Canada: Canada vs. The U.S.: Songwriter Collaborations And The Value Of Co-writer Agreements

Introduction

Two or more songwriters sit down. armed with guitars and a notepad. intending to change the world with a great song (or at least make some money).

Whether songwriters co-write with their co-writer(s) in a living room, spontaneously in the studio, during a song camp, or via Zoom, it is critical that they consider all the "legal stuff." What constitutes "songwriting"? What rights do songwriters have? Can a co-writer record the song or sign a synchronization license without the consent of the other co-writers? How do co-writers "split" songs? What are the benefits of signing a co-writer agreement?

Not only is this area of the law complex, but the legal approaches taken in Canada and the United States with respect to co-writing are different, despite often being misunderstood as one and the same. These distinctions are important for any party involved in both the songwriting process and its subsequent exploitation and commercialization.

The purpose of this article is to (1) start with the basics and provide an overview of the legal definition of a 'work of joint authorship' within Canada and the U.S., (2) highlight the subtle legal distinctions regarding joint authorship between Canada and the United States, (3) highlight key clauses that should be covered within co-writer agreements to confirm the intent of the parties, and (4) identify practical considerations and benefits of utilizing cowriting agreements, which includes ensuring composition ownership is clear, something that is critically important for music partners who wish to invest in a songwriter's music catalogue.

Setting the Stage: What Is "Joint Authorship"?

Under Canadian law, a "work of joint authorship" means a work (i.e., a song) "produced by the collaboration of two or more authors, in which the contribution of one author is not distinct from the contribution of the other author, or authors."1 Under United States law, a "joint work" is defined as "a work prepared by two or more authors with the intention that their contributions be merged into inseparable or interdependent parts of a unitary whole."2

As such, if a songwriter writes a song with a co-writer, unless the songwriters sign an agreement to the contrary, the co-writers will own the entire song jointly (the lyrics and melody will not be distinct parts, for example, unless agreed otherwise). That is, each co-writer's split is generally "not distinct from the contribution of the other author" and is "merged into inseparable or interdependent parts of a unitary whole." To borrow (and slightly tweak) the oft used co-writing analogy, co-writing a song is like cracking an egg and watching the egg white (lyrics) and yoke (melody) mix in an irreversible way. Unless there is an agreement to the contrary, the co-writers do not, for example, own the egg white and yoke separately - they each jointly own 50 percent of the entire pan of scrambled eggs.

In Canada, copyright in a song lasts for the life of the author plus 50 years3 and, in the United States, the life of the author plus 70 years4. Generally, Canada and the United States are similar in that, for joint works, the copyright term is based on the life of the last surviving author.5 For example, if Paul Macartney, Mick Jagger and I co-write a song, copyright would last for the life of the last surviving author (presumably Mick because he will outlive everyone), plus 50 years if the laws of Canada apply, or plus 70 years if the laws of the United States apply.

Joint Authorship Legal Distinctions Between Canada and the United States

What constitutes a work of joint authorship? This question is more complicated than one would think.

In Canada, a "joint author" of a song needs to establish that they made some significant original expression to the song,6 keeping in mind that the contribution need not be equal to that of the other co-writer(s).7 The conventional Canadian legal test for joint authorship also requires that there must be "joint labour in carrying out a common design."8 One court case involving a dispute over Sarah McLachlan songs held that, in addition to the above, each songwriter needs to intend the other co-author to be a joint author.9

However, not all Canadian courts have adopted the "common intention" test. The federal court of Canada, for example, rejected the common intention test that co-authors be joint authors.10 In that case, the court found that the Sarah McLachlan decision followed American law, which imposes a requirement that collaborators also intend to regard each other as joint authors (as identified above., this requirement is actually baked into American copyright legislation, but not into Canadian copyright legislation). The American case Childress v. Taylor, for example, identifies the following three-prong test for a "joint work" under American law: (1) each of the collaborators intended the other to be a joint author of the work; (2) each author's work was independently copyrightable; and (3) each author intended that his work be merged into inseparable or interdependent parts of the whole.

Regardless of the different jurisdictional approaches relating to the intention of the parties to identify the other as a co-writer, the contributions of each co-writer, of course, needs to be original and material enough to attract authorship, subject to an agreement to the contrary. As such, in Canada and the U.S., any significant original expression made to a song, such as lyrics, melody, memorable guitar riffs, cord progression in the chorus, etc., could constitute "songwriting," and attract co-authorship status, if such contributions to the song are deemed to be significant original expression and are carried out in furtherance of a common design to create the work. Whether each co-writer also needs to intend the other to be a co-writer is, in Canada, an open legal question, but perhaps more settled under U.S. law. Every case will be decided based on its unique facts.

Having reviewed the definition of 'joint authorship' within Canada and the United States, what are the practical exploitation issues?

Assuming a work is established as a work of joint authorship, there are differences between Canada and the United States regarding the co-writers' ability to independently exploit the work.

In Canada, for example, composers of joint works cannot exercise their rights independently of each other.11 In the United States, on the other hand, one co-author can grant a non-exclusive license for the use of the work by a third party without the consent of the remaining owners,12 provided that the co-writer fully accounts to the other co-writers for such exploitation. The different legal approaches appear to be based on the following fundamental philosophical differences around exploitation: under the Canadian/British approach, the more limited ability of a co-writer to exploit independently of their co-writers is rooted in the protection of co-authors against the watering down of the work by other co-authors (for example, by issuing several licenses for little remuneration). Conversely, the American philosophy appears to be based on the belief that, by requiring consent of all co-authors, one co-author could "destroy the value of the whole use"13 by preventing the other co-writers from exploiting the work.14 In short, the Canadian/British philosophy focuses on protecting works from the dilution of its value, while the American philosophy focuses on protecting authors' right to exploit.

This distinction is critical as it relates to exploitation of works for obvious reasons. In Canada, for example, if composers of joint works cannot exercise their rights independently of each other, it means that one co-writer, unless they have the consent of the other co-writers, cannot approve a synchronization license, commercially exploit the song on a recording, or approve any other use of the song without the consent/approval of all co-writers. As above, however, the less restrictive U.S. approach suggests that a co-writer can grant a non-exclusive license for the use of a song by a third party without the consent of the remaining co-writers, provided the co-writer exploiting the song accounts to the other co-writer(s).

Canadian and American practitioners must be mindful of the different approaches to exploitation within the two jurisdictions. In the real world, however, ambiguities around exploitation should be clarified by contract.

Co-writer Agreements - Key Clauses

As above, this is an annoyingly complicated area of the law, and the answers to questions like "who owns what" and "who has the right to do what" are not always clear. The different legal approaches under Canadian and American law regarding joint authorship, including exploitation issues, only complicates the matter. Given the complex legal terrain, the author recommends execution of a co-writer or collaboration agreement among parties whenever possible and practical. A non-exhaustive list of terms that may be clarified under co-writer agreements is as follows:

• Composition Ownership (and corresponding revenue split) Among Co-writers - This item alone can be (and often is) dealt with using "split sheets". With respect to how to split songs among co-writers, there are no hard and fast rules.15 For example, a common approach in the industry is that lyricists are given 50 percent and creators of music/melody are given 50 percent, but this is not always the case and is sometimes practically difficult to divide so cleanly. In a four-piece rock band scenario, for example, the band might decide that all members split songs equally (done by U2, Coldplay, REM and the Red Hot Chili Peppers, for example), or alternatively might decide that the "core" band member songwriters split compositions/publishing among only those core members. In a scenario where a hip-hop producer is involved in producing a track, depending on the deal, she may take "publishing"/a co-writing share as producer, particularly if she created the so called "beat"/underlying instrumental track, which is often a substantial contribution to a composition in the hip-hop, R&B and pop space.

To clarify, when referring to song "splits", parties are (or should be) referring to the co-writers' copyright ownership split of the song, and their corresponding share of publishing revenue flowing from such ownership. For example, if two songwriters co-write and agree that the "split" will be 50/50, this means that each co-author owns 50 percent of the copyright in the composition, and each will receive 50 percent of any and all publishing revenue flowing from the exploitation of that song, such as public performance royalties, mechanical royalties, synchronization fees, print royalties, etc. That, of course, is subject to either or both co-writers executing a music publishing deal where a portion of such revenue sources are split with the music publisher.

• Administration Rights - The agreement should determine whether any one co-writer will acquire administration rights of the other co-writer(s), which would give the grantee of such rights the ability to sign licenses on behalf of the other co-writers. If not, and as discussed above, there are jurisdictional implications regarding a co-writer's ability to exploit compositions. Under Canadian law, for example, without a clear grant of administration rights from the other co-writer(s), a single co-writer would be unable to execute a synchronization license, for example, regardless of how appealing that opportunity might be. As a practical consideration, the requirement for multiple signatories to a licensing opportunity involving musical works could be problematic if a single co-writer does not promptly turn their mind to the deal. This could unintentionally hold up the process and risk killing the deal. Having said that, in the event a party to a co-writer agreement is also party to an existing music publishing agreement, such co-writer may be prevented from assigning their respective administration rights in any event.
• Use of Name/Likeness and Credit - Confirming whether one co-writer can use the name/likeness of other co-writer(s) for promotional and marketing purposes should not be overlooked. In addition, the co-writers should confirm how they will be credited in association with the work. Promoting and marketing a creative's career on social media platforms like Instagram, Facebook and TikTok, for example, has never been more important. As such, co-writers should contractually confirm these items.
• Performance & Recording of Song - In the author's experience, when co-writers collaborate, it is often understood among writers who will perform and ultimately "cut" the song. However, complicated issues can arise when those involved in the writing process are also performers, and clarity is not obtained on whether all co-writers are entitled to perform and/or record the song, or whether that right will or should be reserved for a particular artist/co-writer. The agreement will need to consider whether a first use mechanical license, for example, will be provided to either or both parties for the purpose of reproducing the composition on records. Of course, a music publisher's or investor's interest in a specific composition is dependent on it being lawfully exploited to the public.
• Alternations to Lyrics/Melody - A lot can happen between the initial collaborative writing process and ultimate recording of the song, with producers, managers, labels and/or publishers potentially all providing input. As such, a co-writer agreement should confirm whether one co-writer has the right to make alterations to the song, such as to melody, lyrics, song structure, etc. If no such right is provided, complex issues could arise should one party (or their creative team) unilaterally amend/alter a composition that is jointly owned.
• Representations and Warranties - The "reps and warranties" are common provisions in most commercial contracts, which essentially outline what one party (or both parties) promise/assert is true to the other. It is standard in entertainment/music contacts for parties to confirm, among other things, that they have the right to enter into the contract and that the creative work being brought to the table is original and does not violate the rights of any third party (including copyright). These representations and warranties are critical in minimizing risk and cost exposure for a co-writer caught up in an infringement suit due to their collaborator's actions. In addition, from the perspective of a third-party investor or music publisher, such representations and warranties mitigate risk by confirming that the parties have legal recourse in the event such representations and warranties are breached. Standard indemnification clauses will typically confirm that, should a party breach any of the representations and warranties, the "innocent" party, to the extent they are subject to any action resulting from such breach, will be indemnified for any related costs and expenses, including legal fees to defend an action.

It should be noted that, although co-writer/collaboration agreements are frequently used to confirm composition splits and other associated deal points among co-writers (as above), it is highly recommended that these items be captured and clarified in any agreement in which a party was part of the creative process and who could make a joint authorship claim, whether in producer, side artist/feature, band or mixer agreements. In such agreements, and where a particular creative partner is not entitled to ownership rights associated with the composition, the author's practice is to confirm that, other than the rights and entitlements specifically outlined within the agreement, the creative partner is entitled to no other payment, royalty, copyright interest, or additional compensation of any kind. This ensures all parties are on the same page and avoids ambiguity.

Practical Considerations

There are other critically important practical benefits to ensuring such co-writer or collaboration agreements are in place (or, at least, that the material terms have been captured in writing).

As alluded to, above, memories tend to get foggy when a composition starts earning serious revenue. Questions begin to arise, such as: "was that third person in the room really a co-writer?"; "was there an expectation that the producer was also getting publishing?"; "that session musician laid down a great guitar part, but should they be deemed as songwriter?". Co-writer and collaboration agreements clarify near-term exploitation issues, ensuring creative partners and their teams do not squabble over splits.

The longer-term practical implications are just as important. For example, if a co-writer is offered a music publishing deal, the terms of the agreement will almost always require the songwriter to confirm their respective ownership interest in each composition forming part of the deal. Without split sheets, co-writer agreements, or even email correspondence evidencing composition splits, there is greater risk that parties find themselves in costly disagreements, with the underlying publishing agreement potentially being materially breached by the songwriter should an unexpected music partner establish composition ownership to subject compositions under the deal.

In addition, when preparing for the potential acquisition of a songwriter's catalogue, such catalogue cannot be properly valued unless there is a clear chain of title to the vendor songwriter/estate, which can only be evidenced by split sheets, co-writer agreements, or some other written correspondence, as noted above. 2021 saw astronomical dollars spent on music rights acquisitions,16 a large portion of which was acquisitions of music publishing catalogue. As such, given the potential value associated with songwriter interests/catalogues, care needs to be taken to confirm such interests upon inception, ensuring the potential long-term value of a songwriter's work is not jeopardized.

Conclusion

Compositions created by the collaboration of two or more songwriters is incredibly common in the music industry. In the author's experience, whether in the folk, pop, rock, R&B or hip-hop space, artists will likely find themselves collaborating with other songwriters at some point in their career.

A close examination of the law of joint authorship reveals subtle distinctions between Canada and the United States. The Canadian authorities suggest that composers of joint works cannot exercise their rights independently of each other, while the less restrictive U.S. approach suggests that a co-writer can grant non-exclusive licenses for third party use without the consent of the remaining co-writers, subject to the provision of an accounting. The implication of these distinctions needs to be carefully considered.

Given the legal complexities associated with works of joint authorship, and given the differing legal approaches between Canada and the United States, it is always recommended that care be taken to confirm the intent of the co-writing parties from creation of a work (or as close as possible). A non-exhaustive list of clauses/deal points to consider between co-writers has been provided within this article.

In addition, the acquisition of music publishing rights in 2021 has shown the incredible value of some songwriter catalogues. As such, collaboration agreements not only create certainty for the parties and assist in avoiding costly disputes between co-writers, but such agreements evidence a clean chain of title and preserve the potential long-term economic value of compositions and music catalogue.

Footnotes

1 Copyright Act R.S.C., 1985, c. C-42, Section 2.

2 Copyright Act of 1976, Chapter 1, Section 101.

3 Copyright Act R.S.C., 1985, c. C-42, Section 2. As of the writing of this article, the Canadian Government's 2022 Budget proposes to introduce amendments to the Copyright Act to extend the general term of copyright protection from 50 to 70 years after the life of the author, as agreed under the Canada-United States-Mexico Agreement.

4 Copyright Act of 1976, Chapter 3, Section 302(a).

5 In Canada, for example, see Copyright Act R.S.C., 1985, c. C-42, Section 9(1) and in the United States; see Copyright Act of 1976, Chapter 3, Section 302(b).

6 Neudorf v. Nettwerk Productions Ltd., 1999 CanLII 7014 (BC SC).

7 Levy v. Rutley, (1871), 6 L.R. 976 (C.P.).

8 Id.

9 Neudorf v. Nettwerk Productions Ltd., 1999 CanLII 7014 (BC SC).

10 Neugebauer v. Labieniec, [2009 FC 666 (CanLII)].

11 Cescinsky v. George Routledge & Sons, Ltd., [1916] 2 K. B. 325 (1915).

12 Meredith v. Smith, 145 F.2d 620, 621 (9th Cir. 1944).

13 Carter v. Bailey, 64 Me. 458 (1874).

14 See Theodore R. Kupferman, Copyright–Co-Owners 19 St. John's L. Rev. 95 (1945).

15 For an interesting discussion on this, see Jill A. Michael, Music Copublishing and the Mysterious Writer's Share, 20 Ent. & Spots Law. 13 (2002).

16 Music Business Worldwide, January 10, 2022, https://www.musicbusinessworldwide.com/at-least-5-billion-was-spent-on-music-catalog-acquisitions-in-2021-could-2022-be-even-bigger/.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.