor royalty rates, being cheated, harassed, and artistic differences:

  • R&B girl group, TLC signed a shoddy contract with their label Arista’s LaFace Records resulting in delayed royalty payments and they ultimately had to file for bankruptcy.
  • Sony refused to give pop legend, Michael Jackson the masters to his original albums for several years. He soon found out that the same attorney represented him and Sony, creating a conflict of interest, and used this to abort the contract.
  • Pop-rock singer-songwriter, Tommy Jones entered into a deal with Roulette Records where James was not only cheated but also ended up being on the wrong side of a mafia hit, forcing him to flee New York.
  • Prince protested at his label’s (Warner Bros) refusal to release his backlogged material by changing his name to an unpronounceable symbol with the word, ‘SLAVE’ written across his face. His label relented in 1996 and the subsequent album he released was titled ‘Emancipation.’
  • Virgin Records sued Jared Leto from 30 Seconds to Mars for breaching the band-label contract ($30 million), as the band refused to release their third album due to unpaid royalties. The two finally worked things out and entered into a new contract (P.S: Check out 30 Seconds to Mars’ documentary, Artifact, based on this lawsuit).
  • Johnny Cash’s socially conscious concept album, ‘Bitter Tears’ was banned and censored. His label, Columbia Records, refused to advertise and promote the album leading Cash to self-promote his album. Columbia dropped Cash in 1986 as he wasn’t bringing enough money. Eight years later, Cash made a huge comeback with a series of albums with American Recordings.
  • Dr. Dre and Suge Knight founded Death Row Records (DRD). In 1996, Dr. Dre left DRD alleging that Knight was financially corrupt and due to creative differences, and created his own label, Aftermath Entertainment. In 2014, he successfully sued DRD for unpaid royalties.
  • Following the release of the critically acclaimed, ‘Hybrid Theory’, there was mistrust between Linkin Park and their label, Warner Bros regarding some accounting practices. Differences were resolved through a multi-million dollar deal and a higher royalty rate.
  • Pink Floyd did not want their songs to be individually released and downloaded. They wanted each album to be sold as a whole as they told a story. The court ruled in EMI’s favour demonstrating a record label’s win at the cost of destroying an artist’s vision of his music.
  • More recently, Kesha tried to exit her contract with Sony Music on grounds of sexual harassment, battery, and financial malfeasance by her producer, Dr. Luke, but the New York Supreme Court ruled against her.

How important are legal contracts?

We’ll just let aspiring artist manager (and former programs manager and teaching artist at GMI and Music Basti, respectively), Charita Arora tell us –

Every artist is different and their expectations from a contract, whether it’s a management deal or a recording contract, might be different as well. Young artists often look for contracts that are financially beneficial, however, more established artists may desire greater creative control from their contract.

The Indian music industry is rapidly growing and changing. In the current state of the industry, I feel it would be beneficial for artists to avoid long term contractual agreements as they can be fairly restrictive and can impede an artist’s growth, as well as hamper their long term career. I think the best way for an artist to find the right contract is to know what their priorities are and to get legal advice based on that, especially if they have no experience with music industry contracts.

How can artists be more wary and sign foolproof contracts?

The illustrations above indicate how a small loophole can make an artist the label’s puppet. In our previous posts here and here, we offer advice to solo artists and bands on the need and importance of protecting their music.

Here are our top five tips for artists:

  1. If you’re planning on entering into a formal arrangement with anyone (not just record labels), make sure you get a contract in writing.
  2. Be aware and conscious of your rights. Remember, there are three copyrights in every song – lyrics, musical composition, and sound recording.
  3. Don’t forget you also have moral rights and performance rights. If the contract states, “the artists agrees to waive moral rights and other neighbouring rights,” you should definitely take a closer look at the contract.
  4. Always negotiate. It does not matter if you’re a newbie or a veteran in the industry, if you don’t negotiate, you might end up in a legal soup. You could always hire a lawyer to help you in this regard.
  5. Make sure you have a non-disclosure agreement (NDA) in place in case the contract falls apart. You want to make sure your discussions and ideas always remain confidential.

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