“The Game is the Game”: Key Provisions in Artiste Recording Contracts

“The biggest mistake you can make is losing yourself in the process of valuing someone too much and forgetting that you are special also." – Unknown

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INTRODUCTION

The Nigerian Music Industry is full of artistes looking to get signed by an established label and similarly labels looking for fresh talent. However, there seems to be a mismatch between the artiste and the label for various reasons. As an artiste, there is nothing more important than the preservation of your creative freedom and working for a label that understands your vision and direction. On the other hand, a label wants to sign an artiste they think will generate profit. In between the various mismatched expectations, what is clear is that in this market, an artiste’s lifespan with a label is usually about three (3) years, especially if the artiste’s content is promoted regularly, and the Nigerian and international market is consuming same.

Usually, at the point at which an artiste feels like they have “blown”, they typically begin to make strides towards working independently. For a label faced with this reality, their focus shifts to their ability to recoup on their investment. Below are key provisions an artiste and a label should ensure is present in its recording contracts in order to maximize the limited time they have together.

THE ARTISTE’S PERSPECTIVE

Creative Freedom

It is always advisable that artistes ensure that the label will not exercise any direct or indirect control over their creativity, physical appearance, and style. Even more important as we have seen with Kiss Daniel, is to make sure that an artiste’s name as their trademark and copyright is owned by them. What more, the artiste’s ability to choose their manager or creative team should also be the sacrosanct, subject of course, to the labels approval, which should not be unreasonably withheld. To go a step further, creative control concerning the selection of masters to be distributed is also important. There should be a provision in the contract for the artiste’s ability to work alongside the label in selecting the masters for distribution bearing in mind that the label which should have come up with a marketing strategy, will need to ensure that the masters selected, align with that plan.

Accounting 

It is important that the label maintains its books and records and provides a report of the gross proceeds received by the label every quarter. This will give the artiste the transparency needed to track their royalty payments. Additionally, the artiste should be given access to the books and accounting records of the label for as long as the proceeds are being generated. Artistes in recent times have also reminded the labels of the importance of proper accounting and record-keeping, which I implore all industry participants to employ.

Record Label’s Obligations 

There should be a specific obligation on the label to use their best endeavors to promote, publicize, and market the artiste, strategically promote all records, videos, and merchandise (if applicable). This, alongside other obligations, would give the artiste the right to claim for breach of contract in the event a breach was to occur.

 

THE RECORD LABEL’S PERSPECTIVE 

Breach Clause 

The most significant risk for the label is to have an artiste either not fulfill the terms of their recording agreement or walk away before the label has had time to recoup on its investment. Most record agreements provide that in the event of a breach of the terms of the agreement, the innocent party writes a notice to the defaulting party that they are in violation. It further states that in the event the breach is not cured within thirty (30) days after receiving the notice, the innocent party can terminate the agreement. This provision is problematic for two reasons: one, the decision on whether the breach has been cured is a subjective one, and two, the innocent party, therefore, can easily walk away from the agreement. In my experience, many artistes have used this provision as a tool to spirit away from their obligations under the recording agreements. Therefore, how does one find a cure to such a sticky provision? In my opinion, I would advise that the termination provision provides that in the event of termination all outstanding and unrecouped expenses are paid in order to safeguard the label’s ability to recoup its investment.

Conduct 

With artistes exhibiting violent and oftentimes morally repugnant behavior, most international recording contracts provide for a conduct clause. The conduct clause imposes an obligation on the artiste not to do any act which might bring the artiste into public disrepute or offend the community or public morals. This is an essential clause for labels, especially if the artiste will be collaborating with international brands or telecoms companies here in Nigeria. There are several artistes who due to their morally repugnant behavior have lost out on telecoms deals sometimes even halfway through the term of the endorsement agreement. In practice, I also see labels employ the services of a “road manager” and a “fixer” whose role respectively is to keep the artiste in check and to mop up any mess made.

COVERING THE FIELD 

Dispute Resolution 

In this market, I frequently observe that the dispute resolution provision provides that in the event of a dispute, the parties shall first attempt to settle the dispute by negotiation amongst themselves, failing which they explore mediation, failing which arbitration and then court. For the players in this market, the cost of both litigation and arbitration is too high, and I find that some oppressive labels use the court system as a tool to frustrate the artiste as opposed to using the court system to resolve contractual disputes in good faith.

Further, the wheels of justice grind slow in Nigeria. Accordingly, the longevity of the court process, coupled with the fact that judgment in one’s favor is never guaranteed, I always advocate that parties should always try to settle out of court in good faith. If labels set out to frustrate their artistes they lose out as no music is being produced or performed by the artiste, thus no revenue stream. The resultant effect is a loss of profit for both the label and the artiste.

For an industry based majorly on relationships, where the degree of separation is 1, it behooves on both the talent and the label to find an amicable way forward. In recent times, I have seen some labels agreeing to (a) transfer ownership of an artiste’s masters after a certain period post expiry or termination of the recording agreement; the artiste paying a certain buy-out sum to be free of their obligations under the agreement, or certain labels agreeing to float the artiste’s new label under their umbrella pending when the contract has expired or the artiste has fulfilled their obligations under the agreement. During that period, the artiste fulfills the terms of their recording agreement in order for both parties to move forward amicably.

CONCLUSION

From a strictly legal perspective, dispute resolution provisions should only either provide for arbitration or court as the final recourse. Having both does not withstand logic. The reason being that if an arbitration award has been given, it is binding between the parties, and in going to the court thereafter, the court will not be able to proceed in hearing the same subject matter of the dispute unless the arbitral award has been set aside, which only further delays the process to a swift amicable resolution.

 


Georgette Monnou is a Legal Practitioner at Olaniwun Ajayi LP

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