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June 16, 2022

Hal Singer and Ted Tatos Release New Study in Support of California’s Assembly Bill AB-983

Hal Singer and Ted Tatos Release New Study in Support of California’s Assembly Bill AB-983

Section 2855 of the California Labor Code, part (a) of which is known as the “seven-year rule,” prohibits exclusive personal service employment contracts beyond seven years. The California Legislature enacted the statute in the wake of Olivia de Havilland’s famous lawsuit against Warner Brothers Pictures over the studio’s attempt to restrain her beyond the seven years stipulated by her contract.

In 1987, the Recording Industry Association of America (RIAA) and the major record labels succeeded in persuading the state legislature to modify the law, carving out recording artists from the law’s protection and leaving them susceptible to the same form of “peonage” that the Court decried in the de Havilland case. Currently pending in the state legislature, California Assembly Bill 983 (AB-983), also known as the Free Artists from Industry Restrictions (FAIR Act), seeks to close this loophole and to remove the exclusion, allowing recording artists to receive equal treatment under the law as all other Californians including similarly situated workers who provide personal services, such as actors.

Recording artists have fought for decades to close this loophole that subjects musicians to onerous contract provisions that no other personal service provides have to endure. Stars including Prince, Kanye West, Lauryn Hill, Taylor Swift, LeAnn Rimes, Megan Thee Stallion, and others have spoken out against the power imbalance in record industry contracts. The experiences of artists themselves contradict claims by the RIAA and others that the exclusion from the seven year rule benefits musicians.

The RIAA and beneficiaries of its funding have also claimed that the fact that recording artists receive advances necessitates their exclusion from the seven-year rule. Singer and Tatos explain that this specious argument reflects only an attempt at misdirection. Other industries offer advances without the imposition of such onerous terms. Moreover, the nature of recording contracts is such that the advance represents a loan, that the artist pays back from their royalty agreement.

Singer and Tatos argue for the passage of AB-983 and the restoration of musician rights, affording recording artists the same protection under the law that actors and other providers of personal services enjoy.

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