Why are Entertainment industry contracts important?
The entertainment industry broadly categorizes various industries fields, including social media and content creation, podcasting, visual arts, dance, music, theater, film, publishing, television, and more. Contracts are necessary instruments in these fields to protect the creative works of artists in a way that allows them to profit from them.
Entertainment companies, like record labels, agencies, and motion picture studios, use contracts to protect themselves against economic risk. Contracts help lay out the expectations of both parties, the company and the talent, and hold the parties accountable.
What is a Personal Service Agreement?
Many entertainment companies use personal services agreements between themselves and the talent. A personal service agreement outlines the expectations when one party is offering its services to another. Typically, in the entertainment industry, the contract states how a company or individual will produce, distribute, and promote an artist’s work.
A common example of a personal service agreement would be between a musician and a record label. The musician creates songs, and the record label produces, promotes, and distributes the songs. Many record labels use personal service agreements to ensure the musician remains with the record label for a specified period of time. During that period the musician is signed with the record label, the musician cannot create music for any other label, meaning that the personal service agreement creates an exclusive relationship between the musician and the record label.
The most important clauses in a personal services contract include:
- Term: The term will state how long the parties have obligations to one another. Some entertainment contracts, such as influencer contracts, will have multiple terms.
- Intellectual Property: Entertainment contracts typically include the creation of some kind of work that can be copyrighted or protected. The contract will typically state which party owns the rights to the work produced. If the talent maintains ownership over the content, then there will often be a licensing clause allowing the company to use the content as well.
- Exclusivity: Many personal services contracts in entertainment include an exclusivity clause that only allows the talent to work with the company for a certain amount of time or in a certain industry for that duration.
- Payment and royalties: The payment clause will outline how much the talent will be paid, whether this is upfront or in increments throughout the term. Many entertainment contracts also include a royalties provision for the talent, in which they are paid based upon a percentage of the income from the work they produce under the contract.
What is a Booking Agreement?
A Booking Agreement includes the details and scope of a live performance including terms such as the date of the performance, compensation, cancellation policy, and other important provisions. These types of contracts are necessary to protect an artist in the event of a breach, such as nonpayment.
Booking agreements also protect performance venues. For example, if a musician causes physical damage to the venue, a provision in a booking agreement could make the musician contractually liable for the damage.
What is a Work for Hire Agreement?
Generally under U.S. Copyright Law, the person that creates the work is the “author.” Work for hire is an exception to this rule. Work for hire means that the company that commissioned the work is the “author,” and thus the owner, of the work, rather than the actual artist. For example, if a graphic designer is hired to create a logo for a company, the company would own the logo design, not the graphic designer.
Entertainment agreements will state whether the work is work made for hire, vesting the copyright in the company or whether the talent maintains intellectual property rights over it.
If you have any issues with any entertainment industry contracts, please contact our firm. Our attorneys can provide solutions for any legal challenges you may face.
