State and federal lawmakers are planning to launch hearings into music industry business practices after a series of high-profile lawsuits and newfound activism among recording artists.
Sharp criticism of industry customs is resonating in Washington and Sacramento, where officials are preparing to examine what rock stars such as Courtney Love and Don Henley are calling the "unconscionable" contracts and accounting practices of the Big Five music conglomerates.
Kicking off in Sacramento next month, the state hearings will zero in on California Labor Code Section 2855, designed to protect entertainers from being tied to any company for more than seven years. Musicians lost that protection in 1987, when record companies secured an amendment to the law granting them power to collect damages for undelivered albums.
Recording artists believe the amendment is unfair. So does state Sen. Kevin Murray (D-Culver City), who said he is contemplating legislation to repeal the amendment.
"It's time the Senate revisit this issue," said Murray, who will chair the hearings. "In my gut, and most lawmakers' guts, seven years is the appropriate length of time to limit personal service contracts for everyone--including recording acts. We need to take a look at other industry issues too, such as the current state of contracts and accounting practices and pension plans."
California lawmakers aren't the only ones breathing down the industry's neck. Music companies also are feeling the heat on Capitol Hill, where Rep. Mark Foley (R-Fla.), chair of the House's Entertainment Industry task force, said Congress also is planning to hold hearings on contractual rights.
Music labels need to end "indentured servitude" of artists in long-term contracts, Foley said. Rep. John Conyers Jr. (D-Mich.), a ranking member of the House Judiciary Committee, agrees, suggesting that a federal seven-year statute may be needed to protect recording acts.
"Even though artists are the creative force behind music, the studios still have all of the power," Conyers said. "I'm exploring ways that Congress can balance the power between the two groups, so that creators can share more equitably in the fruits of their labor."
Record companies disagree.
Companies have said artists voluntarily sign "industry-standard" recording agreements and are paid "fair" royalties based on "time-honored" industry accounting practices. California's seven-year statute is not popular within the music industry, and label chiefs see no reason for the federal government to begin meddling in contract negotiations.
