<b><i>Clause & Effect</b></i>How To Determine Duration Of Band Member Agreements

Latin artist Francisco Bautista signed this type of agreement when he formally joined the Kumbia Kings in November 2000. The Kumbia Kings had signed a three-album deal with EMI Latin in November 1998. But in 2002, believing he had been fired from the band, Bautista recorded on his own two songs he had co-written titled 'Don't Want to Try' and 'Count on Me.' On April 15, 2002, the Kumbia Kings signed a new recording agreement with EMI that called for a total of five albums. The new agreement stated that it 'shall not constitute nor be deemed a modification or an extension of the [1998 Recording Agreement]. This agreement is a new one and shall have the full force and effect of a new agreement executed on the date hereof. ' [U]pon complete execution of this Agreement, the term of the 1998 [Recording] Agreement shall be deemed terminated, and subject to [certain settlement payments], all parties shall be deemed to have fulfilled all of their obligations thereunder except those obligations that survive the end of the term (eg, warranties, royalty payment obligations and audit rights).' The new recording agreement also provided that 'the third Album under the 1998 [Recording] Agreement will constitute the First Album ' under this [2002 Recording] Agreement.'

Bautista and Kumbia Kings leader A.B. Quintanilla III subsequently agreed to include Bautista's recordings of 'Don't Want to Try' and 'Count on Me' on '4', the next Kumbia Kings album, but soon after decided to further pursue a solo career. After Bautista's lawyers sent EMI a letter seeking return of the two recordings, EMI filed suit in Manhattan federal court for a preliminary injunction to bar Bautista from interfering with the release of the '4' album or from signing an agreement with a different record label.

The duration of the band member agreement, which was governed by Texas law, was central to the dispute. The district court first noted that the term 'Recording Agreement' in the band member agreement referred only to the Kumbia King's 1998 record deal. Thus, the new deal between EMI and the Kumbia Kings recharacterizing the third album in the 1998 recording agreement as the first album in the 2002 record deal didn't extend Bautista's agreement with the band. According to the court, 'the evidence at this stage preliminarily establishes that the term of the Band Member Agreement ended on April 15, 2002. Thus, it became impossible to complete the Band Member Agreement because a third album could no longer be accepted to satisfy the recording commitments of the 1998 Recording Agreement. ' Since Bautista is no longer bound by the non-surviving provisions of the Band Member Agreement, he is not prohibited from accepting any other employment or engagement. Moreover, even if the term of the Band Member Agreement did not end in April 2002, it nevertheless would have ended with the recording and completion of the album '4'.' EMI Latin v. Bautista, 03-0947.

To clarify how long the exclusive services of a member are owed to a band in a similar situation, the band member agreement could include language stating that any redefinitions of album delivery commitments in subsequent recording agreements would not affect the duration of the band member agreement. That is, in Bautista-like cases, the first album under the new record deal would still be counted as the third album for purposes of the band's agreement with the individual member.

Also to be taken into account is the effect the re-recording restriction in the original recording agreement may have on a band member who desires to leave a group. EMI had sought to enjoin Bautista from rerecording his songs. In fact, the band member agreement had bound Bautista to the re-recording restrictions in the 1998 record deal, which applied to 'any of the repertoire embodied in the Masters recorded and delivered to [EMI] for the purpose of making records for anyone other than [EMI] prior to the later of: a period of five (5) consecutive years after delivery of such Masters; or five (5) years following the expiration or earlier termination of the Term [of the Recording Agreement].' Ruling in favor of Bautista on this point, however, the district court noted, 'The Band Member Agreement is devoid of a provision applying the rerecording restriction to songs written during the term of the agreement or even recordings delivered to Quintanilla during its term. It only incorporates the specific rerecording restriction in the 1998 Recording Agreement, which by its own terms only applies to 'the repertoire embodied in the Masters recorded and delivered' under the 1998 Recording Agreement. ' [T]he term of the Band Member Agreement and Bautista's promise to abide by the rerecording restriction in 1998 Recording Agreement ended in April 2002 [when the new recording agreement was executed]. As a result, Bautista is not bound by the rerecording restriction in the 1998 Recording Agreement as applied to [his] Recordings.'

Stan Soocher is Editor-in-Chief of Entertainment Law & Finance. He is also an entertainment attorney, chair of Music & Entertainment Industry Studies at the University of Colorado at Denver, and author of the book 'The Fought the Law: Rock Music Goes to Court.' Web site: http://www.theyfoughtthelaw.com/.

How the duration of an exclusive band member agreement is counted can be a pivotal point of dispute for a member who wishes to leave a group. This can be further complicated if the term of the band agreement is tied to a recording agreement.

For example, the band member agreement may state that the new member 'agrees to perform as a member of the Group to the best of his ability and in a timely, conscientious and professional manner' and that the new member's 'services as a musical artist shall be exclusive to the Group.' In this example, the term of the band member agreement is deemed to have begun upon formation of the band and to continue until 'the recording and completion of three (3) wholly new Group albums unless earlier terminated.' 'Album' is defined in the 'Compensation' provisions of the band member agreement as 'an album recorded and delivered to, and accepted by, Distributor under the Recording Agreement in satisfaction of the recording commitment thereunder.'

The band member agreement may also state that it is terminable at will only by the band and that the 'results and proceeds of [the new member's] services with the Group shall be deemed 'works made for hire' with all right, title, and interest therein ' throughout the universe vesting in the Band in perpetuity.' In addition, the new band member may be required to agree that 'services with the Group' not deemed 'works made for hire' will be deemed to have been irrevocably assigned ' including all rights, title and interests ' to the band in perpetuity.

Latin artist Francisco Bautista signed this type of agreement when he formally joined the Kumbia Kings in November 2000. The Kumbia Kings had signed a three-album deal with EMI Latin in November 1998. But in 2002, believing he had been fired from the band, Bautista recorded on his own two songs he had co-written titled 'Don't Want to Try' and 'Count on Me.' On April 15, 2002, the Kumbia Kings signed a new recording agreement with EMI that called for a total of five albums. The new agreement stated that it 'shall not constitute nor be deemed a modification or an extension of the [1998 Recording Agreement]. This agreement is a new one and shall have the full force and effect of a new agreement executed on the date hereof. ' [U]pon complete execution of this Agreement, the term of the 1998 [Recording] Agreement shall be deemed terminated, and subject to [certain settlement payments], all parties shall be deemed to have fulfilled all of their obligations thereunder except those obligations that survive the end of the term (eg, warranties, royalty payment obligations and audit rights).' The new recording agreement also provided that 'the third Album under the 1998 [Recording] Agreement will constitute the First Album ' under this [2002 Recording] Agreement.'

Bautista and Kumbia Kings leader A.B. Quintanilla III subsequently agreed to include Bautista's recordings of 'Don't Want to Try' and 'Count on Me' on '4', the next Kumbia Kings album, but soon after decided to further pursue a solo career. After Bautista's lawyers sent EMI a letter seeking return of the two recordings, EMI filed suit in Manhattan federal court for a preliminary injunction to bar Bautista from interfering with the release of the '4' album or from signing an agreement with a different record label.

The duration of the band member agreement, which was governed by Texas law, was central to the dispute. The district court first noted that the term 'Recording Agreement' in the band member agreement referred only to the Kumbia King's 1998 record deal. Thus, the new deal between EMI and the Kumbia Kings recharacterizing the third album in the 1998 recording agreement as the first album in the 2002 record deal didn't extend Bautista's agreement with the band. According to the court, 'the evidence at this stage preliminarily establishes that the term of the Band Member Agreement ended on April 15, 2002. Thus, it became impossible to complete the Band Member Agreement because a third album could no longer be accepted to satisfy the recording commitments of the 1998 Recording Agreement. ' Since Bautista is no longer bound by the non-surviving provisions of the Band Member Agreement, he is not prohibited from accepting any other employment or engagement. Moreover, even if the term of the Band Member Agreement did not end in April 2002, it nevertheless would have ended with the recording and completion of the album '4'.' EMI Latin v. Bautista, 03-0947.

To clarify how long the exclusive services of a member are owed to a band in a similar situation, the band member agreement could include language stating that any redefinitions of album delivery commitments in subsequent recording agreements would not affect the duration of the band member agreement. That is, in Bautista-like cases, the first album under the new record deal would still be counted as the third album for purposes of the band's agreement with the individual member.

Also to be taken into account is the effect the re-recording restriction in the original recording agreement may have on a band member who desires to leave a group. EMI had sought to enjoin Bautista from rerecording his songs. In fact, the band member agreement had bound Bautista to the re-recording restrictions in the 1998 record deal, which applied to 'any of the repertoire embodied in the Masters recorded and delivered to [EMI] for the purpose of making records for anyone other than [EMI] prior to the later of: a period of five (5) consecutive years after delivery of such Masters; or five (5) years following the expiration or earlier termination of the Term [of the Recording Agreement].' Ruling in favor of Bautista on this point, however, the district court noted, 'The Band Member Agreement is devoid of a provision applying the rerecording restriction to songs written during the term of the agreement or even recordings delivered to Quintanilla during its term. It only incorporates the specific rerecording restriction in the 1998 Recording Agreement, which by its own terms only applies to 'the repertoire embodied in the Masters recorded and delivered' under the 1998 Recording Agreement. ' [T]he term of the Band Member Agreement and Bautista's promise to abide by the rerecording restriction in 1998 Recording Agreement ended in April 2002 [when the new recording agreement was executed]. As a result, Bautista is not bound by the rerecording restriction in the 1998 Recording Agreement as applied to [his] Recordings.'

Stan Soocher is Editor-in-Chief of Entertainment Law & Finance. He is also an entertainment attorney, chair of Music & Entertainment Industry Studies at the University of Colorado at Denver, and author of the book 'The Fought the Law: Rock Music Goes to Court.' Web site: http://www.theyfoughtthelaw.com/.