About the last thing musicians want to worry about in the first flush of creative ecstasy when a new group is formed is a bunch of legalistic and contractual crap. Unfortunately, these should be among the very first issues considered and resolved. As we have all heard many times before: a little planning now can prevent a whole lot of wasted time, effort and money later, not to mention heartache.
Music attorney Anthony Berman has written a very nice little primer on legal consideratons for musicians and bands:
- The most basic form of business comprised of two or more persons is a general partnership. For that reason, virtually all bands start out as general partnerships. The legal requirements for a general partnership are few. For one thing, the partnership must file a fictitious business name certificate with the county clerk where the business is located. In addition, a partnership usually must file an SS-4 with the IRS in order to receive a federal tax number.
However, even though it is not legally required, it is recommended that the partners enter into a written agreement dealing with issues such as: sharing of profit and loss, voting rights, adding new partners and departing partners, and ownership of intellectual property.
….First, it is important to understand the big picture. Copyright is a form of protection provided by the laws of the United States (title 17, U.S. Code) to the authors of “original, works of authorship” including literary, dramatic, musical, artistic, and certain other intellectual works. Copyright is secured automatically when the work is created, and a work is “created” when it is fixed in a copy. “Copies” are material objects from which a work can be read or visually perceived either directly or with the aid of a machine or device, such as books, manuscripts, sheet music, film, videotape, or microfilm. If a work is prepared over a period of time, the part of the work that is fixed on a particular date constitutes the created work as of that date.
….Unlike copyright, registering your trademarks is more expensive and sometimes complicated. But it is no less important. Finding out that another band has the rights to your band name (or one that is likely to cause confusion with yours) can be devastating after you have built up an audience. Therefore, it is important to carefully choose and then protect your band name and sometimes even a band logo.
This means that (a) you want to make sure that no one else is using the trademark (or one that is confusingly similar) already, and (b) you will want to register the mark with the United States Patent & Trademark Office. The primary reason to obtain federal trademark registration is to provide notice of your exclusive right to use the mark, thus eliminating any such other user’s ability to use a “good faith” defense against a claim of infringement. The owner of a registered mark may also be able to get the court to order injunctive relief to stop third parties from using the mark or one that is confusingly similar.
….As creative as musicians are, it is often necessary to look outside the band for certain services. An obvious example of this would be engaging a producer for a recording session. And let’s not forget the friend of the drummer who designs posters and album covers for the band. The legal implications of these relationships are significant, although highly overlooked.
The use of employees, family, friends and freelancers to apply specialized artistic, musical, graphic, editorial and computer programming skills to the band’s projects may raise questions about the rightful ownership of the resulting intellectual property. The band should contractually retain all ownership of any work contributed by any third parties. It does not matter whether or not the band paid for the services. Failure to “get it in writing” can, and all too often does, result in complex work-for-hire and other disputes that take much time and expense to resolve.
….By the same token, while many new bands are able to design and maintain their own websites, other bands engage a web designer and or webmaster to handle those chores. Again, the following issues may be relevant:
a) All audio, video, text and still image content on the band’s website that is not owned by the band should be cleared in advance. This includes photographs of the band taken by third parties.
b) As stated above, the use of a web designer and/or webmaster to provide specialized graphic, editorial and computer programming skills to the your website may raise questions about the rightful ownership of the resulting intellectual property. You should contractually retain all ownership of any work on the site contributed by such persons. Failure to do so could result in complex work-for-hire and other issues that take much time and expense to resolve.
c) If the band will be selling its own products online, it should provide that its sales terms and conditions properly address issues raised by the worldwide electronic nature of the Internet. Depending upon the types of merchandise sold on the website, these issues may include product liability, tax and related third-party claims.
d) All agreements between the band and webmasters, advertisers, purchasers and/or users should clearly specify the law and jurisdiction that will apply to any action resulting from the site.
See The Theory’s thoughts on bands and websites here.