Royalties owed to bankrupt musician not "wages"

"Royalties from music publisher belonged to lender of bankrupt", published in the World Media Law Report about six weeks ago, is a note on the Ontario, Canada, decision in Re Friedman (2008), 49 C.B.R. (5th) 131 (Ont. S.C.J. in bankruptcy).

In brief, Friedman assigned his rights to royalties payable by Canadian copyright collecting society SOCAN to his music publisher, as security for loans advanced to him from the publisher. He subsequently became bankrupt, owing the publisher some $3.2 million. When the publisher sought payment to it of the royalties payable to Friedman from SOCAN, Freidman applied under the Bankruptcy and Insolvency Act, s.68(1) for a ruling that those royalties were effectively post-bankruptcy wages which, as such, could not be the subject of an attachment.

Holding for the publisher, the Court considered that the royalties in question had been earned from activities which Friedman had completed before the starting date of his bankruptcy. Accordingly s.68(1) did not apply.

Source: note by Miller Thomson LLP

Trust law provides fresh route in Japan

There's good news for anyone planning to securitise patents in Japan, according to an article on Intellectual Asset Management magazine's editor's blog. The article, "Securitising patents in the global credit crunch" by Yohei Iwasaki (Uchida & Samejima Law Firm), outlines the new Trust Law (Law 108/2006) which provides an alternative means for patent securitisation to the little-used Law Relating to the Securitisation of Assets. It enables investors to hold risk-manipulated beneficial interests that are related to the trustee, instead of bonds or shares. Moreover, entrusted patents are separated from the risk of an originator and/or a trustee going bankrupt. The author concludes that there is much optimism that securitisation transactions with innovative structures, using the new Trust Law, could become more common in future.