In light of the recent decision in the Fifth-Six Hope Road Music Ltd (Estate of Bob Marley) vs. UMG Recordings, many Artist are worried that all of their sounds recordings are going to be classified as "works made for hire." Basically, the judge ruled in the Bob Marley case that all of his recordings with Island Records from 1973-1977 were "works made for hire" and Universal Music Group is the rightful owner of the copyrights to five recordings Marley recorded. Specifically, the judge determined that despite Marley's artistic control over the recordings, both parties had a contractual agreement that clearly indicated the Marley sound recordings were "works made for hire."
A work made for hire is defined as a work created by an employee within the scope of the employee's employment. A work made for hire can also be created by a contractual agreement between two parties. Because most recording contracts are classified as independent contractor relationships and not employer-employee relationships, recording contracts are not usually deemed as works made for hires. However, record labels are now adding work made for hire clauses into recording contracts and artists and artists rights organizations are up in arms.
Work made for hire clauses in recording contracts have serious legal implications for artists. If the sound recording is classified as a work made for hire, the record label can retain the copyright to the work and the Masters in the recording. As a general rule, the Artists retains the right to have the Masters returned after a ten year period. This gives the Artist control over licensing and other revenue that can be obtained from the Masters. In addition, there is also "termination of copyrights" to consider. Termination of copyrights assists artists who may have signed away their copyrights. After 56 years, the artist can recapture the copyright for the last 39 years of the 56 years. For example, a contract signing away copyrights entered into in 1950 can be terminated in 2006 and the copyright can revert (artist has to give proper notice of termination) back to the artist or original author of the work. However, termination of copyrights is not applicable if the work is specifically a "work made for hire."
It is evident that both record labels and artists have a lot of stake when it comes to work made for hire clauses. Artists should hire good legal representation to ensure their works are not classified as works made for hire. Especially if the artist has created the work independently and not as an employee.
I welcome your thoughts.