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Music Licensing Liability <<BACK

Copyright Law: The Legal Reasoning Behind Your Need To Affiliate With Either ASCAP or BMI

By: Paul W. Gardner, Esq.
(410) 528-1595 o
(410) 528-1597 f

Article I of the U.S. Constitution was created in 1789. It is the basis of today's copyright laws. It addressed a major concern to protect the interest of those who, through their creativity, were able to constructively contribute to society. Today’s copyright laws were created in 1906 (revisions in 1909) where music is considered a property which the composer owned. Authors and composers of music were given specific rights to collect royalties for use of their music. These royalties were limited to public performances which were for-profit.

Copyright law requires that the producer or sponsor of a public performance of copyrighted musical works -- live or recorded-- must obtain permission (usually by music licensing) from the copyright owner. If you do not get this permission then you are subject to criminal penalties under the provisions of the U.S. Copyright Law.

Producer or sponsor is the association, company, producer or person who causes the music to be performed.

Public performance , according to the copyright law, is a performance held outside a normal circle of family and friends. This includes: concerts, conventions, expositions, industrial show, meetings, trade shows, satellite teleconferences and similar events. Even private clubs are included -- almost any meeting where more than just family and friend are gathered. Fermata International Melodies, Inc. v. Champions Golf Club, Inc. is an interesting example. This case involved a Houston golf club which, one night in 1986, played certain songs on a stereo phonograph using external speakers into the club's dining room; just 21 club members and their guests were present. ASCAP members brought suit for copyright infringement. The ASCAP members prevailed and the court awarded $8,000 as well as costs and attorney's fees.

Musical works i ncludes all forms of music, live or recorded via tape, broadcasts, records, CD, and music in video and audio presentations.

Music licensing is the granting by the owner of the right to publicly perform copyright music to another, thus permitting the recipient to perform he music in public. In return, the recipient of the right -- the licensee-- pays the owner a royalty fee.

The American Society of Composers, Authors and Publishers (ASCAP) was formed by Irving Berlin in 1914 as a performers' rights organization because it was impractical for users to individually license each song that was published. ASCAP was, however, an elitist organization and had little to do with musical works that were considered to be country or rock & roll, as well as several other genres. Thus, in 1939, a group of about 600 broadcasters boycotted ASCAP music and created Broadcast Music Incorporated (BMI) to fill this gap for a growing record and radio industry.

ASCAP and BMI today boast repertoires of 3.5-4 millions songs (95% performed music) and collect over 95% of all the American performing rights royalties. They both are non-profit voluntary associations that actively and aggressively compete with each other for members. These music licensing societies are authorized to collect fees on the behalf of their songwriter

They are also very aggressive in the copyright policing/monitoring activity and copyright enforcement procedures. They have been collecting licensing fees for years from clubs, bars, hotels, restaurants, jukeboxes, elevators, amusement park, and most all other profit making agencies that use music. They are "deep pocket" organizations with annual combined revenues of three-quarters of a billion dollars and are well prepared to flex their legal muscles. This is why every artist must affiliate with either ASCAP or BMI!

There are other licensing organizations (eg. SESAC -- the Society of European State Authors and Composers) who collect fees in a different manner.


Copyright law violations carry severe penalties, including damages of not less than $500 or more than $100,000 per song as well as court costs and attorney's fees.

How enforced?

ASCAP and BMI both monitor compliance through a network of industry contacts – the Music Police, who are typically music instructors that go to events in their own community, write down songs, and turn the lists in. ASCAP for example, maintains a national field staff of 200 to just monitor compliance of just the convention industry!

Just to be clear though, there are exemptions in the copyright law which allow the playing of music without the payment of royalties:

1. A gathering of family and friends (does not constitute a performance)

2. Public domain music

(a) Music licensed before 1978:

(b) Music that is 75 years old that has not been revised and copyrighted. (Most music written before 1917) After 1978: protection expires 50 years after the death of the last surviving author or composer

3. Education: face-to-face teaching activities of a nonprofit educational institution.

4. Religion: Religious music played during the course of services at a place of worship. (However, religious music played at a banquet at which a prayer is said before the meal is not exempt.)

5. Non-profit: Music is exempt when it is performed without any direct or indirect commercial advantage and without payment of any fee or other compensation to any of the performers, promoters, or organizers, and usually where no admission is charged. If admission is charged, the proceeds, less the reasonable costs of producing the performances, are exclusively for educational, religious, or charitable purposes.

6. Public reception by a single receiving apparatus of a kind commonly used in private homes with no admission. A TV or radio can be played in a store, for example, if no additionally speakers are used.

7. Agricultural fairs

8. Record stores

9. Handicapped: Transmission to blind or deaf audiences of non-dramatic literary works and single transmission to blind audiences of dramatic literary works published at least ten years earlier.

The bottom line is that if your copyrighted music is played at clubs, bars, hotels, restaurants, jukeboxes, elevators, amusement park, and most all other profit making agencies that use music, you must be affiliated prior to getting paid royalties.

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