Laws Regarding Sampling

Sampling is using portions of a prior recording which is then incorporated into a new composition meaning, a portion of one song is incorporated into another song where the owner who originally recorded the piece of music being used is not the same person who is using the piece in the newly composed song.   Sampling has become an integral part of many genres of music today.  When you sample someone's song without permission, it is an instant copyright violation. It is the unauthorized use of copyrighted material owned by another person. Sampling without permission violates two copyrights, the sound recording copyright (usually owned by the record company) and the copyright in the song itself (usually owned by the songwriter or the publishing company).
If you want to use a sample legally, you must obtain permission from the copyright owners. The copyright owners are usually a publishing company and/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 vary depending on how popular the piece of music you are intending to use. 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, meaning they get a percentage of every copy made and sold of the song.  Everything is negotiable and even possible to get a license for free if asked.
There are firms to help secure licensee fees for the use of portions of music.  An entertainment attorney can help obtain one and even negotiate on your behalf.  There are also firms dedicated to obtaining sampling licenses that at times are less expensive than an attorney.  But obtaining a sampling license is crucial if you want to record and use the copyright piece of music.
If you use samples without obtaining the proper clearance licenses, the penalties for copyright infringement can be stiff. A copyright infringer is liable for "statutory damages" and if the court determines there has been willful infringement where the infringer is ordered to pay damages that can be in the hundreds of thousands of dollars and sometimes higher. The copyright owner can also get a court to issue an injunction forcing you to cease violating the copyright owner's rights and that means the court can also force you to recall all your albums and destroy them.
It is often believed that there is a “fair use” doctrine of music that a musician can use four notes of a song and not be in copyright violation.  This is not true.  If three notes are recognizable to another song that you do not have the licensing rights to use those three notes you are in copyright violation and can be subjected to serious fines.  The only notes that have ‘fair use’ are songs that are public domain, meaning no one owns the rights to those songs and can be used or sampled, most songs however are copyrighted.  Basically if a judge and jury rules that certain notes are too similar to another song whether intentionally or not you can be in violation of copyright if you do not have a sampling license in place.
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 all the music created on your album is your own and agree to reimburse the label if it is sued. These same provisions are included in all contracts throughout the entertainment distribution chain. Those agreements that are made between record companies, distributors and music stories incorporate language that should copyright infringement happens they are not liable or responsible but that you are in which you are liable for all costs associated with the infringement.  Therefore, sampling with a license is far less expensive than paying all the fees and fines for copyright infringement should you wish to use sampling within your music.

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