While seemingly tucked away quietly behind the scenes, CMRRA’s legal and business affairs counsel, Max Rothschild is very much on the front lines of landmark copyright developments in Canada.
Navigating the grey areas between technology and rights holders, his day-to-day work affords a unique window into the future of the Canadian music industry. It’s an enviable position for many.
A Toronto native, Rothschild plays an increasingly important role in CMRRA’s legal department, and supports the ongoing efforts of CMRRA’s Vice President of Legal and Business Affairs, Veronica Syrtash.
Rothschild’s journey began as an undergraduate Arts student at Montreal’s McGill University in 2009. He then went on to complete a Juris Doctor degree at the Dalhousie University Schulich School of Law in Halifax.
After finishing law school, Rothschild returned to Toronto to article with Cassels Brock & Blackwell LLP, a law firm boasting one of the largest business law practices in Canada.
“Part of what drew me to Cassels Brock was that I’d always been interested in media, arts, technology, and culture generally,” he said. “I wanted to return to Toronto and it was a good fit with where I wanted to take my career.”
During his time at Cassels Brock, Rothschild worked with Intellectual Property lawyer, Casey Chisick, on commercial radio and online music tariff filings, which served as his introduction to CMRRA.
After being called to the Ontario Bar in the summer of 2014, Rothschild joined CMRRA to work with Veronica Syrtash, recognized industry-wide for landing unprecedented licensing deals with Apple, Google, Spotify, and more recently, YouTube.
“As a member of CMRRA’s executive team, Veronica handles both legal matters as well as external partnerships,” Rothschild explained. “I handle the day-to-day licensing negotiations as well as enforcement files, internal policies, and tariffs.”
Rothschild’s experience with tariff filings and hearings made him an attractive recruit for CMRRA.
“One of the first things I was brought on to do was to work on our tariff development,” he said. “At the time, we were launching our new audio-visual line of business which meant drafting tariffs from scratch.”
In addition to tariffs, he spends the bulk of his time working with online service providers to ensure they are fully licensed and compliant in Canada.
“A lot of what we do is reach out or respond to online services to explain who we are and the rights we administer on behalf of our music publisher clients,” he said. “Veronica and our external counsel have worked for years to secure some of the best royalty rates in the world in tariff proceedings before the Copyright Board of Canada, and we use those rates as the basis for our negotiations.”
Most recently, CMRRA (through CMRRA-SODRAC Inc.) inked a milestone agreement with SoundCloud, one of the world’s largest music and audio platforms, in advance of the Canadian launch of SoundCloud Go in mid-October.
“We were pleased to finalize that agreement, as SoundCloud is a major platform for consumers worldwide and in Canada,” he said. “We worked closely with them to license content from music publishers as they prepared to monetize and offer a brand new subscription service.”
It follows a landmark deal with YouTube earlier this spring, a major agreement for reproduction rights in Canada.
“Veronica did a fantastic job securing a deal for Canada that has a significant impact in the audio-visual market,” noted Rothschild.
In fact, CMRRA and CSI have negotiated agreements with all of the major online services operating in Canada, or have applied the CSI Online Music Services Tariff, largely due to the work of Syrtash and Rothschild.
“Generally speaking, we either have an agreement in place or are in negotiations with all the online services in Canada,” he said. “It’s been really exciting to see the Canadian music market expand so rapidly over the past few years.”
Yet with each new online service comes unique challenges.
“Every time a new service comes to us we have to evaluate what it is and how it does or does not fit within our licensing practices,” Rothschild explains. “We constantly have to look at things with fresh eyes. In scenarios where a service does not fit squarely within the four corners of our tariff regime, for example, we are happy to have the flexibility to negotiate a private agreement to find something that makes sense for both us and them.”
This is particularly true with licensing webcasting services, as the Copyright Board of Canada has not yet certified a royalty rate for that use of music for CMRRA (via CSI). The most recent CSI Online Music Services Tariff was certified in 2012, and CSI has continued to file new tariffs each year that include proposed rates for webcasters.
“When we speak to webcasting services we begin with the rates that we have filed before the Board,” explains Rothschild. “It’s a process of finding a middle ground between ensuring that music publishers are compensated without having final royalty rates certified, and trying to provide businesses with a degree of certainty as to their licensing costs.
Rothschild’s daily interactions with technology companies helps him stay abreast of industry trends.
“One of the types of things we’re starting to see are online streaming services experimenting with the standard $9.99 per month business model,” he noted. “For example, the introduction of limited tiers where users can access a prescribed number of songs or playlists, and more options available to users above $9.99.”
The amount of effort required to ensure the right people are paid for the use of their content is daunting.
“There’s a huge amount of work that comes with managing large volumes of data, and ensuring it’s managed the same way on the legal and operational sides of the business,” he said.
Rothschild is quick to point to the important role CMRRA’s Licensing and Royalty Distribution System (LDS) platform plays in accurately tracking and managing data.
“Information technology is a constant iterative process and we’re always getting better and better at dealing with that,” he explained. “We have a very robust system in place now thanks to the great work of our operational team and our award-winning IT partner, Spanish Point.”
“In my first year of call, Veronica and I went to the Supreme Court to see our external counsel advocate on behalf of rights holders for the value of the reproduction right,” he said. “That was very cool to see, and we were pleased to have the Supreme Court agree with the case made by our lawyers.”
Looking ahead, CMRRA’s legal team plans to expand further into the audio-visual marketplace and continue licensing online music services operating in Canada.
“We want to make sure consumers and businesses have as many options as possible to access and deliver content, while ensuring content owners are being effectively compensated at all times,” he said.
Rothschild is encouraged by the shift in awareness about the types of rights CMRRA administers and how they are applied.
“Today, online services are as interested in growing their revenues as they are in making sure they are securing licences and paying rights holders, so they’re very eager to come to the table,” he said.
“We work with them to ensure they can do so, and we try to be transparent so that the services know exactly what has been licensed to them, down to the exact share.”