All shook up
31 August 2011 | Updated: 31 August 2011 12:39 pm | By Joanne Harris
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Since the 1977 death of rock and roll legend Elvis Presley there have been persistent rumours of his continued existence. While most would dismiss these as mere wishful thinking by fans, one thing is certain - Elvis’s legacy lives on.
Now the singer’s estate is seeking to make the most of that legacy, by filing a lawsuit in Germany against a record company that owns the German rights to all the songs recorded by Elvis before 1973.
The case was filed in December, but has just now come to public attention after litigation funder Calunius Capital agreed to support the claim with a “substantial investment” (30 August 2011).
Unlike many recent high-profile copyright cases brought in the UK, such as Pink Floyd’s 2010 battle against EMI or the 2011 Supreme Court judgment in Lucasfilm & Ors v Ainsworth & Ors, this case is unusual in its jurisdiction. But there are solid reasons for bringing the Elvis Presley Enterprises (EPE) claim in Germany, and other artists or artists’ estates of a similar vintage to Elvis will watch the outcome closely.
The case hinges on a buyout agreement between Elvis’s manager ’Colonel’ Tom Parker and record company RCA Records (now Arista Music) in 1973. RCA Records bought the rights to Elvis’s entire back catalogue for $5.4m, a sum split between Elvis and Parker. According to Christian Czychowski, a partner at German IP specialist Boehmert & Boehmert who is acting for EPE, the agreement also meant that Elvis and his estate have received an annual payment of between $10 and $15 in total for each song.
The claim uses German copyright law to claim ’equitable remuneration’ with RCA for the songs. Czychowski explains that a contributing factor, unforeseen by Elvis or Parker at the time of the agreement, is the advent of digital media such as downloads, apps and ringtones, which have increased the availability of Elvis’s music.
The equitable remuneration clause is a feature unique to German copyright law, as is a ’bestseller clause’ also invoked by the EPE claim. However, despite Elvis’s popularity, Czychowski says EPE is only claiming 13 per cent of the revenue generated by each song instead of a much higher amount. This 13 per cent figure is similar to the 12 per cent royalty figure agreed with RCA Records for songs Elvis recorded after 1973.
The claim only applies to revenue made between 2002 and the present, as well as forward-looking revenues up until 2023. The total amount claimed is around €12m.
Czychowski believes the eventual result of the case could prompt similar litigation by other musicians active in the 1970s and 1980s who, like Elvis, received lump sums under buyout agreements common in this era.
Eversheds media and IP partner Neil Mohring, who has advised clients including the Bob Marley estate, agrees that the case could be a “useful test case”.
“Record companies have traditionally not been too concerned by taking the lion’s share of remuneration,” Mohring remarks, adding that there has not been a huge number of equitable remuneration cases in the past.
As the funders of the case, Calunius is confident of success. Chair Leslie Perrin says: “The great thing about this case is that this is a very pragmatic risk management move by the EPE people. You give away a bit of the upside in return for the downside being completely taken off.”