Entertainment Industry Liabilities

Liability: Ambiguous ownership of rights.

A recent article in the Hollywood reporter titled "Lawsuit Explores Who Owns Rights to a Stax Records Musical" points out the intricacies of publishing rights ownership and its importance.

The parties involved include plaintiff Evergreen Media, and defendant Concord Music Group. Both companies are planning to produce a Broadway musical about the artists whose careers were launched by Stax Records, a prolific record company that existed during the civil rights era. The question is who has the right to do so.

Evergreen Media has signed an agreement with Rondor Music, which holds the publishing rights to the music of Stax Records, however Concord Music Group holds the rights to the original sound recordings. Therefore, the likely outcome of the lawsuit appears to be that Evergreen will be able to produce their Broadway show (and related film), but will have to do so without using the original recordings of Stax Records’ artists. Instead, the actors in the play will actually have to be able to sing the songs rather than lip-sync to original recordings.

Based on lessons learned in our Negotiations and Deal-Making class, it would be my suggestion for Evergreen and Concord to enter into negotiations and brain storm ideas for a collaborative effort between the two companies that would likely result in a better overall musical and film so that both companies would reap greater rewards.

Liability: Insufficient knowledge of whom you are dealing with.

The article "Iggy Azalea Sues Ex-Boyfriend for Releasing Early Music, Foregoing Contract" reiterates the importance of federal registration of copyrights and trademarks.

At the age of seventeen, while working on her music, the young artist Iggy Azalea met a man who represented himself as an oil executive. Knowing very little about him (including the fact that he was married with children), she accepted his offer to be put up in an apartment in Houston, Texas. The following year, she moved to Atlanta, and the supposed successful oil tycoon decided to move with her.

Azalea’s lawsuit alleges that while the two lived together in Atlanta, the boyfriend copied the entire content of her computer’s hard drive, including music that she had not yet released. Years later, he formed a joint venture and began distributing her music via digital distribution claiming that he had “secured the rights” to her material. However, the contract that he submitted as evidence to those rights appears to be a fraudulently modified copy of an artist management agreement that Azalea had previously signed.

She is suing for copyright, trademark, and name and likeness infringement (among other things) against her former boyfriend and the other members of his joint venture.

The article does not indicate whether Azalea’s copyrights and trademark are registered, but in my opinion, her first mistake was having no real knowledge of the man with whom she was dealing. When she met him in 2008, and he offered to rent an apartment for her, all kinds of red flags should have gone up! A simple half-day of Internet research on this person could have saved her a lot of time, money, and aggravation.

Liability: Incomplete contracts (not paying attention to what is NOT in the contract).

"Glenn Danzig Loses Misfits Lawsuit Over Merchandise." This article touches on a subject discussed in this week’s video lesson – looking for what is NOT in a contract. Danzig was attempting to sue a former band mate, Jerry Only, for selling band merchandise with the Misfits logo on it without sharing profits with the other members of the band. In 1994, the members of the band had signed a contract that Danzig believed fully covered the equal distribution of profits on merchandise sold. He was wrong.

The judge through the suit out, indicating that the language in the contract did not prevent Jerry Only from entering into his own negotiations with retailers to sell Misfit merchandise.

My only suggestion regarding this case would be this: “If you have the means, have every contract reviewed by an attorney before you sign it, and make sure that the intent of all parties to the contract is understood.”

My business plan.

My business plan will include language that clearly describes how a legal budget reserve will be included and funded proportionately as the company grows. A few years ago, I worked for a very large mortgage lender, and one of my primary responsibilities was to calculate a monthly liability reserve, or reserve for loan loss.  I see no reason that my company should not do the same. While I appreciate the fact that “common law” trademark and copyright laws exist, they appear relatively useless, particularly in a situation where a great deal of money is involved. It will be my intent to protect all of my content to the extent possible without spending so much money on it that it makes the company financially incapable of operating.

Product and Artist Management – Course Review (Full Sail University)

Product management is not an unfamiliar concept to me. Coming from the corporate business environment as a project manager, I have a keen awareness of the differences between project and product management. As a project manager, I was responsible for organizing financial and human resources that were not directly under my control to achieve a desired outcome. A product manager does exactly the same thing, but at the next higher level. He or she must utilize many project managers, along with other resources, to achieve a desired outcome – a viable product that is ready for consumption by the public. In my world, a product manager would have been a person in charge of a line of business (an SVP for example), making that product or line of business attractive to other businesses or individual consumers.

Artist management, on the other hand, was completely new territory. I thought. Because of my personal background, I was not drawing a correlation between product and artist management. Then it dawned on me that an artist manager is in fact a product manager. He or she is responsible for bringing several products (artists) to the table and organizing them into a line of business. Utilization of all typical management core competencies is key: marketing, finance, communication, organization, and social graces.

In week one, we studied Blu Williams, artist manager for OutKast. The man never stops. He doesn’t get weekends. He has to purposely set aside time for himself and turn his phone off just to get a couple of days rest. Even as he does so, he wonders if things are falling apart while he is on a short break.

These are the same characteristics of product managers in “traditional” corporate America. They rarely get breaks, but their personalities are not likely to want them anyway. They are passionate, loyal, driven souls, regardless of what underlying interest is driving them. Most of the time, they would rather be at work doing what they love than sitting on a beach sipping margaritas.

In my original Mastery Journal Timeline, I mentioned that a desired outcome would be to “realize that there is a junction between what an artist wants to do and what the business environment will allow.” A successful artist manager is fully capable of directing multiple artists’ understanding of their talents toward results. Stated another way, directly to an artist, “if you have a message that you want heard, you are going to have to achieve some degree of financial success.” If for some reason, that artist feels that achieving financial success means selling out, it is time for the artist manager to move on.

Product Management at Apple

There is a funny daily question at my family’s breakfast table: “Did you charge your iPhone, your iPad, and your iPod?” My wife and (usually) my daughter reply, “Yes, and iPeed, and iPooed, and iPoured you a cup of coffee too.” If that is too much information, I apologize. However, it makes a simple point. I never ask them if they have charged their windows-based laptops, those thingies that we are still strapped to in order to get us through the work / school day. That is a given.

Apple has done an amazing job of convincing us that we need multiple devices to satisfy our personal needs while at the same time convincing us that we only need one brand. You can’t take your iMac with you on a run in order to listen to music, so you need an iPod. You can’t scan the web on an iPod while on the go so you need an iPad. You can’t make a phone call to your child’s school from an iPad, so you need an iPhone, which is the solution to all of the above-mentioned situational problems but is not allowed in this discussion, so I’ll move on. Don’t’ forget that soon you are going to need an iWatch!

I am about “i"-d out! However, one cannot argue with the product management genius at Apple. One letter has become synonymous with Apple, and it is not A. I wonder (yes, sadly that would be iWonder, which I will never get credit for) what would have happened if Windows would have wondered. W?

At Apple, product management is key. Mr. Jobs and crew knew how to (1) conduct competitive research and implement SMART goals in order to determine where the company should go. (2) conduct an environmental scan in order to determine where they were relative to Microsoft and where they wanted to go. (3) Implement strategies to take them there.

The video from 1984 was just the start of the rebellion. In 1984, if you put a large breasted woman in tight red shorts throwing a sledgehammer at the image of corporate America, you were taking a huge chance. Nicely done, Apple.

Do You Have What It Takes To Be An Artist Manager In The Entertainment Business?

I have speculated for a long time that I had little interest in a career in artist management, and author Paul Allen (2007, pp. 55-67) reiterates my awareness of that fact in Chapter 6 of Artist Management for the Music Business. While I certainly recognize the need for and appreciate the hard work of these dedicated professionals, I have no desire to become what I would describe as a professional babysitter. Much praise to those who do, however, because they are the bearings and grease that make the music wheel turn. (Oswald, 2007).

Do I want to prepare meal and drink budgets for a potential rising star’s showcase venue? Do I want to console an artist when a performance was not up to par? Counsel an artist on proper savings for tax purposes? Simple answer: Hell no. I have no patience for such things. These are grown up issues that grown up people know how to handle.  But that is just me.

The opposing side to my position is that a career in artist management can lead to all kinds of exciting things: The ability to travel incessantly, socialize as part of your job, meet brilliantly talented people, and potentially earn a very significant income. However, if a person desires a career in artist management, they had better decide so early in life. It takes years to build up the kind of network and power to get past gatekeepers and open the door to decision makers on behalf of an artist. (Allen, 2007).

As entrepreneurs in the entertainment business, we all must assess our strengths and weaknesses related to an opportunity. A weakness of mine (as it relates to this topic) is that I am analytical and unmoved by emotional appeal. If I managed an artist that had just performed their showcase and bombed, the first thing I would do is ask why, not give them a hug and reassure them that “it will all be okay.” In fact, my position would more likely be: “You just wasted my time.” That is not the attitude that most artists want in a prospective partner, and I am fully aware of that. Nevertheless, I am also aware that there is a need for a supportive manager/partner, and would be more than happy to point an artist in the right direction.

References

Allen, P. (2007). Artist Management for the Music Business. Burlington, MA: Elseviar, Inc.

Oswald, M. (2007). What Does an Artist Manager Do? Artist House Music. Retrieved from: https://www.youtube.com/watch?v=Y0avdzxAONU&feature=youtu.be

Negotiation and Deal-Making: The Course in Review

In my original Mastery Journal Timeline post, I stated that my original goal for the Negotiation and Deal-Making course was: “To make sure that both artist and publisher are satisfied with the financial outcome of a contract. To avoid litigation from the onset.” To accomplish this, I would utilize the following tactics:

1.     Understand the Artist’s motivation: monetary or artistic?

2.     Protect those artists with extreme talent but minimal business experience.

3.     Continue to pursue a “deal” for my own company and learn from that experience.

The focus of the course is the concept of principled negotiation, developed by three professors at the Harvard Negotiation Project, and outlined in the book “Getting to Yes: Negotiating Agreement Without Giving In.” (Fisher, Ury, & Patton, 2011). To summarize, in a principled negotiation, a wise, efficient, amicable agreement is reached by focusing on the merits of a situation, rather than on positional bargaining or inflexible bottom-line stances.

The book gives a detailed list of steps for reaching that desired agreement. Related to my stated tactics for the course, here are a few of the most relevant:

1.     “Focus on interests, not positions.” If I am to understand a particular artist’s motivation, than I must understand his or her underlying interests. Why is the artist pursuing a publishing agreement? Our instructor cautioned us not to make assumptions about the answer like “because he wants to be rich,” or “because she wants to be famous.” It could very well be that the artist is pursuing a publishing deal because he or she wants to utilize music as a platform to raise awareness for a particular cause. As a negotiator, you would never know that unless you ask, and you might very well lose the deal if you do not appeal to that interest.

2.     “Insist on using objective criteria.” If my stated tactic is to protect talented artists with minimal business experience, the best way to do that is to use objective criteria – relevant data. Some artists might be so passionate about their underlying interests, or their cause, that they would throw caution to the wind in pursuit of a deal and accept a sub-par agreement. If you were the publisher, you might initially think that makes a better deal for you. However, in the end, you will probably be viewed as an unscrupulous negotiator that preys on the inexperienced. Your reputation will decline, and your business will suffer.

3.     “Separate the people from the problem.” My third stated tactic is an all-encompassing one, and is difficult to address as my business model evolves over the course of this MSEB program. Initially, I thought it would be rational to combine both my interests as an artist with my interests as a publisher / producer. However, a former client of mine said this to me recently: “You will not be a successful producer until you can separate yourself from your client’s music.” As much as I hate to admit it, he was right.

As a producer, I get aggravated when an artist who has “written” a song cannot play it from start to finish, or for that matter has not even completed the song before the recording process begins. That is simply laziness and lack of rehearsal, and as an artist, I would never put a producer in that position. In fact, I would be embarrassed if I did.  In “separating the people from the problem,” the negotiator has to include him or herself as one of those people. That leads me to my final point.

The second of the three texts included in this course, “Beyond Reason: Using Emotions as You Negotiate,” goes into detail about how to apply emotions during the negotiation process. (Fisher & Shapiro, 2005). The central theme is that every person that negotiates has five core concerns. To help me memorize them, I created the acronym AAASR, representing: appreciation, affiliation, autonomy, status, and role.

During the negotiation process, it is critical to understand the other party’s five core concerns and how you might address them in order to achieve mutual benefit. However, here is the kicker: you also have to understand yours.

The entire negotiation process can be boiled down to a quadrant: Do both parties understand what they need tangibly and emotionally to establish a mutually beneficial agreement?

	Yes	No
Yes	Good Deal	Bad Deal
No	Bad Deal	Bad Deal

References

Fisher, R., Ury, W., & Patton, B. (2011). Getting To Yes: Negotiating Agreement Without Giving In. New York, NY: Penguin Books.

Fisher, R. & Shapiro, D.L. (2005). Beyond Reason: Using Emotions as You Negotiate. New York, NY: Penguin Books.