Copyright Catches Up

Introduction

Copyright law has traditionally been viewed as the branch of intellectual property (“IP”) law that has lagged behind patents and trademarks. Some may say that this lag is because copyright law faces technological challenges that trademarks and patents do not. For example, streaming has been a constant issue that has made it harder for copyright laws to keep up with technology. As a result, Congress has recently passed legislation to try to bring copyright laws up to speed with the rest of IP laws.  

Music Modernization Act

The Orin G. Hatch-Bob Goodlatte Music Modernization Act (“MMA”)[1] was signed into law on October 11, 2018. Its main goal was to modernize the various copyright issues for music and audio recordings that fell behind thanks to streaming capabilities. The MMA is the product of three separate bills that were consolidated.

In view of the consolidated history, the Act consists of three main titles, each of which serves the purpose of updating the copyright laws. Title I - Music Licensing Modernization primarily serves the purpose of modifying the existing section-115 “mechanical” licenses for reproduction and distribution of musical works in phonorecords. In the past, these mechanical licenses meant that a licensee would have to obtain a new license for every new work, i.e., on a song-by-song basis. The Title I update establishes a new blanket license for digital music providers to engage in specifically covered activities. These covered activities include permanent downloads, limited downloads, and streaming.

This blanket license excludes physical configurations of works such as CDs and vinyls. Title I further establishes a new legal standard that is market oriented and covers the new section-115 mechanical licenses. There will be a transition period to move to the new blanket licenses, which allow digital-music providers to limit copyright infringement liability. Liability is limited so long as the provider engages in good-faith, commercially reasonable efforts to identify and locate musical works’ copyright owners. Lastly, Title I modifies the procedure for selecting a federal district court judge to adjudicate the rate-setting disputes concerning performance rights organizations that are subject to consent decrees by the Department of Justice.

Title II - Classics Protection and Access, primarily brings pre-1972 sound recordings into federal copyright system by extending copyright infringement claims to owners of works that predate February 15, 1972. This section applies a statutory licensing regime similar to the one that is applicable to post-1972 sound recordings . Title II further establishes a process for lawfully engaging in noncommercial uses of pre-1972 sound recordings not being used for commercial gain.

Title III designates SoundExchange. Congress created a nonprofit to distribute royalties on sound recordings, and to distribute a part of those same royalties to producers, mixers, and sound engineers, who were part of the creative process for a sound recording.

Conclusion

Although copyright law is still lagging behind the other two main branches of IP, the MMA is an important first step to bring copyright law up-to-speed with the ongoing technological boom.

At Rao DeBoer Osterrieder, our goal is to help you understand complex aspects of copyright law as they apply to your business. As intellectual property strategies vary greatly between industries or even businesses, it is our aim to learn your business goals and function as an in-house IP attorney would for you. There are a number of strategies even after a copyright is registered that can help increase your bottom line.

Contact us so we can tailor a plan to your individual business goals and needs.  Make your intellectual property effectively work for you.

We look forward to speaking with you!

 

© 2018 Jorge Zamora

The views expressed in this article are those of the author and do not reflect the views of Rao DeBoer Osterrieder, PLLC, or any of its clients. All rights reserved.


[1] https://judiciary.house.gov/wp-content/uploads/2018/04/HR___-MMA.pdf. This is a version of the bill that was introduced in the House of Representatives, later passed in the Senate, and signed by the White House.