Wu Tang Clan’s Once Upon a Time in Shaolin Continues to “Bring Da Ruckus” in the Legal Community

In 2015, Wu Tang Clan released Once Upon a Time in Shaolin, a studio album of which a single copy was pressed. This one-of-one album was sold as an art object in auction for $2 million, serving as something of a precursor to non-fungible token (NFT) music releases.¹[1]Elias Leight, Revealed: The Crypto Fans Who Secretly Paid $4 Million for Pharma Bro’s Wu-Tang Album. ROLLING STONE (Oct. 20 2021) https://www.rollingstone.com/music/music-features/wu-tang-nft-album-once-upon-time-shaolin-1244859/ The album itself and the legal rights attached to its purchase agreement raise issues about copyright of original pieces of work for artists and purchasers.

The purchase agreement for the one-of-one album contained a provision limiting the buyer’s rights to commercially exploit the work for 88 years.²[2]Zach O’Malley Greenburg, Wu-Tang Clan Set To Release Secret Album–In 88 Years, Give Or Take FORBES (Mar. 2 2015) https://www.forbes.com/sites/zackomalleygreenburg/2015/03/02/wu-tang-clan-set-to-release-secret-album-in-88-years-give-or-take/?sh=6bf26c1d2ea0 Additionally, the album’s purchase agreement requires any new “taker” of the album to be bound to the original terms and condition of the first sale.³[3]Zach O’Malley Greenburg, Why Jeff Sessions May Control The Fate Of Wu-Tang’s Secret Album FORBES (Mar. 21 2018) https://www.forbes.com/sites/zackomalleygreenburg/2018/03/21/why-jeff-sessions-may-decide-the-fate-of-wu-tangs-secret-album/?sh=549298ad1c02 Section 106 of the United States Copyright Act provides the legal authority for Wu Tang Clan to include such a clause in the purchase agreement for Once Upon a Time in Shaolin.⁴[4]17 U.S.C. § 106 (1976) Under §106, the owner of a copyright has the exclusive rights to “reproduce the copyrighted work,” and “distribute copies or phonorecords of the copyrighted work to the public…”⁵[5]Id. Despite being a one-of-one album, the copyright in the recordings does not transfer to the owner of the work unless contractually specified. Under §204(a) of the Copyright Act, “A transfer of copyright ownership, other than by operation of law, is not valid unless an instrument of conveyance, or a note or memorandum of the transfer, is in writing and signed by the owner of the rights conveyed or such owner’s duly authorized agent.”⁶[6]17 U.S.C.§ 204 (1976) This means that for purchasers of a one-of one album like Once Upon a Time in Shaolin, despite being the sole owner of the original piece of work, such purchasers do not by default obtain a copyright interest in that work.⁷[7]Id. If sellers of one-of-one albums want to transfer their copyright interest and the ability to commercially exploit the work as part of the terms of the sale, the conveyance of that right must be in writing signed by the original copyright owner or their authorized agent.⁸[8]Id.

Further, an author’s copyright interest in a musical composition created on or after January 1, 1978, is protected for “70 years after the death of the author,” or in cases of multiple authors, “70 years after the last surviving author’s death.”⁹[9]Coe Ramsey, Music Law 101: How Long Does Copyright Protection Last? (Jan. 30 2019) https://www.jdsupra.com/legalnews/music-law-101-how-long-does-copyright-57301/ However, if the work is a “work for hire,” then the copyright is maintained by the hiring entity for 95 years from publication or 120 years from creation, whichever date is earlier.¹⁰[10]Id. For a piece created by a musical group such as Once Upon a Time in Shaolin, this means that by default the copyright in the work belongs to the authors for 70 years after the last remaining member’s death (unless otherwise transferred prior) and will then enter the public domain upon expiration of the 70 years after the last member of the group’s death.

Speaking on the decision not to assign commercial rights to the album’s purchaser, Cilvaringz, the album’s producer, told Forbes that “We thought long and hard about whether to defy art world conventions and transfer all rights to public release to the buyer. But we genuinely felt that a swift public release after such a radical concept would neutralize the statement we are making. So we decided that the right to release the album would be transferred only after 88 years have passed.”¹¹[11]Krissie Ducker, A ‘Discussion of Once Upon a Time in Shaolin with RZA & Cilvaringz’ (Last Accessed Oct. 24 2021) http://scluzay.com/eighteight/ Wu Tang Clan’s RZA explained that the 88 year provision came from a mix of the fact that there were eight original members in the group and that adding the individual digits of the album’s release year (2015) also came out to eight.¹²[12]Id. Comparing ownership of a one-of-one album to owning a piece of original art, Wu Tang’s RZA explained “When you buy a painting or a sculpture, you are buying that piece rather than the right to replicate it. Owning a Picasso doesn’t mean you can sell prints or reproductions, but that you are the sole owner of a unique original. And that’s what Once Upon a Time in Shaolin is – it’s a unique original rather than a master copy of an album.”¹³[13]Id. What this means for owners of a one-of-one album such as Once Upon a Time in Shaolin is that they own the chattel or physical property of the one-of-one album, but do not own the copyright in either the sound recording or musical composition.

Unfortunately for fans of Wu Tang Clan worldwide, the album’s original purchaser, Martin Shkreli, played only brief snippets of some of the album’s material for fans on a few select occasions.¹⁴[14]Rania Aniftos A Timeline of Events Since Martin Shkreli Purchased Wu Tang Clan’s ‘Once Upon a Time in Shaolin’ BILLBOARD (Mar. 5 2018) https://www.billboard.com/articles/news/8232213/timeline-martin-shkreli-wu-tang-clan-album However, upon being convicted of securities fraud, Shkreli was forced to forfeit Once Upon a Time in Shaolin to the United States government “as a substitute asset in connection with the approximately $7.4 million forfeiture money judgment” entered against him at his 2018 sentencing.¹⁵[15]Department of Justice, United States Sells Unique Wu-Tang Clan Album Forfeited by Convicted Hedge Fund Manager Martin Shkreli (July 27 2021) https://www.justice.gov/usao-edny/pr/united-states-sells-unique-wu-tang-clan-album-forfeited-convicted-hedge-fund-manager Since the United States government requires payment in standard United States currency, even the album’s purchase from the United States government was complex.¹⁶[16]Ben Sisario, Meet the New Owners of the Wu-Tang Clan’s One-of-a- Kind Album NEW YORK TIMES (Oct. 20 2021) https://www.nytimes.com/2021/10/20/arts/music/wu-tang-clan-once-upon-a-time-in-shaolin.html The New York Times reported that NFT collectors PleasrDAO offered to pay the equivalent of $4 million in cryptocurrency for the one-of-one album.¹⁷[17]Id. Because the government requires standard U.S. currency, PleasrDAO paid through an intermediary what amounted to “roughly $2.2 million, based on an accounting filed in court by prosecutors earlier this year.”¹⁸[18]Id. To the delight of fans, PleasrDAO intends to give fans an opportunity to finally hear the album.¹⁹[19]Elias Leight, Revealed: The Crypto Fans Who Secretly Paid $4 Million for Pharma Bro’s Wu-Tang Album ROLLING STONE (Oct. 20 2021) https://www.rollingstone.com/music/music-features/wu-tang-nft-album-once-upon-time-shaolin-1244859/

Despite the album’s purchase agreement providing that any owner of the album cannot commercially license or distribute the album, fans may finally be able to listen to the album and its new owners to recoup some of their investment.²⁰[20]Id. at 2. In 2015, Forbes noted that there was originally “talk of sending the album around the world on a ‘tour,’ shipping it to galleries and other exhibitions spaces where people could pay $30-$50 per person to hear the full recording on headphones.”²¹[21]Zach O’Malley Greenburg, Wu-Tang Clan Set To Release Secret Album–In 88 Years, Give Or Take FORBES (Mar. 2 2015) https://www.forbes.com/sites/zackomalleygreenburg/2015/03/02/wu-tang-clan-set-to-release-secret-album-in-88-years-give-or-take/?sh=6bf26c1d2ea0 However, the album was sold to Martin Shkreli before this idea came to fruition.²²[22]Id. Speaking to Rolling Stone about their plans to give the public a chance to hear the album, Jamis Johnson, a member of PleasrDAO, explained that they still need to sort out the legality of a listening tour, but that they “want fans to participate in this album at some level.”²³[23]Id. at 1. Cyrus Bozorgmehr, who worked with Cilvaringz on the album’s initial launch, noted that “you can’t do much with the album” but that if PleasrDAO has a “good enough idea,” some of the album’s restrictions would likely be “open for discussion.”²⁴[24]Id. Time will tell what the new owners have in store for Once Upon a Time in Shaolin given the original restrictive purchase agreement. However, the future seems promising for PleasrDAO and Wu Tang Clan to come to an agreement to honor the album’s artistic intent and purchase agreement while finally giving fans the chance to experience the album on a limited basis in a controlled environment.

Written by: Jared Weiner
Jared is a 2023 J.D. Candidate at Brooklyn Law School