The Seven Year Statute was designed to prevent employers in California from enforcing excessively long contracts, but per a 1987 amendment that was pushed by the major record labels recording artists that do wish to terminate a deal with undelivered albums would have to pay damages -- like possibly lost profits from that undelivered album -- which often invites renegotiation.
If the FAIR Act passes, it would make it harder for record labels to contract for a certain number of deliverables, such as albums, as opposed to a specific time frame, forcing them to reconsider how they structure deals.
In a statement, Music Artists Coalition founder Irving Azoff says amending the current law has become even more urgent in light of the streaming boom.
“Streaming has been an unprecedented bonanza for the record labels, but not so for artists,” said Azoff. “It is unfair that the only Californians excluded from the protection of the Seven Year Statute are recording artists. We ask our record label partners and members of the California legislature to join us and support this important initiative. We must protect artists and modernize this archaic law.”
"The landscape of the entertainment industry has dramatically changed, yet companies still benefit from outdated laws that allow them to wield an overwhelming amount of control over artists," added Gonzalez. "No worker should ever be bound to an unreasonable contract that holds them back from making decisions about their own livelihood. It’s time we changed the law to reflect a new reality for creators. I introduced the FAIR Act to simply ensure artists are empowered to freely practice their craft and pursue a career doing what they love.”
Added Dina LaPolt, co-founder and board member at SONA, "Recording artists should have the same 7 year protection as others signed to personal services agreements in CA. The FAIR Act will eliminate the carve-out in the law that unfairly holds artists in their contracts for longer than 7 years. This exception must be eliminated. It’s unfair and oppressive—leaving some artists in their record deals for decades!"
In 2001, there was a similar push to repeal the 1987 amendment that resulted in a California Senate bill introduced by Democratic State Sen. Kevin Murray, a former agent at William Morris. Though that effort resulted in major artists including Courtney Love and Don Henley testifying before the State Assembly, the bill was ultimately brought down by the major labels, who argued it was too difficult for artists to complete the terms of a standard seven-album recording contract in just seven years.
Azoff, who has long managed Henley’s band the Eagles, also backed the 2001 repeal via the Recording Artists Coalition, a now-defunct precursor to MAC that he co-founded alongside Henley and Sheryl Crow.
UPDATE: This article was updated March 21 at 1:20 a.m. EST to correct the description of how the Seven Year Statue applies to record contracts.