The law regarding music sampling
If you want to use a sample legally, you must obtain permission from the copyright owner. The copyright owner is usually a publishing company or record label. Remember that you must obtain permission from both the owner of the sound recording and the copyright owner of the underlying musical work. The fee for a license to use a sample can vary tremendously. The fee will depend on how much of the sample you intend to use (a quarter second is a minor use; five seconds, a major use), the music you intend to sample (a Madonna chorus will cost more than an obscure drum beat), and the intended use of the sample in your song (it is more costly to build your entire song around the sample than to give it only minor attention).
There are two different ways to pay for a license. First, you can pay a flat fee for the usage. A buy-out fee can range from $250 to $10,000 on a major label. Most fees fall between $1,000 and $2,000. The other way to pay for the license is a percentage of the mechanical royalty rate. The mechanical royalty rate is the amount a person pays to the copyright owner to make a mechanical reproduction (copy) of the song. A license which is a percentage of the mechanical royalty rate is generally between ½ ¢ and 3¢ per record pressed. Everything is negotiable and it is not unusual to get a license for free, if you ask.
If all of this sounds confusing, there's hope. There are businesses devoted entirely to securing and negotiating clearances for samples. These firms charge less than an entertainment attorney would charge and are generally more knowledgeable about the going rates for uses.
If you use samples without obtaining the proper clearance licenses, you have to be aware of the penalties. A copyright infringer is liable for "statutory damages" that generally run from $500 to $20,000 for a single act of copyright infringement. If the court determines there has been wilful infringement, damages can run as high as $100,000. The copyright owner can also get a court to issue an injunction forcing you to cease violating the copyright owner's rights. The court can also force you to recall all your albums and destroy them.
There is also a rumour going around that you can use four notes of any song under the "fair use" doctrine. There is no "four note" rule in the copyright law. One note from a sound recording is a copyright violation. Saturday Night Live was sued for using the jingle, "I Love New York" which is only four notes. The test for infringement is whether the sample is "substantially similar" to the original. Remember, a judge or jury is the one who determines this and these people may be much less receptive to your music than your fans. My point is you cannot rely on fair use as a defence.
Sampling can also have tremendous consequences if you have a record contract. Most record contracts have provisions called "Warranties", "Indemnifications" and "Representations". These provisions constitute a promise that you created all the music on your album and an agreement to reimburse the label if it is sued. These same provisions are included in all contracts throughout the entertainment distribution chain. The record company has them with the artist, the distributors with the record company, the record stores with the distributors, and so on. Well, all these warranties point back at the artist who is responsible to everyone else! Therefore, if you violate someone else's copyright, you will be paying all the bills of your record company, distributor and any stores which incur expenses as a result of your infringement. This can run into serious money as you can imagine. You will also be in breach of your record contract. Read your record contract carefully before using any samples.
Michael McCready represents clients in all areas of the music industry including music, radio, television, stage, and book publishing. His music law practice includes representing bands, record labels, production companies, recording studios, promoters, and music publishers. His work includes copyrights, analysing and drafting contracts, trademarks, publishing, and litigation.
Attorney at Law
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Chicago, IL 60411
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