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"It is my opinion that [the damages provisions] may not be enforceable as now contemplated by the RIAA and the record companies."
——Attorney
Don Engel
DON ENGEL: JUST SAY NO
TO "TACKING"
Veteran Attorney Urges Artists and Their Reps Not to Compromise on the Resetting of the Seven-Year Clock
Music attorney Don Engel, who has represented artists including Don Henley in contract disputes with record companies involving California’s seven-year statute, has something to say.

Engel, a recognized expert in analyzing and litigating record contracts, says artist representatives are in danger of needlessly giving away artist rights under the law by considering allowing the resetting of the seven-year clock upon contract renegotiation—a theoretical practice known as “tacking”—to be formally adopted.

Engel wishes to dissuade all artist representatives from “pursuing any arrangement that in any way embraces the ‘tacking’ position of the record companies, because it will completely destroy the value to recording artists of the seven-year rule,” he says.

Recent reports (in this publication and elsewhere) of negotiations between artist and RIAA reps that have suggested “tacking” might be allowed in exchange for concessions on the controversial special-damages-provisions amendment (enacted in 1986) have spurred Engel to speak out, he says. The damages provisions, which apply only to the record industry, allow labels to sue over undelivered albums if an artist walks from a contract after the maximum seven-year period.

Although the damages provisions are “unfair and improper,” he says, “it is my opinion and the opinion of other attorneys that it may not be enforceable as now contemplated by the RIAA and the record companies. We have continued since 1986 to invoke the seven-year rule on behalf of recording artists and were prepared to litigate the effect of the special damages provision, but the record companies have consistently avoided that eventuality by settling with performers either before or after the performers defected to other record companies.”

Engel further says that, although he opposed the damages amendment, “it may not need to be repealed at all and, at most, it requires only a slight amendment that record companies cannot be awarded damages for the number of albums specified” in a recording contract that has run its seven-year course. “Incidentally, despite their current position, this is what the record companies told the legislature in 1986 was the meaning of their proposed damages amendment.”

As it happens, the California Assembly last week inserted new language into Sen. Kevin Murray’s bill to amend the seven-year statute stipulating new limits on damages. The new language states that if an artist has delivered three albums or fewer in seven years and owes at least two more, the record company “may recover damages for the non-delivery of two albums.” If an artist has delivered four to six albums in seven years and still owes at least two more, damages for one album may be recovered. In any case, no damages will be awarded if the artist elects to produce the albums in question. The Murray bill is now back in committee.

However, to have damages specifically limited in exchange for allowing record companies to start the seven-year term over again with every renegotiated contract is ludicrous, Engel says. “This is the antithesis of the consistent case law explaining that the purpose of the seven-year rule in California is to permit recording artists and other performers of services, at least once every seven years, to go freely into the marketplace and secure compensation at their full worth.”

Furthermore, Engel observes that the RIAA study presented at the Senate Committee hearing last month stated, “After a successful album, EVERY contract was renegotiated with greatly increased compensation…”

“Of course, because every contract granted to an entry level artist is unfair, oppressive and unconscionable,” Engel says. “More importantly, by admission of the record companies, they are going to contend that ‘EVERY’ renegotiated contract contains new and better terms and, therefore, is a new contract binding ‘EVERY’ successful artist ad infinitum to successive terms of the seven years to the same record company for the lifetime of their careers.”

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