Howard Hertz is a longstanding entertainment lawyer who got his start in Detroit after graduating from Wayne State University, passing the bar in 1976 and setting up his own firm in 1979. Hertz Schram is still located in Detroit where Howard also serves as the President of the Detroit Music Awards. Over the course of nearly 50 years, he’s represented the likes of Eminem, Jack White and Marilyn Manson, so after hearing about his work, I reached out with an interview request and we got on the phone shortly thereafter.
– Hi Howard. It’s a pleasure to be speaking. Can you tell me about your background leading up to becoming a lawyer?
Sure. When I was in sixth grade, my teachers told me I’d be a lawyer because I often argued with them to show I was right, so I always had that profession in the back of my mind growing up. I wasn’t sure of what major to choose at university, but I knew it wouldn’t affect getting into law school, so I tried different things and eventually majored in Psychology, which I really enjoyed. During that time, there was an ongoing project where young people who’d committed crimes would be spared juvenile detention and paired with a counselor. I became one of those counselors, and since my professors thought I did a good job, they hired me to be a supervising counselor for the next semester. They later said I could combine my interests in psychology and law by working with children at the Juvenile Detention Center, so that’s what I did.
After my first year at law school, I applied to be a clerk at the Juvenile Detention Center but was told they didn’t hire people without a law degree. I was able to convince them to give me the job anyway, and worked there full-time whilst in school. As a result, I got to work on three murder trials before passing the bar and officially becoming a lawyer in 1976.
– Once you became a lawyer, how did you get your first entertainment client?
My wife was a teacher at the time, and right before I passed the bar, she moved to a new school district and became friends with another teacher whose husband was a singer-songwriter. He’d been offered a publishing deal that he didn’t fully understand, but he told his wife he would sign the contract anyway because it was too frustrating to make sense of it. She suggested he talk to me since I was a lawyer, and I agreed to help despite not knowing what entertainment law was at the time. I quickly realized that I couldn’t negotiate on his behalf since I didn’t know the standards of industry, but he gave me an entertainment law book to read and I used it to figure out the contract. I made some changes to the agreement, and once the publisher agreed to the new terms, I had my first client.
I later met the publisher at one of my client’s gigs, and it turned out he was an eighteen year-old named Joel Martin. He was a musician that was signed to a local production company, but things weren’t moving fast enough for him, so he set up his own publishing and management company, as well as a recording studio. He started sending other artists to me and my client base grew. Thanks to him, I ended up working with names like The Romantics, George Clinton, Parliament Funkadelic and others.
– You started your own firm in 1979, correct? How did that come about?
I left the defender’s office in 1978 and moved into an office in downtown Detroit that I shared with other lawyers. I kept busy by taking court assignments, and there was always enough work for me since I got along with the judges. I later partnered with Bradley Schram to create Hertz Schram in 1979, which now has about 25 lawyers doing different kinds of legal work, from corporate to securities to criminal law. We’re 44 years old and still going strong.
– You’re known for having represented Eminem, and for having been involved since he signed to the Bass Brothers in the mid-90s. How did you first hear about him?
During the 80s, Joel Martin hired me as his lawyer and we signed Jeff and Mark Bass to his management company in 1990. The Bass Brothers later hired me to help them form their production and publishing companies. I used to put their signed artist contracts in a manila folder and would forget about most of them because I knew the music business was a hard one for new artists to break into. In 1995, I remember getting a contract signed by Marshall B. Mathers III, which I thought was an interesting name. I put it in the manila folder and thought I’d never hear about him again, but it was one of two times where I was wrong about an artist prediction (laughs).
The Bass Brothers released Marshall’s early albums, and he later got invited to attend the Rap Olympics in 1997. He was disappointed to come in second place, but there was an Interscope intern in the audience who was blown away by his performance, so he asked for a copy of his demo tape and took it to Jimmy Iovine. I’ve heard various stories about what happened afterwards, but my understanding is that Jimmy wasn’t equally impressed after listening to it. The intern kept saying that he had to sign him, so Jimmy finally said, “We’re starting a joint venture with Dr Dre. Let him listen to it and decide“. Dre was blown away and said to bring Marshall in, and the rest is history.
– I’d like to mention a few names of your past clients, and perhaps you could tell me what cases you represented them on?
Eminem: The first matter I represented him on was his gun case in 2000. Prior to that, I never handled his entertainment matters because I already represented the Bass Brothers who controlled his rights until he signed to Interscope. Paul Rosenberg and I negotiated that deal with Interscope in 1998 for the masters, and then with Famous Music for the publishing. Then I got a call one day saying “Marshall is in jail. Help…“. Paul knew that I’d been a public defender and that my partner, Wally Piszczatowski, was one of the top criminal defense attorneys in the Midwest. So we represented Marshall in his two cases for felonious assault and possession of a weapon, for which we got him probation.
Marilyn Manson: Following the Eminem case, Marilyn Manson was in town doing a show, and he got into trouble for going to the edge of the stage and humping a security guard’s head. The guard got upset and sued, so we represented Manson in both the criminal and civil cases. I think I was recommended by Interscope since we did a good job on Marshall’s case, and we were able to get Marilyn probation on a lesser charge.
Jack White: He got into a bar fight with Jason Stollsteimer from The Von Bondies and had to face both criminal charges and a lawsuit. I represented him on both cases, with Wally handling the criminal side. We often got called when artists like that got into trouble.
Berry Gordy: I didn’t represent him directly, but I acted as a Special Master in a music-related case. Holland Dozier Holland was the premier songwriting and production team at Motown in the 60s. They wrote hits for The Supremes, Four Tops and others. They got into a dispute with Berry and his publishing company, Jobete, claiming to have not been properly paid, so they left and started their own label and sued Berry. That case either got settled or dismissed, but they sued him again years later. The lawyers kept bringing new motions to the judge, but she didn’t understand them because they contained technical music business information, so she appointed me as a Special Master to handle the motions. My rulings were only recommendations and weren’t final, but the judge sided with me each time. The case went on for years, and at one point I had to review 400 banker’s boxes of documents to decide which side should get to see them. The case was eventually settled. I also mediated on disputes involving The Temptations and Four Tops where band members or the estates claimed they weren’t being paid what they should be.
Anita Baker: Anita had gotten divorced, and her settlement contained an agreement saying that her husband should receive a certain amount of royalties, but once the divorce papers were signed, they couldn’t agree on what the settlement meant. As a result, the judge appointed me as an expert witness to review everything and recommend what to do. That went on for a couple of years and was very contentious, but it eventually got resolved.
Insane Clown Posse: That case was filed against the FBI on behalf of their fan-base, the Juggalos. I brought in the American Civil Liberties Union to work the case with me, and they did most of the heavy lifting in terms of briefs and motions. The Juggalos were listed as a gang by the FBI in 2011, and even though the report stated there were over a million fans, it claimed all of them were part of the gang, which was ridiculous. So we brought a suit against the FBI, but the judge dismissed it, claiming we didn’t have standing to bring the case. The Court of Appeals disagreed and sent it back for further rulings, so the FBI brought another motion to dismiss based on more technical grounds. The judge agreed with them and the Court of Appeals sided with the dismissal this time. The only remedy was to appeal to the US Supreme Court, but the case didn’t meet the criteria for what they’d want to hear, so we had to accept the result.
“Vs Everybody” brand: We handle the filing of their trademarks, and since Tommey Walker owns the brand, we also monitor whether companies infringe on his trademark. For example, if a sports team were to use “Team ABC vs Everybody”, that would be an infringement. We’d approach them and say “You’re violating the trademark, so you either have to stop and pay us damages for what you’ve sold, or we can license it to you“. We’ve done that dozens of times with various organizations, and we recently entered into an agreement with Gucci to do “Gucci Vs Everybody”, which led them to open a store in Detroit. My partner, Joseph Bellanca, is the only lawyer who strictly does entertainment law along with me, and he handles most of our trademark work.
– Let’s talk a bit about Eminem. Despite not representing his music projects, you do represent The Marshall Mathers Foundation, correct?
Yes. Starting in 2002, Marshall wanted to give back to the community and help organizations in Detroit that work with at-risk youth, providing them with skills to earn a living away from criminal activity. He and Paul Rosenberg asked me to set up the nonprofit and work with them as one of the board members. I’m still deeply involved with the Foundation, and we not only work with youth, but with other social issues as well. When there were mass shootings in Vegas and the UK, we donated money to organizations that work with therapists who helped people get through it. We also donated to organizations working with gun control, and we got involved during the pandemic too, donating to organizations on the frontline like hospitals, food banks and homeless shelters, most of which was done under the radar.
– During the 2000s and 2010s, there were multiple lawsuits related to Eminem’s music that were brought against companies like Apple and Universal. Were you involved in those?
I was the local counsel in Detroit for two lawsuits involving Apple, one for the use of an Eminem track in an iPod commercial without permission, and the second for the usage of Eminem’s music on iTunes without a proper license from the publishing company. Richard Busch was lead council on those, and I was the second chair. We represented the Bass Brothers’ F.B.T. Productions, and both cases ended up being settled.
The third case was brought against Universal/Interscope in regards to the correct royalty rate being paid for downloads. We lost at the trial level, but the Court of Appeals reversed the decision, so Universal appealed to the Supreme Court. They denied hearing the appeal, so the Bass Brothers won the case.
– Last Eminem question: If Marshall’s artist name is “Eminem”, and there’s a brand of popular candy called “M&Ms”, how has it never created a dispute trademark-wise?
I don’t know the answer to that (laughs). “Eminem” is spelled totally different from “M&Ms”, and Marshall isn’t in the candy business, so I think we’d have good defenses if it was ever brought to court.
– Aside from your legal work, you’re also the President of the Detroit Music Awards. Tell me about that.
We have a fantastic team who arrange the awards every year, and we won a regional Emmy award for our 30th anniversary show. I’ve been the President for 25 years, and we had a live show for the first 29, but the last three have been virtual due to the pandemic. At the live show, we have 1200 people who attend and they’re mostly industry folk, so it’s a chance for all groups of people to network and socialize.
– How did you end up becoming President for the show?
I was at a music event one night and someone introduced me to Gary Graff, a well-known music journalist. He was a co-founder of the Motor City Music Awards, and there was another show at the time called Detroit Music Awards, which was started by a music-related newspaper called Metro Times. Gary tried to convince me to participate in the Motor City Music Awards, but I said “I don’t think there should be two music awards in one town. I couldn’t really pick one over the other “. So Gary said “We’re actually in the process of merging the two, so maybe you could help with that? “. So I did, and three years later I was voted in as President. No-one’s kicked me out yet (laughs).
– You’ve said in the past that more successful musicians have come out of Detroit than any other city in the world. Can you elaborate on that?
That’s my belief. In cities like New York, LA and Nashville, most of their artist population migrated there from other places to get signed, whereas Detroit largely has homegrown musicians dating back to the mid-20th century. You had R&B and blues labels in the 50s like Fortune Records that produced hits, followed by Motown in the 60s, most of whom were Detroiters. That continued into the 80s with techno music, and into the 90s with hip-hop acts like Eminem and even Big Sean in the 2010s. We also have rock bands galore like MC5, Iggy and the Stooges, Jack White, etc.
– Let’s talk about your current work at Hertz Schram. You’ve mentioned in the past that the four areas of your legal practice are drafting contracts, trademark/copyright filing, dispute resolution and networking. Which of those four take up most of your time?
It goes in spurts, but it’s mostly negotiating contracts and resolving disputes. Filing copyrights and trademarks is mostly handled by Joseph Bellanca, but I get involved on the dispute side when it comes to infringement. I recently handled a case where a rapper was trying to get out of her label contract and we were able to settle the case, which allowed her to sign with a major. When it comes to music, film and TV cases, I’m mostly drafting contracts rather than settling disputes, but it changes day to day.
– Which one of the four categories tends to be the most lucrative?
Probably dispute resolution since it’s the most time-intensive, and that’s only because I bill by the hour. That’s why I encourage my clients to let me settle before it gets to litigation, otherwise the costs are enormous, plus you can’t decide what the result will be. You’re normally better off negotiating a settlement rather than letting a judge or jury decide for you.
– You’ve said in the past that publishers aren’t as well compensated as record labels from streaming. Is that still the case?
It is – the numbers haven’t risen much on the publishing side. According to the Copyright Act, you can bring action against the streaming services if their rates aren’t appropriate, so there’s litigation pending constantly over that issue. If you look at a song that’s placed into a film or commercial, the licensing fee is typically split 50-50 between the masters and publishing. It’s nowhere near that for streaming, so publishers are constantly fighting to get their numbers higher.
The people who really got hurt in the early days at Motown and other labels were the session musicians who didn’t get credited, much less receive any royalties. But now you have SoundExchange, through which session musicians are entitled to about 5% in royalties for digital and satellite radio usages.
– I’ve heard rumors that part of the reason for exploitative recording contracts was that the early music industry was influenced by the Mob, who sought to always tip the scales in their favor at the expense of the artist. What do you know about that?
I haven’t seen that to be true. Since labels are often the source of funding for recording and promotion, I think it naturally took place that they owned the masters. It’s different on the publishing side where the standard split between writers and publishers is 50-50. Also, if the artist has a good lawyer, major labels don’t necessarily get a share of the publishing, though it’s known to happen with smaller labels because they argue that publishing is needed for them to make a return. I do know that some labels in the past have allegedly been mob-related, but the issues are less about copyright ownership and more about royalty pay-outs.
– If not for the influence of the Mob, what do you think is the source of artists being given only 2% – 8% of their masters in a record deal?
Those are old school rates – today it’s closer to 12% – 15% of the retail price for new artists and as high as 20% for an established artist. But even those rates aren’t used as much anymore – what you ideally want is a 50% cut of the net profits rather than arbitrary percentage splits that come with all kinds of manufactured deductions. An example is the 20% deduction for the cost of making CDs, even though CDs don’t cost 20% of the retail price. It was just an arbitrary number used to cut into an artist’s royalty rate, so by going with a percentage of net profits, the artist has a better chance to make money, and indie labels are typically willing to do that.
Depending on when your contract was signed and the music was released, US copyright law says you have the right to get back your songwriting copyrights if you properly file for a reversion. You have to file within a certain three to ten year window, so you’re out of luck if you miss it. That law was put in place to give rights back to older artists who didn’t have negotiating power when they first signed their deals, and it also gives them the option to sell those rights to a label. It’s a confusing statute though – it applies to songs released prior to and after 1978, but with different schedules for each. It’s also disputed whether it applies to masters, but it arguably does, and legal cases have been settled which claimed that.
– The progression of AI has been one of the most talked about developments of the last 12 months, but the issue of copying an artist’s voice is several decades old, is it not?
Yes, it is. Back in the 80s, Ford Motor Company approached Bette Midler and asked her to do a commercial using one of her famous songs. She said no, so the company hired one of her background singers to record the same song in a similar style. Bette sued them for using a soundlike and won that case. Tom Waits had a similar one against Frito-Lay where they used a soundalike for a commercial. It raises the question of whether those who release AI recordings will be required to pay or get a license from the original artist. This is what’s being discussed in legal circles.
– Wouldn’t the artist have to trademark their voice to do that?
Not necessarily. You don’t have to file a copyright to own one, and it’s the same with a trademark – it just gives you more protection if you do. But I don’t even know of a method for trademarking your voice, so it’s hard to say what will happen.
– Historically, what’s been your most difficult case?
Based on the fact that we got dismissed twice, I’d say the lawsuit against the FBI. I’m not used to losing (laughs).
– How many cases have you lost?
Not very many. I’m very good at negotiating resolutions. When I was at the public defender’s office, I’d settle most of my cases, and out of the 26 jury trials, I either won every case or had a hung jury. Since then, most of my cases settle and don’t go to trial. Even the ones that go to trial often end up settling during the trial.
– As someone who’s been around a while, who’re some of the most impressive lawyers you know of?
Richard Busch is a great lawyer who’s handled a lot of important cases like the “Blurred Lines” one, and Dina LaPolt in LA is an awesome lawyer who’s represented a lot of major artists. Jeff Liebenson in New York is also a great lawyer and President of the International Association of Entertainment Lawyers. But Joseph Bellenca and I are clearly the best (laughs).
Prior to the pandemic, I used to attend the yearly MIDEM festival, where the International Association of Entertainment Lawyers (IAEL) would have our annual meeting, and I’d meet great lawyers from all over the world through that.
– Thanks for talking to me Howard. What’s next for you and your firm in the coming months?
I’m working on a few of the copyright reversion matters that’ll help some artists to get back their master and publishing rights. Following that, I’ll either help resell them or determine if they want to release music on their own.