Hear It From The Industry Experts

Podcasts are known as multimedia digital files that are available through the Internet, mostly for downloading to portable devices like iPods and various media players. To help highlight important lessons learned from the Advanced Entertainment Law course at Full Sail University, we turn to podcasts to help keep audiences up to date on entertainment law issues in the industry. Keeping up to date on podcasts helps the research that goes into music festivals and live concert issues for future business plans. This blog post will demonstrate and incorporate the skills and techniques learned and employed in the course to identify business liabilities. 

Gordon P. Firemark, Esq. is an attorney and the publisher of Entertainment Law Update, a newsletter for artists and professionals in the entertainment industries. Firemark has several episodes of his podcasts available on this site; the first podcast up for discussion involves James Taylor v. WB Records. In this case, Taylor is a musician fighting for digital royalties and argues that digital downloads should be treated as licenses. Taylor has been auditing records and royalty statements seeking $2 million dollars in damages since 2008. One of his main disputes is that there are numerous unpaid foreign royalties. Taylor is trying to get 50% of royalty licenses as opposed to the traditional artist royalty rate on a sale. As Firemark and a guest attorney discuss the issues on the podcasts, they raise valuable questions regarding the three years max on audit rights (most of the time it is 2 years). Should Taylor get paid the 50% royalty when he originally agreed to a 10-12% before he got famous? The experts advise that Taylor should not get the 50% royalties when the statue of limitations has lapsed already.

The second podcast discusses 360 Deals and the Talent Agencies Act, which was enacted for the protection of the artists. Firemark and his guest attorney explain how there are basically two types of 360 deals: (1) ownership of rights deal, and (2) income participation deal. What this tells us is that 360 deals are not traditional record deals; they can encompass all the details such as live touring, merchandising, and literary rights, or just encompass a few as opposed to everything. According to the experts, there has been a change in landscape for the deals, for example the Marathon Entertainment v. Rosa Blasi case. This case involves talent managers who procure work for their clients. Under the Talent Agencies Act, only licensed talent agents can procure jobs for clients, managers cannot do this. Rosa Blasi is an actress that ended the relationship with Marathon Entertainment, she stopped paying commissions, and Marathon Entertainment sued. Blasi got the Labor Commissioner to declare the deal void because work was procured. The new trend has been that courts will severe the contract for the illegal parts and the parts that are still okay remain intact, instead of voiding the whole contract.

The third podcasts discusses the J. Geils Band Trademark Dispute, to evaluate the lessons learned and the expert advise for cases like this, we must first understand the facts of the case.

J. Geil of the J. Geils Band is suing his band mates for trademark infringement and deceptive business practices. Geil registered his name as a trademark in 2008, and was granted a year later, but the band had no prior knowledge of this activity. Geil argues that the other band members are “seeking to misappropriate and steal” the name from Geils by touring without him. Delving deeper into the case, band members claim that Geil signed a document that prevented band members or other shareholders from using “J. Geils Band” for a commercial purpose that did not involve the rest of the band. The experts in the industry advise that at the end of the day, the rights of Geils will be upheld over the rights of the other claimants of the band since he holds the trademark rights.

Recent Industry Liabilities & Rulings

Creating a successful business plan requires many things, but some of the most important elements include all of the legal concerns and financial liabilities that have the potential to negatively affect future investors. Non-disclosure agreements (NDAs) with third parties, non-compete agreements, conflicts of interest, privacy concerns, and the protection of one’s trade secrets fall under industry liabilities. As a part of the curriculum in the Advanced Entertainment Law course, students are required to analyze legal liabilities associated with their business plan. To begin such an analysis, three recent court cases were identified to help understand the impact they had on the entertainment industry. The first case involves the New York Yankees v. Stubhub concerning on-going ticket scalping. The second case takes a look at the Trade Union of Russian Citizens v. Madonna, seeking damages after the singer’s pro-gay rights speech. The third case will touch on Comcast’s recent win for the anti-trust appeal from the U.S. Supreme Court.

According to the New York Post, the Yankees are argued that the pick-up location represents the “completion of sale” of online ticket purchases and violates their 1,500-feet rule already in place. The Yankees also have complaints concerning Stubhub’s unrestricted online market allows speculators to push resale ticket prices below face value. This undercuts the Yankee’s prices and drives down future attendance. My opinion has always been that Stubhub is a ruthless scalping system that is truly un-honorable to the live concert and event business. Selling tickets under face value so close to the event venue is infringing upon the venue’s rights.

The second court case that impacts the live concert and event industry relates to Madonna and her recent involvement with the Trade Union of Russian Citizens. In this case, The Huffington Post reports that the lawsuit against Madonna for allegedly traumatizing minors by speaking up for gay rights during a concert was dismissed. The Moskovsky district court in St. Petersburg dismissed the $10.7 million dollars that the Trade Union of Russian Citizens sought for allegedly exposing youths to “homosexual propaganda.” This case impacts the live concert industry because it ties in directly with freedom of speech in our country, and what that can be interpreted in another country like Russia.

The third case to review involves Comcast and their anti-trust appeal that passed recently. On March 27, 2013 The Hollywood Reporter published the Comcast victory against a class-action lawsuit that challenged how it has allegedly monopolized the Philadelphia cable market. Throughout Comcast’s business dealings they managed to acquire competitor cable provider systems in the region in exchange for systems outside the region (Gardner, 2013). What this means is that Comcast made dealings that bolstered its local market share, resulting in an estimated 60% of pay-TV subscribers in Philadelphia. My opinion of this case is that it is not a full-fledged monopoly, but an enterprise. This case leaves an impact on the entertainment industry because it demonstrates a new way for corporations to expand and offer new ways of trading services and connections.