Limitations of the 1999 Work-for-Hire Amendment: Courts Should Not Consider Sound Recordings to Be Works-for-Hire When Artists' Termination Rights Begin Vesting in Year 2013
Rafoth, Ryan Ashley, Vanderbilt Law Review
PREFACE: 1999 WORK-FOR-HIRE AMENDMENT ELIMINATES IMPORTANT TERMINATION RIGHTS FOR ARTISTS
The legal issue that is the subject of this Note was once nothing more than a curious topic of debate among attorneys who represent recording artists. When I began researching the topic in June of 1998, several artists' attorneys explained the problems with language customarily inserted in record contracts by record companies claiming that the artists' sound recordings are "work made for hire." Most artists' attorneys have always disagreed with this work-for-hire language, believing it to be a misguided interpretation of the law, but they have always known that the contractual language could not legally bind their clients.*1 Instead, the issue of whether a sound recording is a work-for-hire has been considered a question of statutory interpretation that courts would one day decide in favor of artists.*2
Until November 29, 1999, artists' attorneys had rested on the assumption that the issue whether sound recordings are works-forhire would be decided by courts around year 2013. Beginning in that year, the so-called "right of termination" would have entitled artists to reclaim their copyrights after proving that their sound recordings are not works-for-hire under the 1976 Copyright Act.*3 Congress, however, eliminated artists' termination rights with a recent Copyright Act amendment expanding the definition of "work made for hire" to include sound recordings.*4 The artists' rights to reclaim valuable streams of royalty revenue generated by their sound recordings was the result of years of negotiations between private interests, a number of Copyright Office studies, and careful consideration by the 94th Congress in 1976;*5 Congress eliminated these rights with the stroke of a pen in 1999.
If Congress had not suddenly intervened, courts would have found that artists' sound recordings are not works-for-hire in accordance with equitable principles,*6 legal precedent,*7 and congressional policy underlying the 1976 Copyright Act.*8 A United States District Court recently reached this conclusion. On March 5, 1999, the court in Ballas v. Tedesco held that "sound recordings are not a work-forhire under the second part of the statute because they do not fit within any of the nine enumerated categories."*9 Unfortunately, Congress passed the 1999 amendment without considering equitable principles, legal precedent, or the uniquely intricate compromise underlying the 1976 legislation.
The work-for-hire amendment passed without hearings or debate*10 on November 29, 1999, the last day Congress was in session, in an appendix to an appropriations bill of over 1,000 pages.*11 The amendment is one sentence found within the appendix in a title regarding satellite transmission of copyrighted television content.*12
The section in which the work-for-hire amendment appears bears the label "Technical Amendments"*13 and the legislative history calls it a "clarifying change."*14 These characterizations belie the significance of the amendment and explain why no debate occurredtechnical amendments usually correct spelling, punctuation, or numbering without changing the substantive meaning of the law.*15 If Congress had held hearings on the subject, artists would have informed Congress that the work-for-hire amendment was not a mere technical amendment, but instead a significant piece of legislation with major consequences-namely the elimination of artists' termination rights.*16 Before "clarifying" previous legislation Congress also should have considered that a United States District Court had reached the exact opposite conclusion in interpreting the same legislation just six months earlier.*17
Shortly after Congress enacted the work-for-hire amendment, lobbyists working for record companies, the Recording Industry Association of America ("RIAA"), maintained that the work-for-hire amendment was merely a clarification of existing law, and that "in everybody's view this was a technical issue. …