Code Section Group

Civil Code - CIV

DIVISION 3. OBLIGATIONS [1427 - 3273.16]

  ( Heading of Division 3 amended by Stats. 1988, Ch. 160, Sec. 14. )


  ( Part 4 enacted 1872. )

  ( Title 10 added by Stats. 2004, Ch. 150, Sec. 2. )


As used in this title:

(a) “Royalty recipient” means a party to a contract for the furnishing of services in the production of sound recordings, as defined in Section 101 of Title 17 of the United States Code, who has the right to receive royalties under that contract.

(b) A “royalty reporting party” is the party obligated to pay royalties to the royalty recipient under the contract described in subdivision (a).

(Added by Stats. 2004, Ch. 150, Sec. 2. Effective January 1, 2005.)


Notwithstanding any provision of a contract described in Section 2500:

(a) A royalty recipient may audit the books and records of the royalty reporting party to determine if the royalty recipient earned all of the royalties due the royalty recipient pursuant to the contract, subject to the following:

(1) A royalty recipient may conduct an audit not more than once per year.

(2) A royalty recipient shall request an audit within three years after the end of a royalty earnings period under the contract.

(3) A royalty recipient may not audit a particular royalty earnings period more than once.

(b) The royalty recipient shall retain a qualified royalty auditor of the royalty recipient’s choice to conduct an audit described in this section.

(c) The royalty recipient may enter into a contingency fee agreement with the auditor described in subdivision (b).

(d) A qualified royalty auditor may conduct individual audits of the books and records of a royalty reporting party on behalf of different royalty recipients simultaneously.

(e) Except as required by law, a qualified royalty auditor shall not disclose any confidential information obtained solely during an audit without the express consent of the party or parties to whom that information is confidential. This subdivision shall not prohibit the auditor from disclosing to the royalty recipient, or an agent of the recipient, on behalf of whom the auditor is conducting the audit information directly pertaining to that royalty recipient’s contract, as described in Section 2500.

(f) The provisions of subdivisions (a), (b), (c), (d), and (e) are in addition to any other rights provided by a contract, as described in Section 2500, between a royalty recipient and a royalty reporting party.

(g) Nothing in subdivision (a), (b), (c), (d), or (e) shall be deemed to extend any limitations period applicable to royalty accounting or payments not specifically addressed in this section.

(h) Nothing in subdivision (a), (b), (c), (d), or (e) shall be deemed to limit any rights provided by collective bargaining agreement or by applicable state or federal law.

(Added by Stats. 2004, Ch. 150, Sec. 2. Effective January 1, 2005.)

CIVCivil Code - CIV