May 4th 2012, the music community mourned the passing of musical pioneer in Adam Yauch. Predictably, sales skyrocketed the week of Yauch’s passing. According to Billboard figures, in a two day period singles jumped 802% while album sales surged 1,235%. Hours prior to Yauch’s death, The Beastie Boys were slapped with an untimely lawsuit for alleged copyright infringement on several samples contained in their greatest hits.
All the attention brings along two very interesting questions: (1) What happens to the income generated from sales, and (2) what happens to the group moving forward, does the group “Beastie Boys” exist, and if so, who defends the lingering lawsuit? Blame it on the attorney curse, but my first thought following the news of his passing and increased album sales was that this could be a colossal mess. Not “could” – it “will.” Luckily for the parties involved, most will take place out of the public eye. Eventually, the inevitable legal labyrinth will be resolved, but to generate answers to the questions presented above, all paths will lead to one piece of paperwork – The Band Agreement.
I have no idea if The Beastie Boys have a band agreement and I have no idea what language it contains, assuming they do; but a band agreement is literally the foundation for musical groups which dictates a host of potential legal issues. The band agreement is the internal blueprint of how your business (i.e. the band) is run. Agreed upon by the group members, the document ultimately dictates how dollars are to be divided, voting formats, ownership, the legal rights for departing members, the legal rights for passing members, etc… Prior to the inclusion of labels, managers, agents, and so forth, the band agreement becomes the document everyone must follow.
In this case, like most typical band agreements, The Beastie Boys likely addressed how assets would be divided, and more importantly, to who: active members, expelled members or deceased members. Somewhat straightforward, active members may be defined as one of the participating members of the group.
EXAMPLE – If Band X has four members, and all actively perform, band income may be divided equally 25% to each member. Expelled members (i.e. -members kicked out of the group for various reasons), typically have less rights to band related income once they depart the band (songwriting and publishing remain completely different issue).
Other language may suggest “band related income” seizes once a member passes (again, songwriting and publishing remain separate issues).EXAMPLE – if Band X has four members and one dies by a freak mudslide accident, coincidentally the remaining band members play a show three days later for a fee of $12,000 – the active members would divide $12,000 three ways ($4,000 per member), not four ways ($3,000 to the performing members and $3,000 the deceased members estate).
All of this would be dictated via the band agreement. In the Beastie Boys situation, this will play out over time and we’ll receive a subtle glimpse as to what was in the confidential agreement.
The Beastie Boys are a widely popular group operating at the highest of levels, so do band agreements apply to the indie band just starting off? Absolutely. Regardless if major label success arises, band agreements dictate how the business operates – not to mention having a plan is just good business. If a major label opportunity should arise, success has the potential to develop rapidly, therefore the band agreement becomes an afterthought – which I can assure becomes detrimental.
At a minimal level – every band should have a document defining 4 basic terms: READ HERE at the MIDEM BLOG
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