IP DRAMA: From The Beatles to Beyonce - Part 1

In this blog series I am sharing Licensing lessons from pop royalty, exploring how some of the world’s most bankable pop stars manage their intellectual property affairs.

In interviews Paul McCartney has shared an anecdote about working with Michael Jackson who asked him for some advice about the music industry, among the advice McCartney offered was “think about investing in music publishing”.?

Music publishing is the business of commercialising the intellectual property related to composition (the melody and the lyrics), meaning the owner of the publishing rights can collect a royalty every time the song generates revenue - such as through radio play, record sales, streaming, the release of cover versions by other artists or a song’s use in TV, film or advertising.

McCartney had started to accumulate the rights to various catalogues, including that of Buddy Holly and a number of Broadway shows, he confided that he regretted losing the rights to his own songs through various bad deals negotiated by former manager Brian Epstein. The conversation eventually led to one of the most famous spats in popular music.?

According to McCartney, Jackson said “One day, I’ll own your songs” which McCartney laughed off as a joke. Two years later however, Michael Jackson did indeed buy the ‘ATV catalogue’ a collection of around 4000 songs including hits by Elvis Presley, the Rolling Stones and compositions by Lennon & McCartney, the latter accounting for an estimated two-thirds of the income.

McCartney says that he contacted Jackson several times during his stewardship of the McCartney/Lennon catalogue asking to renegotiate the compensation rate paid to him. “Even if I was a writer on the payroll, after thirty years of being successful for this company - that you now own - don’t you think I can have a raise?”. Jackson apparently replied “That’s just business”, which led to a souring of the relationship.

Jackson’s business manager John Branca outmanoeuvred several other bidders, including Richard Branson, to close the deal on the ATV catalogue.?

Yoko Ono and McCartney were apparently offered first refusal; McCartney is alleged to have passed because they were too expensive saying “I wrote them for nothing and buying them back at these phenomenal sums - I can’t do it”.?

Yoko Ono is alleged to have given another reason for vetoing a joint venture saying,?

“No, no, if we bought them, then we’d have to deal with Paul”.

The ATV catalogue was put up for sale by Australian businessman Robert Holmes à Court. The novel deal that Branca struck was for around ￡24.5m, less than a competing offer by music executive (then head of EMI Music Publishing) Marty Bandier, however as part of the deal Jackson agreed to appear at an event in aid of Holmes à Court’s favourite charity, and the rights to the song Penny Lane were exempt from the agreement allowing Holmes à Court to gift them to his daughter, Penny.

There were rumours in the media that Jackson’s will stipulated that upon his death the rights should return to McCartney/Ono, but these turned out to be false. After Jackson’s death his estate sold the catalogue to Sony.?

In 2017 McCartney sued Sony/ATV in the USA citing changes to copyright law in 1976 which meant that songwriters could reclaim copyright from music publishers after a certain period had elapsed.

The case was settled out of court and the suit withdrawn by McCartney’s lawyers after reaching a confidential agreement, so it is fair to assume that McCartney achieved the pay rise he was seeking.?

Disclaimer: I am not a lawyer, just nerdy about IP.