Selling beats containing licensed samples

I got an interesting email from someone who is basically wondering where he stands if he purchases sounds from a sample site, makes a beat and then sells the beat to a third party. Is he breaking his license agreement with the original sound publisher?

First off, it's worth noting that all publishers have their own terms, but generally the following seem standard:

1) When someone 'buys' a samplepack, the publisher still owns the sounds and just licenses them non-exclusively to the customer.
2) That license allows the customer to use the samples to form part of a musical composition without paying any royalties to the publisher ('royalty free')
3) The customer cannot transfer the license, cannot sub-license, and cannot re-distribute or re-sell the samples themselves (modified or not) to third parties. They also cannot use them within a commercial sample library.

So the question is, what happens when the customer makes a beat using those samples, and then sells that entire beat to a third party? Does he have the right to sell the beat in those circumstances?

It is further complicated as this guy wants to offer the individual stems, which means:

1) the original samples will be easily accessible (e.g. a licensed bass loop will probably form an entire stem), thus falling foul of the 'no distribution' restriction

2) by providing the stems rather than a stereo mixdown, the client is clearly wanting to make their own unique 'musical composition' from all the stems provided (e.g. changing the mix, potentially rearranging or remixing with third parties, adding vocals etc). At which point does this no longer become about the musical composition that the original customer was licensed to use the samples for and instead become a situation where a third party is now freely using that sample to produce their own unique composition, a sample for which they have no license to use (remember these licenses are not transferrable and cannot be sub licensed by the original license holder)?

I've checked out a few sound sites, and no one makes this situation clear whatsoever. I feel once he's asked to provide the stems, he's headed into different territory where he either needs to obtain an 'extended' license from the publisher, or requires this new client to purchase their own license from the sound publisher.

But what if he's even just selling a stereo mixdown (e.g. $20 beat type of stuff) - is this a valid use of the license - it certainly seems to fall under the right to make your own musical composition for commercial gain. However, does it give his customers the right to exploit music containing this sample for commercial gain? I'm not sure it does.

Thoughts?

Great post. Very informant.

It seems like a huge grey area.

I think content creators in general would be reasonably happy if people actually bought their sounds rather than obtained them from torrent sites, providing those same sounds weren't redistributed as-is. A lot of the other stuff may be considered fair game.

For example, remixes have always been a big part of all the sample-based genres, so it would be virtually impossible to police the exchanging of stems for those purposes. In my mind (although not necessarily legally correct), at the point where a stem is passed on, the chances are it has been heavily processed and layered and forms part of a music composition rather than being a static WAV file in a folder. If the stem is passed on with a completely unaltered version of the sample then maybe that's a different story? I think it's up to the distributors to clarify exactly what people can use the sounds for.

The people selling beats at $20 (I've even spotted $5 beats ) aren't worth bothering with. I think what some of the bigger distributers are hoping for is that some of their sounds end up in massive tracks, which they can then cross reference to check whether those sounds have been legally bought or not. That's my little conspiracy theory anyway.

T-Virus wrote:Great post. Very informant.

Been trying to simplify this, so answering my own post, basically the intended use of most standard licenses is to grant a producer the right to use the samples for his own musical projects which he alone can commercially exploit, for example make an album and sell it to the general public for their listening pleasure, or incorporate them into a soundtrack to a film he owns the rights to.

However, if the producer was being specifically hired by a client to make music for them, then it's that client should be the one who the samples are licensed to (hence the producer could purchase them on behalf of his client).

In the case of a producer selling 'ready-made beats' to clients who themselves intend to use these beats commercially, both him and the client will need to obtain a license each; he'll need a license to create the beat in the first place, and the client (or clients) that he sells the beats to will each need a license so they can then use the beats in their own commercial products.

This all of course assumes that anyone even read these licenses.

...the chances are it has been heavily processed and layered and forms part of a music composition rather than being a static WAV file in a folder...

Most licenses do not allow redistribution of 'modified' samples, which should stop people applying some effects and EQ and insisting they are now 'different' samples with a new owner. I think it's probably more important to focus on the definition of 'musical composition', which I don't feel can be applied to an individual stem.

MPC-Tutor wrote:Most licenses do not allow redistribution of 'modified' samples, which should stop people applying some effects and EQ and insisting they are now 'different' samples with a new owner. I think it's probably more important to focus on the definition of 'musical composition', which I don't feel can be applied to an individual stem.

I think that anything that constitutes part of a melody or groove could be considered a musical composition. Even just a simple hi hat on every beat of a bar, as the formation of the pattern or groove didn't previously exist, and wasn't part of the original pack. This is probably why we don't see remix artists in court - on one hand they are working with samples they have no license to use, and on the other they are manipulating a musical composition that they'll never have any ownership of anyway. It's weird, but I can see why all parties should technically have their own license.

How does this work in VST land? I know you can't use most software packages to create sample packs (which is annoying), but the situation with remixes seems to be the same as regular samples…

so, in the history of human civilization... the producer of a beat bought drum samples on behalf of a singer/rapper/movie producer.... made said beat and handed it in along with a usb key with the only copy of all those samples... which the cost was marked on the invoice?

Who the hell makes beats that way where they have to sell the sample kit before they can start making a beat to sell along with it? I don't know what drums a beat is going to need until I'm working on the beat... and a person who wants a beat doesn't know until they heard the beat (after it is done)

so that transferring license part and getting permission is a joke IMO. Tutor, could you imagine if everyone who bought drum sounds from you emailed you to ask if they could give or sell a beat to someone else? Imagine if it was licensed and not sold as an exclusive... they would either have to use some other drums or ask you every time a 15 dollar download happened.

mr_debauch wrote:so, in the history of human civilization... the producer of a beat bought drum samples on behalf of a singer/rapper/movie producer.... made said beat and handed it in along with a usb key with the only copy of all those samples... which the cost was marked on the invoice?

As I said, I am aware lots of people ignore the legal side of this, but that's not what I started this topic for. What I am talking about are the people who do actually wish to do things 'properly' - are the sample licenses actually clear enough in terms of what the legal POV is when producers sell beats to their clients? Do they actually allow producers to cover all the necessary licensing when making beats for third parties?

Think about it - if a client approaches a producer to make a beat for them, assuming they are not idiots, they are going to want to ensure that they have the legal right to use everything in that beat. Why wouldn't they? I'm not just talking about the hip hop market, these are corporate clients in TV, film, video, computer game industry etc. They will not be interested in winging it, they have the money to ensure everything is licensed and legit and will want to work with producers who share the same ethos.

If I hire someone to design a web site for me, I expect him to purchase a license for me for all stock images he uses, or show me proof that he has the right to sublicense them to me. Otherwise the image company comes after me for unlicensed use.

So, back to the producer hired to make the beat for his client. What if that client instead asks a producer to sell them one of his existing beats on an exclusive, why would it be any different for the client? They'd still want to ensure they had the legal right to use the sounds in the music they were buying. Now if that producer is using third party samples licensed to him, he can only sub license or transfer that license to his client if the license he bought allows him to. From what I can see, most sound licenses specifically do not allow sub-licensing or license transfers.

so that transferring license part and getting permission is a joke IMO. Tutor, could you imagine if everyone who bought drum sounds from you emailed you to ask if they could give or sell a beat to someone else? Imagine if it was licensed and not sold as an exclusive... they would either have to use some other drums or ask you every time a 15 dollar download happened.

Let's face it, the majority of clients buying non-exclusive $15 beats are probably not going to be the type of clients looking to cover all their legal bases, there is a different level of expectation here in practice. Again though, I'm simply interested in the actual legal issues here when the beat maker selling beats with commercial samples in them potentially doesn't actually have the rights to transfer that license to third parties.

I think that the selling of the beat would be seen as the selling of the sample, or sub-licensing of the sample, to someone else, and not allowed.

Selling it as part of a song, that is composed and sold for others to listen to, would be seen as different to selling it as a sample, that is composed and sold for someone else to compose a full song from.

SimonInAustralia wrote:I think that the selling of the beat would be seen as the selling of the sample, or sub-licensing of the sample, to someone else, and not allowed.

Or alternatively it would be seen as selling a musical composition, which generally is allowed.

One area that needs a lot more clarification is 'redistribution', and exactly how it affects the end user. For example - I create a track for a singer and she requests the stems so she can mute and solo various parts as she's adding her vocals and getting to know the track. What I get in return is a finished stem of her vocal with some basic processing. Is that allowed?

In the same vein, I'm TERRIBLE at mixing, so I send my 50 track masterpiece as stems to be professionally mixed by an engineer. The engineer and the vocalist both have the exact same stems, and they are both getting paid for their contribution to the track. Is this allowed?

Coz wrote:Or alternatively it would be seen as selling a musical composition, which generally is allowed.

If the copyright owner finds out that you are using a sample in your composition, that you are selling, you would be able to show the copyright owner that you have purchased the license to use it.

If the copyright owner finds out that someone you have sold the sample to, as part of your composition, is then reusing it in their own composition, the person you sold the sample to would not be able to show the copyright owner that they have purchased a license to use it.

They would definitely be able to go after the person using it without the license.

Not sure if they would also be able to go after the person selling the composition, containing the sample, without a license, if it could be shown the intention was for it to be re-used, without license, within someone else's composition?

Would it be like someone creating/selling fake Nike shoes or LV bags, can they go after the person for selling the composition with the intention of it being used, unauthorised, in other people's compositions, as a sample, or can they only go after the person who is using it, unauthorised, in their composition?

SimonInAustralia wrote:Would it be like someone creating/selling fake Nike shoes or LV bags, can they go after the person for selling the composition with the intention of it being used, unauthorised, in other people's compositions, as a sample, or can they only go after the person who is using it, unauthorised, in their composition?

If Tutor isn't 100% sure then maybe nobody is!

I think a common sense approach is needed. It seems a little bit self-defeating to put the upper echelons of the sample using industry in the same category as the sub £20 sample pack market. For one, if you sell a pack called 'Hip Hop Drumz 10' (hopefully Tutor doesn't ) the chances are that the people buying it will be creating mixtapes and/or firing their beats around the globe in the hope that an MC picks up on it. I don't see that as such a heinous crime personally.

The people blowing a grand and above on massive string libraries are probably working solely in their own studios, and collaborating in that space. They are more than likely covered for most eventualities. So what we're talking about (so it seems) is the lowest end of the market. The kids in bedrooms who want to sell a few beats and collaborate online.

As I said before, the onus is entirely on the content creators/distributors to spell out exactly what can be done with the samples.

I think that legally, it doesn't really make any difference what end of the market it is at.

When money starts being made, obviously that is when someone will start taking notice, and make the effort to do something about it, if it is worth the hassle to them.

It is probably up to the person using the samples to have a license to use them, if they don't, the copyright holder can sue them, if it is worth it to them, and if they can prove that they own the copyright to those samples.

As for the person selling them on, again, if it is worth it to the copyright owner, I imagine they could go after the person selling them on without the permission to sub-license them, and that the person that bought them, and was sued by the copyright holder for damages, could probably come after the person selling them on to recover those damages as well.

SimonInAustralia wrote:I think that legally, it doesn't really make any difference what end of the market it is at.

The only legal stipulations are those that are contained in the initial license, which is written by the content owner and/or distributor. You agree to the license when you buy the pack, but it's entirely at the owners discretion what they put in the license.

From what's been said here, I think a certain dispensation should be allowed for online collaboration. Flogging shitty $20 beats should probably be stamped out though.

Coz wrote:The only legal stipulations are those that are contained in the initial license, which is written by the content owner and/or distributor. You agree to the license when you buy the pack, but it's entirely at the owners discretion what they put in the license.

The legal stipulations are also the copyright laws wherever you are located.

If someone can prove they own the copyright to something, and someone else is using it without permission, the copyright owner can take legal action to stop the copyright infringement, and to recover damages.

yeah I see some of the points here... but imagine if everyone major had to pay roland every time a sound from an 808 was used... or if anyone to use a drum hit from battery had this obligation to NI... it would be crazy IMO...

Sure it can be looked at as an issue of doing things properly, just like with other sample sources you would have to clear... but if a sample kit is sold for this purpose, who would buy it if it was only to be played behind closed doors? Who would buy a kit knowing right off the batt they would be breaking the law selling the beat or licensing to a film? they might as well steal a break instead if they aren't allowed to sell it without clearing a sample... it just adds another avenue of pain-in-the-ass-ness to the artist.