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The Indie Band Vault will begin posting brief articles and legal analysis of issues facing today’s quickly changing music industry. We have retained the services of well known Boston, MA. entertainment lawyer, Michael DeYoung. Be aware that the information in attorney DeYoung’s advice column (The Music Law Connection) is general in nature, and not designed to address the legal issues of any specific individual. If you are in need of such services, you are advised to contact a licensed attorney directly. Attorney DeYoung does accept certain clients on a limited basis. Information re: Attorney DeYoung’s fees and services, etc. may be obtained by writing to him at The Music Law Connection.

 

(Music Law Connection 3/10/05 - #3)

Real World Music Business Articles written by a licensed Boston arts attorney, exclusively here at “The Indie Band Vault.”

Future Music Stars, learn these words well, “Advancement & Recoupment”

So, ya got the BIG recording deal and hey, you even got an ADVANCEMENT! Wow, you’ve hit the big time now Stanley! You’re a “STAH,” the “main man/woman” that’s “down” with the adoring fans. Whoa, not so fast! Slow down and take a deep breath, Ommmmm. Let’s talk about “Advancement and Recoupment.” You have heard there is no FREE lunch? Well, that applies to the recording world in a major way. The record company has paid you a certain sum of money, say an ADVANCE of $15k to sign a record deal. Well, the first $15k you hopefully later make (via record sales/shows, etc) goes back to RECOUP the record company’s original $15k ADVANCE! That’s right. This process of keeping money to recover what was ADVANCED to you by the record company is called “RECOUPMENT.”

Basically you are a gamble to the record company, kind of like picking a stock or a horse. The company, if it deems you a good risk, invests a certain amount of money in your operation, your “band,” but hey baby, it all must be paid back to “the man”. No company (especially record companies) stay in business giving money away; before you get a penny free and clear, the company RECOUPS! Remember that phrase! Ah, you’re thinking, what happens if we don’t sell enough records to pay back the full advance? Well, that was the risk your talented band and its “flesh pressing” strategies caused the record company to take in the first place. They didn’t sign you because they “like you,” well, maybe one of the execs thought your singer was hot, but they very likely signed you because they thought they could make money in a business deal with you. Normally, if you don’t sell any records, there is no recoupment of the record company’s advance, yaaay! However, usually you get, what’s that thing Indians used to throw? A-x-e-d, booooo. Alas, you flew so high, but not high enough dudes. But, wasn’t it fun (-:

Remember, like everything in business, the more someone believes you can help or hurt them, the more negotiating power you have. Usually bands just beginning have little negotiation power, and the more talented and experienced, if they are lucky, have more negotiation juice to use.

Check back for the next article “Managers & Attorneys”

M.J.DeYoung, Esq.

Semper Paratus!

M.J.DeYoung, Esq.

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The above does not constitute specific legal advice, and is provided only as general information in a public service capacity. For questions involving specific legal issues, please consult an attorney directly.
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