There have been a number of legacy artists who have recently sold their publishing rights for astronomical sums. In December 2020, Bob Dylan reportedly sold his catalog to Universal Music Publishing, UMP, for $300 million.
In the 1970’s, Jacques Levy co-wrote seven songs with Dylan for the 1976 album Desire, including “Hurricane,” “Isis” and “Mozambique.” Levy died in 2004. Levy’s estate has now sued (on Jan. 20, 2021) Dylan and UMP, alleging he is owed a share of the $300 million Dylan has apparently received from UMP. The estate seeks damages of $7.25 million.
The Levy estate contends that Levy entered into a work-for-hire agreement in 1975 with Dylan, which ordinarily would mean that Dylan would own any and all of Levy’s contribution to the subject songs. However, the agreement, according to the estate, was not a typical work-for-hire agreement. The complaint states:
“The agreement terms make clear that the agreement is highly atypical of a work-for-hire agreement, bestowing on plaintiff’s considerable significant material rights and material benefits that are not customarily granted to employees-for-hire, and that the label ‘work-for-hire’ is, in this instance, a misnomer.”
The estate claims, since the agreement gave Levy the right to 35% of the income from the seven compositions, it is entitled to 35% of the value of those songs, which should be considered as a part of the sale to UMP.
In the lawsuit, the estate claims that Dylan was required to pay Levy “thirty-five percent of any and all income earned by the Compositions and actually received by [the Dylan Defendants] from mechanical rights, electrical transcriptions, reproducing rights, motion picture synchronization and television rights, and all other rights therein.” The estate claims this must include its share of the sale to UMP.
“The agreement terms make clear... that the label ‘work-for-hire’ is a misnomer.”
Dylan’s attorneys will contend that the estate will continue to receive its 35% of income from the use of the subject compositions, but now it will be paid by UMP. Dylan’s attorneys will probably argue that since Levy never owned any part of the songs, his estate should not be entitled to a share of the sale to UMP. Dylan’s team will contend that he was only hired to co-write the songs in exchange for a share of the royalties and that’s all the estate is entitled to.
The lawsuit also makes claims against UMP, stating that it knew about the estate’s rights and “Wrongfully, intentionally and without justification induced the Dylan defendants to breach the agreement with plaintiffs by advising and/or instructing the Dylan defendants not to render any revenue, income and/or payments to plaintiffs in connection with the catalog sale.”
It is interesting to note that there have been a number of high-profile sales of publishing rights recently from other legacy artists, such as Stevie Nicks and Neil Young. One question is why is this happening now? It could be a combination of factors, including low interest rates, the increased value of catalogs due to streaming, and tax and estate planning considerations.
GLENN LITWAK is a veteran entertainment attorney based in Santa Monica, CA. He has represented platinum selling recording artists, Grammy winning music producers, hit songwriters, management and production companies, music publishers and independent record labels. Glenn is also a frequent speaker at music industry conferences around the country, such as South by Southwest and the Billboard Music in Film and TV Conference. Email Litwak at email@example.com or visit glennlitwak.com.