Calif. Royalty Bill Passes Committee

Legislation headed to Assembly floor.

California State Sen. Kevin Murray's quest to help recording artists collect unpaid royalties took a huge step toward becoming reality today in Sacramento.

The bill received unanimous support in the California Assembly Committee on Arts, Entertainment, Sports, Tourism and Internet Media. Now the legislation will head to the Assembly floor for a vote next Monday, followed by a concurrence vote on the Senate floor.

Sources with Sen. Murray's office say the bill could be signed by Gov. Arnold Schwarzenegger in August. The bill would go into effect in January 2005.

Before the Assembly vote, the legislation -- dubbed the Recording Industry Accounting Practices Act -- went through another round of amendments last week, the fourth such revision in less than two years.

Major revisions included the creation of "minimum audit procedures" for all royalty contracts -- a change from the "statutory right to audit royalty statements" in the previous bill. The amended version also struck the institution of penalties for underpayment.

The bill has evolved significantly over time as record labels have proactively modified their royalty accounting practices. The bill originally sought to create a fiduciary duty for labels to accurately report and pay royalties.

The official analysis of today's hearing states that since the bill was amended following last week's proceedings, the RIAA has removed its opposition and "has no objection to [the bill] moving forward."

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