Monday, March 6, 2017

Music Business/Law Tips - "Endorsement Deal Structures"

Talent compensation models when an artist enters into an endorsement deal (i.e., the artist promotes a product by appearing in an advertisement using and/or complementing the product) can be structured in a variety of ways, but 3 of the most common are as follows: (1) Flat Fee (the brand pays the artist a fixed fee to promote the product for a period of time); (2) Flat Fee + Bonus (similar to #1, but if the ad generates a spike in brand revenue that meets a certain threshold then additional fees are paid to artist); and (3) Equity Share (instead of a fee, or for a much reduced fee, the artist can share in a healthy percentage of the net revenues generated from the product sales and/or sometimes even an ownership stake in the company). Of course these types of deals tend to be geared towards a more famous artist, but endorsements (and similarly sponsorships) can exist at all levels, so these examples can be used as a guideline in negotiations. Ben McLane Esq benmclane.com

Wednesday, February 1, 2017

Music Business Law Tips - "Major vs. Indie Record Deals"

In my years of doing deals I have discovered there are pros and cons of an artist signing with a major label versus with an independent label. Of course each artist situation is different and the factors can be negotiable case by case, but below are some of the major general differences to keep in mind: "Pro Major": (1) Bigger advance, (2) Greater promotion to mass media, (3) Perception that artist is a star; "Con Major": (1) Deal terms are longer, (2) Label takes/participates in more rights (i.e., 360 deal), (3) Artist can be a small fish in the system; "Pro Indie": (1) More chance of being a priority act, (2) Higher royalty split, (3) Can keep more rights (e.g., master license); "Con Indie": (1) Smaller advance, (2) Less promotional support, (3) Can be inconsistent due to less resources and staff Ben McLane Esq benmclane.com

Monday, December 26, 2016

Music Business/Law Tips - "Cover Recording Tips"

If you are releasing a straight-up cover version (your own interpretation) and re-recording all the audio from scratch, you simply need a mechanical license from Harry Fox (harryfox.com) to release the cover. However, if you want to actually "sample" the original recording (all or in part) and sing over it, that is more complex as you have to get permission/license from whoever owns the original master and the original songwriter/publisher(s) (and sometimes it is hard to find those party/ies if it is an obscure recording, or the originator may demand outrageous sample license fees for consent). Hence, it is usually better to just re-do (i.e., make a sound-alike/copy) the sounds you want, and not have to deal with sample clearances - and with today's technology that is quite possible; just don't do a verbatim rip-off. Ben McLane Esq benmclane.com

Wednesday, November 23, 2016

Music Business/Law Tips - "5 Steps to a Record Deal"

In my experience these 5 steps give a recording artist the best chance to get a record deal: 1. Have a demo with at least 3 hit radio songs; 2. Have a unique/marketable image and name; 3. Have an entertaining live show; 4. Have a strong social media presence (YouTube, etc); 5. Include the selling points listed above into a "package" that is easy for the industry to check out via computer (i.e., website or EPK link). Ben McLane Esq benmclane.com

Saturday, October 22, 2016

Music Business/Law Tips - "Accounting Transparency"

Recently The Orchard - which now also releases indie films as well as music - set up a new "transparent" form of accounting that to date has been unheard of in the film business (based on all the "net profit" lawsuits over the years on why no one is paid on a big hit film). The new model allows filmmakers to see the revenue and expenditures from the beginning to the end of any film that the company acquires or distributes and the bottom line net profit. Now filmmakers can see in real time the revenues (e.g., ticket sales, streams, cable) and costs to be deducted (production, distribution, marketing). According to The Orchard this new model is set up to let the parties have a better working relationship of collaboration/trust and hopefully will prompt the filmmaker to cooperate with promotions, etc., and so that everyone understands the reality of the costs versus benefit so that all parties can better project the long term outcome. We can hope that this type of mentality will also spill over into the music business where historically there has also been an information gap that has led to many unhappy results. Ben McLane Esq benmclane.com

Sunday, August 28, 2016

Music Business/Law Tips - "Brand v. Artist"

Trademark law seeks to prevent consumers from being confused. Recently, some rappers have incorporated the luxury brand names "Burberry" and "Rolls Royce" into their artist names and related imagery. Burberry and Rolls Royce objected, alleging that the use of their marks will cause consumers to mistakenly believe that the rappers are affiliated with, endorsed/sponsored by, or somehow connected to the brands, and the use of offensive language in the rapper's music could diminish the value of the brands. Because either the rappers changed their names or did not put up a legal challenge, the brand's arguments won out here. However, because of potential free speech or no confusion arguments - is it really this black and white? For instance, in 2000, Mattel sued MCA Records for pop group Aqua’s use of the Barbie trademark in their song and video for “Barbie Girl”. After a lengthy battle, the court found that Aqua’s use was not confusing because the title of an artistic work was viewed differently than a commercial product. Clearly, trademark law is a murky and a dangerous area to tread lightly. Bottom line probably better to come up with a unique name with no potential conflicts. Ben McLane Esq benmclane.com

Monday, August 1, 2016

Music Business/Law Tips - "Infringement - Statutory Damages"

The US Government is evaluating the Copyright Act to see if it needs to be updated to keep in step with the digital age. One of the areas it is thinking of revising is the "Statutory Damages" clause when someone infringes a copyright. The current standard per-work amount of statutory damages is set by Congress at $750-$30,000 per infringement, with an increased ceiling of up to $150,000 where infringement is found to be willful. However, to try and make awards more fair and not random - especially since with the Internet there are lots of cases of "innocent infringement" whereby users do not really know or are ignorant - the task force has recommended adding a list of factors for courts to consider when picking a number from the statutory range for an appropriate damages award (and perhaps making a new lower minimum): (1) The plaintiff’s revenues lost and the difficulty of proving damages. (2) The defendant’s expenses saved, profits reaped, and other benefits from the infringement. (3) The need to deter future infringements. (4) The defendant’s financial situation. (5) The value or nature of the work infringed. (6) The circumstances, duration, and scope of the infringement, including whether it was commercial in nature. (7) In cases involving infringement of multiple works, whether the total sum of damages, taking into account the number of works infringed and number of awards made, is commensurate with the overall harm caused by the infringement. (8) The defendant’s state of mind, including whether the defendant was a willful or innocent infringer. (9) In the case of willful infringement, whether it is appropriate to punish the defendant and if so, the amount of damages that would result in an appropriate punishment. Perhaps the Law will evolve - wait and see. Ben McLane Esq benmclane.com