Hunky Dory (Who Knew)

by Laurence Myers

  15. TONY MACAULAY

  Unquestionably my greatest contribution to the songwriters’ cause was my orchestration of Tony Macaulay’s case against his wicked publisher Schroeder Music.

  When Tony first came to me for management he was contracted exclusively to Pye Records for his services as a producer. Using the technique I had acquired from Mr Klein, I told Louis Benjamin, the head of Pye Records, that Tony would no longer be making records for them. Louis did not put up much of a fight, and in return for a very reasonable ten thousand pounds, Tony was free.

  For his songwriting, Tony had signed for an advance of fifty pounds exclusively to Schroeder Music Publishing. It was a small firm owned by the American husband-and-wife team of Aaron and Abby Schroeder. The contract was patently unfair. Tony could not place a song with any other music publisher, the Schroeders had no obligation to pay Tony any sort of retainer and they had no obligation to actually do anything with the songs that Tony was obliged to give them. He had made them a great deal of money with songs that he had written with John Macleod including ‘Baby, Now That I’ve Found You’, and other hits which he produced for The Foundations.

  The traditional split between a songwriter and the publisher was 50/50. This harked back to the days before songs were recorded and publishers had to promote the sales of printed sheet music. They would try to get the songs sung by popular artists, in the hope that the public would want to buy a copy. The publisher would also employ people to sing the songs at a piano inside shops selling sheet music. A publisher’s hard work justified his 50 per cent. Almost every home had a piano, and a popular song could sell thousands of copies and make a decent sum to be divided between publisher and writer. In order to get a song exploited in a foreign territory, the UK publisher would license the song to a local publisher in the foreign territory. The local publisher was obliged to work as hard as the original publisher to get the song known in their own country, sending the other 50 per cent of their income back to the original publisher, who would then divide the 50 per cent between himself and the writer. This was all perfectly fair until songs could be exploited on gramophone records and radio, at which point sheet-music sales became just a tiny part of income derived from hit songs.

  In the sixties, unscrupulous publishers still applied the 50/50 formula even if they had their own company in the foreign territory. The Schroeders licensed Tony’s copyrights back and forth between their own companies to contrive that Tony and John shared 12.5 per cent of the income on foreign sales, as opposed to 50 per cent. The Schroeders also held on to royalties in each country so that the writers might have to wait for years for foreign income to filter through. Other publishers, including some of the majors, also indulged in this practice.

  Aaron Schroeder was himself a songwriter who in the past had written songs recorded by Frank Sinatra and Elvis Presley. Abby was the businesswoman who ran the company and she was not at all interested in my threat that Tony would not write any more songs for them. Under the then UK law, the contract was binding and she was both unpleasant and immovable. I discussed the problem with my American lawyer Normand Kurtz. Normand was a passionate man who railed against injustice. Such a contract would not be upheld in the USA and he urged me to take the Schroeders to court in the UK. Nick Kanaar was our UK lawyer and he recommended that I go to see Robert McCrindle, a barrister who was England’s leading expert on contract law. Mr McCrindle told me that Tony’s contract was indeed unfair but binding as English law now stood. If we wanted to get Tony out, we would have to change the law. He really fancied our chances of doing this and would have been delighted to take the case, but he was about to retire and, as the case would take months if not years to run its course, he advised me to find another barrister.

  I recommended to Tony that he should sue the Schroeders. John Macleod was on the same unfair contract but he was too meek take them on and Tony decided that he would bear what might be the considerable cost of such an action himself.

  The music business is replete with contract disputes and I had become somewhat of an expert in the field. One of the most important things that I had learned was that often it is the best prepared, not the virtuous, who win the day in court. I went to QC Morris Finer. He was under fifty, a young man by legal standards. I made it a condition that I could call him directly, unheard of when protocol demanded that a barrister could only be seen in the presence of the instructing lawyer. I even had his home telephone number. I drove everybody mad with detail and when the case started I sat behind Mr Finer in court, frequently handing him notes on points of the proceedings. I called councils of war with Morris and Nick on a regular basis to discuss strategy.

  The Schroeders’ lawyer was the notoriously outspoken Oscar Beuselinck. He admitted to me that he had told his clients that they would lose but they ignored his advice. He was right.

  We won the case with Macaulay’s costs awarded against the Schroeders. Our jubilation was short-lived because they appealed. We won the appeal and once again our costs were awarded against the Schroeders. They appealed yet again, this time to the House of Lords, then the highest court in the land in the days before the Supreme Court. There they lost yet again, with costs awarded against them once more. Not only did they lose the future copyrights of a great writer, their intransigence cost them several hundred thousand pounds in legal fees.

  The House of Lords ruling is rather wordy but just in case any of you are interested I am setting out a summary below. It is easy to skip if you are satisfied to know that, as a result of this case, music publishers were obliged to be more transparent and fairer in their dealings with writers.

  In 1974 five of England’s most senior law lords held that the Schroeders’ standard form agreement could not be justified as moulded under the pressures of negotiation, competition and public opinion. Macaulay had no bargaining power. The defendants purported to be able to arbitrarily decline to exploit the plaintiff ’s work in which event the plaintiff ’s remuneration under the agreement would be limited to a £50 advance payable hereunder during the five-year period. The defendants’ power to assign precluded the argument that the restrictions would not be enforced oppressively. The defendants had failed to justify restrictions which appeared unnecessary and capable of oppressive enforcement.

  Morris Finer, our QC, came to the celebration party at our offices and let his wig down a little. He later told me that he had allowed my unconventional approach of dealing with him directly because he admired my enthusiasm and passion for the case. In the seventies Morris successfully represented The Beatles against Allen Klein. He went on to be Sir Morris Finer, a senior judge.

  Tony was free from the Schroeders but unfortunately was not returned his copyrights. To do this, the Schroeders would have to have been guilty of fraud as opposed to being dishonest exploiters of young talent. Macaulay v Schroeder became the test case that enabled many writers to escape from unfair contracts, including Elton John.

  Nowadays, established singer/songwriters can get as much as 90 per cent of the income, and the copyright in the songs reverts to them after relatively few years. This is because – other than executing the paperwork necessary to register the copyright with the various collection bodies – there is little for the publishers to do. Led Zeppelin’s Peter Grant made deals with publishers where the writers got 100 per cent of the money and the companies paid huge advances for the privilege of being the band’s publisher and the right to hold on to the money that they collected for a few months until they accounted to the writers. Eventually music publishers just became bankers for writers.

  In the 1980s, George Michael’s UK publisher Dick Leahy, my ex-partner in GTO Records, asked me to assist him in the negotiating of a new deal for George’s non-UK songwriting services. His contract with Warner Music was about to expire and just about every international publisher wanted to sign him. The competition to sign him drove the price so high that I could not see how the publisher could ever earn its money back before t
he copyrights reverted to George. Eventually Warner Music paid the price to retain him.

  Tony Macaulay was one of the best UK writer-producers of his era. He co-wrote and produced a string of hits, including ‘Build Me Up Buttercup’ with Mike d’Abo; ‘Let The Heartaches Begin’ with John Macleod for Long John Baldry and ‘You Won’t Find Another Fool Like Me’ with Geoff Stephens for The New Seekers. He is a very intelligent man, very driven and wanted to be involved in every aspect of his records. He used to help plug his own records in answer to his complaint that one wasn’t selling, I told him that I couldn’t get a machine gun and make people go into a shop to buy his records, to which he replied: ‘Why not?’ He was a complex man but had a great sense of humour as he demonstrated when the guitarist on one of his records was unhappy with his solo. The record had gone to be pressed and Tony, with his tongue firmly in his cheek, told him that the only way the guitar break could be changed was if the guitarist plugged his guitar into the pressing plant and replayed his bit as each record was pressed. According to Tony, the guitarist offered to do it!

  Tony desperately wanted to be a star artist himself but was smart enough to realise that he was a lousy singer. He was very demanding of my time and attention and when I started GTO Records in 1974 I diplomatically asked him to find another manager. His attitude changed and he became cold. But I will always be grateful to Tony because he co-wrote and produced ‘Love Grows (Where My Rosemary Goes)’, Gem Production’s first release in February 1970, very soon after I started the company. A huge hit, it was like going to the casino for the first time and having a big win. This of course can be dangerous but I managed to continue on a winning roll for some time. Anyway, it was ‘Love Grows (Where My Rosemary Goes)’ that set Gem on the path to success, so thank you, Tony.

  16. MUSIC PUBLISHERS, FREDDY BIENSTOCK AND ELVIS

  For those of you who are interested, this is how a song actually earns income for the publisher and songwriter. For those of you who are not interested, skip the next couple of pages.

  Still with me? Good. There are three sources of revenue from copyrighted music.

  Mechanicals. This is pretty straightforward. Any company that wishes to manufacture a record is legally obliged to get permission from the copyright owner to use the song. There is a statutory rate, which is the royalty that legally has to be paid by the manufacturer. The current UK rate is 8.5 per cent of the price charged to a record dealer. More songs are downloaded than physically bought and the online site is obliged to pay the copyright holder a royalty on every download. In the USA the mechanical rate is paid per track – so the more tracks on an album, the greater the cost. British albums were usually twelve tracks and, until UK artists were powerful enough to insist that their albums were released as recorded, the US record companies used to drop two tracks to save money. The current rate is 9.1 cents per track, so by cutting out two tracks the record company saves 18.2 cents on each album sold. The Beatles sold about one hundred and eighty million albums. You do the maths.

  Performance royalties. This is a little more complicated. The songwriter assigns the right to collect income from public performances to the Performing Rights Society. The board of PRS is mainly made up of songwriters. Television and radio companies pay PRS a substantial fee for the right to broadcast music. Live music venues have to pay a fee. Even a shop that plays music that its customers can hear is obliged to pay the PRS a fee for doing so. Fees vary depending on the size of the potential audience. Over many years, the PRS have developed an algorithm by which they distribute the considerable amount of money they have collected between the songwriters.

  ‘Points’ are awarded for chart positions and plays on radio and TV. For example, a Saturday-night, prime-time TV show will accrue more points than an afternoon chat show. A big hit song can earn its writer several hundred thousand pounds over a number of years. In 2017, PRS announced record figures including payouts of £527.6 million to its members. It was the first time it surpassed half a billion pounds. To put it in context, Noddy Holder and the bass guitarist from Slade earn around a million pounds a year from ‘Merry Christmas Everybody’. Writing a perennial Christmas song is the holy grail for songwriters. Irving Berlin was the first to do so with ‘I’m Dreaming of a White Christmas’, a song which he anecdotally wrote in ten minutes.

  In the days before the public bought records, a publisher would distribute sheet music to bandleaders and end-of-the-pier concert parties, to encourage them to use the song. A bandleader was obliged to file a report listing all the songs that they had played. Many put down songs that they had written themselves, even if they had not played them.

  Similar societies to the PRS all over the world collect performance income in their own territories and, after deducting a fee, pass it over to the PRS. Obviously, the allocation of PRS income is somewhat arbitrary but over the years it has been refined to the satisfaction of the songwriters.

  Synchronisation fees. This is now a huge revenue earner. If a film or TV commercial uses a song, the producers negotiate a fee with the publisher for the copyright-holders, who can take home a seven-figure sum. I recently saw a TV documentary that purported to list the top ten earning songs. ‘Happy Birthday’ predictably is the highest at thirty million pounds and ‘White Christmas’ is next. In terms of pop music ‘You’ve Lost that Loving Feeling’ is the highest at No. 3 and ‘Yesterday’ is next. Obviously the longer a copyright is around the more it can earn and some more recent hits may well be up there in the fullness of time.

  At a time when very few so-called publishers actually understood the intricacies of the business Freddy Bienstock was a proper exception. Most importantly he knew how to maximise income from the less obvious revenue streams. Freddy spent twenty years learning about his trade. He ensured that those who were supposed to pay did so. In the sixties and seventies, the publisher also took responsibility to ‘plug’ a song on radio and TV. Unlike some of his contemporaries, my friend Freddy was an expert in copyright law, to the point that he spotted a rather obscure court ruling which enabled a writer’s estate to claim back a copyright years before its natural expiration. Freddy’s companies own the copyright of important songs from the biggest hits of rock’n’roll to standards from the great American songbook. Freddie died in 2009, leaving his family a company that I am sure is worth many hundreds of millions of dollars.

  In the same way as a lot of amateurs jumped on the property development bandwagon of the sixties and seventies, almost everybody in the music business – including me – started a publishing company. There was no real skill required. The key was to persuade writers to sign a copyright over to your company and then sit back and watch the money come in. The records went out and the publisher collected the income generated. The way publishing developed, copyright owners could contract with major publishing houses to administer and collect on their behalf at a small cost. All you needed was a bank account.

  Had I been the publisher of the artists I managed, I could now have a single filing cabinet holding copyrights that, without my lifting a finger, would have generated enough income to keep me and my descendants in a luxury lifestyle until the copyrights expired. But most of the writers I knew had existing contracts with publishers, and in any event, I had decided that I could not be all things to all people and had elected to concentrate on management and records. I did have a 50/50 publishing company with Freddy, mainly B-sides or album tracks that we had picked up via our recording activities. There was one decent copyright, for ‘The Pushbike Song’, acquired for the company by my partner David Joseph, of whom more later.

  As a general rule, copyrights become PD (in the public domain) seventy years after the death of the last living writer of a song. This may vary from country to country. If someone makes an arrangement of a PD song, the copyright in their version belongs to the arranger. ‘The House of the Rising Sun’ was a traditional American folk song, but Alan Price was credited as the arranger on The Animals, recording and he there
fore earned the royalties.

  Freddy Bienstock was the last of the old-school independent publishers. Born in Switzerland in 1923, his family lived in Vienna before moving to New York just before the outbreak of the war. Freddy started work in the stock room of Chappell Music in the Brill Building. He worked his way up to being a song-plugger before going to work for publishers Hill & Range, where one of his jobs was to find songs for Elvis Presley to record. In 1966, Freddy bought their UK subsidiary and changed the name to Carlin Music. He was also partner in Elvis’s music publishing company. Although Elvis was not a songwriter, his manager Colonel Parker made it a rule to get the company the publishing of every new song that Elvis recorded. Freddy ran the company, and Elvis had such respect for him he would ask his opinion on almost everything that he recorded.

  After ‘Hello,’ the next thing that Freddy said to a talented songwriter was ‘I can get you an Elvis cover.’ In fact sometimes this even preceded ‘Hello.’ I used to tease him incessantly about this. If we were in a restaurant I would nod to the waiter and say: ‘He can get you an Elvis cover.’ Most of us hang our gold discs on a wall. Freddy would have needed the Great Wall of China to hang his and he only had one gold disc on his office wall. It was a gold disc I had specially made for him with ‘I can get you an Elvis cover’ on the plaque.

  Geoff Morrow, a good friend of mine who I managed as part of the writing team Arnold, Martin and Morrow, had several songs recorded by Elvis thanks to Freddy. One of them, ‘Let’s Be Friends’, was the title song of an Elvis album. The team also wrote ‘Can’t Smile Without You’ for Barry Manilow, a huge hit which is still the high point of Barry’s act. Our business paths crossed again when Geoff started writing for theatre. Geoff is now an extremely successful businessman.