Thursday, April 28, 2011

Music Business/Law Tips - "Name" (Part 2)

B. There could be a question as to who owns the name between two, or more, different groups who all perform under the same name. The actual ownership is usually decided by which artist performed under (i.e., used) the name first. However, there is a legal term called "secondary meaning" which could override first use. A secondary meaning is when the public identifies a name with a particular artist. The Rolling Stones are a good example. There is no question as to who this name refers to. It could be that another act using the name the Rolling Stones was around first, but the public identification is with the famous group. If the artist is just starting out and finds itself in a situation where there is a rival claim to the name, it is probably better to change the name early on to avoid legal hassles.

C. There could be a question as to who owns the name between the members of a group. This becomes a problem if a member leaves or the group breaks up. It is advisable for the group to enter into a partnership agreement, or form a corporation, so that this issue is dealt with in advance.

An artist should also be wary of any record label that attempts in the contract to have ownership rights in the name transferred to the label. The artist must refuse this request because it is unfair for the label to benefit from owning a name that the artist created and developed.

In conclusion, a name is very important and great care should be taken in selecting it, protecting it and clarifying ownership in it.

Ben McLane Esq

Tuesday, April 19, 2011

Music Business/Law Tips - "Name" (Part 1)

The professional name that an artist performs under is a valuable commodity to both the artist and to any record company that releases the artist. Both the artist and the record company should be concerned that the name is protected, and that the rights in the name are reserved and understood. Usually, a record contract will have provisions dealing with the name, whether it is the artist's real name or a professional name. This article will discuss some of the common problems surrounding names.

The record label will essentially be concerned with two aspects of the name. First, the label will demand that the artist warrant and represent that the name used by the artist is in fact owned by the artist. Second, the label will demand that the artist grant to the label the right to use the name for publicity and promotion of the artist's recordings.

Often, the ownership of the name is disputed. There are three common scenarios:

A. There could be a question as to who owns the name between the artist and a third party (i.e., producer, production company, label, manager). In these situations, there is usually a contract between the artist and the third party that sets forth who in fact owns the name.

[part 2 next time]

Ben McLane Esq

Tuesday, April 12, 2011

Music Business/Law Tips - "Merchandising" (Part 2)

Term. This period is usually one or more years, or until the advance is recouped. The artist should make sure it has the right to repay the advance so that the deal does not drag on if sales are slow. The merchandiser will want to have a sell-off period (generally six months) after the deal ends in order to finish selling the goods that were manufactured. However, there should be no right to manufacture any further items.

Territory. The territory can be worldwide or rights can be licensed on a region by region basis.

Creative Control. The artist should insist that it has approval over any artwork which will be marketed so that shoddy or negative merchandise does not enter the marketplace.

The sale of merchandise can be very lucrative depending upon the type of artist because some forms of music lend themselves better to the sale of merchandise. Yet, since most popular artists will enter into some type of merchandising agreement, knowledge of the parameters of the contract will help ensure a fair deal.

Ben McLane Esq

Tuesday, April 5, 2011

Music Business/Law Tips - "Merchandising" (Part 1)

Signed artists, as well as unsigned artists that tour and have a strong following, can make a considerable amount of money by selling merchandise such as T-shirts, jackets, buttons, bumper stickers, posters, etc.

When an artist is preparing to tour, the artist will enter into a merchandising agreement with a merchandiser. The artist licenses to the merchandiser the right to use the artist's name, likeness or logo for the manufacture and sale of merchandise. In exchange for the license, the merchandiser pays the artist a royalty on the goods sold. Artists and their representatives beware because many record companies try to obtain the exclusive merchandising rights to the artist when the artist signs a recording contract.

The merchandising agreement consists of a few basic deal points:

Royalty. The royalty will either be a percentage of the gross sales of the item sold (usually from 25%-50%), or it will be in the form of a flat fee per unit sold.

Advances. Although the amount of the advance depends upon the stature of the artist, it can range anywhere from $0 to over $1,000,000. As with record royalties, merchandising advances are recoupable from royalties.

[part 2 next time]

Ben McLane Esq