S.B. No. 846
relating to distribution of recordings on consignment.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 2101.002, Occupations Code, is amended
by amending Subdivision (1) and adding Subdivisions (6) and (7) to
read as follows:
(1) “Art” means a commonly recognized art form,
including a painting, sound recording of a musical performance,
sculpture, drawing, work of graphic art, pottery, weaving, batik,
macrame, or quilt.
(6) “Recording distributor” means a person who
acquires a sound recording and sells the sound recording to another
person for use or resale.
(7) “Sound recording” means a tangible medium on which
music or other sounds are recorded or otherwise stored, including a
phonograph record, disc, tape, cassette, or other medium now
existing or developed later on which music or other sounds are or
can be recorded or otherwise stored or a copy or reproduction that
duplicates in whole or in part the original. The term does not
include a medium on which the primary recorded information is
information other than music or other sound, such as a motion
picture or computer program, and that contains recorded sound as an
integrated part of the primary recorded information.
SECTION 2. Chapter 2101, Occupations Code, is amended by
adding Section 2101.004 to read as follows:
Sec. 2101.004. CONSIGNED SOUND RECORDINGS EXEMPT FROM
CERTAIN LIENS OR CLAIMS. (a) Notwithstanding any provision of the
Business & Commerce Code, a sound recording delivered by the artist
who produced the music or other sound on the recording to a
recording distributor for sale and the proceeds from the recording
distributor’s sale of the sound recording are not subject to a
claim, lien, or security interest of a creditor of the recording
(b) Except as provided by Subsection (c), this section
applies to the proceeds of a sale of a sound recording regardless of
whether the recording distributor or another person purchased the
(c) This section does not apply to the proceeds of a sale of
a sound recording if the artist delivered the recording to the
recording distributor pursuant to a sale for which the artist has
been paid in full.
SECTION 3. Subdivision (20), Subsection (a), Section 9.102,
Business & Commerce Code, is amended to read as follows:
(20) “Consignment” means a transaction, regardless of
its form, in which a person delivers goods to a merchant for the
purpose of sale and:
(A) the merchant:
(i) deals in goods of that kind under a name
other than the name of the person making delivery;
(ii) is not an auctioneer; and
(iii) is not generally known by its
creditors to be substantially engaged in selling the goods of
(B) with respect to each delivery, the aggregate
value of the goods is $1,000 or more at the time of delivery;
(C) the goods are not consumer goods immediately
(D) the transaction does not create a security
interest that secures an obligation; and
(E) the transaction does not involve delivery of
a work of art to an art dealer or delivery of a sound recording to a
distributor if[, as provided by] Chapter 2101, Occupations Code,
applies to the delivery.
SECTION 4. This Act takes effect immediately if it receives
a vote of two-thirds of all the members elected to each house, as
provided by Section 39, Article III, Texas Constitution. If this
Act does not receive the vote necessary for immediate effect, this
Act takes effect September 1, 2005.
President of the Senate Speaker of the House
I hereby certify that S.B. No. 846 passed the Senate on
April 14, 2005, by the following vote: Yeas 31, Nays 0; and that
the Senate concurred in House amendment on May 16, 2005, by the
following vote: Yeas 30, Nays 0.
Secretary of the Senate
I hereby certify that S.B. No. 846 passed the House, with
amendment, on May 11, 2005, by the following vote: Yeas 146,
Nays 0, two present not voting.
Chief Clerk of the House