Scooter Braun Acquired Taylor Swift's Back Catalogue. But What Does That Really Mean?
Erin M. Jacobson, a music transactional attorney in Beverly Hills who also wasn’t involved in the sale, says acquisitions of this nature occur regularly. As Jacobson explains, the seller—in this case, Borchetta—stands to make a profit upfront from the sale, while the buyer—Braun, who reportedly paid over $300 million for Big Machine—earns profit over time from acquiring ownership of the assets. Because of that, “The buyer is usually obligated to follow the terms of the purchased company’s existing contracts, meaning that Ithaca Holdings would now be responsible for collecting all earnings of the masters and paying Swift her contractual royalties.”
Jacobson says it’s common for a label to own the masters, like Swift’s initial contract with Big Machine. “Record labels traditionally own the master recordings, and usually the artists do not have legal recourse.”
But Valentino believes there could be deeper conflicts at play here. Because Swift was negotiating with Big Machine to earn back her master recordings, as she said in her Tumblr post, there could have been other potential deals—like buyers Swift and her team were championing—that fell through, he explains. “Maybe they felt slighted in that it went to Scooter; they might have wanted it to go somewhere else and were angry that happened,” Valentino says. “I can tell you as a lawyer, there’s always more to it than we read about.”
As a part of her new deal with Universal Music Group, Swift now owns her masters and licenses for any new music released by Universal going forward. However, Jacobson says, unestablished artists—like Swift was at the start of her career—rarely have the clout or pull to retain ownership over the masters. Lou Hayat, one half of the indie rock duo The Dove And The Wolf, says these arrangements are still indicative of where the music industry stands—and Braun’s purchase over Big Machine is just another facet of the business. “While this might be an extreme case of industry-man-on-a-power-trip to control, manipulate, or bully an artist, it is unfortunately still very representative of how the music industry functions,” Hayat says. “Regardless of what people may think of Taylor Swift, I think her speaking up about this is very important and necessary.”