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
benmclane.com
Thursday, April 28, 2011
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
benmclane.com
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
benmclane.com
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
benmclane.com
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
benmclane.com
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
benmclane.com
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
benmclane.com
Sunday, March 27, 2011
Music Business/Law Tips - "Management Agreement" (Part 2)
Further, the Agreement will have a time limit, or "term". The average term is three years. Normally, there is an initial number of years and then "options" for additional years, with the manager generally having the option power. The artist can limit the term by requiring "performance standards" whereby, for example, if the artist does not obtain a recording agreement or does not make a certain amount of money in the initial period, then the manager cannot pick up an option for more years.
Moreover, the Agreement will set forth the manager's fee, which on average is fifteen to twenty percent "of gross earnings" (i.e., before deductions) from all aspects of the artist's career. Yet, the artist can exclude certain monies from the manager's commission. If the artist, for example, is already a successful songwriter or actor, the manager should not be able to commission those earnings. Further, there are other monies which only "pass through" the artist's hands and which the artist never really earns. These, too, should be excluded and consist of: recording costs, tour support, independent promotion money, producer fees, and live gigs where the "net" is minimal.
Finally, with respect to commissions, the Agreement should have what is known as a "sunset clause" on activities which occur after the termination of the Agreement. Although a manager normally wants to be paid perpetually on sales of records released during the term, the band can negotiate that the percentage is reduced over a span of a certain number of years until the manager is no longer entitled to any commission.
Although this is not an exhaustive list of the important points, an artist needs to at least have a grasp of these concepts before he or she signs on the dotted line.
Ben McLane Esq
benmclane.com
Moreover, the Agreement will set forth the manager's fee, which on average is fifteen to twenty percent "of gross earnings" (i.e., before deductions) from all aspects of the artist's career. Yet, the artist can exclude certain monies from the manager's commission. If the artist, for example, is already a successful songwriter or actor, the manager should not be able to commission those earnings. Further, there are other monies which only "pass through" the artist's hands and which the artist never really earns. These, too, should be excluded and consist of: recording costs, tour support, independent promotion money, producer fees, and live gigs where the "net" is minimal.
Finally, with respect to commissions, the Agreement should have what is known as a "sunset clause" on activities which occur after the termination of the Agreement. Although a manager normally wants to be paid perpetually on sales of records released during the term, the band can negotiate that the percentage is reduced over a span of a certain number of years until the manager is no longer entitled to any commission.
Although this is not an exhaustive list of the important points, an artist needs to at least have a grasp of these concepts before he or she signs on the dotted line.
Ben McLane Esq
benmclane.com
Thursday, March 10, 2011
Music Business/Law Tips - "Management Agreement" (Part 1)
Once an artist has decided to work with a manager in which there is mutual trust and belief, it is advisable to memorialize a management agreement ("Agreement") in writing. Such an Agreement has certain elements an artist should be familiar with. This article will discuss the most important components.
The Agreement will contain a description of what the manager will do for the artist. The standard terminology is that a manager will "advise and consent" the artist in all aspects of the artist's career. Although this is vague, the manager will be performing creative functions, such as formulating an image, selecting material, and finding ways to promote the artist. Further, the manager will act as the artist's liaison with record companies, publishing companies, attorneys, agents, the press, etc.
The Agreement will also set forth that the manager is "not a talent agent". This means that the manager is not agreeing to find live gigs for the artist. There is a law in California which requires a talent agency license in order to procure live engagements for an artist. A talent agent must abide by strict standards which most managers do not want to be shackled by (i.e., posting a bond, limited commission percentage, cannot work out of home). If a manager violates this law, the artist can terminate the Agreement and require the manager to pay back commissions collected from the act in the past.
Additionally, the manager is usually granted some form of "power of attorney" to act on behalf of the artist on business matters. This allows the manager to approve such things as ads and publicity. However, it also allows for abuses because this power lets the manager sign documents on behalf of the artist. Thus, it is best to limit the signing authority only to short term live appearance documents or publicity matters, and only then once the artist has consented to the terms.
[part 2 next time]
Ben McLane Esq
benmclane.com
The Agreement will contain a description of what the manager will do for the artist. The standard terminology is that a manager will "advise and consent" the artist in all aspects of the artist's career. Although this is vague, the manager will be performing creative functions, such as formulating an image, selecting material, and finding ways to promote the artist. Further, the manager will act as the artist's liaison with record companies, publishing companies, attorneys, agents, the press, etc.
The Agreement will also set forth that the manager is "not a talent agent". This means that the manager is not agreeing to find live gigs for the artist. There is a law in California which requires a talent agency license in order to procure live engagements for an artist. A talent agent must abide by strict standards which most managers do not want to be shackled by (i.e., posting a bond, limited commission percentage, cannot work out of home). If a manager violates this law, the artist can terminate the Agreement and require the manager to pay back commissions collected from the act in the past.
Additionally, the manager is usually granted some form of "power of attorney" to act on behalf of the artist on business matters. This allows the manager to approve such things as ads and publicity. However, it also allows for abuses because this power lets the manager sign documents on behalf of the artist. Thus, it is best to limit the signing authority only to short term live appearance documents or publicity matters, and only then once the artist has consented to the terms.
[part 2 next time]
Ben McLane Esq
benmclane.com
Monday, February 28, 2011
Music Business/Law Tips - "Infringement" (Part 2)
Under the Copyright Act, the copyright owner is entitled to several remedies. Along with the damages suffered, the writer can obtain attorney's fees and court costs. In some instances, the writer can obtain profits of the infringer and an injunction. However, in order to take advantage of the full remedies under the Copyright Act, the song must be registered with the U.S. Copyright Office. Moreover, it is important to not delay in bringing the infringement suit once the infringement is discovered. Otherwise, the suit might be barred by what is known as the "statute of limitations". The party sued for infringement may raise certain defenses which are exceptions to copyright infringement. For instance, the doctrine of "fair use" allows a work to be copied if there is no "profit" motive (e.g., for education, research, news). Another legitimate defense is that the new work is a parody of the original work.
Although copyright registration is not mandatory under the Copyright Act of 1976, songwriters are encouraged to officially register their works because if an infringement situation arises, it will be easier to recover damages.
Ben McLane Esq
benmclane.com
Although copyright registration is not mandatory under the Copyright Act of 1976, songwriters are encouraged to officially register their works because if an infringement situation arises, it will be easier to recover damages.
Ben McLane Esq
benmclane.com
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