Obtaining Rights For Music-Driven TV Productions

This is Part Two of a two-part interview, coordinated by Entertainment Law & Finance Editor-in-Chief Stan Soocher, with Santa Monica-CA-based entertainment Henry Root. In Part One, Root, who has extensive experience handling legal issues for music-driven television productions, discussed considerations in clearing rights in, and determining fees for, songs and sound recordings used in a production, as well as how option rights for the music are negotiated. Root also began, and continues here, a discussion of the issues to be negotiated for a record label to waive its exclusive right to the services of an artist who will appear in a TV
music production. Root also discusses copyrights in artist TV performances, reciprocal rights with record labels, holdbacks on exploitation, and warranties and representations.

EL&F: What key copyright issues are involved in negotiating the record label's waiver of exclusivity of its rights to an artist's musical services?

Root: The copyrights in, and to, the production itself will vest in the TV producer. Persons rendering services, including the artists, in connection with the production will do so on a 'work-for-hire' basis for the producer. These include, but aren't limited to, the executive producers, line producers, directors, lighting designers, set designers and other key production individuals. These services are considered to be 'specially ordered and commissioned' by the producer for inclusion in an 'audio-visual work' under the Copyright Act. Under the Act, the definition of 'audiovisual works' include 'all accompanying sounds, regardless of the nature of the material objects, such as films or tapes, in which the [audiovisual] works are embodied.'

(Union and guild collective-bargaining agreements and the 'standard engagement agreements' that apply to rendition of services by union members factor into the copyright ownership issues to consider, particularly those of American Federation of Television and Radio Artists (AFTRA) and the American Federation of Musicians (AFM), and the prudent practitioner will review the union and guild standard forms to make certain they contain a 'work for hire' acknowledgment or add such a provision if they do not.)

On occasion, during negotiations of a waiver of label exclusivity, I am asked by the business-affairs department of the label to incorporate an acknowledgement that the label is deemed owner of the copyright in the underlying sound recording and/or to the audio-only performances of the artist as embodied in the soundtrack of the audiovisual work comprised of the TV program. However, the fact is that no sound recording-copyright is being created independently of the TV-production audio-visual work itself. What I customarily do, when so requested, is to provide in the label-waiver agreement that, as between the TV producer and the label, the producer will not claim any interest in any sound-recording copyright associated with the artist's audio-only performances in the TV production separate and apart from the audiovisual work as a whole.

EL&F: What so-called 'reciprocal rights' in the artist's performances in a TV production might a record label want in exchange for waiving its exclusive right to the artist's musical services?

Root: The TV producer's counsel must first review the producer's broadcast-license agreements with respect to the scope and extent of the exclusive rights being granted to the broadcasters. In negotiating the broadcast agreement, the experienced TV-production counsel will have anticipated that the labels will seek to obtain 'reciprocal' uses of the artist's performances and should have negotiated with the broadcaster for 'exceptions'/'carve-outs'/'exclusions' from the scope of the broadcast exclusivity being granted by the producer to the broadcaster in order to permit the labels (and in some instances the producer itself) to use and exploit the artist performances in the TV production without violating the exclusive rights granted to the broadcaster. Also, if the TV producer enters into a sponsorship agreement (with the sponsorship fees paid to the TV producer often being applied to finance the production-deficit costs), the sponsor ' particularly if a wireless carrier or mobile-phone manufacturer ' will often times want certain exploitation rights to one or more individual artist performances in connection with the benefits to be accorded the sponsor.

In the TV producer/record label discussions, under older exclusive artist recording agreements between the label and the artists, the definition of a 'master recording' was defined as a recording 'intended for home use.' Under those older definitions, TV productions intended for exploitation in broadcast media only didn't fall within the category of a recording 'intended for home use.' Therefore, if TV broadcasts were the only form of exploitation contemplated by the TV producer, a waiver from the record label arguably wasn't required. Under more recent recording agreements, however, the definition of 'recordings' typically include all forms of exploitation of the artist's musical services, whether or not 'intended for home use,' and consent may have to be obtained from the label for the artist to appear and render musical performances in the production even if intended only for TV broadcast.

The objective of the TV producer is to obtain a waiver from the label that will enable the producer to exploit the artist's performances in the TV production by any and all TV manners, means, methods and media, now and hereafter known, throughout the world and in perpetuity, without payment of remuneration by the TV producer to the label in connection with the exercise of those TV, broadcast (and any sponsor's) rights. If the producer pays the artist in connection with the TV-production performances, the labels will generally seek to obtain payment from the producer of 50% of the fee paid to the artist. This element of the negotiation alone can be exceedingly complex, because monies that may become payable to artists may not necessarily be tied to the artist's 'recording services' for the TV producer per se. For example, the total amount of compensation paid by TV producers to artists in connection with many top-tier variety and musical specials is minimum AFTRA and/or AFM scale (presently $1361.00 for an AFTRA member classified as a 'principal performer' for a 2-hour network special, plus pension, health and welfare contributions, and $814.85 for an AFM member ' double for the 'leader' ' plus pension, health and welfare contributions in such a special). Also, if the artist's performance is being recorded and produced in connection with a concert event at which 'hard tickets' are being sold, the artist is often paid one lump sum covering fees for both the concert performance and the recording and production rights being granted to the TV producer. In that case, there's no practical way to allocate the lump sum between what the artist deserves for the concert performance, and the amount attributable to the recording and production rights being granted to the TV producer. In some instances, the TV producer may pay the artist a nominal flat-fee 'honorarium' to defray the artist's out-of-pocket travel, hotel, cartage, etc., expenses. The artist may, in other cases, render services for minimum union scale while the label contributes to the artist's out-of-pocket costs, including mounting the production for the artist (eg, scenery, sets, props, dancers, etc.). Costs paid by the label are generally treated by the label as advances being paid to the artist and are often recoupable, in whole or part, from the artist's royalty account.

The labels (and to a lesser extent, management and counsel for the artist) will seek to narrow the scope of the rights sought by the TV producer. At the same time ' particularly in instances where the TV producer isn't in an economic position to offer significant fees to the artist and/or label ' the artist/label may seek to obtain maximum rights to use and exploit the artist's performances, without compensation to the TV producer. In the digital era, the obtaining of reciprocal rights by the label/artist from TV producers can be an important source of obtaining 'free' high-quality content from the TV producer that the label can use and exploit itself, without incurring any direct acquisition costs. Productions today are recorded and produced using high-definition recording equipment, and the audio is often in the 5.1 surround-sound format.

Among the reciprocal rights generally sought by labels in exchange for granting waivers of artist exclusivity to the TV producer may be the right to use the artist's performances as: 'MTV-style' promotional videos; 'bonus-added' features to the artist's DVD products; the audio-only soundtrack recording on the artist's own phonorecords, either as album tracks and/or as bonus tracks; streaming video from the label's own Web site and/or from the artist's 'official' fan-club Web site; use of the audio-only soundtrack as an iTunes (and other) audio downloads; a 'full-track' 'over-the-air' (OTA) for download to portable devices, including cell phones, iPods and other 'personal digital devices'; and streaming content to Web-browser enabled cell phones and other mobile devices as part of the cell-phone carrier's subscription services. All of the major record labels now have in effect blanket licenses granting the major mobile carriers the right to stream content specifically authorized for such purpose to the carrier's subscribers in exchange for a portion of the revenues obtained by the carriers from the subscription services.

EL&F: When might the label begin its reciprocal exploitations of an artist's performance derived from the TV production?

Root: In negotiation of reciprocal rights, it's common for the label's reciprocal rights to the use of the artist's performance to be subject to a 'holdback period,' so as to not interfere or compete with the initial broadcasts or other exploitations of the TV production and/or place the TV producer in breach of the exclusive broadcast provisions under the TV producer's broadcast-license agreements. For example, in a recent production that I was involved with, the label could exercise its reciprocal rights subject to the following holdbacks: make the audio-only soundtrack of the artist's performance available for streaming and downloading immediately following the initial premiere broadcast of the production in the United States; make promotional uses of the artist's performance as a 'MTV-style' promotional video in the United States 3 months from the date of the initial broadcast premiere of the production; make promotional uses of the artist's performance as a 'MTV-style' promotional video outside the United States 6 months from the date of the initial broadcast premiere of the TV production; and make all other promotional and commercial uses of the artist's performance (excluding, however, by means of TV/broadband/on-demand Internet streaming or downloads) that the label desired 1 year following the initial TV broadcast premiere of the production in the United States. However, other than the reciprocal right to make promotional uses of individual artist performances as 'MTV-style' promotional video clips, TV broadcast rights in all television media (including broadband and on demand services) are not typically granted to the labels, but instead are retained by the producer.

Where the artist has rendered services in connection with more than one performance in the TV production, there is typically a limitation on the number of artist performances for which the record label may exercise its reciprocal rights at any given time, to avoid direct competition with the broadcasts and/or other exploitations of the TV production.

My TV-producer clients tend to be extremely 'user friendly' with the labels when it comes to grants of reciprocal rights. No practitioner or label business-affairs executive can anticipate each and every use of an artist's performance that the label, or artists themselves, might wish to exploit. I have been involved in numerous instances where years after the initial production, the TV-producer client receives a request for use of an artist's performance for a particular purpose, such as a newly produced retrospective on the artist's career, use of the artist's performance as a bonus audio-only track on a record and/or use of the audio-visual performance as bonus-added DVD materials. Where the reciprocal right sought by the label, or artist, is promotional in nature, the request is nearly always granted by my TV producer clients on a 'gratis' basis. Where the use requested is of a commercial, revenue-bearing nature, an appropriate fee, royalty or other form of income participation is arrived at between the TV producer and the label, taking into account the cost of the TV production and whether or not the producer has by then recouped its production costs. I have even been involved in one situation where a major artist, whose recording agreement had expired, obtained from my TV-producer client the right to release the artist's full audio-only soundtrack from a TV production as an EP on an income-sharing basis with my client.

EL&F: What form does a label waiver take in terms of grants of rights, and what warranties and representations on the part of the TV producer and the label affect the label waiver?

Root: The form in which the TV producer grants the reciprocal rights is in the form of a 'quit-claim' license running from the producer to the record label, with the producer making no warranties or representations ' other than perhaps a warranty and representation that the producer has paid or will pay all production costs incurred in connection with the production itself. The label, on the other hand, warrants and represents that the label has the right to the exclusive recording services of the artist applicable to the artist's performances in the production and the right to waive such exclusive rights, and accordingly will waive its exclusivity to the artist's services and the exploitation of the results and proceeds thereof, including, without limitation, any rights that the label may have in and to the artist's name, likeness, image, biographical materials, and other personal and professional identifications for the TV producer's (and its licensee's) exploitation of the artist's performances to the fullest extent that the label possesses such rights and as may be necessary under the exclusive recording agreement with the label. All other rights required to be obtained in and to the artist's services, results and proceeds must be obtained by the TV producer directly from the artist.

Additionally, the grant of reciprocal rights by a TV producer to a label is preconditioned upon the label: obtaining any and all necessary third-party rights, licenses, permissions and consents necessary in connection with the label's uses, including, without limitation, from the artist (to which the label must make all royalty and other required payments under the recording agreement), the music publishers, etc.; complying with any and all applicable regulations of unions and guilds having jurisdiction over the TV production, and paying any and all residual payments and pension, health and welfare contributions required in connection with the exercise of the reciprocal rights; making any and all payments, fees, royalties and advances required in connection with the exercise of the reciprocal rights; providing the TV producer and/or broadcaster with a customary courtesy credit; and defending, indemnifying and holding the producer harmless from and against any and all claims, costs, demands and liabilities ' including reasonable legal fees and court costs ' arising from and/or related to the label's exercise of its reciprocal rights.

EL&F: Are there any other forms or variations on the theme of label waivers that you have been involved in?

Root: Over the years, I have been involved in negotiations of nearly every conceivable form of contractual relationships between record labels and TV producers, having represented both labels and TV producers, as well as TV networks, in these negotiations; from 'true joint ventures' where both parties contribute equally to the costs of the production and share equally in the income derived from the exploitations, to 'modified joint ventures' where the TV producer provides all the financing and has all exploitation rights, including the right to 'administrate' all the third-party exploitation agreements in all media, while providing the label with an 'override'/'profit participation' after the true costs of production are recouped, to 'joint exploitation' models where the producer owns and controls worldwide, perpetual TV rights, the label controls worldwide, perpetual audio-only soundtrack and DVD rights and each shares 'profits' and/or pays an 'override' to the other in connection with each's exploitations. There's no 'off the rack' model. The objective is to take into account the relative risks undertaken by each party, including which party provides the financing and which party has the skill set, knowledge and experience to maximize both the promotional opportunities for the artist and the revenue potential that can be gained.

No doubt as the digital landscape expands, new models will evolve. I recently represented a TV producer where the rights clearances/waiver process applied to a full-length 2 hour concert by a major, internationally renowned artist that was produced solely for initial 'broadcast' by linear and 'chapterized' (ie, by interactive transmission where the viewer could select which individual performances he or she wished to view) means from the Web site of a major cellular/mobile carrier.

EL&F: When do the artist approval and consultation discussions occur in the TV-production process, and how are any upfront payments by the TV producer to the label accounted for between the label and artist?

There are frequently 'back-door' conversations undertaken between the label and the artist for the label to obtain such approvals and/or consultations in advance of the TV production while the producer and label are negotiating the waiver of exclusivity.

Where the TV producer may be making some form of 'upfront' payment to the artist in connection with the production itself and/or any ancillary rights being exploited by the producer, not atypically the label will permit the amount of the upfront payment the label might be otherwise entitled to receive under the exclusive recording agreement be paid to the artist, but all monies thereafter payable to the artist would be paid by the TV producer to the label and credited to the artist's royalty account in accordance with the applicable terms of the recording agreement. However, the topic of whether the artist receives all or any portion of the producer's upfront payment is a hot one and ever-changing, depending on a number of factors, including the costs the artist will incur in performing in the production and the recouped/unrecouped status of the artist's royalty account at the time of the production.

This is Part Two of a two-part interview, coordinated by Entertainment Law & Finance Editor-in-Chief Stan Soocher, with Santa Monica-CA-based entertainment Henry Root. In Part One, Root, who has extensive experience handling legal issues for music-driven television productions, discussed considerations in clearing rights in, and determining fees for, songs and sound recordings used in a production, as well as how option rights for the music are negotiated. Root also began, and continues here, a discussion of the issues to be negotiated for a record label to waive its exclusive right to the services of an artist who will appear in a TV
music production. Root also discusses copyrights in artist TV performances, reciprocal rights with record labels, holdbacks on exploitation, and warranties and representations.

EL&F: What key copyright issues are involved in negotiating the record label's waiver of exclusivity of its rights to an artist's musical services?

Root: The copyrights in, and to, the production itself will vest in the TV producer. Persons rendering services, including the artists, in connection with the production will do so on a 'work-for-hire' basis for the producer. These include, but aren't limited to, the executive producers, line producers, directors, lighting designers, set designers and other key production individuals. These services are considered to be 'specially ordered and commissioned' by the producer for inclusion in an 'audio-visual work' under the Copyright Act. Under the Act, the definition of 'audiovisual works' include 'all accompanying sounds, regardless of the nature of the material objects, such as films or tapes, in which the [audiovisual] works are embodied.'

(Union and guild collective-bargaining agreements and the 'standard engagement agreements' that apply to rendition of services by union members factor into the copyright ownership issues to consider, particularly those of American Federation of Television and Radio Artists (AFTRA) and the American Federation of Musicians (AFM), and the prudent practitioner will review the union and guild standard forms to make certain they contain a 'work for hire' acknowledgment or add such a provision if they do not.)

On occasion, during negotiations of a waiver of label exclusivity, I am asked by the business-affairs department of the label to incorporate an acknowledgement that the label is deemed owner of the copyright in the underlying sound recording and/or to the audio-only performances of the artist as embodied in the soundtrack of the audiovisual work comprised of the TV program. However, the fact is that no sound recording-copyright is being created independently of the TV-production audio-visual work itself. What I customarily do, when so requested, is to provide in the label-waiver agreement that, as between the TV producer and the label, the producer will not claim any interest in any sound-recording copyright associated with the artist's audio-only performances in the TV production separate and apart from the audiovisual work as a whole.

EL&F: What so-called 'reciprocal rights' in the artist's performances in a TV production might a record label want in exchange for waiving its exclusive right to the artist's musical services?

Root: The TV producer's counsel must first review the producer's broadcast-license agreements with respect to the scope and extent of the exclusive rights being granted to the broadcasters. In negotiating the broadcast agreement, the experienced TV-production counsel will have anticipated that the labels will seek to obtain 'reciprocal' uses of the artist's performances and should have negotiated with the broadcaster for 'exceptions'/'carve-outs'/'exclusions' from the scope of the broadcast exclusivity being granted by the producer to the broadcaster in order to permit the labels (and in some instances the producer itself) to use and exploit the artist performances in the TV production without violating the exclusive rights granted to the broadcaster. Also, if the TV producer enters into a sponsorship agreement (with the sponsorship fees paid to the TV producer often being applied to finance the production-deficit costs), the sponsor ' particularly if a wireless carrier or mobile-phone manufacturer ' will often times want certain exploitation rights to one or more individual artist performances in connection with the benefits to be accorded the sponsor.

In the TV producer/record label discussions, under older exclusive artist recording agreements between the label and the artists, the definition of a 'master recording' was defined as a recording 'intended for home use.' Under those older definitions, TV productions intended for exploitation in broadcast media only didn't fall within the category of a recording 'intended for home use.' Therefore, if TV broadcasts were the only form of exploitation contemplated by the TV producer, a waiver from the record label arguably wasn't required. Under more recent recording agreements, however, the definition of 'recordings' typically include all forms of exploitation of the artist's musical services, whether or not 'intended for home use,' and consent may have to be obtained from the label for the artist to appear and render musical performances in the production even if intended only for TV broadcast.

The objective of the TV producer is to obtain a waiver from the label that will enable the producer to exploit the artist's performances in the TV production by any and all TV manners, means, methods and media, now and hereafter known, throughout the world and in perpetuity, without payment of remuneration by the TV producer to the label in connection with the exercise of those TV, broadcast (and any sponsor's) rights. If the producer pays the artist in connection with the TV-production performances, the labels will generally seek to obtain payment from the producer of 50% of the fee paid to the artist. This element of the negotiation alone can be exceedingly complex, because monies that may become payable to artists may not necessarily be tied to the artist's 'recording services' for the TV producer per se. For example, the total amount of compensation paid by TV producers to artists in connection with many top-tier variety and musical specials is minimum AFTRA and/or AFM scale (presently $1361.00 for an AFTRA member classified as a 'principal performer' for a 2-hour network special, plus pension, health and welfare contributions, and $814.85 for an AFM member ' double for the 'leader' ' plus pension, health and welfare contributions in such a special). Also, if the artist's performance is being recorded and produced in connection with a concert event at which 'hard tickets' are being sold, the artist is often paid one lump sum covering fees for both the concert performance and the recording and production rights being granted to the TV producer. In that case, there's no practical way to allocate the lump sum between what the artist deserves for the concert performance, and the amount attributable to the recording and production rights being granted to the TV producer. In some instances, the TV producer may pay the artist a nominal flat-fee 'honorarium' to defray the artist's out-of-pocket travel, hotel, cartage, etc., expenses. The artist may, in other cases, render services for minimum union scale while the label contributes to the artist's out-of-pocket costs, including mounting the production for the artist (eg, scenery, sets, props, dancers, etc.). Costs paid by the label are generally treated by the label as advances being paid to the artist and are often recoupable, in whole or part, from the artist's royalty account.

The labels (and to a lesser extent, management and counsel for the artist) will seek to narrow the scope of the rights sought by the TV producer. At the same time ' particularly in instances where the TV producer isn't in an economic position to offer significant fees to the artist and/or label ' the artist/label may seek to obtain maximum rights to use and exploit the artist's performances, without compensation to the TV producer. In the digital era, the obtaining of reciprocal rights by the label/artist from TV producers can be an important source of obtaining 'free' high-quality content from the TV producer that the label can use and exploit itself, without incurring any direct acquisition costs. Productions today are recorded and produced using high-definition recording equipment, and the audio is often in the 5.1 surround-sound format.

Among the reciprocal rights generally sought by labels in exchange for granting waivers of artist exclusivity to the TV producer may be the right to use the artist's performances as: 'MTV-style' promotional videos; 'bonus-added' features to the artist's DVD products; the audio-only soundtrack recording on the artist's own phonorecords, either as album tracks and/or as bonus tracks; streaming video from the label's own Web site and/or from the artist's 'official' fan-club Web site; use of the audio-only soundtrack as an iTunes (and other) audio downloads; a 'full-track' 'over-the-air' (OTA) for download to portable devices, including cell phones, iPods and other 'personal digital devices'; and streaming content to Web-browser enabled cell phones and other mobile devices as part of the cell-phone carrier's subscription services. All of the major record labels now have in effect blanket licenses granting the major mobile carriers the right to stream content specifically authorized for such purpose to the carrier's subscribers in exchange for a portion of the revenues obtained by the carriers from the subscription services.

EL&F: When might the label begin its reciprocal exploitations of an artist's performance derived from the TV production?

Root: In negotiation of reciprocal rights, it's common for the label's reciprocal rights to the use of the artist's performance to be subject to a 'holdback period,' so as to not interfere or compete with the initial broadcasts or other exploitations of the TV production and/or place the TV producer in breach of the exclusive broadcast provisions under the TV producer's broadcast-license agreements. For example, in a recent production that I was involved with, the label could exercise its reciprocal rights subject to the following holdbacks: make the audio-only soundtrack of the artist's performance available for streaming and downloading immediately following the initial premiere broadcast of the production in the United States; make promotional uses of the artist's performance as a 'MTV-style' promotional video in the United States 3 months from the date of the initial broadcast premiere of the production; make promotional uses of the artist's performance as a 'MTV-style' promotional video outside the United States 6 months from the date of the initial broadcast premiere of the TV production; and make all other promotional and commercial uses of the artist's performance (excluding, however, by means of TV/broadband/on-demand Internet streaming or downloads) that the label desired 1 year following the initial TV broadcast premiere of the production in the United States. However, other than the reciprocal right to make promotional uses of individual artist performances as 'MTV-style' promotional video clips, TV broadcast rights in all television media (including broadband and on demand services) are not typically granted to the labels, but instead are retained by the producer.

Where the artist has rendered services in connection with more than one performance in the TV production, there is typically a limitation on the number of artist performances for which the record label may exercise its reciprocal rights at any given time, to avoid direct competition with the broadcasts and/or other exploitations of the TV production.

My TV-producer clients tend to be extremely 'user friendly' with the labels when it comes to grants of reciprocal rights. No practitioner or label business-affairs executive can anticipate each and every use of an artist's performance that the label, or artists themselves, might wish to exploit. I have been involved in numerous instances where years after the initial production, the TV-producer client receives a request for use of an artist's performance for a particular purpose, such as a newly produced retrospective on the artist's career, use of the artist's performance as a bonus audio-only track on a record and/or use of the audio-visual performance as bonus-added DVD materials. Where the reciprocal right sought by the label, or artist, is promotional in nature, the request is nearly always granted by my TV producer clients on a 'gratis' basis. Where the use requested is of a commercial, revenue-bearing nature, an appropriate fee, royalty or other form of income participation is arrived at between the TV producer and the label, taking into account the cost of the TV production and whether or not the producer has by then recouped its production costs. I have even been involved in one situation where a major artist, whose recording agreement had expired, obtained from my TV-producer client the right to release the artist's full audio-only soundtrack from a TV production as an EP on an income-sharing basis with my client.

EL&F: What form does a label waiver take in terms of grants of rights, and what warranties and representations on the part of the TV producer and the label affect the label waiver?

Root: The form in which the TV producer grants the reciprocal rights is in the form of a 'quit-claim' license running from the producer to the record label, with the producer making no warranties or representations ' other than perhaps a warranty and representation that the producer has paid or will pay all production costs incurred in connection with the production itself. The label, on the other hand, warrants and represents that the label has the right to the exclusive recording services of the artist applicable to the artist's performances in the production and the right to waive such exclusive rights, and accordingly will waive its exclusivity to the artist's services and the exploitation of the results and proceeds thereof, including, without limitation, any rights that the label may have in and to the artist's name, likeness, image, biographical materials, and other personal and professional identifications for the TV producer's (and its licensee's) exploitation of the artist's performances to the fullest extent that the label possesses such rights and as may be necessary under the exclusive recording agreement with the label. All other rights required to be obtained in and to the artist's services, results and proceeds must be obtained by the TV producer directly from the artist.

Additionally, the grant of reciprocal rights by a TV producer to a label is preconditioned upon the label: obtaining any and all necessary third-party rights, licenses, permissions and consents necessary in connection with the label's uses, including, without limitation, from the artist (to which the label must make all royalty and other required payments under the recording agreement), the music publishers, etc.; complying with any and all applicable regulations of unions and guilds having jurisdiction over the TV production, and paying any and all residual payments and pension, health and welfare contributions required in connection with the exercise of the reciprocal rights; making any and all payments, fees, royalties and advances required in connection with the exercise of the reciprocal rights; providing the TV producer and/or broadcaster with a customary courtesy credit; and defending, indemnifying and holding the producer harmless from and against any and all claims, costs, demands and liabilities ' including reasonable legal fees and court costs ' arising from and/or related to the label's exercise of its reciprocal rights.

EL&F: Are there any other forms or variations on the theme of label waivers that you have been involved in?

Root: Over the years, I have been involved in negotiations of nearly every conceivable form of contractual relationships between record labels and TV producers, having represented both labels and TV producers, as well as TV networks, in these negotiations; from 'true joint ventures' where both parties contribute equally to the costs of the production and share equally in the income derived from the exploitations, to 'modified joint ventures' where the TV producer provides all the financing and has all exploitation rights, including the right to 'administrate' all the third-party exploitation agreements in all media, while providing the label with an 'override'/'profit participation' after the true costs of production are recouped, to 'joint exploitation' models where the producer owns and controls worldwide, perpetual TV rights, the label controls worldwide, perpetual audio-only soundtrack and DVD rights and each shares 'profits' and/or pays an 'override' to the other in connection with each's exploitations. There's no 'off the rack' model. The objective is to take into account the relative risks undertaken by each party, including which party provides the financing and which party has the skill set, knowledge and experience to maximize both the promotional opportunities for the artist and the revenue potential that can be gained.

No doubt as the digital landscape expands, new models will evolve. I recently represented a TV producer where the rights clearances/waiver process applied to a full-length 2 hour concert by a major, internationally renowned artist that was produced solely for initial 'broadcast' by linear and 'chapterized' (ie, by interactive transmission where the viewer could select which individual performances he or she wished to view) means from the Web site of a major cellular/mobile carrier.

EL&F: When do the artist approval and consultation discussions occur in the TV-production process, and how are any upfront payments by the TV producer to the label accounted for between the label and artist?

There are frequently 'back-door' conversations undertaken between the label and the artist for the label to obtain such approvals and/or consultations in advance of the TV production while the producer and label are negotiating the waiver of exclusivity.

Where the TV producer may be making some form of 'upfront' payment to the artist in connection with the production itself and/or any ancillary rights being exploited by the producer, not atypically the label will permit the amount of the upfront payment the label might be otherwise entitled to receive under the exclusive recording agreement be paid to the artist, but all monies thereafter payable to the artist would be paid by the TV producer to the label and credited to the artist's royalty account in accordance with the applicable terms of the recording agreement. However, the topic of whether the artist receives all or any portion of the producer's upfront payment is a hot one and ever-changing, depending on a number of factors, including the costs the artist will incur in performing in the production and the recouped/unrecouped status of the artist's royalty account at the time of the production.