SoundExchange: Looking for a Few Good Men
Okay, it’s more like 30,000 men, women and record companies (based on statements released by SoundExchange).
The good news is these people don’t have to go to boot camp. The better news is SoundExchange is holding sound recording performance royalties for these people. The bad news is these people only have until December 15, 2006 to claim their money.
What are these Royalties? Sound recording performance royalties are royalties for non-interactive subscription and non-subscription digital transmissions of sound recordings (satellite radio [e.g., XM and Sirius], music services on digital cable and satellite television, and webcasts), payable to featured artists and sound recording owners. Interactive performances, such as on-demand streaming or downloads, and music publishing are not involved.
How to Find Out: To find out if money is owed from SoundExchange, go to http://www.soundexchange.com/, click on PLAYS SEARCH ENGINE on the left side of the screen and search the database of sound recordings by label, featured artist, song title or album. If your name or sound recording is listed, SoundExchange may be holding your money.
How to Collect Undistributed Royalties: To receive any undistributed sound recording performance royalties, either affiliate with an agent to license the performances and collect royalties (we are aware of SoundExchange and Royalty Logic[1] as such agencies) or directly file the appropriate Royalty Distribution Information Form(s) (as either or both featured artist or sound recording owner) and W-9s with SoundExchange by the December 15, 2006 deadline.
Since owners of sound recordings and featured artists are each paid their share of sound recording performance royalties directly, each must affiliate separately. This applies even if the featured artist is also the owner of the sound recording.
[1] To affiliate with SoundExchange or Royalty Logic, fill out and file the proper paper work with the chosen organization. SoundExchange forms can be found at http://www.soundexchange.com/members/become_member.html.
Royalty Logic forms can be found at http://www.royaltylogic.com/join.php.
Artist and Publishing Royalties for Sales of CD Burners and Blank CDs: “The Forgotten Audio Home Recording Act of 1992”
It might only be pennies, but pennies add up to dollars.
The Audio Home Recording Act of 1992 (“AHRA”) was passed, in part, to help the music industry recover royalties lost due to home taping. The AHRA requires companies who manufacture and/or import products like CD burners, DAT machines, DATs and CDRs to make royalty payments to the Copyright Office in the form of a tax or levy on such products. The royalty collections are divided into two funds: One for songwriters and music publishers (“Musical Works Fund”) and the other for artists and record labels (“Sound Recording Fund”).
In order to collect royalties from these funds, a party or their designated agent must file a claim with the Copyright Office in January or February of each year for royalties received by the Copyright Office the previous year. Filing a claim can be time consuming and costly, so we recommend designating an agent to file the claims. Failure to file a timely claim each year waives the right to collect royalties for the previous year.
The U.S. performance rights organizations (ASCAP, BMI and SESAC) offer to collect royalties in the Musical Works Fund on behalf of their songwriter and music publisher members. Songwriters and music publishers should review their PRO agreements to determine whether they designated the PRO as their agent to collect these royalties. If not, please speak with the member representative at the PRO or the publisher about it.
If affiliated, the Alliance of Artists and Recording Companies (“AARC”) will collect money in the Sound Recording Fund and distribute it to their featured artist and sound recording owner members. AARC accounts to featured artists and sound recording owners every year based on record sales from the previous year. AARC uses sales figures it receives from SoundScan to determine each member’s share of the AHRA Sound Recording Fund royalties collected by AARC. To receive royalty payments from AARC, complete and file the proper forms. The forms can be found at http://www.aarcroyalties.com/new/join.html.
It is important to note that some artist record deals include a provision where the label collects the artist’s share of AHRA Sound Recording Fund royalties. Nevertheless, the artist is still required to affiliate with AARC, and the label is required to demonstrate its right to collect which is typically handled by a letter of direction.
There are times a music publisher has the right to collect and/or recoup the writer’s share of AHRA Musical Works Fund royalties. If this right is granted to the publisher, the publisher may need to file a letter of direction with the relevant PRO, if the PRO is actually collecting for the writer. It the PRO is not, the writer needs to take care of this directly, which again is costly and time consuming.
Trademark News
Your Community Trademark will now be Protected in 27 Countries
Two new countries will join the European Union effective January 1, 2007 – Bulgaria and Romania. Fortunately, the protection of all existing Community Trademark registrations obtained and all Community Trademark applications filed before this date will automatically extend to these two new Member States without the need to take any action or pay additional fees. In addition, the Community Trademark Office will not review the validity of CTM registrations or pending CTM applications filed before January 1, 2007 on grounds that the marks are generic or descriptive in the 2 new member states. On the other hand, filings that were made after July 1, 2006 may be opposed by prior rights holders in Bulgaria and Romania. Therefore, any watches or searches of trademark rights in the E.U. should include these two countries going forward.
Trademark Dilution Revision Act Signed into Law
And if you didn’t get it right the first time….
On October 6, 2006, President Bush signed into law the Trademark Dilution Revision Act of 2006 (the “Act”), which replaced the Federal Trademark Dilution Act and was effective immediately. The impetus behind the Act was to strengthen U.S. dilution law, and, in particular, to respond to the U.S. Supreme Court’s decision in Moseley v. V Secret Catalogue, Inc., 537 U.S. 418 (2003), which found that actual dilution must be shown to obtain relief. The Act reverses that decision by stating that only a likelihood of dilution is required in order to obtain relief. Additionally, the Act allows owners of famous marks to seek profits, damages, and costs, as well as the destruction of infringing articles.
The Act further clarifies anti-dilution law by expressly stating that trade dress dilution is actionable for trade dress that is not registered on the U.S. Trademark Office’s Principal Register. The Act also elaborates the fair use exclusion by expressly excluding from dilution claims fair use in criticism, parody, and commentary.
Additional Counterfeit Laws Enacted in Response to a Rise in Counterfeit Goods
The U.S. Customs and Border Protection has found that counterfeit and pirated goods accounted for approximately USD$ 512 billion, or about 7%, of global trade, and this amount continues to rise. In 2005 in the U.S. alone, over USD$ 93 million worth of counterfeit goods was seized.
Earlier this year, the Stop Counterfeiting in Manufactured Goods Act was enacted to amend the criminal counterfeiting statute and to strengthen the laws regarding counterfeit goods overall.
While prior counterfeit laws only prohibited the use of counterfeit marks in connection with goods, the new laws include intentionally trafficking or attempting to traffic in patches, stickers, label, wrappers, badges, boxes, containers, hangtags, documentation, and packaging. The new laws also strengthen the possible penalties against counterfeiters by requiring the destruction of all counterfeit products and labels seized during a criminal investigation. It also requires convicted counterfeiters to turn over their profits and equipment used to make the counterfeit goods and to pay restitution to trademark owners. Finally, the new laws will also allow the U.S. government to push for stronger anti-counterfeiting provisions during trade negotiations with other countries.
Trademark Board in European Union Found Registration of SCREW YOU Partially Acceptable
Back in the Summer of 2004, an individual filed a Community Trademark application for the word mark SCREW YOU for contraceptives and sex toys, as well as clothing, sports gear, eyeglasses, and alcoholic beverages. At that time, the trademark examiner refused registration of the mark on the basis that it was morally objectionable. Specifically, the examiner noted that in the U.K. and Ireland, the phrase “SCREW YOU” is a profane expression used to insult a person.
The applicant appealed the examiner’s refusal to register the mark to the OHIM’s Grand Board of Appeals ("Board"). The Board considered the matter and found that it should apply the standards of reasonable people with normal levels of tolerance and sensitivity, as well as take into account the context in which a trademark is likely to be used. In applying this rationale, the Board concluded that a substantial number of ordinary people in the U.K. and Ireland would find the trademark SCREW YOU for most goods and services morally objectionable. However, in connection with sex toys and contraceptives, the Board concluded that it was unlikely that the relevant public would be offended by a term with sexual implications.
First Sound Mark Filed with an MP3 File Accepted by the Community Trademark Office of the E.U.
The first sound mark presented as an MP3 file (as opposed to musical notations) was recently accepted and published for opposition in the European Union. Although the application was not accompanied by a description of the sound, it sounds like a crying baby or a whale. The application covers arranging subscriptions to newspapers and other publications, communications via computer terminals and other methods, and legal services (and other, related services).
Both the United States and the European Union have long recognized that sounds can be source-identifiers and may therefore be registrable. However, even in the U.S. where the regime is the most liberal, only a small number of sound mark applications have been filed – 276 since 1947. In the European Union, only 52 sound mark applications have been filed, and 31 have been registered. Some countries, such as Egypt, China, Saudi Arabia, Brazil, and Iceland, actually prohibit the registration of sound marks.
Domain Name News
Recent Limitations on Availability of Domain Name Ownership Information could have a Negative Impact on Actions Against Cybersquatting
“WHOIS” refers to the database by which the public may obtain contact information for domain name owners, but if a new proposal for limiting information goes into effect, the name may change to “WHOISN’T.”
WHOIS is an invaluable resource for trademark owners and law enforcement authorities who are combating cybersquatting, trademark infringement, Internet fraud, phishing schemes, spyware, and other illegal activities on the Internet. Upon discovering an infringing or otherwise illegal activity, the next immediate step is to check the WHOIS information to discover who owns the associated domain name.
Recently, the Generic Name Supporting Organization (“GNSO”) of the Internet Corporation for Assigned Names and Numbers ("ICANN"), the organization that administers the Internet’s name and address system, voted to limit the WHOIS database to only that information that is needed to resolve technical issues. While the U.S. Government Accountability Office has found that around 5% of domain name registration information in the U.S. is false, doing away with detailed ownership information could make it easier to engage in illegal activity anonymously and will eliminate an important deterrent to criminal behavior. Trademark owners and other parties are concerned that this will cause enforcing intellectual property rights to be more expensive and time consuming.
The decision remains controversial, and in early 2007, the full ICANN board will consider the possibility of providing a system of tiered access (i.e. allowing law enforcement authorities and intellectual property lawyers to have access to WHOIS without making it public to everyone).