Warner Music says that the American Federation Of Musicians cannot rely on a ‘new use’ clause in the Sound Recording Labor Agreement it negotiates for its members in order to demand information about and compensation from the major’s licensing deals with AI companies like Udio and Suno. 

The US performer union sued both Warner and Universal Music last month, insisting that the new use clause in its SRLA applies to AI deals. Which means Warner should have informed musicians hired under that agreement about those AI deals and should be compensating any union members whose recordings are being exploited by the AI companies. Which it is not. 

However, in a letter to the court, Warner’s lawyers insist AFM is interpreting the new use clause incorrectly. The relevant clause, it argues, states that if a musician’s recording is used for a purpose not covered by the agreement, they should get an additional payment as if they had been brought back into the studio to record music specifically for that purpose. 

Warner’s letter then quotes an example given on AFM’s own website for how the new use clause might work. It says that a musician on a sound recording that is subsequently used in advertising, “should be paid for the usage as if they were called to perform a commercial recording session”, based on whatever standard agreement would cover that kind of session. 

But there is no current AFM agreement with the labels covering the use of music in AI training. And, Warner claims, “where no agreement exists covering the new medium”, the new use clause “has nothing to point to” and therefore “there is no entitlement to payment”.

As record labels and music publishers have started to enter into licensing deals with AI companies, organisations representing artists, musicians and songwriters have started to raise concerns about those deals, asking what music will be automatically opted into to those arrangements, and how any money will be shared out between different stakeholders. 

The majors have said they will get artist and writer opt-in in specific circumstances – mainly voice clones and mash-ups – but when it comes to general AI training, the plan seems to be to opt everyone in by default. It’s also assumed that the majors will unilaterally decide what royalties to pay artists for AI uses, while offering session musicians no payment at all. 

It’s in that context that AFM filed its lawsuit, seeking to get some clarity and to ensure compensation for its members as more and more AI licensing deals are agreed and then announced with a big PR fanfare but very little information for music creators. 

In its letter to the court, Warner says that AFM is currently negotiating the next iteration of the SRLA and that AI usage is very much part of those negotiations. And as far as the major is concerned, that’s the forum where musician remuneration from AI deals should be discussed, not in a court of law. 

“AFM filed this lawsuit in an improper attempt to place a judicial thumb on the negotiation scales”, the letter goes on, claiming that the performer union is “asking this court to impose contractual terms that only collective bargaining can create”.

This, Warner’s lawyers claim, means AFM is asking the court to “create new contractual obligations out of whole cloth”, adding, “the court should decline the invitation”.  

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