The Exclusive Songwriter Agreement: Part 1

As featured in: Performing Songwriter Issues #8-11, September 1994 - April 1995.  Visit performingsongwriter.com to order back issues or subscribe.

By John Beiter

Part 1 | 2 | 3 | 4

For the past few issues, we have been following the young songwriting career of our heroine, Mandy Murphy, who has been working her way through the provisions of a single song contract presented to her by Patoka Music for her tune, “Teddy Bear Blues.” Fast forward to three years later. Mandy ultimately signed the song with Patoka Music, which got it cut by the hottest group in country music, Roy and the Ramblers. The song was chosen as the first single off the group’s debut album, and went to the top of the charts. The group was so impressed with Mandy’s writing that they recorded two more of her tunes, also published by Patoka Music, on their follow-up album.

Meanwhile, Mandy decided to put her waitressing career at the Xanadu Grill on hold and move to Nashville to pursue songwriting fulltime. She has begun spending more of her days at the publisher’s offices co-writing with other Patoka Music composers, always assigning her share to her good friends at that company.

Recently the folks at Patoka Music have approached Mandy with a new business proposition. They are so impressed with her songwriting skills and believe so strongly in her future that they want her to enter an exclusive songwriting relationship as one of five staff writers with the company. Mandy is honored by this vote of confidence, but is unclear about the implications of becoming an “exclusive” songwriter for any one publisher, even her good friends at Patoka Music.

Single Song Publishing vs. Exclusive Songwriting Agreement
The fundamental distinction between a single song publishing agreement and an exclusive songwriting agreement can be simply stated: In a single song agreement, the songwriter assigns to the publisher the rights in a particular tune. By contrast, in an exclusive songwriter agreement, the songwriter assigns to the publisher his or her rights in all songs written during the contract term, which may be several years. Any songs composed during its term automatically become subject to the exclusive agreement when they are created (although it is quite common for a publisher to have the songwriter also execute a single song contract for each song, so that there will be absolutely no misunderstanding concerning who owns the tune).

Although these two types of agreements contain many similar provisions, the exclusive songwriter agreement contains numerous distinct provisions that you should know about. Because the songwriter, with one stroke of the pen, will be signing away a number of songs written during an extended period - perhaps the most creative period of his or her career - the songwriter must be especially careful to understand the rights and obligations set out in the exclusive songwriter agreement.

First, the agreement probably will contain an initial paragraph stating that the publisher “employs” the songwriter to provide services as a composer exclusively to the publisher for the term of the agreement. (The songwriter’s parents may be thrilled to learn that their wayward child, who has chosen a career in music instead of medicine, is about to become gainfully employed by a major international entertainment conglomerate.) This contract language, although it may appear simple enough, is at the heart of the contract and its legal significance cannot be understated. An understanding of what’s going on here requires a quick side trip through Copyright Law 101.

Under the copyright law, the author of a work is its initial owner, possessing the exclusive right to exploit it or transfer it to someone else. Surprisingly, the creator of a work (here, the writer of a tune) is not always considered its legal “author.” If a songwriter writes a tune as an employee of the publisher, the publisher, rather than the songwriter, generally is considered the song’s owner and legal “author.” If a songwriter writes a tune as an employee of the publisher, the publisher, rather than the songwriter, generally is considered the song’s owner and legal “author.” Strange as it may sound, that’s the way the copyright law works.

What difference does it make whether the songwriter or the publisher is considered the legal “author” of the song so long as the songwriter is paid a fair royalty on it? There are at least two very significant ramifications. Most importantly, if the songwriter is the “author” and he or she enters a contract transferring rights in the song to a publisher, under the copyright law the songwriter generally can terminate that transfer and “get back” the song after 35 years. Additionally, the identity of the “author” directly determines the length of time that copyright protection will be given to the song: on the one hand, if the publisher is the “author,” the copyright generally will continue for either 75 years from the date of publication, or 100 years from the date of creation, whichever period is shorter. On the other hand, if the songwriter is the “author,” copyright protection for the composition generally will continue for the life of the songwriter plus 50 years.

Returning from the esoteric world of copyright law to the exclusive agreement under discussion, it’s obvious that the publisher wants to insert this language to create an employment relationship so that the songs will not revert back to the writer in 35 years. Interestingly, however, contract language alone is not sufficient to create an employee-employer relationship between the songwriter and the publisher. The United States Supreme Court recently ruled that, in determining whether the creator of a work is an employee, the crucial factor is whether the person doing the hiring (here, the publisher) has the “right to control the manner and means by which the product is accomplished.” Simply stated, if - as is usually the case - the publisher does not have the authority to control the “manner and means” by which the songs are written under an exclusive agreement, the publisher may not be the songwriter’s employer (and the songs’ legal “author"), regardless of what the contract says.

Second, the exclusive agreement will contain a paragraph establishing the length of the relationship. Often, the term of the agreement will be stated as an initial period, such as one year, with several additional option periods that may be exercised by the publisher, typically up to four additional one-year periods (totaling a five-year duration if the publisher chooses to exercise all four option periods). The specific method by which the publisher exercises an option period may be the subject of some negotiations. On the one hand, the contract simply might provide that each option can be exercised only by written notice sent by the publisher to the songwriter within a certain number of days before the expiration of the preceding one-year period. Alternatively, the contract simply might provide that the next option period is automatically exercised by the publisher unless it gives the songwriter written notice to the contrary. Finally, when the songwriter is also a recording artist, the publisher often will seek a provision that the exclusive songwriting agreement will continue for as long as the recording contract does.

Third, the agreement will contain a paragraph stating that the publisher is granted all of the songwriter’s rights to exploit the tunes, the litany of rights usually being the same as those granted under a single song contract, with which Mandy already is familiar. This paragraph typically also will grant to the publisher any songs written by the songwriter before the date of the agreement, at least those that already haven’t been assigned to someone else.

At this point, having reviewed only the initial few paragraphs of the proposed exclusive agreement with Patoka Music, Mandy already realizes that entering into such a relationship would be something akin to marriage and assuredly would have a significant impact on the course of her musical career. Would she be better off “tying the knot” with Patoka Music or continuing to deal with it on a song-by- song basis, possibly even “playing the field” with other publishers? Let’s leave Mandy to ponder these heavy questions until next issue, when we will discuss other provisions unique to the exclusive songwriter agreement.

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