Important clauses in a contract with a composer using the "Zaychik" case as an example — analysis and advice from Semenov & Pevzner

In the Russian gaming industry, there's an ongoing discussion about the situation surrounding the visual novel "Tiny Bunny" (Зайчик). One of the project's composers, Dmitry Petyakin, wanted to increase the remuneration for his music and claimed that the music was being used improperly. Additionally, he started blocking the game's streams on YouTube, raising concerns among other developers. In an article, lawyers from Semenov&Pevzner delve into how to determine if rights were transferred to the client under the contract, whether an author can secure higher compensation, and how rights holders can protect themselves from such situations.

Irina Gushchina and Karina Bragnyuk

The game's creators and Dmitry Petyakin have not publicly shared the text of the contract signed between them, making it difficult to objectively assess the positions of the parties involved.

The position of the game's rights holders: Dmitry Petyakin signed a contract with them granting perpetual ownership of the music and received all the compensation stipulated in the contract. Five years have passed, the project became popular, and now he wants more.

The composer's position (based on open sources) is the opposite:

• The game's rights holders have no rights to his music;
• His residency is not in Russia but in the European Union (where different rules apply);
• By law, one cannot own music indefinitely.

Let's dissect these theses in order and provide our recommendations: what to do to avoid a similar situation.

How to determine if rights were transferred to the client under the contract?

You must verify:

• What specific objects are being transferred under the contract;
• What rights to them are transferred to the client, and which remain with the performer;
• How the conditions regarding the performer's remuneration are formulated.

About the objects. It often happens that a contract is concluded with vague descriptions of what will be created—like saying musical compositions will be created for a particular game. This is allowable, but it is better to agree on specifics in separate assignments or acts later. In the worst-case scenario, involve written correspondence. For example, if the contract stipulates the creation of ten variations of the main musical theme without specifying them, it will be extremely difficult to prove later that the client obtained rights to the specific variations they claim. It's crucial to describe in detail exactly what is being transferred, the duration of the melodies, and who the authors are. In addition, it is advisable to send the music via email or upload it to the client's cloud storage without the possibility of deletion. Although messenger correspondence might be more convenient for negotiation and discussion, because messages can be edited and deleted, it is a less reliable option for recording the fact of the object's transfer.

About describing which rights are transferred to the client. Every situation is unique: some composers are ready to completely cede rights, while others try to limit the permissible ways of usage. The ideal approach is to prescribe the condition about the transfer of rights in an unambiguous formulation so both parties clearly understand what they can and cannot do. For example, if the agreement was about using the composition only in a specific part of the game, that's exactly what should be stated in the contract.

About the performer's compensation conditions. These can be formulated in various ways. Compensation can be paid as a fixed amount or as royalties. A good addition to any of these formulations is: “this compensation is a comprehensive fee for all methods of using the works. The author is not paid any additional fixed or periodic payments for the use of the works by the client.”

Can an author request more after several years?

In cases where the author significantly underestimated the project's profitability, under Russian law (major change of circumstances), they may attempt to go to court to alter the conditions of a previously concluded contract. In Russia, the revision of contract terms is possible if a court acknowledges that circumstances have changed to the extent that the agreement would not have been concluded or would have been signed under significantly different terms if the parties could have reasonably foreseen such a change. The compensation amount is evaluated based on regular market conditions, and it should be considered that the financial success of the project is a business risk for all participants in the video game creation process.

Similar rules apply abroad. For example, in the EU, Directive 2019/790 requires all EU member states to provide a mechanism for adjusting compensation in cases where the initially agreed compensation for rights transfer becomes disproportionately low compared to the client's actual earnings related to the contentious work. If the parties cannot agree on higher compensation for the author, the author has the right to file a lawsuit.

Legislation from European countries indeed provides such opportunities for authors. A well-known case is the dispute between "The Witcher" author Andrzej Sapkowski and the game studio CD Projekt RED. Back in the 1990s, the studio acquired a license from the author to adapt his books into the computer game "The Witcher." Sapkowski was paid 35,000 Polish zlotys at the time (approximately 9,000 USD at the start of March 2025). The studio offered Sapkowski a percentage of the game sales, but he doubted the game's profitability. The game later became very popular, and in 2018, Andrzej Sapkowski demanded additional royalties of 60 million Polish zlotys. According to the Polish "Act on Copyright and Related Rights," when the author's compensation is disproportional to the commercial gain received by CD Projekt RED from exploiting the license rights, the author was entitled to request an increase in his licensing fee. The dispute was resolved before reaching court, with the exact payment to Sapkowski undisclosed.

Returning to the controversy about "Tiny Bunny": for the author to apply foreign law, it's necessary to check what the contract states. If the applicable law in the contract is Russian law, arguments about EU countries' laws will be unfounded.

Can music rights be transferred indefinitely?

The duration of copyright is limited. In Russia, the exclusive right to a work lasts for the entire life of the author plus seventy years, starting from January 1 of the year following the author's death. After that, the work enters the public domain. Copyright cannot be indefinite by nature — in this respect, the thesis is accurate.

If you need to acquire rights from an author for the maximum possible duration, contracts usually state that this will be for the entire term of the exclusive right to the work. Even if the contract states that rights are transferred indefinitely, this does not render the contract invalid. Such wording is meant to transfer rights for the longest possible term. Since the term cannot exceed the duration of the exclusive right, this contract will be considered concluded for a term equal to the duration of the exclusive right.

However, it is better to immediately indicate the term condition correctly in the contract and avoid using the word "indefinitely."

How to protect against such situations and what to include in a contract with an author?

Key aspects to pay attention to:

1. Contract subject and usage methods. It is essential to clearly state what will be transferred and to what extent. It's vital to consider whether the developer can not only include tracks in the game but also use them separately from it. For instance, in promotional videos and YouTube streams. Another crucial aspect is whether the developer can incorporate tracks into game sequels.
2. Financial conditions. It is advisable to align the author's licensing remuneration with future commercial gain to avoid similar disputes over monetary compensation.
3. Permissions related to the author's non-property rights, such as the right to anonymous use of tracks in the game and the right to make changes, cuts, and additions to the tracks.
4. If rights are not transferred entirely but by license, the type of license should be specified: exclusive or non-exclusive ("exclusive" or "non-exclusive"). If you want the author not to grant the rights to the tracks to anyone else, you must state this in the contract explicitly.
5. For licenses, it's also crucial to indicate the term and territory. If rights are transferred entirely, the term and territory may not be limited.
6. If the contract is not with the author but another rights holder (e.g., an outsourcing studio), it is worth including guarantees of rights clarity. These imply that the rights holder obtained all rights from the author and promises to resolve any claims from the author independently, should they arise.
7. A crucial condition often forgotten is the applicable law and dispute resolution procedures. This will help you avoid spending money on foreign lawyers. If you provide that the author must first file a complaint with the developer before going to court, you can avert the dispute at its inception.
8. Consider confidentiality conditions to ensure both parties keep the contract terms secret.

What actions can an author take if rights are not fully transferred to the developer?

1. After evaluating the scope of rights to the track transferred to the game's rights holder, the author can propose that the developer buys the remaining rights (e.g., extend the license term, rights for use in sequels, mobile versions, etc.).
2. If the track is used within the game beyond the agreed contractual conditions not authorized by the music's rights holder, and negotiations with the developer fail to reach a compromise, the logical next step would be to issue a pre-trial claim with an obligation to pay compensation and cease using the track in unauthorized ways.
3. If the game rights holder does not respond to claims or considers them unfounded, the next step would be legal proceedings. This litigation will determine whether the developers are truly infringing on the composer's rights or if the author has inaccurately assessed the contract conditions.
4. Other methods an author might employ without engaging with the game's rights holder include filing "complaints" with platforms and streaming services (Steam, YouTube, App Store) regarding the violation of the composer's intellectual property rights. The consequences of these strikes might lead to the removal of content by the platform or the blogger who uploaded the game's playthrough stream.
5. The author can also use the track in ways not transferred to the game developer. For example:
   • Upload the music to streaming services (Spotify, Yandex Music, Apple Music, etc.) and earn from plays.
   • Sell the track as a soundtrack for other products via Bandcamp or Steam if the game's rights agreement doesn't include this restriction.
   • License the music for other projects—films, commercials, other games.

What should the game rights holder do to protect their rights?

1. Promptly address the author's claims with legal justification for holding rights to the track in the appropriate scope.
2. The primary response to strikes is appealing and contesting them on platforms by providing all supporting documents regarding the game's components and their rights.

For a streamer, appealing, just like for a developer, can be a relevant and functional tool, provided the streamer holds the game rights in the necessary scope for streaming. For instance, if a developer studio owning the game signed an agreement with a blogger for a playthrough and integration of the process in videos with a provided license for such video placements. Or if the user/license agreement explicitly indicates the game’s use in streams and video reviews (often such permission comes with restrictions like non-commercial use only or use only in videos directly related to the game, etc.). For instance, the Morteshka studio's website explicitly states streaming is allowed for their games, but music must not be played separately from the visuals.

To confirm a streamer's rights and the wrongful warning/deletion of content, it is necessary to submit a counter-notification and prove the presence of rights by attaching the user agreement or a direct agreement with the studio. However, entering into disputes with platforms brings its reservations, as it is not always possible to obtain justified comments on the denial of an appeal and content removal from services.

Legally, there is a difference if the game is used as a single object or if its elements (illustrations, animations, music, texts, etc.) are used separately. In streams, the game is used as a unified object. If this is done lawfully, then the music played within the game, being an inseparable part of it, is also lawful. Therefore, blocking a game's playthrough video due to music rights violations within such a game is not entirely correct from a legal standpoint. However, whether this can be contested successfully in each specific case depends on the platform, its user agreement, and policy.

Public disputes between an author and developers can affect not only the composer’s reputation but also the studio’s standing within the gaming community. Since users rarely possess complete information about the conflict, their opinions often form under emotional influences rather than objective facts. Therefore, it is crucial for developers to anticipate the necessary extent of rights for all game components and carefully organize contractual relationships in the production phase, helping to avoid reputational risks and maintain audience trust in the future.