An American’s perspective on Pelham v Hütter and the role of fundamental rights in sampling

Last month I had the privilege to travel to Chicago and discuss EU copyright issues with the enthusiastic JD and LLM students of Prof Graeme Dinwoodie at Chicago-Kent Law School. At some point, the discussion inevitably shifted to the copyright cases currently pending before the Court of Justice of the European Union (CJEU), including Pelham, C-476/17 (the Metall auf Metall case) and the question of lawfulness of unauthorized sampling. 

In his Opinion back in December [Katposts here and here], Advocate General (AG) Szpunar advised the CJEU to rule that unauthorized sampling may be considered infringing.

Now, Thomas Key, a JD student at Chicago-Kent Law School, provides an American perspective on this important case.

Here's what Thomas writes:

An American’s Perspective on Pelham v Hütter and the Role of Fundamental Rights in Sampling 

Moses Pelham
Last year, The IPKat reported on Advocate General Szpunar’s recommendations to the CJEU in the Metall auf Metall litigation, Pelham v Hütter. Regarding role of the the Charter of Fundamental Rights of the European Union in ascertaining the scope of the producer’s right to distribute and reproduce their work, the AG stressed that the producer’s rights in phonograms derives from their investment. In order to balance the right of “a guarantee of a return on their investment” for producers with the freedom of the arts, perhaps a system of compulsory licensing for sampling would prove more effective. 

Mechanical Licensing

U.S. copyright law provides for compulsory mechanical licensing with regards to the reproduction and distribution of musical works; as a result, artists may produce cover versions of existing musical works without permission from the author. Rather, artists give notice to the copyright holder and pay predetermined or negotiated royalties as facilitated by a mechanical licensing collective. This mechanism ensures renumeration for copyright holders while providing a limited exception to their rights over the work; it also allows artists to more easily revive older musical works, promoting the proliferation of the arts. While this sort of exception is in tension with the author’s rights over their own intellectual creation, it may be more applicable to downstream artistic uses of phonograms protected by the related right of producers. 

Fundamental Rights of the Producer of a Phonogram

The AG in Pelham v Hütter described the distinction between copyrights and the related rights in phonograms on the basis of what the rights are intended to protect; copyright protects the “author’s own intellectual creation” whereas a phonogram is the fixation of sounds and the related right protects the “financial investment” of the producer. Thus, the related right for phonograms is a right to the financial gain from the phonogram, while copyright protects any intellectual creation that may underlie the recording. I would argue, therefore, that related right could be well protected through a compulsory licensing mechanism, providing a royalty schedule that ensures producers equitable renumeration for any downstream creative use of their recording. 

The AG contended that the freedom of the arts cannot guarantee “free use of whatever is wanted for creative purposes.” Compulsory licensing would still ensure that unlicensed use is infringement; in fact, simplifying the process of clearing samples may prevent artists from using infringing samples in ways that are more difficult to detect. In 1996, DJ Shadow released the critically acclaimed “Endtroducing…..” which was almost entirely composed of samples; at the time, he discussed seeking obscure source material as a way to avoid lawsuits when sampling. Rather than preventing the behavior, prohibitions on sampling may drive samplers to infringe such obscure works, shifting the damages to those producers who presumably receive lower return on their investment anyway due to the obscurity of the recording. A compulsory license system would provide these producers with renumeration and credit for their investment, while removing the incentive for samplers to conceal the source of their material. 

Freedom of the Arts

Sampling: “It’s the backbone of hip-hop.” – Statik Selektah 

When Moses Pelham sampled Metall auf Metall to produce Sabrina Setlur’s Nur Mir, he had already achieved commercial success as a producer; in 1995, he co-produced the song Ja Klar, which Setlur performed under the name “Schwester S”. The song spent 18 weeks in the Austrian music charts, peaking at 14th place. Moses Pelham later formed a record company, Pelham Power Productions, which would release Nur Mir. Already successful and established in the music industry, I presume that Pelham had achieved an increased capacity to clear the sample for Nur Mir. While this circumstance reflects many of the most successful artists in pop and hip-hop who take advantage of sampling, it does not reflect the difficulties faced by artists who have not yet achieved such success. 

Artists at the dawn of their careers are often limited in their ability to clear samples; in genres where sampling is a scène à faire, consent-based sample clearance can serve as a barrier to entry that stifles creativity. Baauer rose to fame after his song Harlem Shake [note from Eleonora: check out the Kat version below] became an internet phenomenon in 2013; he used two samples without clearance and faced copyright claims as a result. When asked about his legal troubles, he responded, “I didn’t clear the samples because I was in my f***ing bedroom on Grand Street.” While flippant, his comment reflects the difficulties that independent artists face regarding sample clearance without access to the original artists and often with reduced financial capacity. A compulsory license system would have allowed for Baauer to properly clear his samples and give credit to the underlying works, while allowing the producers of the underlying works to reap benefits that reflect Baauer’s success. 

Even artists with commercial success struggle to clear samples effectively; American rapper Logic recently described the difficulties of clearing samples from older works and other hip-hop productions: 
It’s just hard to see young producers who could have life changing placements torn from them because an artist has been unreachable for 20 years… I mean sampling can I kick it [by A Tribe Called Quest]. And finding out tribe owns zero publishing and I have to give up 100 percent of my publishing to Lou Reed, and not quest is insanity.
Even those acting in good faith have been negatively impacted by the consent-based sample clearance system. Popular Minecraft YouTuber, Mumbo Jumbo recently received copyright claims on 400 of his 1800 videos due to his outro music; while he had properly received permission from the artist who produced the song, the artist had not properly cleared the underlying samples. The practice of sampling has proliferated; the consequences of infringement are not fairly borne by good-faith downstream users. A compulsory license-based system would reduce these downstream effects, as producers would release fewer works with uncleared samples. Here, a compulsory license system would have allowed the original producer to profit from Mumbo Jumbo’s good-faith use without the harsh consequences and burdens of hundreds of copyright claims 


The AG noted that creating an exception to the phonogram right for sampling “is not for the Court to do.” Therefore, a comprehensive statutory solution is the proper response. Creating a comprehensive compulsory license system for sampling would effectively balance the rights of producers by ensuring proper renumeration for downstream use of the result of their investment. Such a system would generate royalties for the initial producer proportional to the amount of downstream use, which would properly account for the disparities between established artists and independent artists. Further, such a system would encourage attribution, whereas the current system encourages concealment in sampling. While this would strip producers of control over subsequent uses of their phonogram, such a change would preserve any copyrights in the underlying work. Thus, the fundamental rights of producers over their financial investments, the rights of authors in their copyrighted works, and the freedom of the arts are well balanced by implementing compulsory licensing in sampling.
An American’s perspective on Pelham v Hütter and the role of fundamental rights in sampling An American’s perspective on Pelham v Hütter and the role of fundamental rights in sampling Reviewed by Eleonora Rosati on Saturday, May 25, 2019 Rating: 5

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