Serena Nath is an IPilogue Writer and a 2L JD candidate at Osgoode Hall Law School.

In a recent installment in the series of intellectual property disputes in the music industry, electronic artist Four Tet, also known as Kieran Hebden, has against his independent British record label, Domino Record Label, over how much he is paid every time one of his songs is downloaded or streamed. Four Tet had ; a time where CDs were still popular and long before the invention and popularization of music streaming. In this contract, it was stipulated that for licences, he would be paid a royalty rate of but for a sale, such as the sale of a CD, he would be paid a royalty

Sales vs Licences

When Four Tet’s contract was signed in 2001, these standard licensing terms were for the music industry. For music sales, such as selling music via CDs, vinyl, and cassettes, overhead costs for record labels were much higher due to manufacturing and distribution expenses. Thus, in order to cover the overhead costs, record labels would pay their artists a lower royalty rate compared to the royalty rate for licences. For licences, it was understood that the third party licensing the music, such as for a movie, television show, or advertisement, would take on the extra costs, allowing for an artist to receive a higher royalty rate from the record label.

However, with advancements in technology for music consumption, the landscape of the music industry changed. Record labels no longer had high overhead expenses due to no longer having to manufacture and distribute CDs, vinyl or cassettes. Yet record labels continue to ��argue that music downloads and streams should be considered as sales as this is a new technology format. Artists have typically disagreed with this and insist that this type of royalty model is unfair. For example, in 2011, against Eminem’s record company, Universal Music Group for unpaid royalties, due to the producers arguing that streamed and downloaded music should be considered akin to licencing of music and not sales.

The Case at Hand

In 2020, Four Tet against Domino for unpaid royalties. Similar to the Eminem case, Four Tet argued that he should be paid a royalty rate of 50% for streams and downloads of his music, not the 18% that the record label had been paying him. Four Tet reasoned that streams and downloads of music are like licences; not sales. In response to the lawsuit, Domino removed three of Four Tet’s four albums produced with the record label, without Four Tet’s consent, from all streaming services and online stores in November, 2021, which ” Four Tet. Four Tet responded by adding a claim for breach of contract, resulting in Domino threatening to take the case to the High Court.

The case, which took place in the Intellectual Property and Enterprise Court, ultimately and Domino agreed to pay the requested royalty rate of 50% on streams and downloads as they are now considered to be licences. Domino also paid Four Tet £56,921.08 to account for the difference in income owed as a result of the difference between the royalty rates of 18% and 50% and simple interest calculated at a rate of 5% per year during the accounting period commencing July 1, 2017.

Future Impacts

The settlement may significantly impact the way the music industry values streaming and downloading and thus may impact royalty rates. This is particularly important as the music industry seems to be undergoing a reform regarding royalty payments. , a committee of UK MPs published a report advocating for a 50/50 royalty split between the record label and the artist. Similarly, the US Copyright Royalty Board has to increase streaming royalty rates to 15.1% for songwriters/publishers. ��These decisions, including Four Tet’s successful settlement, indicate that the music industry is changing and artists will start gaining fairer deals when it comes to royalties from streaming and downloading.

The post Four Tet’s Successful Royalty Battle: Are Changes Coming in the Music Industry for Royalty Payment? appeared first on IPOsgoode.

Photo by Ståle Grut ()

Claire Wortsman is an IPilogue Senior Editor and a 2L JD Candidate at Osgoode Hall Law School.

As Toronto museums once again, their only option to stay “open” is to turn towards the digital. Toronto museums are not alone, although perhaps their struggles are more drawn-out; museums and art galleries . have also faced physical closures due to lockdown restrictions. According to , more than 85,000 museums worldwide (nearly 90% of museums surveyed) have closed their doors. In 2020, visitor figures for the world’s top 100 art museums by 77%.

In staying “open” virtually, museums and galleries have their online presence by producing virtual tours and immersive experiences for remote viewing. Many museums have made high-resolution images of their collections available online, including the Victoria and Albert Museum, whose hit a level of audience engagement in 2020. New 91��ɫ art attorney Amelia K. Brankov that museums can ensure compliance with copyright legislation while protecting against the risk of liability resulting from third-party actions by providing an appropriate “terms of use” section on their website.

For North American museums with works still under copyright, the 2017 Guidelines for the Use of Copyrighted Materials and Works of Art by Art Museums by the Association of Art Museum Directors will come in handy. However, many of the masterpieces housed by museums are in the public domain. Copyright subsists in until 50 years after the creator’s death and in the . and . until 70 years after the creator’s death (although, per the terms of the Canada-greement, Canada will bridge that 20-year gap). Yet, in many cases, museums continue to profit off of and control these works.

On the one hand, licensing deals made possible by control over artistic works offer an important source of revenue for museums struggling during, or in the wake of, mandated closures. On the other hand, some museums’ practice of reappropriating works in the public domain by claiming copyright protection for their reproductions, thereby artificially extending the duration of copyright protection. Further, museums risk being “hypocritical” when they promote the commercialisation of their collections while banning usage by others.��

In 1972, art critic John Berger , “For the first time ever, images of art have become ephemeral, ubiquitous, insubstantial, available, valueless, free.” Taco Dibbits, director of collections at the Rijksmuseum in Amsterdam, that the museum allows audiences to download high-resolution photos of its collections: “If they want to have a Vermeer on their toilet paper, I’d rather have a very high-quality image … than a very bad reproduction.”

The question remains whether Vermeer-covered toilet paper marks a problem. The debate of who, if anyone, should have control over cultural artefacts in the public domain was recently reinvigorated when the Louvre museum and Uffizi Gallery to sue Pornhub for turning works by painters Titian and Courbet into pornography without authorization. As , it is worth noting that Pornhub is at the center of of hosting and profiting off videos of rape, incest, and child abuse. Those who criticize the company, and any association with it, may have better grounds to stand on than moral outrage over pornography.����������������

Moral rights the right to the integrity of the work and attribution in reasonable circumstances. Museums in France claim perpetual moral rights of an author’s work. In Italy, the museums’ permission to use images from their collections for commercial purposes. On these bases, the Louvre museum and Uffizi Gallery, based in France and Italy respectively, threatened to bring legal action against Pornhub. This is the same Louvre that launched “a flurry of brand partnerships” in 2021 with brands ranging from to . This is also the same Uffizi that has taken to to depict scenes ���dzٳپ����������’s Venus running away from tourists attempting to take selfies with her. Would Botticelli approve more of his works appearing on TikToks, phone cases, and graphic tees than pornography? And the ultimate question: Who’s to say?

So, what can we expect as the COVID-19 pandemic enters its third year? The best answer I have found is : the only certainty is that nothing is certain. Despite this, the museum directors and head curators that Cheshire spoke to are confident in their ability to adapt to the changes that 2022 will bring. Director of the UCCA Center for Contemporary Art Philip Tinari , “It’s a question of pricing in some uncertainty to your planning.” Another explanation for the confidence of directors and curators going into the new year is the and the of global sales of licensed goods and services, particularly in art.

The post When Doors Close, A Market Grows: Museums, COVID-19, and Cultural Digitisation appeared first on IPOsgoode.

Photo by (

Natalie Bravo is an��IPilogue��Writer and a 2L JD Candidate at��Osgoode��Hall Law School.��

��

is a 1994 (RPG) released in North America on the . It is the second entry in Nintendo’s series and the first to be translated and released outside of Japan. The game is satirical, featuring many zany characters and subversive content that mostly provides commentary and homage to Western culture. The soundtrack is just as strange, featuring , despite the of . The game’s 8-bit songs are inspired by genres ranging from to . Everything about the game defies what you would expect from a typical RPG, especially one from 27 years ago.

It also happens to be my all-time favourite game. ; the game has established itself as a . videos (LP) are a YouTube staple and popular games will have many LP series. Earthbound is no exception,

History of Earthbound

Though mass-marketed in a , Earthbound failed replicate its Japanese success in North America. Copies of the game along with a gamer’s guide packaged in special extra-large cardboard boxes sat unsold on shelves for months. Due to low sales ( sold in North America), the game remained a hidden gem for years until Earthbound’s main character appeared in the popular 1999 fighting game for the (and ), sparking a newfound interest in the forgotten series.

As popularity increased throughout the years, . Since many did not originally own or buy Earthbound, dwindling supply allowed the cartridges’ price to far beyond that of a regular SNES game. , software meant to emulate a game system, instead of shelling out over $100 USD to purchase the game. Thankfully, after endless lobbying from thousands of dedicated fans, Nintendo eventually re-released Earthbound for the Nintendo and for the in 2016—a move that finally allowed fans legal and affordable access to the game. The re-releases have also enabled many to broadcast their playthroughs with greater ease than previously possible. As it’s not on the yet, many who don’t own the older consoles may still enjoy watching others play online.

Let’s Plays & YouTube
Gamers and streamers often upload their gaming content onto sites like YouTube hoping to share their experiences with viewers. This type of video documentation is called “Let’s Play”. Legally publishing videogame footage largely depends on who the developers are and what they allow.

In late 2018, Nintendo discontinued the and implemented the . Nintendo “will not object to your use of gameplay footage and/or screenshots captured from games for which Nintendo owns the copyright (‘Nintendo Game Content’) in the content you create for appropriate video and image sharing sites,” as long as the guidelines are followed. The rules allow streamers to via “methods separately specified by Nintendo.” Nintendo further mandates “creative input and commentary” and explicitly disallows videos lacking such commentary. The remaining guidelines detail Nintendo’s reserved rights, Nintendo’s non-affiliation with YouTubers utilizing their intellectual property, and a FAQ section.

Copyright Claims
Earthbound content and music have remained mostly unscathed on YouTube for many years. Unfortunately, in recent months, many Earthbound players who uploaded their Let’s Plays have been struck with , effectively demonetizing the videos or, in some cases, outright removing them. One YouTuber, recently lost their Earthbound LPs’ ad revenue and their videos were removed. The YouTuber , with many fans responding with similar experiences and concerns.

How Does Sony Fit into This?

Nintendo owns the game’s brand and composed its music, but licensed the first two Earthbound series soundtracks to Sony for . Many fans were unaware of Sony’s Earthbound connection. Even though Nintendo allows LP videos, Sony can take down LPs and related content to protect its rights in the music. Users have attempted to dispute copyright claims, only to allegedly be hit by counterclaims from Sony. Google’s likely automatically detected Earthbound music and subsequently initiated the claims. , leading game developers to introduce “copyright-free” and . Earthbound is an old game though, and nobody seemingly knew Sony’s music license for the Japanese album even existed, until these claims arose.

The entire situation is noticeably disheartening for fans of a game where the music is integral to the plot and experience. Even though it is likely an algorithmic flagging issue, and Sony is entitled to defend their IP, the issue seems to indicate a larger problem. YouTube gaming is many users’ livelihood and/or dedicated hobby. Even if Sony eventually allows videos to return, unexpected copyright issues like these make the gaming process unnecessarily burdensome and financially detrimental. Suspended video publication interrupts potential ad revenue; while this may not have consequences for most, it can trouble users with millions of viewers. While potentially disingenuous to the experience, muting or changing the audio might be the easiest workaround to continue publishing LPs.

The post Copyright Confusion: Sony Upsetting Nintendo YouTubers appeared first on IPOsgoode.

Meena Alnajar is an��IPilogue��Writer, IP Innovation Clinic Fellow,��and a 2L JD Candidate at��Osgoode��Hall Law School.��

��

Costumes can memorialize iconic movie characters even off-screen. Behind every costume is a designer whose vision and design breathes life into characters. But behind every designer, other figures may undercut and miscredit them.

�پ����Ա��’s Cruella, , tells the story of two haute couture designers battling for recognition in the fashion industry. The film is also an origin story for . Oscar-winning costume designer created the film’s mesmerizing costumes with plenty of colour, whimsy, and, of course, animal prints. Life now imitates art as Beavan battles Disney for attribution for her work.

Beavan that Disney discussed co-branded products for Target and Singer Corporation as well as a possible fashion collection. But these talks ceased once production on the movie ended. Then, in May 2021, the fashion brand advertised a new, officially-licensed Cruella-inspired collection—without Beavan’s knowledge or attribution.

This is not the first time this has happened, even recently. In 2020, a licensed Harley Quinn-inspired did not involve the film’s costume designer, . These incidences raise the question: are creators unfairly excluded from these licensing processes?

The answered that question in June 2021 by calling out �پ����Ա��’s practice in reference to the Cruella-inspired licensing. Disney has . CDG President Salvador Pérez Jr. : “Our work is reproduced for toys, costumes, fashion collections and more. Not only are we not allowed to participate in the profits made off of the merchandising, we aren’t even credited for our work on the original designs.”

Licensing requires ownership of the designs, which calls into question who owns a costume—the costume designer or the production company who them? Many costume designers’ contracts with big production companies currently . There are, however, some exceptions. , the designer for the television show Mad Men, entered a multi-year collaboration for a .

Conflict arises in contracts’ terms. Contracts typically allocate the rights to the film, , to the company. However designers may push back by arguing that . Many designers believe that they do not sign away their ownership rights for external merchandising or collaborations, while production companies counter that this is implied in their contracts. Two apparent approaches can resolve these contractual issues.

First, designers can negotiate and carefully draft s. But this approach can be unpredictable. Merchandising opportunities may only arise when designs become popular or if the film is successful. Further, it is uncertain how much of the costume design will be included in future merchandise. Creating a film character involves many contributors, so the merchandise may not relate to the character’s costume and therefore for the costume designer.

The second approach is more collaborative. Costume designers can pitch collaborations with certain brands to the production companies, , to ensure their attributions. But this approach also carries uncertainty based on whether companies would agree to such collaborations prior to the film’s release.

While the Cruella-inspired line continues to generate discussions on designer ownership and compensation, the issue still depends on whether big production companies will collaborate with individual designers beyond what they create for films. With the CDG’s continued public support, the film industry could implement changes to allow designers to receive compensation for not just their designs, but for their ability to immortalize characters through merchandise and fashion lines.

The post Cruella Costume Licensing: A Fashion Faux Pas appeared first on IPOsgoode.

Photo Credit: (

Claire Wortsman is an IPilogue Writer and a 2L JD Candidate at Osgoode Hall Law School.

��

In music copyright news, producer and DJ iMarkkeyz informed that his management is in talks with Cardi B’s in the wake of the success of his song, . The song features audio taken from one of Cardi B’s Instagram posts. Personally, when it comes to pandemic-inspired music, I am partial to Lawrence’s and Fred again… and The Blessed Madonna’s . While the former romanticizes the quarantine period of living in sweatpants, microwaving Pad Thai, and playing board games, the latter reminds lovers of concerts, music festivals, and dancing in general of what they have lost and will hopefully regain in the not-so-distant future. Many live music listeners are feeling the same way as Lacey Novinka, who revealed to the that she misses, “being with all these people, jumping up and down yelling, getting sweaty.”��

What Have Musicians Lost? ��

While concert-goers have temporarily lost an experience that brings them joy, a recent detailing a brilliant jazz pianist’s departure from the music industry has brought to the forefront of my mind the losses suffered for those on stage. Ron Davis had spent over five decades in music and released 13 albums, but due to COVID-19, he lost the ability to play gigs and had to turn to his fallback career: law. Fortunately for Davis, his fallback plan doesn’t sound so bad. As he works on interesting cases and earns a steady pay cheque, he seems at peace with his shift away from the stage and towards the courtroom.

Unfortunately, not many musicians have fallbacks that offer the same level of fulfillment and financial security. Singer-songwriter Chris Luedecke took up work harvesting scallops, a job he as invigorating but not something he could see himself doing long-term as his desire to play again grows. Fiddler Ashley MacIsaac told that after gigs, which make up 95% of his gross income, were cancelled, he had to resort to selling the rights to his catalogue of recordings as well as two of his three best violins.

Many musicians need to tour and sell merchandise to earn a liveable wage. Royalties from digital streaming services, which the reports average half a cent per listen, are often not enough on their own. Kevin Erickson, the director of artist-advocacy non-profit group Future of Music, wants more than a return to the pre-virus status quo. He that the pandemic be viewed as “an opportunity to reflect on the precariousness that so many creative workers face, and to take bold action to remedy that problem.” ��

In conversation with Andrew Oliver, who fans may know as or as lead guitarist and bassist of , I learned that the entire music ecosystem feels the pandemic’s impact – from musicians to venue owners to promoters to sound and lighting-technicians. Oliver recounted the loss of many small and medium sized venues that “either closed down or were bought up by larger corporations. Many owners operate their venues as a labour of love, and it is terrible to see them be forced to sell their prized spaces.”

Oliver describes the last couple years as devastating for the industry and personally challenging as his band’s first European tour was cancelled. However, Oliver also left me with some hope for the future: “Many musicians, including my band mates… cycle between two modes: writing/recording and touring. When our tours got cancelled, we decided to take the opportunity to record as much music as we could… One big silver lining of the pandemic is the massive amount of music that is waiting to be released around the world.”

The Changing Copyright Landscape

After losing the ability to tour, musicians found creative ways to earn money and deliver music to and engage with their fans, including and , to name a couple. Oliver also mentioned TikTok, Discord, Twitch, Instagram live chats, and interactive YouTube premiers. Each of these platforms, and their associated copyright landscapes, present unique challenges and opportunities for both creators and users.

As the pandemic has pushed life online, live-event producers have moved into the digital sphere and must adapt to its more complicated and potentially more expensive IP licensing process. Writing for the , law professor Edward Klaris warns that as more businesses enter the rights clearance game, people may look for shortcuts. Like Erickson, however, Klaris also views the pandemic as an opportunity. For him, it is an opportunity “to avoid the chaos of the past, [and to urge] organizations across the board – whether individual performers, arts platforms, small businesses or major corporations – to start thinking and behaving like the multimedia companies they have abruptly become.”

The post A Challenge, An Opportunity: The Music Industry and COVID appeared first on IPOsgoode.

On the most basic level, a patent gives you the ability to exclude all others from the invention the patent teaches. This 20-year term means that nobody else can make, sell or otherwise take advantage of your patent. If they do, they are infringing the patent and you can sue them. However, a patent is much more than an enforcement tool, it can also be your most valuable asset.

Even before your patent is issued, your invention may form the basis of a start-up company. Perhaps, you’ve invented the new wonder-drug and you decide to leave the world of academia to build a pharmaceutical empire. With your patent in hand, there are a few things to consider before you venture into the world of IP commercialization. First and foremost, you want to make sure to protect your IP. You’ll always be the inventor of the patent, but it is good practice to assign the patent ownership to the company. Both patents and companies often have co-inventors or co-founders, which can make things complicated. If the company does not own the IP, a fall-out between co-inventors could prove fatal. In this case, the unhappy inventor could essentially hold the IP hostage preventing the company from functioning. Making sure the company owns the IP would allow for a disgruntled co-inventor or co-founder to leave the company with the IP still intact.

It’s also important to account for future innovation. As the company grows, employees may develop new innovative ideas for which you may seek patent protection. In these events, be sure to have contractual agreements in place to ensure the company owns the IP, not the employee. In the , the law will favour the employee as owner. The company may gain a shop right to use the invention without infringement but won’t own and be able to commercialize the invention.

Having ownership of a patent means you can monetize your invention through licencing agreements. Using the COVID-19 vaccine for example, the patent owners of each vaccine have the ability to license others to manufacture and distribute the vaccine. This has been a particular cause for concern due to compulsory licencing during emergencies, recently discussed on the . Global pandemic aside, inventors have the opportunity to capitalize on their success through a variety of licencing schemes, be it one-time payments, annual licencing fees or royalties.

It’s also important to consider that not all inventions can stand-alone. Consider an inventor who designed an eco-friendly jet engine. The engine alone doesn’t do much good, but licencing the invention to the companies that build planes offers a huge source of revenue. Licensing is often a two-way street. Your competitors may benefit from your invention, but their success is your success as well. By licencing your eco-friendly jet engine, you may ward off the competition from attempting to develop a non-infringing product. This not only keeps the competition in check but allows you to benefit from the success of all the licensees.

A patent is a powerful tool. It can be the basis of a company and open the door to a profitable licensing scheme. So long as you have a strategy to protect and license your patent there is a world of opportunity awaiting. As an inventor, you have 20 years to capitalize on your patent, so make the most of it.

Written by Maddie Lynch, JD Candidate 2022, enrolled in Professor D'Agostino's Directed Reading: IP Innovation Clinic course at Osgoode Hall Law School. As part of the course requirements, students were asked to write a blog on a topic of their choice.��

The post You’ve got a patent, now what? appeared first on IPOsgoode.

Over the course of three days in early February 2016, IP Osgoode played host to the , a multidisciplinary and international event that resulted in a memorable proposal for an “Orphan Hunter.” While that may sound more like a discarded Stephen King draft than a solution to an important copyright issue, it is indicative of the creative and innovative thinking that drove the event.

I was lucky enough to have the opportunity to participate in the Hackathon, along with a number of other Osgoode students. Hosted by and the Copyright and International Trade Policy Branch of the Department of , the event brought together stakeholders from various fields and institutions, including: libraries, archives, and museums, the , the United Kingdom’s , and students from Osgoode Hall Law School and the . Our “Design Hosts” were IP Osgoode Founder & Director, Professor and Margaret Hagan of .

The event sought to take a approach to addressing the issue of works with unlocatable copyright owners (“orphan works”), which can currently be licensed to users by the Copyright Board of Canada, per section 77 of the . As such, much of the time was spent broken out into groups - made up of participants from various disciplines – which focused their attention on a hypothetical but specific user. The approach was something very unlike my usual experiences with law school and the law in general. Creativity was central to the process, and the legal perspective was only one among many to be considered.

The Process: Some Pretty Messy Creativity

My experience in my working group (one of half a dozen groups) really showcased for me the design-forward approach and its potential benefits in problem solving. Working with people from different stakeholder groups really makes you feel like a “beginner,” forcing you to consider their needs and concerns, which often place legal consideration well below others. Moreover, the focus on “failing quickly” kept us from getting bogged down in debates about why a solution would not work and instead encouraged brainstorming, creativity, and testing. While it was still frustrating to hear testers’ problems with a given prototype – usually barely cobbled together in time for the next “session” – you knew quickly if something worked or not, giving you a chance to leave it behind or fix it before having invested precious time and resources. It is easy to see why this approach has become popular in other disciplines (our computer engineer told me that Hackathons are regular occurrences in that sphere): solutions are responsive to the diversity of stakeholder needs and wants, it is easier to stray from traditional approaches, and little initial investment is required before an idea has been tested for feasibility.

The event also incorporated a group of very talented computer engineers from Lassonde. They were able to create highly successful mock-ups and prototypes that demonstrated the various group’s ideas, ranging from policy to practical applications. Our own group’s engineer was able to put together a visually striking and impressively functional website in mere hours. That process was impressive, and more importantly, I think, demonstrated the importance of technology and user-friendliness going forward in the legal realm. We have the technology and the people to do it; the legal profession and the justice system just need to embrace it.

The Results: One Question, Lots of Answers

The whole process was informed by presentations from representatives of the UK IPO and the United States Copyright Office (who joined us via Skype), giving us two very different models from which to draw inspiration. The UK launched an in October 2014, inspired by the pre-existing Canadian regime. While their system remains in beta, it allows for on-line applications for licenses for the use of orphan works (including for commercial purposes) for licensing fees set in advance. The Canadian approach predates this, and relies on the discretion of the Copyright Board to deal with applications for licensing (the applications must show that reasonable effort was made to locate the work’s copyright owner and that the owner is unlocatable). Neither the Canadian nor the UK system has been much used; while neither denies many licenses, few are applied for and fewer are issued.

It is easy to see why orphan works licensing requires modernization – the systems that exist are little used, and as my group-mates who work in the libraries, archives, and museums field noted, they are forced to sit on hundreds of thousands, if not millions, of works whose authors are unlocatable. While the Hackathon may not have produced a game-changing breakthrough, which is not what it was designed to do in the first place, it did produce a number of diverse and creative proposals to deal with some of the issues surrounding orphan works, which reflects the value and potential of the design process.

From insurance schemes (“F’It”) to search tools (“Annie”) to identifying marks (“OWL”), and of course the winning “Orphan Hunter” bounty concept, participants approached the theme of the event with enthusiasm, creativity, and a willingness to move beyond traditional models. I was lucky to have had the opportunity to take part and I am genuinely hopeful that the success of such events will encourage similar approaches within the law school and in the broader legal realm.

Sebastian Beck-Watt is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

The post Thinking Outside the (Legal) Box: IP Osgoode’s Orphan Works Licensing Portal Hackathon appeared first on IPOsgoode.

This year several high profile artists spoke out against, or withdrew from streaming services. In June, the members of Pink Floyd against Pandora’s attempts to decrease the royalties that streaming services pay to the artists in their libraries. In Early July, Thom 91��ɫ his music from Spotify. The Radiohead front man claims that the site’s business model does not properly compensate new artists. In late July, Aimee Mann filed a against MediaNet. The claims allege that MediaNet’s library includes a number of improperly licensed works and further claims that Mann has not received a royalty payment from the entity since 2006.

Before the industry can expand, streaming services must resolve their licensing problems. In 2011, ASCAP reached a U.S. with Spotify, granting the site access to over 8.5 million songs in the ASCAP catalogue. In that same year, however, over indie labels withdrew their catalogs from several streaming services, including Spotify, Napster, Simfy and Rdio over concerns of under-compensation and for the fear that streaming would hurt sales for smaller artists.

Streaming services rely on artist participation and licensing agreements. These relationships must be stable in order for streaming to truly take off as an alternative to traditional radio, or services like iTunes. If artists do not have faith in the current business model, then it will be difficult for streaming services to expand. When popular artists publicly decry the system, it can sour potential relationships both with new users and artists who have yet to licence their music.

Some streaming services argue that the barrier to expansion is the cost of royalty payouts. Pandora��a Canadian expansion in 2007 due to the cost of royalty payments in Canada. , “the rates that have been proposed by the Canadian music rights societies are simply uneconomic.” ��In addition, the current tariff rate may not be set until several years into the future. For example, one����on streaming services for the period from 2008-2010 did not receive certification until 2012. It may be difficult for a service to accurately gauge their viability in a new market if they may end up paying a substantially higher royalty rate than initially anticipated.��Services may simply be unwilling to expand without certainty regarding these tariff rates.

While radio tariffs account for the fact that one play of a song can reach a large audience, on streaming services each play generally only reaches one user. Therefore the amount paid out for each play is much smaller. For example, one artist only received $1652.74 for����plays on Pandora. If these services increase in popularity, then perhaps the number of individual plays may eventually lead to payouts that resemble those for current radio rates.��The t from Pandora is that lower royalties now will mean long-term higher payouts. Lower royalties would allow services to pour more money into development and advertising. If services expand in size, then although the rate is lower the actual amount will increase due to the increased volume of traffic on the services.

Organizations that collect royalties for Canadian rights holders feel that their proposed rates represent . In fact, in the U.S. over signed an open letter opposing Pandora’s lobbying attempts to lower royalty rates. Moreover, despite Westergren’s assertions, Songza successfully negotiated a private to licence music from Re: Sound and launched its “music concierge” playlist streaming service in Canada in 2012. Therefore there is potential for other services to come to an agreement in Canada, but the question remains whether royalties will present a problem for their bottom line.

Sadly, the string of artist complaints and withdrawals from several popular streaming services may temper online music streaming services expansion to Canadian markets, and the growth of the industry in general. Licensing agreements are a tremendous initial cost required to build a library expansive enough to attract users. If the relationship with artists remains unstable and services are unable to retain a diverse library, then attracting users to pay for these licences through subscriptions becomes a more difficult task. As a relatively small market, with the potential for retroactive tariffs, we may have to wait for the business model to further develop and grow before Canada enjoys the variety of services offered in other jurisdictions.

Allison McLean is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

The post Royal(ty) Pains: The Expansion Woes of Online Music Streaming Services appeared first on IPOsgoode.

Looking at the current state of trans-border licensing of music inEurope, the European example can teach mainly what to avoid. Even more so, many of the issues discussed in the EU might even be totally irrelevant for Canada. Unlike Canada, the EU currently consists of 27 member states, and as of today, there is no unified EU copyright code.

As a starting point, it has to be stated, that since the beginning of the new millennium no workable mechanism has been achieved for the music sector to provide easy, centralised Pan-European access to the full scope of licenses needed for on-demand offers of music. Investigating this issue a bit closer, it becomes evident however, that the problems are limited almost entirely to the licensing of copyrights for works of musical authors, namely the rights of composers and lyricists. In contrast, the EU-wide licensing of the rights vested in producers of sound recordings and in performing artists functions relatively smoothly without any fundamental problems arising.

In the “” and “” authors’ societies, organised in CISAC, chose a type of reciprocal representation agreement containing a restriction whereby only the society at which the user was located should be responsible (and qualified) for licensing. This restrictive policy lead to antitrust investigations with the Directorate General (DG) Competition at the EU Commission and an administrative ruling against CISAC and the member companies concerned. This matter () is currently subject of a lawsuit before of the ECJ, effectively resulting in a breakdown of the system of reciprocal representation concerning online rights of musical authors.

Subsequently, encouraged by an official yet non-binding recommendation by the EU Commission (DG Markt) () which was intended to facilitate and speed up pan-European licensing of rights, most of the big music publishing companies have withdrawn the mechanical rights concerning the US repertoire from the network of European collecting societies, in order to administer these rights by themselves.

This fact has shown to have serious consequences – and not at all the ones intended by the EU Commission: While withdrawing US-repertoire from collective licensing, all other parts of the overall repertoire of music remained within the collecting societies. The same applied to the “making available” right. If an online service like iTunes is interested in licensing a sound recording of a US author, he not only requires a license of the record company but needs to establish licensing relations with collecting societies of musical authors, too, and, last but not least, with the respective music publishers insofar as their rights are not represented by those societies. In effect, not two, but three different types of contracts are required for using a single song in an online service (while not a single such contract was needed for a traditional retailer to re-sell CDs) – theoretically to be concluded on a country by country basis.

These problems are basically home made by the music publishing industry and should not be used as an argument against the viability of the EU Copyright System as it stands.

Dr. Jur. Martin Schaefer began his career as assistant to his mentor, Prof. Dr. Wilhelm Nordemann. From the beginning of the 1990s, Dr. Schaefer was employed by the German national group of the recording industry association, IFPI (Bundesverband der Phonographischen Wirtschaft und Deutsche Landesgruppe der IFPI). As in‐house counsel, and from 1998 as Managing Director, Dr. Schaefer was responsible for such areas as combating piracy, representing industry interests in the making of government copyright policy, and the development of future oriented industry projects. In 2001, he moved to BMG (Bertelsmann Music Group) as Vice President, Legal Counsel Europe. In this position, he was integrated into the European management team before leaving the company at the beginning of 2004 in order to apply his knowledge and experience as lawyer. He has specialized in copyright law with an emphasis on music industry matters, collective and individual administration of rights and electronic media law.

The post Collective Licensing: Promises and Pitfalls appeared first on IPOsgoode.

Eastman Kodak has received some uplifting news in its ongoing patent dispute with tech giants, Apple and Research In Motion. Last week, the US International Trade Commission announced that it will rendered against the photography pioneer. If the decision is reversed, the beleaguered Kodak stands to gain more than US$1 billion in settlement.

At issue is a patent for previewing digital images on smartphones, which Kodak obtained in 2001 and claims that Apple and RIM have infringed. In January, however, the ITC’s chief administrative judge that the companies had not, in fact, violated Kodak’s patent. The decision was another blow to the traditionally print-focused camera company, which has fallen on tough times as it struggles to stay relevant in the digital world. It operates with a of only 18,800 employees, down from 70,000 in 2002, and its stock has over US$25 to a paltry US$5 in the same period.

Nevertheless, Kodak has worked admirably to redefine itself, having invested US$3.4 billion in a completed in 2007. It has done well to carve out a niche for itself as licensor to some of the world’s top tech companies; the company boasts over 1,000 digital-imaging patents alone, which are used by almost all digital cameras. Its Chief Intellectual Property Officer formally acknowledges this strategy: “.” Indeed, Kodak has announced to investors that it expects up to US$350 million in annual revenue from intellectual property licensing through 2013.

Kodak has been unafraid to go on the offensive when this latest revenue stream is at risk. In 2008, the company filed a complaint with the ITC over accusations that they had infringed on the same patents at issue in the present Apple and RIM case. The ITC sided with Kodak, which soon after received US$964 million from the cellphone makers. Kodak has also recently filed two suits against Apple alleging infringement of other patents related to digital cameras and certain computer processes.

The ITC will decide by May 23 whether the initial decision should be altered or let to stand. Failure of its bid could be a devastating blow to the fragile camera company. Success, on the other hand, would not only bring riches but status to the 131-year-old Kodak as a company that has fought for and won a place in the digital world.

The post Take Two for Eastman Kodak in Patent Row with Apple, RIM appeared first on IPOsgoode.