If the band cannot afford a federal registration, there are some things which can be done to protect the name. First, do a name search to find out if the name is unique. Google is the easiest, or some large libraries have a publication called (Index To) The Trademark Register. Or, one could check the Billboard International Talent & Touring Directory. Additionally, a person could order a name search report from a professional searching bureau for a few hundred dollars. Such bureaus are listed in the yellow pages on online under "Trademark Consultants." If the name is free and clear, the letters "TM", although unofficial, can be utilized to indicate rights to an unregistered service mark. Finally, the most important thing an act can do is to use the name publicly and consistently.
Assuming the act will seek a federal registration and has done a thorough search, the application procedure basically involves submitting (1) the appropriate application form (online or hard copy), (2) proof of public performance (e.g., advertisement or promo material for the public performance), and (3) the filing fee of approximately $325-375 (subject to change).
In a group situation, it is also important to come to some agreement in writing as to who owns the group name, and what will happen if a member leaves the group. The lack of such an understanding has led to a plethora of lawsuits.
The purpose of this article was to familiarize an artist with the way to protect one of the most important attributes that the public will associate with an act: the name. Since trademark matters can be somewhat complex, it might be wise to consult an attorney who can assist with the search and registration process.
Ben McLane Esq
benmclane.com
Tuesday, October 25, 2011
Monday, October 17, 2011
Music Business/Law Tips - "Trademark" (Part 1)
A band contemplating a serious career in the business would be well advised to take the necessary steps to protect its name by obtaining trademark protection. That way, the act will not only be secure in knowing that it has acquired the right to the name, but also the artist will not be sued for infringing someone else's name.
A name used for entertainment services is actually known as a service mark. Although a service mark is akin to a trademark and is governed by the same law, a service mark is used to identify services offered to the public (e.g., live performances by a group). A trademark, however, distinguishes symbols used on tangible physical goods (e.g., a record or merchandise displaying a group name). Neither of the above should be confused with a copyright which instead protects works such as songs and sound recordings.
In the United States, as opposed to some other foreign countries, rights in a group name are usually created by use of the name, not registration. Therefore, the act must actively perform under its name, advertise under its name, and sell product bearing its name to the public. Nonetheless, it is still advisable to register the service mark with the U.S. Patent and Trademark Office in Washington, D.C. This not only allows the use of the (R) symbol which gives notice to the public of your rights, it also will allow an artist to get an injunction and collect damages.
[part 2 next time]
Ben McLane Esq
benmclane.com
A name used for entertainment services is actually known as a service mark. Although a service mark is akin to a trademark and is governed by the same law, a service mark is used to identify services offered to the public (e.g., live performances by a group). A trademark, however, distinguishes symbols used on tangible physical goods (e.g., a record or merchandise displaying a group name). Neither of the above should be confused with a copyright which instead protects works such as songs and sound recordings.
In the United States, as opposed to some other foreign countries, rights in a group name are usually created by use of the name, not registration. Therefore, the act must actively perform under its name, advertise under its name, and sell product bearing its name to the public. Nonetheless, it is still advisable to register the service mark with the U.S. Patent and Trademark Office in Washington, D.C. This not only allows the use of the (R) symbol which gives notice to the public of your rights, it also will allow an artist to get an injunction and collect damages.
[part 2 next time]
Ben McLane Esq
benmclane.com
Saturday, October 8, 2011
Music Business/Law Tips - Taxes (Part 2)
C. Car. Gas, repairs, parking and depreciation are deductible in total. As an option, in lieu of deducting all the car expenses added together, an artist can simply keep track of the mileage and just take the standard per mile deduction.
D. Entertainment. Meals, drinks, etc. are 50% deductible so long as "primarily" business related.
E. Equipment. For an artist, many tools of the trade are deductible. These would include such things as musical equipment, instruments, computer, etc. Moreover, if an artist uses a portion of their home or apartment on a regular basis for business (e.g., practicing, recording, booking, etc.), that portion is deductible as a home office. This means that a percentage of the rent/mortgage and utilities are deductible. For instance, if an apartment has 4 rooms and 1 is used for business, 25%of the rent and utilities are deductible expenses.
The foregoing is only meant to give an artist an overview of potential business deductions. It is advisable to contact an accountant before filing a tax return to confirm that the artist's particular situation allows for these, or other, tax deductions.
Ben McLane Esq
benmclane.com
D. Entertainment. Meals, drinks, etc. are 50% deductible so long as "primarily" business related.
E. Equipment. For an artist, many tools of the trade are deductible. These would include such things as musical equipment, instruments, computer, etc. Moreover, if an artist uses a portion of their home or apartment on a regular basis for business (e.g., practicing, recording, booking, etc.), that portion is deductible as a home office. This means that a percentage of the rent/mortgage and utilities are deductible. For instance, if an apartment has 4 rooms and 1 is used for business, 25%of the rent and utilities are deductible expenses.
The foregoing is only meant to give an artist an overview of potential business deductions. It is advisable to contact an accountant before filing a tax return to confirm that the artist's particular situation allows for these, or other, tax deductions.
Ben McLane Esq
benmclane.com
Thursday, September 29, 2011
Music Business/Law Tips - "Taxes" (Part 1)
If a person is actively pursuing a career as a musical artist, and not just playing/writing as a hobby, that person is engaged in a trade or business (i.e., the music business). Hence, an artist can use the Internal Revenue Laws of the United States to his or her advantage. This article will discuss the main deductions that an artist can utilize for the purposes of paying taxes.
So long as an artist incurs expenses that are "ordinary and necessary" in pursuit of that artist's career, the expense should be deductible. However, any expense deducted from a tax return must be backed up by documentation. Therefore, it is imperative that an artist keep complete records of any and all expenses paid in pursuit of the artist's career. Usually, the record will be a receipt. Note that the IRS does not consider a cancelled check, by itself, adequate to verify a deduction; a receipt is more official and credible. An account book/file is also recommended to keep track of expenses. The main deductions to be aware of are as follows:
A. Travel. This would include air, bus, taxi or train fares, and any related transportation.
B. Meals and Lodging. These are deductible if related "primarily" to business.
[part 2 next time]
Ben McLane Esq
benmclane.com
So long as an artist incurs expenses that are "ordinary and necessary" in pursuit of that artist's career, the expense should be deductible. However, any expense deducted from a tax return must be backed up by documentation. Therefore, it is imperative that an artist keep complete records of any and all expenses paid in pursuit of the artist's career. Usually, the record will be a receipt. Note that the IRS does not consider a cancelled check, by itself, adequate to verify a deduction; a receipt is more official and credible. An account book/file is also recommended to keep track of expenses. The main deductions to be aware of are as follows:
A. Travel. This would include air, bus, taxi or train fares, and any related transportation.
B. Meals and Lodging. These are deductible if related "primarily" to business.
[part 2 next time]
Ben McLane Esq
benmclane.com
Wednesday, September 21, 2011
Music Business/Law Tips - "Songwriter Agreement" (Part 2)
Statements. Once the song is recorded or printed, the writer is entitled to receive royalty statements at least once every six months. Further, the writer should be allowed to audit the publisher's books to see if royalty calculations were done correctly.
Writer's Credit. The publisher must see to it that the writer receives proper credit on all uses of the song.
Arbitration. In order to avoid large legal fees, it is advisable to include a provision to allow an arbitrator to settle any disputes between the writer and publisher.
Future Uses/Rights. Any use/right not mentioned specifically in the contract should be retained by the writer because it could be a valuable bargaining chip in the future.
Performing Rights Affiliation. The writer must affiliate with either BMI, ASCAP or SESAC and the contract should read that all writer performance royalties must be paid directly to the writer by the performing rights organization; and, if the publisher should be paid these monies in error, the monies must be immediately sent to the writer.
Because of the length of a publishing relationship and rights transferred, the writer should obtain an experienced person to assist with a contract negotiation, preferably an entertainment attorney.
Ben McLane Esq
benmclane.com
Writer's Credit. The publisher must see to it that the writer receives proper credit on all uses of the song.
Arbitration. In order to avoid large legal fees, it is advisable to include a provision to allow an arbitrator to settle any disputes between the writer and publisher.
Future Uses/Rights. Any use/right not mentioned specifically in the contract should be retained by the writer because it could be a valuable bargaining chip in the future.
Performing Rights Affiliation. The writer must affiliate with either BMI, ASCAP or SESAC and the contract should read that all writer performance royalties must be paid directly to the writer by the performing rights organization; and, if the publisher should be paid these monies in error, the monies must be immediately sent to the writer.
Because of the length of a publishing relationship and rights transferred, the writer should obtain an experienced person to assist with a contract negotiation, preferably an entertainment attorney.
Ben McLane Esq
benmclane.com
Monday, September 12, 2011
Music Business/Law Tips - "Songwriter Agreement" (Part 1)
Important decisions a songwriter faces concern which publisher to sign with and what type of contract to sign. Publishing deals are of two basic kinds: the single song contract (generally for one song) and the exclusive songwriter's contract (for all songs written during a period of time). Although these two deals are quite different, they have one thing in common that the writer must be aware of: copyright ownership is transferred to the publisher. Therefore, it will be a long-term deal. This being the case, the writer needs to be certain that he/she is entering into a fair contract. Some basic points that a songwriter's contract include are the following:
Reversion Clause. There should be a provision that if the publisher does not secure a commercial release within a specified time (i.e., one year), the songwriter can terminate the deal.
Work For Hire. If it is a single song deal, make sure that "employment for hire" and "exclusive writer agreement" phrases are not included. Also, there should be no options for future songs.
Changes To Song. The publisher should only be able to change the title, lyrics or music with the songwriter's consent.
Royalty. The songwriter should receive at least fifty percent (50%) of all income earned from the song(s).
Deductions. The costs of demos should be paid 100% by the publisher.
[part 2 next time]
Ben McLane Esq
benmclane.com
Reversion Clause. There should be a provision that if the publisher does not secure a commercial release within a specified time (i.e., one year), the songwriter can terminate the deal.
Work For Hire. If it is a single song deal, make sure that "employment for hire" and "exclusive writer agreement" phrases are not included. Also, there should be no options for future songs.
Changes To Song. The publisher should only be able to change the title, lyrics or music with the songwriter's consent.
Royalty. The songwriter should receive at least fifty percent (50%) of all income earned from the song(s).
Deductions. The costs of demos should be paid 100% by the publisher.
[part 2 next time]
Ben McLane Esq
benmclane.com
Monday, September 5, 2011
Music Business/Law Tips - "Royalties (computing)" [Part 2]
Since new, unknown acts do not have a guaranteed audience, the label is hesitant to grant a high rate because there a is good chance that the artist will never even sell enough records to recoup all of the costs that go into releasing a record (i.e., recording, promotion, pressing, etc). In comparison, a well-known artist is almost assured of making a profit and hence would receive a higher rate.
The artist must be knowledgeable about what the royalty is based on. The base is usually the suggested retail list price, but oftentimes the wholesale price of the record acts as the base upon which the royalty is computed. Since the wholesale price is roughly one-half of the suggested retail list price, the artist should receive approximately twice the royalty that would be allowed under the retail base price system.
The artist should try to negotiate escalations for royalties. In essence, this means that the artist is rewarded in the future with a higher rate if the artist reaches certain sales levels. For example, it the artist has a 10% royalty, the rate would be bumped up a percentage point if 250,000 units were sold. Increases can continue for even further sales levels. Escalations can also be tied to when the label picks up an option for another year/record.
Royalties for sales outside of the United States are usually reduced. The reduced rates depend upon whether sales are in major foreign markets or not. For example, Canadian sales usually receive 85% of the U.S. rate; sales in the United Kingdom, Germany, France, Japan and Australia receive 75% of the U.S. rate; the remainder of the world receives approximately 50% of the U.S. rate. The justification for the lower foreign rate is that the label is probably licensing the product to an independent foreign distributor that must also be compensated.
Other things which affect the rate but which were not discussed here consist of, but are not limited to, packaging deductions, free goods, and whether a record is a budget release or not.
Ben McLane Esq
benmclane.com
The artist must be knowledgeable about what the royalty is based on. The base is usually the suggested retail list price, but oftentimes the wholesale price of the record acts as the base upon which the royalty is computed. Since the wholesale price is roughly one-half of the suggested retail list price, the artist should receive approximately twice the royalty that would be allowed under the retail base price system.
The artist should try to negotiate escalations for royalties. In essence, this means that the artist is rewarded in the future with a higher rate if the artist reaches certain sales levels. For example, it the artist has a 10% royalty, the rate would be bumped up a percentage point if 250,000 units were sold. Increases can continue for even further sales levels. Escalations can also be tied to when the label picks up an option for another year/record.
Royalties for sales outside of the United States are usually reduced. The reduced rates depend upon whether sales are in major foreign markets or not. For example, Canadian sales usually receive 85% of the U.S. rate; sales in the United Kingdom, Germany, France, Japan and Australia receive 75% of the U.S. rate; the remainder of the world receives approximately 50% of the U.S. rate. The justification for the lower foreign rate is that the label is probably licensing the product to an independent foreign distributor that must also be compensated.
Other things which affect the rate but which were not discussed here consist of, but are not limited to, packaging deductions, free goods, and whether a record is a budget release or not.
Ben McLane Esq
benmclane.com
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