Spotify settles Wixen's $1.6 billion mechanicals lawsuit
Spotify has settled the mechanical royalties lawsuit that captured by far the most headlines. That being the $1.6 billion action launched by music publisher Wixen right at the end of last year.

While the potential damages bill - coupled with the eminent list of songwriters Wixen represents - meant that particular litigation was very widely reported, it was merely the latest in a number of lawsuits focused on the payment, or not, of mechanical royalties by streaming services in the US. Most of those unpaid mechanical royalties were the result of a flawed licensing system in America, flaws that this year's Music Modernization Act seeks to address. Although it was one element of that new legislation that prompted Wixen to sue.

Streaming services exploit both the so called mechanical and performing rights of the song copyright, and in some countries those two elements are licensed separately. However, in most countries there are collecting societies representing both mechanical rights and performing rights. This means that - even where some publishers license some of their songs to some digital service providers directly - there is a society that can provide a DSP with a 'mop-up' licence covering pretty much any song on its platform not already covered by a direct deal.

In the US, while there are collecting societies representing performing rights, there is no society for mechanical rights. American copyright law actually sets a compulsory rate for mechanical royalties, but the DSP must send paperwork and payments to each song's publisher. The problem is, the DSP doesn't actually know what precise songs are contained within any one recording, let alone who wrote or published that song. So it doesn't know who to pay.

There are rights agencies in America which can help to identify what songs are in what recordings and send off the paperwork and payments. Some of these traditionally helped the record labels, who always needed to sort out the payment of mechanical royalties on CDs and downloads. But sorting out such things for a DSP with 40 million tracks on its system is different to helping a label licence a new ten track album. As a result, a certain portion of the songs on Spotify's platform (and other DSP platforms) were not fully licensed in the US.

Once that became apparent, songwriters and music publishers started to sue for copyright infringement. Under American law, when you sue for infringement, you can claim so called 'statutory damages', which is a fixed sum per infringement, oblivious of what mechanical royalties might actually be due. Which is how, when you have a publisher like Wixen with many songs on Spotify, the total potential damages could reach something like $1.6 billion.

While some songwriters and publishers blamed Spotify and the other streaming services for not properly navigating the US mechanical rights licensing system and ensuring all songs on their platform were fully licensed, others in the music publishing sector conceded that the real problem was that that licensing system wasn't fit for purpose.

Some of the latter group started to champion copyright law reform to overcome the issues, which resulted in the MMA - passed by US Congress in September - via which a mechanical rights collecting society will be set up able to offer DSPs one of those mop-up licences. That society will be paid for by the DSPs but run by the music community.

That was all very sensible. Although one element of the MMA was to draw a line in the sand on 1 Jan 2018 and say that from that point onwards songwriters and publishers could no longer seek statutory damages from DSPs over unpaid mechanicals, providing the DSP sought a licence from the new society. Where a DSP didn't have a direct relationship with a publisher, royalties would be paid to the new society, and writers and publishers could claim what they are due from there.

Worried that this element of the MMA might stop it from suing over past unpaid mechanicals, Wixen quickly filed its lawsuit at the end of last year before that proposed deadline. The independent music publisher was actually already participating in negotiations to settle an earlier class action on the mechanical royalties issue, but said that it had to also file its own legal action in case it wasn't happy with that settlement and then the MMA prevented new litigation.

At the time the publisher's President, Randall Wixen, said in a statement: "We are very disappointed that these [streaming] services will retroactively get a free pass for actions that were previously illegal unless we actually file suit before 1 Jan 2018. Neither we nor our clients are interested in becoming litigants, but we have been faced with a choice of forfeiting rights and damages, or taking action at this time".

Although Wixen insisted that his company "loved" the Spotify service, he was at times very critical of the company and its management, and of its attempts to settle the aforementioned class action. But behind the scenes talks continued between the two businesses, even as Spotify listed on the New York Stock Exchange, something that again put the streaming firm's mechanical royalty woes in the US back under the spotlight. And now a deal has been done, with Wixen becoming much more complimentary about the Spotify company and its bosses.

Name-checking both Spotify's CEO and General Counsel, Wixen told reporters yesterday: "I want to thank Daniel Ek and Horacio Gutierrez, and the whole Spotify team, for working with the Wixen team, our attorneys and our clients to understand our issues, and for collaborating with us on a win-win resolution".

He went on: "Spotify is a huge part of the future of music, and we look forward to bringing more great music from our clients to the public on terms that compensate songwriters and publishers as important partners. I am truly glad that we were able to come to a resolution without litigating the matter. Spotify listened to our concerns, collaborated with us to resolve them and demonstrated throughout that Spotify is a true partner to the songwriting community".

Although specifics of the settlement are confidential, the two companies said in a statement: "Wixen Music Publishing Inc and Spotify USA Inc have agreed to a final dismissal of the lawsuit filed by Wixen Music Publishing late last year. The conclusion of that litigation is a part of a broader business partnership between the parties, which fairly and reasonably resolves the legal claims asserted by Wixen Music Publishing relating to past licensing of Wixen's catalogue and establishes a mutually-advantageous relationship for the future".

Confirming the settlement for Spotify's side, the aforementioned Gutierrez said: "We'd like to thank Randall Wixen and Wixen Music Publishing for their co-operation in helping us reach a solution. Wixen represents some of the world's greatest talents and most treasured creators, and this settlement represents its commitment to providing first-rate service and support to songwriters while broadening its relationship with Spotify".

BACK TO THE TOP OF THE BULLETIN

New Zealand's Supreme Court agrees to hear final MegaUpload extradition appeal
New Zealand's Supreme Court has agreed to hear a final appeal by Kim Dotcom and the other former managers of one-time file-transfer platform MegaUpload in relation to efforts to extradite them to the US to face charges of criminal copyright infringement.

It's nearly seven years since the US authorities shut down MegaUpload on copyright infringement grounds, seizing its domains and servers and launching criminal proceedings against its management team, many of whom, like Dotcom, lived in New Zealand. The music and movie industries subsequently filed civil litigation which was then put on hold pending the outcome of the criminal cases.

Dotcom et al have been fighting extradition through the New Zealand courts ever since. At each stage judges have ultimately sided with US prosecutors, ruling that there are grounds to extradite the MegaUpload men. However, not all routes of appeal have been exhausted.

That said, lawyers for the US argued that the case should not go to the Supreme Court, and that the second phase of the extradition process should begin, where the case is considered by the country's Minister Of Justice.

Whether or not a third appeal in the courts should be allowed depended on how you interpreted changes to New Zealand law since the whole case began back in 2012. For their part, MegaUpload's lawyers argued a final appeal in the courts should go ahead.

This morning the Supreme Court itself sided with Team MegaUpload, in that they said they would take the case. In a statement, the court said that "given the significance of extradition" it didn't believe that, when amending the rules, the country's parliament intended to deny the right of appeal to the Supreme Court in cases like this. To that end the country's highest court stated: "We conclude that we have jurisdiction to entertain the proposed appeals".

Needless to say, Dotcom was quick to welcome the ruling, saying on Twitter: "The US tried to stop the Supreme Court of New Zealand from hearing my appeal by challenging its jurisdiction. What was the US afraid of? Today the Supreme Court held that it has jurisdiction and granted leave to appeal. Merry Christmas!"

Meanwhile, Dotcom's US attorney Ira Rothken added: "We are pleased that the New Zealand Supreme Court granted review of the US extradition case against Kim Dotcom. We believe that the court will find that cloud storage providers cannot be held criminally liable for user copyright infringements under NZ law".

And so the case continues!

--------------------------------------------------

US magistrate judge advises safe harbour be denied to ISP Grande Communications
A magistrate judge in the US has advised that American internet service provider Grande Communications should be denied safe habour protection in its legal battle with the Recording Industry Association Of America.

The judge told the court hearing that legal battle that it should grant the RIAA a summary judgement in its favour on the crucial safe harbour question.

Grande was sued by the RIAA over its failure to deal with repeat copyright infringers among its customer base. Internet companies cannot usually be held liable for their customers' infringement because of the safe harbour. However, to qualify for safe harbour protection, the internet company must operate a takedown system via which copyright owners can have infringing content removed and complain about repeat infringers.

The RIAA argues that Grande did not have sufficient anti-infringement procedures in place to qualify for safe harbour protection under America's Digital Millennium Copyright Act. And therefore it should be held liable for its users' infringement.

The trade body's legal action followed BMG's case against another American ISP, Cox Communications, which was likewise accused of having shoddy procedures for dealing with infringing customers. BMG's court win against Cox was overturned on appeal, but on a technicality, with appeals judges pretty much confirming Cox was liable for its customers' infringement. Cox subsequently settled with BMG.

Earlier this year the RIAA requested a summary judgement stating that Grande, like BMG, did not enjoy safe harbour protection. Such a judgement would mean that the court would then only have to decide what kind of copyright infringement Grande was liable for, and therefore what kind of damages it should pay the record industry.

Magistrate judge Andrew Austin has been considering that request and has now advised that the court grant the summary judgement.

According to Torrentfreak, he wrote in a report on the case that although Grande had a policy to deal with repeat infringers - as the DMCA demands - the ISP "affirmatively decided in 2010 that it would not enforce the policy at all, and that it would not terminate any customer's account regardless of how many notices of infringement that customer accumulated".

The report then goes on: "A 'reasonably implemented' termination policy requires that the policy be enforced, and not just adopted. Because the evidence is undisputed that Grande never enforced its policy during the relevant time period, it is precluded from raising the DMCA safe harbour defence in this case".

Indeed, the judge added, "it is hard to imagine a case in which it is more clear that the DMCA safe harbour is not available".

None of which bodes well for Grande. And although a district judge must now make a final ruling on the RIAA's request for summary judgement, if they follow the magistrate's judge's recommendation, that will seemingly confirm that the BMG v Cox judgement has set a definite precedent under American law as to the requirements on ISPs claiming safe harbour protection.

BACK TO THE TOP OF THE BULLETIN

CTM Publishing announces four deals via its partnership with Steve Lewis
Independent music publisher CTM has announced a number of new deals, all of which have been secured via the firm's partnership with UK music publishing veteran Steve Lewis.

The new deals include acquisitions of the publishing catalogue of multi-instrumentalist, songwriter and producer Derek Bramble and the music publishing rights of composer Matt Winn. Meanwhile an administration deal has been secured with Roger Greenaway and a worldwide publishing agreement with Neil Rushton for his Kool Kat/Base Room catalogues.

Confirming the new deals, CTM owner André de Raaff - who previously founded and ran indie publisher Imagem before its sale to Concord last year - says: "I have known Steve for more than 20 years and we always had a very successful and also pleasant relationship. During my 'Imagem years' we did not work together, but we always kept in contact. His extremely impressive career speaks for itself and I am pleased that in the first year of our new relationship we have been able to make these signings and I am convinced many will follow in 2019".

For his part Lewis - who over his career has run music publishing businesses like Virgin Music, Chrysalis and Stage Three Music - adds: "André was my sub-publisher when I ran both Chrysalis and Stage Three and, having worked together for 25 years, I know we have the same philosophy. CTM is proactive, writer-centric and independent minded. I know I can rely on their administration and creative teams to provide the very best service to writers".

BACK TO THE TOP OF THE BULLETIN

UK music industry supports grassroots venue investment fund
Numerous organisations from across the British music industry have given support to the idea of creating a 'pipeline investment fund' to support the grassroots live music network in the UK.

The fund was proposed by the Music Venue Trust at its Venues Day event back in October, and would seek to find ways to raise money from within the music industry that could be used to fund infrastructure, sound and lights in grassroots venues; acquire freeholds on the properties utilised by such venues to assure their long-term future; offer centralised legal, planning and licensing advice; and other training and support for those involved in the grassroots live sector.

The aim of the fund would be to tackle the widely documented challenges facing many grassroots venues across the UK. Which is to say, the challenges that have led to many venues closing down, depriving local music fans of easy access to grassroots music and early-career artists of a platform via which to hone their performance skills and build an initial fanbase.

Specifics of how the fund would work are still to be decided and discussed, but at Venues Day MVT encouraged other stakeholder groups in the music industry to support the initiative by signing a 'statement of intent'. The likes of the Musicians' Union, the Concert Promoters Association, the National Arena Association, the Entertainment Agents Association, the Music Managers Forum and the Music Industries Association have now done so.

As has UK Live Music, the committee that sits within UK Music and which brings together representatives from across the live music sector. Its Chair, Greg Parmley of ILMC, said yesterday: "With 35% of the UK's grassroots venues having closed over the last ten years, it's time for the industry to act. We need structured and planned investment to secure these vital spaces against development, rent rises, poor infrastructure and failing facilities".

Meanwhile MVT's Beverley Whitrick added: "We asked the UK music industry to sign up to the concept that we need to take collective financial action on the challenges facing grassroots venues. We are delighted with the response from the industry and the willingness to find positive, constructive solutions so that we can properly protect the grassroots music venues pipeline from which, ultimately, everyone benefits".

You can read the full statement of intent and more about the proposed fund here.

BACK TO THE TOP OF THE BULLETIN

James Ainscough named new Help Musicians UK CEO
Music charity Help Musicians UK has announced the appointment of James Ainscough as its new permanent CEO. Ainscough initially joined the organisation back in April as interim Financial Director, before becoming interim CEO in July, following the sudden departure of his predecessor Richard Robinson.

"On behalf of all the trustees, I am delighted to announce that James Ainscough has been appointed to the position of permanent Chief Executive at Help Musicians UK", said the charity's Chair Graham Sheffield. "This appointment has been made following an exhaustive and rigorous search process".

Ainscough adds: "Help Musicians UK has been doing great work for decades to support and empower musicians through all stages of their lives and it is a privilege to take the helm as the charity approaches its centenary in 2021".

"In recent years", he goes on, "we have been working hard to reach out to professional musicians of all ages, all genres and from all areas of the UK with research-based initiatives and funding programmes where the need is greatest. This will continue, with a growing emphasis on supporting musicians' health, welfare and careers in a joined-up way".

He continues: "I am hugely grateful for the encouragement and support that the trustees have shown me. Help Musicians UK wants a world where musicians thrive, and I am delighted to work together with the trustees and our exceptional staff team as we play our part in fulfilling this vision".

Prior to joining HMUK, Ainscough spent a decade at the Royal Albert Hall, initially as Finance Director, before moving up to COO in 2015.

BACK TO THE TOP OF THE BULLETIN

Unauthorised Beyonce and SZA albums briefly appear on streaming services
Beyonce and SZA have become the latest artists to have old music wrapped up and presented as new by scammers.

Two albums of old Beyonce songs, demos and other rarities - credited to Queen Carter and titled 'Have Your Way' and 'Back Up, Rewind' - appeared on streaming services last night. Meanwhile, a collection of leaked SZA demos, titled 'Comethru', was also released, credited to Sister Solana.

Commenting on the unauthorised release, SZA said on Instagram: "These are random scratches from 2015. Def not new new!" Meanwhile the President of her label, Top Dawg Entertainment's Terrence Henderson, said on Twitter: "There is no new SZA album out. Old songs were stolen and leaked. We are currently fixing the issue".

All three releases were quickly taken down and are no longer available. The release of these albums follows a similar incident involving Ariana Grande last month. Under the name Zandhr, an album of previously unreleased and rare songs by Grande was briefly available to stream under the title 'Nobody Does It Better (Deluxe Version)'.

Exactly who is behind these leaks, and their motivation, is unclear.

BACK TO THE TOP OF THE BULLETIN

Beef Of The Week #435: Beefs Of The Years 2018
So, another year is all but over. Which means now is the time to look back and reflect on how bloody angry everyone was. Each week this column was filled with musical people shouting at each other. And what a joy it was.

Here we select ten of our favourite Beef Of The Week articles from the last twelve months. I'm sure you'll all be pleased to know that - despite there being plenty of opportunity to include daft music-based quarrels over it - we've left all mention of Brexit out entirely. Let's just forget about all that for a couple of weeks, eh? Maybe even forever.

So enjoy these, ten of the finest cuts of beef we could find in this year's archive. The Beef Of The Week column will be going on hiatus in 2019. We've been doing this every week for eight full years now and it's time for a rest. Plus, I have a really good feeling that everyone's going to start getting along super well next year, making this column entirely redundant.

Anyway, here are the Beefs Of The Year...

19 Jan: Moby v Donald Trump
It's been a weird year, politically. It's been a weird few years, really. But we had an indication of how weird this year was going to get when Moby started claiming to have secret information about Donald Trump back in January. Information, he claimed, he'd been given by "active and former CIA members" specifically because he had a bigger social media following than them, so would be able to share it with more people. [Read full article]

2 Feb: Everyone v The Grammys
I had to double check that this happened this year, but it definitely did. It was in 2018 that Grammys boss Neil Portnow said that the main reason women hardly appeared at his big awards ceremony - as winners or performers - was because they weren't trying hard enough. "Step up", he said, "Fuck off", they replied. [Read full article]

23 Feb: Fergie v The USA
Fergie's attempt to jazz up the American nation anthem - hindered by the fact that she isn't a jazz singer - was one of the year's great joys. Not just because it's fun to watch a line of basketball players trying not to laugh, but also because it provided an excuse to watch a load of other equally bad celebrity renditions of the song. [Read full article]

2 Mar: Mount Eerie v Autographs
Mount Eerie's Phil Elverum doesn't like signing autographs. As you would know if you've asked him for one recently, because instead of getting a speedy signature you would have been handed a 2733 word essay on why he's just not that into them. I'll pay good money to anyone who can get me a signed copy of it. [Read full article]

6 Apr: Louis Cut v Gravity
I'm not sure this really counts as one of the beefs of the year, but I'd completely forgotten about it and really enjoyed reading about it again. Also, having already warned you all of the perils of asking for autographs, we might as well cover the even more dangerous pastime of shaking the hands of your favourite music makers as well. [Read full article]

4 May: Police v Illegal raves
As the summer drew near, Gwent Police put together a handy guide for countryside dwellers to spot illegal raves being set up. The document also doubled as a handy guide for putting on a successful illegal rave. [Read full article]

15 Jun: Pusha T v A fox
Sure, everyone was talking about Pusha T's beef with Drake this year. But Drake's all anyone ever talks about. I'm so bored of Drake. Much more fun was Pusha T's encounter with an angry fox while recording his latest album 'Daytona'. Here we analyse the effect this incident definitely had on the album's lyrics. [Read full article]

24 Aug: Nicki Minaj v Travis Scott (and his baby)
Lest we forget that this was the year the Nicki Minaj had so many beefs that one of them was with an actual baby. The baby of Travis Scott. With whom she also has beef. "I know that you guys are saying, me and baby Stormi have beef", she said on her Beats 1 show. "Yes we do". [Read full article]

16 Nov: Threatin v Europe
We couldn't let this one slip by, even though I'm sure it's still fresh in everyone's minds. The story of the man who built a fake fanbase and then booked a tour hoping they'd turn up is one that will live on for many years. [Read full article]

14 Dec: Neil Young v Barclaycard
This was only last week, but oh man is it one of my favourites. Neil Young always delivers the goods. Some people would pull out of a show when they realised it was sponsored by a company that doesn't align with their political beliefs. Instead, Neil Young convinced AEG to pull a whole day out of a festival, so his show could sit outside of those proceedings without bloody Barclaycard's logo on the poster. [Read full article]

BACK TO THE TOP OF THE BULLETIN