Quebec songwriters are claiming $2 million in unpaid royalties from the Society of Composers, Authors and Music Publishers of Canada (SOCAN) over an 18-month period between 2019 and 2021.
Posted at 2:44 p.m.
SOCAN collects and redistributes to artists and publishers the royalties paid by radio stations as royalties when they play their songs.
French-speaking songwriters believe they were harmed because of an error in the royalty redistribution model that favored their English-speaking colleagues in the rest of the country.
A 45% error
“For a period of at least 18 months, there was an imbalance between the amounts that were paid by Quebec radio stations and the royalties that were distributed to songwriters whose works were played on Quebec radio stations” , explained publisher David Murphy in an interview with The Canadian Press.
“This imbalance corresponds to a shortfall of 45%, a percentage determined from SOCAN figures,” he said.
David Murphy, whose eponymous company specializes in the management of musical rights, will submit a request for authorization of collective action on behalf of the songwriters of Quebec “at the end of September or the beginning of October”.
Vigneault, Coeur de Pirate, Elisapie and others
A little more than a dozen Quebec songwriters, including Gilles Vigneault, Cœur de Pirate, Vincent Vallières, Elisapie, Ariane Moffatt or Klô Pelgag, to name a few, also signed a letter denouncing the method of SOCAN’s calculation that deprived them of their due.
“It is clear that Quebec has been underrepresented for several years in SOCAN’s distribution methods,” they write.
“We are these veterans of the song or these proud representatives of the next generation. We are the architects of this musical effervescence that can be heard on the airwaves of Quebec radios.
“Our culture can only live if all creators receive without compromise from their management company, all the royalties which are rightfully theirs,” they argue.
Royalties paid to the wrong recipients
According to calculations made by David Murphy and endorsed by two independent economists, the error in SOCAN’s methodology meant that “for every dollar paid by Quebec broadcasters, 55 cents went to creators whose works had been broadcast on these radio stations. The other 45 cents was shared by all the songwriters and publishers whose works were played outside Quebec. »
He explains that, in SOCAN’s calculation pool, “there were perhaps 9% or 10% of the 200 radio stations that came from Quebec, whereas Quebec represents 20, 22 or 23% of Canadian license fees. So the fact that Quebec radio stations were under-represented in the pool resulted in rights holders being harmed. »
However, the class action request is not intended to recover the money overpaid to other songwriters and publishers, he said.
“It is not the responsibility of these rights holders, these songwriters and publishers, to give the money to SOCAN. It is SOCAN that must compensate Quebec creators for this shortfall. And SOCAN has a contingency fund that they’ve already taken tens of millions of dollars out of for joint venture losses. Let them look in the same fund, ”he pleads.
SOCAN knew
SOCAN can hardly plead ignorance, Murphy adds, simply because it saw the error and revised its methodology in November 2021. “The actions, to me, speak for themselves. We want creators to be compensated for the previous period. »
While some songwriters were surprised to see their royalty income decrease between 2019 and 2021, the methodological error became evident from the November 2021 correction, says David Murphy.
“We recovered the shortfall of 45%. For all of my clients, my figures are 43.5%. There was a significant increase between when SOCAN corrected the situation in November 2021 and the previous quarter. »
He adds that the claim spans an 18-month period, but the problem could go back further in time. “The two economists who analyzed our figures think it is highly likely that the losses were spread over a longer period. We will find out in Court when we question SOCAN because for the moment we do not have this data. »
Same mistake as 10 years ago
He adds that a similar problem arose ten years ago.
“SOCAN had indeed recognized that Quebec, in 2012, had been under-represented and had told us that they had made changes, corrections, but it had not paid any compensation.
“We are playing in exactly the same film, except that today SOCAN does not recognize that Quebec creators have been harmed, but it is exactly the same film and this is the second time it has happened. At some point, you have to say no, put your foot down and say: we want creators and publishers to be compensated. »
SOCAN: “a different interpretation”
In an email to The Canadian Press, SOCAN said it “takes these allegations very seriously.”
On the other hand, she does a completely different reading from that of the songwriters who signed the letter and of Mr. Murphy: “We have a different interpretation, but we are determined to continue discussions with our French-speaking partners in order to find the best arrangement there is, ”one writes.
No retroactive adjustment
With this in mind, it clearly states that it does not intend to give in to the demands of Francophone creators: “It would be inappropriate and unjustified to make a retroactive adjustment, for two reasons. First, no market is uniform in how it is affected by a change in allocation rules. Second, retroactive adjustments would mean taking money back from some Quebec-based members who benefited from the old rule. »
SOCAN’s argument thus finds itself completely ruling out the idea of dipping into its reserve fund, an idea that it does not even address: “You have to see royalties as a whole. If we enlarge the slice of pie of a beneficiary, we reduce the slice of pie of another. »
The organization’s missive also points out that “the distribution rules have been approved by SOCAN’s Board of Directors, one-third of whose members are French-speaking” and that these rules and their modifications are subject to consultation. regularly with industry stakeholders.
A “big step forward” for equity
As to why SOCAN changed its rules in November 2021 and why these resulted in an upward readjustment of the amounts given to French-speaking creators and publishers, the organization offers a long technical answer. In particular, it states that “creators and publishers are paid based on the exact number of performances of their songs rather than based on an extrapolation based on a sample which may only represent four to seven days per quarter”, a method which she describes as a “great step forward […] that allows us to fairly compensate music creators and publishers for their work.”
Referring to the technological evolution of the market and consumer habits, SOCAN acknowledges that it has had to and will have to continue to change its distribution rules, but hastens to add that “such changes are obviously not a sign that previous rules were unfair, but simply proof that SOCAN is following the evolution of the market and the tools available for analysis purposes in order to adapt to them in order to provide royalty payments as consistent, timely and accurate as possible to its members and customers. »
The email specifies that a meeting with “French-speaking stakeholders” must take place before the end of the month “to discuss the issue and seek the best possible ground for agreement”.