Moral rights not k2 contracts

For Black artists, negotiating fair and equitable contracts with record labels and other industry players is crucial to achieving success and financial stability in the music industry. The music industry has a history of exploiting Black artists and perpetuating economic disparities through unfair contract terms and unequal bargaining power. As such, Black artists must clearly understand the key contract considerations they should be aware of when negotiating with industry players. This section will discuss some suggested contract considerations for Black artists, including definitions, transparency, plain English contract drafting, morals clauses, non-disclosure agreements, and inclusion riders. By understanding these considerations and advocating for their rights, Black artists can work toward building more equitable and sustainable careers in the music industry.

A. USE OF UNIFORM DEFINITIONS

Like a typical contract, this section begins with definitions. The “definition” section is important in contracts for Black artists because it helps establish clarity and consistency in interpreting the contract terms. These sections define key terms and phrases used throughout the contract, which can be critical to ensuring that both parties have a shared understanding of the obligations and expectations set out in the agreement.

Contract interpretation is the largest single source of contract litigation. It is critical that contract terms are unambiguous. To achieve this goal, many contracts include a “definition” section at the beginning of the agreement or before a relevant provision. Defined terms are given specific definitions in the contract. The term’s definition applies in the context of the particular contract, and definitions are generally only applicable to that contract. Defined terms also ensure consistency throughout the agreement. A failure to define terms in a contract often leads to a dispute when two parties have opposing understandings. This has resulted in struggling artists being taken advantage of by the power of the recording industry.

Analogously, it is imperative that artists use the same vocabulary to discuss diversity, equity, and inclusion when drafting contracts and reviewing provisions with the other party. The National Association of Student Personnel Administrators (NASPA) has created a terminology guide to bring together definitions and resources to establish a common language to be used within and across leadership programs, civic engagement and diversity, equity, inclusion, and social justice work. The guide also attempts to harmonize some of the often-misguided interpretations of terminology regarding current political and public discourse. Though this project intended to advance anti-racism and social justice efforts in higher education and student affairs, it lends itself to multiple functional areas addressing inequality. NASPA’s guide highlights terminology that could be incorporated in the contract and clearly defines those terms.

A clear definition of Black Individuals of Color, Ethnicity, and Diversity would play a key role in drafting an effective inclusion rider (see Part F). The inclusion rider aims to increase the diversity and inclusion of traditionally underrepresented groups in the entertainment industry. It would be difficult to achieve this goal if we did not have clear guidance for what success would look like. For example, a broad definition of diversity would include all traditionally underrepresented groups, such as women, people of color, LGBTQ+ individuals, and people with disabilities. Such a broad definition may dilute the talent pool and make it more difficult for Black artists to achieve their specific diversity goals.

Additionally, with the rise in civil unrest in the United States and the series of demonstrations and protests that surround police brutality, such as the killing of George Floyd in May 2020, it would be beneficial to artists to have a clear definition of civil action and have it excluded from their morals clauses (see Part D). For example, NASPA defines Civic Engagement as “Political and nonpolitical behaviors aimed at making a difference in the civic life of communities to which one belongs.”117 If artists value their voice to openly discuss issues affecting their communities, creating a carveout with a detailed definition would be imperative. These definitions can protect artists by providing the precise language needed to effectuate change. Once everyone is speaking the same language, we can move to addressing the contract terms.

B. COMPENSATION TRANSPARENCY

Transparency in contracting is the solution. Transparency promotes fairness and accountability in contracting by enabling all parties to identify potential issues and negotiate more effectively. For example, if one party has significantly more bargaining power than the other, transparency can help level the playing field by giving the less powerful party the information they need to make informed decisions about the contract’s terms. Moreover, transparency can help prevent unethical or illegal behavior by ensuring that all parties are aware of their legal obligations and the consequences of non-compliance. This is particularly important in industries that are prone to exploitation or abuse, such as the entertainment industry, where artists and creators may be vulnerable to exploitation by more powerful entities. Record labels and artists would likely resist fully disclosing artists’ salaries and royalty schemes. However, including a range can be a simple way to allow artists to have a better gauge of what their talent is worth. The importance of transparency can be shown through one of America’s largest regulators, the Securities Exchange Commission. The federal regulatory agency, founded in 1933, oversees and enforces federal securities laws, which are designed to protect investors and promote fair, transparent, and efficient markets. The SEC plays a critical role in maintaining confidence in the securities markets and ensuring that companies, brokers, and other market participants comply with legal requirements, thereby promoting investor protection and market stability.

If successful Black artists use their newly acquired social and financial influence as a vehicle to demand transparency from record labels, we could finally establish a clear view of the racial disadvantages in the music industry at scale. Moreover, Black artists across the world would have tangible evidence to advocate for stronger, more equitable, terms in their contracts.

C. PLAIN ENGLISH CONTRACT DRAFTING

Why are contracts so hard to read? Dating back to as early as 1596, contract drafters have chosen to use arcane language to express commonplace ideas—sometimes to their own demise. English lawyers have long taken pride in creating their own language. In 1817, Thomas Jefferson made clear that he and his fellow lawyers were accustomed to “making every other word a ‘said’ or ‘aforesaid,’ and saying everything over two or three times, so that nobody but we of the craft can untwist the diction, and find out what it means.” Thankfully, there has been a movement toward plain language legal writing. Law schools, court rules, and federal agencies have all been transitioning toward clearly written legal language to achieve greater benefits for transacting parties. For example, a motorcycle manufacturer’s clearly written warranty can help sell motorcycles, and a clearly written service agreement can reduce the likelihood of costly litigation in the future. The executive branch has already taken a strong stance on plain English writing. In 2010, President Barack Obama signed The Plain Writing Act into law, which requires “government agencies to write clear communication that the public can understand and use.” The president’s goal was to emphasize transparency—a trait often lost in the entertainment industry.

Reading and understanding a contract shouldn’t require a law degree. Frequently, artists are relinquishing significant control over their creative output and personal brand by signing contracts with agents and recording companies. Sometimes, these entertainers’ only choice is to accept an unfavorable deal. Furthermore, other artists are manipulated into agreeing to inequitable terms because the agreement is either inadvertently or intentionally long-winded, unclear, or amorphous. For example, a profit-sharing provision from one of Kanye West’s above-mentioned contracts reads, In connection with the sale or other exploitation of Phonograph Records derived from the Master Recordings recorded during the Initial Period and the Option Period, in lieu of accruing royalties to your account hereunder in accordance with the provisions of Article 7 of the Recording Agreement (which have been incorporated herein), IDJ shall pay to Grantor the Net Proceeds and Net Licensing Proceeds earned in connection therewith.

Effective legal writing does not sound like an attorney wrote it. This is underscored by the fact that more than half (54%) of Americans between the ages of sixteen and seventy-four read below the equivalent of a sixth-grade level, according to a piece published in 2022 by APM Research Lab. Contract language is most effective when it is targeted toward the reading level of the contracting parties. Artist should refuse to sign contracts that are littered with legalese and other unnecessary jargon. Instead, artists should advocate for a mandatory required readability score. Readability refers to the ease at which the reader can understand a passage of text. Many factors affect readability, including sentence structure, delivery, vocabulary, length, and content. When drafters are mindful of writing at a high level of readability, it is far more likely that communication is easily understood. The most common way to calculate a readability score is to analyze the number of characters, syllables, words, and sentences. For example, the Flesch Reading Ease Test uses a mathematical formula to determine how easily a text reads. A higher number (90–100) means a text is easier to read; a lower number (0–30) means it is more difficult. The calculation subtracts total syllables from total words, then subtracts that sum from the total sentences minus total words. Artists could require a similar readability rating that would make agreements easier to understand.

Readability is even more important for Black artists because of differences in graduation rates in the United States. White students are 250 percent more likely to graduate than Black students at public universities. According to the National Assessment of Educational Progress (NAEP), eighty-five percent of Black students lack proficiency in reading skills, which is twenty-eight points lower than that of White Students. The industry boasts many famous Black high school and college dropouts, including Jay Z, Lil Wayne, Mary J. Blige, LL Cool J, and Rihanna.

Many plain language statutes address consumer contracts. These statutes protect consumers by requiring a minimum readability score for contracts, which helps them better understand their rights and duties. The motivation for these statutes is the unequal bargaining power between companies and consumers. Plain English contract drafting should be implemented whenever one party is unsophisticated or unrepresented—like many young Black artists.

D. REVERSE MORALS CLAUSES

While morals clauses have become popular contract devices, they are typically drafted for the benefit of employers. Often, entertainers are bound by morals clauses that stipulate certain actions or activities, even those undertaken in private life, that may be grounds for termination of the agreement. For example, these contracts may state that at any time, in the sole judgment of the Label, if the Artist has engaged in personal conduct reasonably judged to reflect adversely on the Label, the agreement may be terminated. These provisions can be problematic when there is a large power difference between the parties, as in the entertainment industry. In today’s world of social media, it seems difficult for any artist to confine their behavior in a way that would not somehow offend a company.

Cultural differences can have a disproportionate impact on Black artists when it comes to morality clauses because of systemic racism and implicit bias. For example, research has shown that Black people are more likely than White people to be perceived as engaging in immoral or inappropriate behavior, even when they are engaged in identical behavior. A study conducted by the U.S. Sentencing Commission found that Black people received sentences almost ten percent longer than those of White people arrested for the same crime. This same bias can result in Black people being targeted more frequently by morality clauses or facing greater consequences for breaking them.

Cultural differences may also affect the interpretation and enforcement of morality clauses, as some behaviors that are considered acceptable in Black communities may be viewed as inappropriate or immoral by individuals from other cultural backgrounds. This can lead to Black people being held to a different standard than their White counterparts, even if their behavior is consistent with the norms and expectations of their community. Black artists must be aware of these sometimes unconscious cultural differences to ensure morality clauses are fair and unbiased.

Though reverse morals clauses—which require the employer to follow the same behavioral standards imposed on entertainers— were created in 1968, they are only now becoming more common. Iconic American entertainer Pat Boone was the first to negotiate a reverse morals contract. Boone had a high-profile, righteous image and did not want it tarnished by signing with a label that permitted images of nudity on album covers. Many entertainers since Boone’s negotiation could have benefited from including a strong reverse morals clause. For example, a reverse morals clause in Clippers players’ contracts would have given them the opportunity to become free agents when owner Donald Sterling’s bigoted statements were made public. The golfer Vijay Singh was caught in a similar situation when Stanford Financial Group was implicated in a Ponzi scheme after he signed a five-year, $8,000,000 endorsement contract with them. Furthermore, Jay-Z faced immense public scrutiny in 2013 for his endorsement ties to Barneys after allegations of racial profiling in the store surfaced. These recent examples demonstrate that it is crucial for entertainers to protect their interests in the now lucrative endorsement market.

Drafting an effective reverse morals clause can be difficult. It is important to consider factors such as the term of the clause, who is included in the clause, and what specific acts trigger the clause. For example, the clause could state that, “During the Term of the Agreement, Company shall always act with due regard to public morals and conventions. If Company shall have committed or shall commit any act or do anything that is or shall be an offense involving moral turpitude under federal, state or local laws, or which brings Artist into public disrepute, contempt, scandal or ridicule, or which insults or offends the community, or which injures the success of Artist or any of Artist’s products or services, then at the time of any such act or any time after Artist learns of any such act, Artist shall have the right, in addition to its other legal and equitable remedies, including injunctive relief, to terminate this Agreement.” Artists should research their record label and search its history of contracting to find any recurring issues or red flags. Artists will want a broadly drafted reverse morals clause that covers any adverse act by the label. Artists should also limit who can invoke the clause by stipulating which corporate entities are bound by it. This prevents labels from intentionally performing acts to trigger the clause or from escaping unpunished when there is a violation.

E. NON-DISCLOSURE AGREEMENTS

A non-disclosure agreement is one of the most common provisions in an artist’s contract. Non-disclosure agreements (NDAs) are used in the music industry to preserve confidential information, including songs, vocal arrangements, and other creative artistic matters that have not been performed publicly. Artists often fail to realize the significance of NDAs and sign them as a matter of course. Issues arise because most NDAs over-protect, compromising the rights of musicians. Some demand unconditional injunctive relief and other remedies against artists who breach the terms and conditions. Others may stipulate that artists must pay a penalty every time they disclose information about the labels’ practices.

NDAs perpetuate racial injustice by silencing victims of discrimination or harassment and protecting the perpetrators; this is especially true in the entertainment industry where power imbalances and unequal access to resources are prevalent. There have been numerous instances of racial discrimination and harassment in the entertainment industry, particularly against Black artists and performers. Powerful individuals or companies can use NDAs to prevent victims of such misconduct from speaking out about their experiences, enabling the perpetrators to continue their abusive behavior without consequences. This creates a culture of silence and complicity that spreads racial injustice and allows discrimination and harassment to go unchecked. NDAs can be particularly harmful to marginalized communities because they often lack the resources and power to challenge these agreements or to seek legal recourse. This can create a cycle of oppression where powerful entities are able to exploit and discriminate against vulnerable individuals with impunity.

The secrecy in contracting is beginning to have a detrimental effect on the music industry. Brian Message, a partner in Courtyard Management of Radiohead, has openly voiced his concern that continuing these practices will create “value lost to the economic chain.”154 Message explains that the NDA culture now prevalent in artist negotiations is central to the structural failure of the industry. 155 Additionally, this secrecy has wider-reaching implications such as allowing sexual assault in the workplace. Notably, filmmaker and convicted sex criminal Harvey Weinstein used these types of agreements to bind women into not talking to family, friends, or the authorities about alleged assaults. 156 The terms also required the women to adhere to strict parameters that limited their ability to seek therapy. 157

The same techniques pervade music industry dealings. Record labels can insist that artists refrain from engaging in certain activities, including sharing company pay structure and discussing alleged unfair terms and conditions with regulatory agencies. Suppressing this type of information is not only harmful to the contracting artists but also to future entertainers entering the industry. However, if artists advocate for limiting or excluding these clauses, they can effect positive change for upcoming artists.

F. INCLUSION RIDER

There is a compelling argument that Black artists would get better contracts if the entertainment industry was more diverse. The Annenberg Inclusion Initiative at the University of Southern California issued a report that found little Black representation on the executive level (that is, vice president level and above), even though African Americans dominate the charts. The Initiative is a leading think tank dedicated to studying diversity and inclusion in entertainment through original research and sponsored projects.159 It also develops targeted, research-based solutions to tackle inequity.160 The report analyzed race, ethnicity, and gender in the executive ranks in the music industry, covering 4,060 executives from the vice president to C-Suite roles across 119 companies and six industry categories, including music groups, publishers, labels, streaming, and live music.161 The goal was to give a comprehensive look at the diversity in music’s decision-making roles.162

The statistics are bleak. Out of the CEO, chair, and president roles across 70 major and independent music companies, only 13.9% were from underrepresented racial and ethnic groups, 4.2% were Black, and 13.9% were women.163 It is important to remember that 40% of the U.S population identify with an underrepresented group, 14% are Black, and half are women.164

The broader statistics are no better for these marginalized groups. Of the more than 4,000 executives at 119 major and independent companies and their subsidiaries, 19.8% of executives at VP-level and higher were underrepresented, 7.5% were Black, and 35.3% were women.165 Underrepresented and Black executives varied little from the vice president head level of employment to executive vice president, senior vice president, general manager, chief, or president positions.166

Additionally, there is an uphill battle for these marginalized groups to be promoted to CEO, chief, or president roles. Record labels were the only category where the percentage of Black executives (14.4%) reached proportional representation with the U.S. population. In every other category, the percentage was less than 10%: 7.4% in streaming, 7.2% in music groups, 6.1% in publishing, 4% in radio, and 3.3% in live music and concert promotion. These figures are upsetting, given that Black artists were 37.7% of all artists on the popular charts in the last nine years. As mentioned above, the music industry’s lack of diversity, especially in executive positions, is shocking. Strong contract terms may be the answer. Frances McDormand made a bid at the Oscars for entertainers to take control and demand change in the industry in arguably one of the most influential references to the #MeToo movement. After lauding all the successful women in the audience and prodding the men in the room to help fund these women’s future projects, McDormand signed off with a mysterious phrase— inclusion rider.

McDormand was referring to a contract term that entertainers occasionally include in their agreement. The term promotes inclusion by requiring a certain percentage of the cast and crew to be ethnically diverse. If even a few artists began to regularly adopt inclusion riders into their contracts, it would likely make an impactful change. But if a significant number of entertainers, in unrelated contracts, draft in a way to address key social issues, there could be a more substantial change. An inclusion rider, for example, could state its purpose to ensure that diversity and inclusion are prioritized throughout an Artist’s participation in any project or event. Take the following language: To achieve the goals of diversity and inclusion, Company shall ensure the following diversity goals are met: (1) At least 13%167 of the performers, crew, and staff involved in any project or event must be from Underrepresented Groups, 168 including but not limited to Black people, African American people, and people of color; (2) Artist reserves the right to approve the diversity goals and to adjust them as needed; (3) A diversity and inclusion report must be provided to Artist on a regular basis, detailing the progress made towards the diversity goals; (4) If the diversity goals are not met, Artist reserves the right to terminate their participation in the project or event.

Incorporating inclusion riders into entertainment contracts has the potential to provide impactful change when embraced by individual artists. Further, the prevalence of these clauses would promote a transformative industry-wide shift, creating a more inclusive and representative landscape for all.

As stated by Professor Lobel, director of the Center for Employment and Labor Law, the “aggregation of multiple contracts in a single market has a collusive effect. Each additional contract signed not only binds the parties to the contract, but also affects everyone else in their ability to operate in the market, to compete, and to assert their rights.” For example, Black artists can begin the snowball effect by refusing to accept agreements that lack an inclusion rider. They have this power because of their extensive public reach and resources. Black producers, recording engineers, managers, booking agents, composers, etc., could put further pressure on the industry to make standard mandatory inclusion riders.