Sunday, December 18, 2011

Clearances For Name & Likeness, Location License, And Life-Story Rights In Motion Pictures And Television: Written By New York Entertainment Lawyer And Film & Television Lawyer John J. Tormey III, Esq.


Law Office of John J. Tormey III, Esq. – Entertainment Lawyer, Entertainment Attorney
John J. Tormey III, PLLC
1324 Lexington Avenue, PMB 188
New York, NY  10128  USA
(212) 410-4142 (phone)
(212) 410-2380 (fax)

Clearances For Name & Likeness, Location License, And Life-Story Rights In Motion Pictures And Television: Written By New York Entertainment Lawyer And Film & Television Lawyer John J. Tormey III, Esq.
© John J. Tormey III, PLLC. All Rights Reserved.

This article is not intended to, and does not constitute, legal advice with respect to your particular situation and fact pattern. Do secure counsel promptly, if you see any legal issue looming on the horizon which may affect your career or your rights. What applies in one context, may not apply to the next one. Make sure that you seek individualized legal advice as to any important matter pertaining to your career or your rights generally.

An entertainment lawyer handling production and rights motion picture work can spend much of his or her time fighting off detractors. One example? It is actually quite common for individuals who incidentally appear in a film or television shot, to later sue or otherwise claim upon the production company or network, asserting violations of their personal or proprietary rights. It is also fairly common for those that believe their life-story in whole or in part has been used or referenced in a film or TV program, to put an adverse life-story rights claim on the motion picture project, even if the reference is but a passing reference. When such a claim is long on bluster but short on underlying legal merit, it is known as a nuisance claim, or “strike suit” if and once litigated.

Entertainment lawyers with a motion picture practice in the U.S. who have worked in Business Affairs or other in-house positions at entertainment companies, as well as most all entertainment lawyer litigators at outside law firms, will confirm all of this. I have served as both, prior to my solo law practice here in New York. One thing you learn quickly in this line of work, is that, while some claims are valid, more people claim more rights in more situations than actually have them.

Film and television producers usually complain to their own entertainment lawyers that the commencement of such a rights nuisance claim is a sleazy thing to do, and the sign of someone watching too many motion pictures with too much time on his/her hands. Often true. Yet the film or TV production can be out time and money by the time that same complaint can be made to the person with the power to dismiss the claim – that is, the judge in the applicable court system. The film or TV producer’s feeling is understandable, unless the person incidentally depicted in the motion picture program is truly ridiculed or hurt in some way. But many Americans use litigation as a sport, and greed is a powerful motivator. There is an entire section of the motion picture entertainment insurance industry and an entire cadre of in-house entertainment lawyers devoted almost exclusively to extinguishing rights nuisance claims and strike suits, often but not always through what is known as errors and omissions (E&O) insurance. Without insurance, even a strike suit can sometimes close a company down.

The first thing an entertainment lawyer does when fielding an adverse film or television claim – life-story, likeness, location, or otherwise - is evaluate the apparent sense and sensibility of the rights-complainant. So, let’s assume that the distinction has already been made between an unstable unfortunate soul who thinks that every successful Hollywood motion picture director is stealing his persona and private thoughts with implanted electrodes and radio waves, on the one hand – versus a person whose full name, likeness, and/or life-story in whole or in part actually appears in an exhibited film or television property. Let’s assume that the entertainment lawyer has reviewed the claimant’s identity with his or her film or TV producer client, and it turns out that the claimant has certain rights and is sane, stable, sympathetic, aggrieved – and unsigned. If the person’s name or likeness or life-story is recognizable in the film shot or in the television script, and no written “clearance” (to wit, signed “license”, “release”, or “agreement”) is in place, then the entertainment lawyer tells the producer of the film or TV production that rights may have been violated thereby and the motion picture production is that much more at risk.

Period.

In reply to the next likely question, the entertainment lawyer next opines that the dollar value at law of the risk or exposure to the rights violation claim cannot be accurately quantified, unless and until the issue is litigated between the aggrieved claimant on the one hand, and the film or TV company (or its insurer) on the other hand.

Period.

These decidedly-fuzzy motion picture law principles even apply to film and television location licenses and related rights, albeit under different legal theories than those corresponding to names, likenesses, and life-stories. As an example, the entertainment lawyer might next ask the motion picture producer to consider the Hollywood Chamber of Commerce that historically has licensed uses of the famous “Hollywood” sign located up on Beachwood Canyon. The Chamber has, at least in the past, asserted rights to claim and sue for unauthorized uses and depictions of the “Hollywood” sign itself - even though the sign is comprised of but a bunch of letters, and rights to letters of alphabet themselves should in theory be public domain and not owned by anyone. In any event, reasonable minds in the film and TV businesses and elsewhere, including as between entertainment lawyers themselves, have differed in the past as to whether there is legal support for these types of “location” rights claims in motion picture practice. Rather than risk it, though, a careful film producer, or television producer or executive producer, usually “clears” depicted locations rather than pay the entertainment lawyer to tell him to clear those (possible) rights post facto after the film or TV project is in the can - or else the producer moves the motion picture shot to a different location if the location license rights “clearance” is too expensive. This is particularly true of the film or TV executive that knows he or she must keep the company’s errors and omissions (E&O) insurance carrier happy and motivated to provide and not cancel coverage. Much of an entertainment lawyer’s detractor-fighting discussed above, includes the creation of alliances with the E&O carriers and their counsel. E&O carrier counsel are sometimes even more rights-sensitive and risk-averse than the motion picture studio or television network Business Affairs in-house counsel are, themselves.

Sure, a film or television producer - particularly one without an in-house or other entertainment lawyer to advise him/her, or an E&O carrier to chastise him/her - can try and fly under the radar on the “incidental use” issue, and hope no rights-violation claims occur. Many producers in fact do try this. But seemingly-incidental shots and uses cannot necessarily be safely assumed to be immune from rights claims. And Murphy’s Law will tell you that someone whose life-story truly appears in a picture in whole or substantial part, will always see it and recognize it. Some of these seemingly-innocuous motion picture uses can in fact turn out to be legally-actionable, and there are plenty plaintiff-side entertainment lawyer litigators out there who seem to be hungry to take on such causes. Even if not legally-actionable, a nuisance claim or lawsuit based on location, likeness, or life-story rights against a film or TV company can still be predicated upon an incidental-shot use in a motion picture, as a practical matter. Even with no supporting legal merit to it, it can still become an expensive headache. In other words, the law is what you read in the casebooks and statutes, but life is what happens out on the street, and rights are often what even undeserving allege until extinguished in a litigation.

Moreover, most of the good film and TV rights and “clearance” stories, though perhaps bandied-about as anonymous and sanitized hypotheticals, never make it to the casebooks. Most of these types of motion picture rights and clearance claims are never litigated, much less revealed by the publication of judicial opinions thereafter. From a film or TV entertainment lawyer defense counsel’s perspective, it is often worth paying the motion picture rights claimant US$2,500 or more, just to go away. Oftentimes, the deductible on the errors and omissions (“E&O”) insurance policy for a film can be at least US$10,000. Sometimes the deductible is even more. (Life-story encroachments and celebrity likeness rights violations can be far more expensive). Therefore, in practice, in the case of an incidental use “passing shot”, the film or TV company, with or without its entertainment lawyer’s advice, may simply pay the rights claimant. The producer may elect to do this rather than (rightfully or wrongfully) even report the claim to the E&O insurance carrier, much less seek coverage on it. Moreover, the E&O carrier will typically not defend against the motion picture rights claim and staff it up with its own defense-counsel entertainment lawyers, unless and until the suit is actually commenced or filed. So it is often the film or TV producer’s or distributor’s exclusive headache unless and until the lawsuit is filed.

The New York statute on point for those in the film and television industries and other media and entertainment industries as well, is New York Civil Rights Law, Sections 50 and 51, a statutory lattice which should be deemed relevant to both name & likeness and life-story rights matters:



If anyone thinks that an individual can’t sue for an unauthorized use of his or her likeness in a motion picture, then that skeptic should read that statute and the cases decided under it. California (Civil Code Section 3344) and most other American states have law similar to New York’s Civil Rights Law 50/51, on the books.

“50/51” and “3344”, are the bread and butter of entertainment lawyers. A private person usually sues a film or TV company on this type of likeness claim, under his or her “right of privacy”, whereas a celebrity usually sues the motion picture company on this type of likeness claim under his or her “right of publicity”. And the best way to evaluate a life-story rights claim is to navigate through a morass of prior case law, or else, better yet, have your entertainment lawyer do it for you.

It’s rough out there. One should obtain signed written rights clearances from those whose names, likenesses, or life-stories recognizably appear in one’s motion picture or TV production. Even a location-depiction claim could tie up a film or television shoot in a worst-case scenario, including that familiar case that many entertainment lawyers have dealt with on an incoming cell phone call when the location-landlord shows up on set 15 minutes before cameras roll and demands more money. When that happens, count your blessings, though. After all, the film likeness rights claimant or life-story rights claimant often doesn’t approach the production company until after the film is in theatrical release, when it is too late to cut the film’s negative.

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My practice as a film lawyer and entertainment attorney includes film and television rights, life-story rights, clearances, location agreements, licensing matters, and other aspects of motion picture development, production, exhibition, and distribution. If you have questions about legal issues which affect your career, and require representation, please contact me:

Law Office of John J. Tormey III, Esq.
John J. Tormey III, PLLC
1324 Lexington Avenue, PMB 188
New York, NY  10128  USA
(212) 410-4142 (phone)
(212) 410-2380 (fax)

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Clearances For Motion Pictures

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Thursday, December 15, 2011

“Performance” Clauses In Entertainment Contracts: Written By New York Entertainment Lawyer And Music And Film Attorney John J. Tormey III, Esq.


Law Office of John J. Tormey III, Esq. – Entertainment Lawyer, Entertainment Attorney
John J. Tormey III, PLLC
1324 Lexington Avenue, PMB 188
New York, NY  10128  USA
(212) 410-4142 (phone)
(212) 410-2380 (fax)

“Performance” Clauses In Entertainment Contracts: Written By New York Entertainment Lawyer And Music And Film Attorney John J. Tormey III, Esq.
© John J. Tormey III, PLLC.
All Rights Reserved.

This article is not intended to, and does not constitute, legal advice with respect to your particular situation and fact pattern. Do secure counsel promptly, if you see any legal issue looming on the horizon which may affect your career or your rights. What applies in one context, may not apply to the next one. Make sure that you seek individualized legal advice as to any important matter pertaining to your career or your rights generally.

Producing and editing a masterwork of recorded music is obviously a specialized art form. But so is the entertainment lawyer’s act of drafting clauses, contracts, and contractual language generally. How might the art of the entertainment attorney’s legal drafting a clause or contract affect the musician, composer, songwriter, producer or other artist as a practical matter? Many artists think they will be “home free”, just as soon as they are furnished a draft proposed record contract to sign from the label’s entertainment attorney, and then toss the proposed contract over to their own entertainment lawyer for what they hope will be a rubber-stamp review on all clauses. They are wrong. And those of you who have ever received a label’s “first form” proposed contract are chuckling, right about now.

Just because a U.S. record label forwards an artist its “standard form” proposed contract, does not mean that one should sign the draft contract blindly, or ask one’s entertainment lawyer to rubber-stamp the proposed agreement before signing it blindly. A number of label forms still used today are quite hackneyed, and have been adopted as full text or individual clauses in whole or in part from contract form-books or the contract “boilerplate” of other or prior labels. From the entertainment attorney’s perspective, a number of label recording clauses and contracts actually read as if they were written in haste - just like Nigel Tufnel scrawled an 18-inch Stonehenge monument on a napkin in Rob Reiner’s “This Is Spinal Tap”. And if you are a musician, motion picture fan, or other entertainment lawyer, I bet you know what happened to Tap as a result of that scrawl.

It stands to reason that an artist and his or her entertainment lawyer should carefully review all draft clauses, contracts, and other forms forwarded to the artist for signature, prior to ever signing on to them. Through negotiation, through the entertainment attorney, the artist may be able to interpose more precise and even-handed language in the contract ultimately signed, where appropriate. Inequities and unfair clauses aren’t the only things that need to be removed by one’s entertainment lawyer from a first draft proposed contract. Ambiguities must also be removed, before the contract can be signed as one.

For the artist or the artist’s entertainment attorney to leave an ambiguity or inequitable clause in a signed contract, would be merely to leave a potential bad problem for a later day - particularly in the context of a signed recording contract which could tie up an artist’s exclusive services for many years. And remember, as an entertainment lawyer with any longitudinal data on this item will tell you, the artistic “life-span” of most artists is quite short - meaning that an artist could tie up his or her whole career with one bad contract, one bad signing, or even just one bad clause. Usually these bad contract signings occur before the artist seeks the advice and counsel of an entertainment attorney.

One seemingly-inexhaustible type of ambiguity that arises in clauses in entertainment contracts, is in the specific context of what I and other entertainment lawyers refer to as a contract “performance clause”. A non-specific commitment in a contract to perform, usually turns out to be unenforceable. Consider the following:

Contract Clause #1: “Label shall use best efforts to market and publicize the Album in the Territory”.

Contract Clause #2: “The Album, as

delivered to Label by Artist, shall be produced and edited using only first-class facilities and equipment for sound recording and all other activities relating to the Album”.

One shouldn’t use either clause in a contract. One shouldn’t agree to either clause as written. One should negotiate contractual edits to these clauses through one’s entertainment lawyer, prior to signature. Both clauses set forth proposed contractual performance obligations which are, at best, ambiguous. Why? Well, with regard to Contract Clause #1, reasonable minds, including those of the entertainment attorneys on each side of the transaction, can differ as to what “best efforts” really means, what the clause really means if different, or what the two parties to the contract intended “best efforts” to mean at the time (if anything). Reasonable minds, including those of the entertainment lawyers on each side of the negotiation, can also differ as to what constitutes a “first-class” facility as it is “described” in Contract Clause #2. If these contractual clauses were ever scrutinized by judge or jury under the hot lights of a U.S. litigation, the clauses might well be stricken as void for vagueness and unenforceable, and judicially read right out of the corresponding contract itself. In the view of this particular New York entertainment attorney, yes, the clauses really are that bad.

Consider Contract Clause #1, the “best efforts” clause, from the entertainment lawyer’s perspective. How would the artist really go about enforcing that contractual clause as against a U.S. label, as a practical matter? The answer is, the artist probably wouldn’t, at end of day. If there ever were a contract dispute between the artist and label over money or the marketing expenditure, for example, this “best efforts” clause would turn into the artist’s veritable Achilles Heel in the contract, and the artist’s entertainment attorney might not be able to help the artist out of it as a practical matter:

Artist: “You breached the ‘best efforts’ clause in the contract!”

Label: “No! I tried! I tried! I really did!”

You get the idea.

Why should an artist leave a label with that kind of contractual “escape-hatch” in a clause? The entertainment lawyer’s answer is, “no reason at all”. There is absolutely no reason for the artist to put his or her career at risk by agreeing to a vague or lukewarm contractual marketing commitment clause, if the marketing of the Album is perceived to be an essential part of the deal by and for the artist. It often is. It would be the artist’s career at stake. If the marketing spend throughout the contract’s Term diminishes over time, so too could the artist’s public recognition and career as a result. And the equities should be on the artist’s side, in a contractual negotiation conducted between entertainment attorneys over this item.

Assuming that the label is willing to commit to a contractual marketing spend clause at all, then, the artist-side entertainment lawyer argues, the artist should be entitled to know in advance how his or her career would be protected by the label’s expenditure of marketing dollars. Indeed, asks the entertainment attorney, “Why else is the artist signing this deal other than an advance, marketing spend, and tour support?”. The questions may be phrased a bit differently nowadays, in the current age of the contract now known as the “360 deal”. The clauses may evolve, or devolve, but the equitable arguments remain principally the same.

The point is, it is not just performers that should be held to performance clauses in contracts. Companies can be asked by entertainment lawyers to subscribe to performance clauses in contracts, too. In the context of a performance clause - such as a record label’s contractual obligation to market and publicize an album - it is incumbent upon the artist, and the artist’s entertainment attorney if any, to be very specific in the clause itself about what is contractually required of the record company. It should never be left to a subsequent verbal side conversation. In other words, working with his or her entertainment lawyer, the artist should write out a “laundry-list” clause setting forth each of the discrete things that the artist wants the label to do. As but a partial example:

Contract Clause #3: “To market and publicize the Album in the Territory, you, Label, will spend no less than ‘x’ U.S. dollars on advertising for the Album during the following time period: ____________”; or even,

Contract Clause #4: “To market and publicize the Album in the Territory, you, Label, will hire the ___________ P.R. firm in New York, New York, and you will cause no less than ‘y’ U.S. dollars to be expended for publicity for and directly relating to the Album (and no other property or material) during the following time period: _____________”.

Compare Clauses #3 and #4, to Contract Clause #1 earlier above, and then ask yourself or your own entertainment attorney: Which are more hortatory? Which are more precise?

As for Contract Clause #2 and its vague unexplained definition of “first-class facilities and equipment” – why not have one’s entertainment lawyer instead just include in the contract a laundry-list clause of the names of five professional recording studios in the relevant city, that both parties, label and artist, prospectively agree constitute “first-class” for definitional purposes? This is supposed to be a contract, after all, the entertainment attorney opines. “Don’t leave your definitions, and therefore definitional problems, for a later document or a later day, unless you truly want to make a personal financial commitment to keeping more litigators awash in business debating bad clauses and bad contracts before the courts”.

If you don’t ask, you don’t get. Through the entertainment lawyer, the artist should make the label expressly sign on to a very specific contractual list of tasks in an appropriate clause, monitor the label’s progress thereafter, and hold the label to the specific contractual standard that the artist was smart enough to “carve in” in the clause through the entertainment attorney in the first instance.

* * * *

Again, consider Contract Clause #2, the “first class facilities and equipment” clause, from the entertainment lawyer’s perspective. Note that, unlike Contract Clause #1, this is a promise made by the artist to the label - and not a promise made by the label to the artist.

So, an artist might now ask his or her entertainment attorney:

“The shoe’s on the other foot, isn’t it?”

“‘First class’ in that clause is as vague and undefined a contractual standard as ‘best efforts’, isn’t it, entertainment lawyer?”

Entertainment attorney answer: “Right”.

“So, entertainment lawyer, there won’t be any harm in me, the artist, signing onto that contractual clause, will there, because I will be able to wiggle out of it if I ever had to, right?”

Entertainment attorney answer: “Wrong”.

The fact is, a contractual ambiguity in a performance clause is a bad thing - in either case - whether in the context of a label obligation to artist; or even in the context of an artist obligation to a label. The entertainment lawyer should advise that any contractual ambiguity in any clause could hurt the artist, even in the context of one of the artist’s own obligations to the other contracting party. Don’t rest on the linchpin of ambiguities in clauses when conducting business and relying on contracts - even if, in your musical art form itself, as Cameron Crowe once suggested of my first guitar hero Peter Frampton, you may happen to write “obscurantist” song lyrics while taking your own artistic license. Contracts need to be handled differently.

Here’s how ambiguity in your own contractual commitment to a label hurts you, from the entertainment lawyer’s perspective. The old-saw contractual principle of music “delivery” often finds the artist required to hand over documents to the label, as well as physical materials such as the album itself in the form of masters, digital masters, or “glass masters”, in order to get paid. By virtue of a contractually-delineated procedure vetted by and between entertainment attorneys, the label may be entitled to hold some (or even all) monies back, and not pay those monies to the artist until “delivery is complete” under the delivery clauses and delivery schedule in a contract. As one might therefore guess, “delivery” is a definite event whose occurrence or non-occurrence under the contract is oft-contested and sometimes even arbitrated or otherwise litigated by and between artists, labels, and the entertainment lawyers and litigators that represent them.

It is incumbent upon the artist and the artist’s entertainment attorney to prevent the label from drumming-up a pretextual “failed delivery” under any clause in the contract as an excuse for non-payment. In the context of Contract Clause #2 above, “first-class facilities and equipment” could easily become that pretext - the artist’s Achilles Heel in the litigation-tested contract contested between entertainment lawyer litigators. The label could simply take the position through counsel or otherwise that the delivered materials were not created at a “first-class” facility as contractually required in the relevant clause, no matter what facility was used. Why? Because “first-class” was never defined in any clause in the contractual document by either entertainment attorney on either side, as any particular facility.

And if no clause in the contract explicitly defined “first class” as an entertainment lawyer would have advised that it should do, then the artist could well be out the money, at least for the entire duration of an eminently avoidable multi-year litigation over what two dumb words mean. Worse yet, meanwhile, the label might be holding the money and laughing at the artist behind the artist’s back for his or her lack of contractual prescience. From the artist-side entertainment lawyer’s perspective, both of those horror-show possible eventualities and scenarios, are intolerable. They could have been avoided by a single, better clause – often the narrow reed upon which an artist’s success ultimately rests. (Ask Billy Joel. Ask Neil Young. Ask Bruce Springsteen. Ask George Michael. Ask John Fogerty).

What about prescience? How can this foreseeable contractual delivery dispute in the context of Contract Clause #2, be avoided by the entertainment lawyer? The simple solution in this case, again, is for the artist’s entertainment attorney to take a few extra minutes during the negotiations, and textually list-out, in a reply draft counter-proposed contract sent to the label, even if a single succinct clause, the actual facilities intended to be used. The artist-side entertainment lawyer can seek to make the label explicitly contractually pre-agree to the list of facilities, by name and address, in the body of the contract’s text. That is what a contract is for, anyway, as an entertainment attorney will tell you. When used correctly, a contract and its clauses really just comprise a dispute-avoidance tool. An entertainment contract should be a dispute-avoidance tool exchanged between entertainment lawyers. Also note that a contractual ambiguity in a clause could hurt an artist, regardless of whether it is embedded in one of the artist’s performance obligations, or even in one of the label’s performance obligations! The moral?: List all performance obligations. Break them down into discrete and understandable tasks, clause by clause. Approach it the same way an entertainment attorney would. Better yet – enlist the assistance of one before forming an opinion about the clauses or signing the contract.

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My entertainment law practice includes the drafting, editing, negotiation, and closure of personal service agreements as well as all other entertainment transactional and advisory matters in the fields of music, film, television, publishing, Internet, and all other media and art forms. If you have questions about legal issues which affect your career, and require representation, please contact me:

Law Office of John J. Tormey III, Esq.
John J. Tormey III, PLLC
1324 Lexington Avenue, PMB 188
New York, NY  10128  USA
(212) 410-4142 (phone)
(212) 410-2380 (fax)

Page:
“Performance” Clauses In Entertainment Contracts

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