NJ Creatives Network November 2004 Meeting

by Eileen Watkins

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Has a client ever re-used your design for a new, more lucrative purpose without paying you accordingly? Ever not received payment because the middleman who hired you went bankrupt? Ever been sued because you created an ad for a product that made someone ill?

In a program on “Contract Negotiation for Creative Professionals,” two professionals gave advice to NJ Creatives on how to avoid such professional disasters.

George Watson, principal with the New York firm Watson & Spierman, and president of the Society of Professional Artists Representatives (SPAR), negotiates on behalf of photographers and illustrators. Eric Vaughn-Flam, intellectual property rights lawyer with the New York firm Rubin, Bailin, Ortoli, Mayer, Baker & Fry, LLP, represents many artists and serves as special counsel for SPAR.

When Watson started his firm in the 1970s, he found many photographers and illustrators were operating without contracts. He noted that SPAR strongly encourages artists to have a contract that includes particular clauses, and handed out examples of SPAR-approved documents.

“It’s in your interest to get to know these terms very well,” added Vaughn-Flam. He also cautioned that on a big job, the artist should have the contract reviewed by his attorney.

Watson told of a graphic designer and a photographer who collaborated on a job and ended up in a dispute over the use of the photograph in a poster. “Their agreement left out one little word—‘only’,” said Watson. “It would have allowed the photographer to restrict the ways in which his work could be used.”

Vaughn-Flam said he knew of another photographer engaged by an ad agency to do a series of photos for the Holiday Inn. After the agency went bankrupt, he had trouble collecting his fee because the Holiday Inn already had paid the agency. “Always find out who your ultimate client is, and whether he’s able to pay you,” advised the lawyer.

Other tricky situations arise in the area of client approval. “If the client stalls on giving approval, the job can drag on forever,” observed Watson. “Your contract should say that approval cannot be ‘unreasonably delayed’.”

It also should state that if the client or his representative does not come along on the photo shoot, he can’t withhold payment because he’s not satisfied with the result. It should say clearly that if the work is approved, the client must pay you.

The question of whether a design is “original” sometimes causes problems. “How can you be sure,” Vaughn-Flam asked, “if it’s based on your client’s concept?”

Your contract should specify whether you or your client is responsible for getting a release for any copyrighted images you may use. If you got your idea from a stock image, you may have to pay an “inspiration fee,” a relatively new legal concept.

Watson recalled a client who created a spherical logo for a corporation; Budweiser later approached him about using it, with a bottle cap in place of the sphere. He was ready to agree until they wanted to have it shot more cheaply by another photographer. Watson warned Budweiser that would be infringement. He noted, “Comp artists have thanked me since, because swiping of images has declined in that city!”

The electronic age, unfortunately, presents new avenues for exploitation of both illustrators and writers. Vaughn-Flam pointed to the case of Tasini vs. The New York Times, in which the newspaper put a series of articles by a freelancer on the Internet without offering any additional payment. The Supreme Court decided this to be a different use of the work, with greater economic benefit to the Times
--since more people were paying to read the material--and ruled in favor of the writer.

“Electronic use is not automatic,” Vaughn-Flam said. “Your client has to get permission.”

He currently is representing a photographer whose images have been re-used by one client 148 times. Although the contracts specified “one time only” use for the pictures, the photographer so far has been paid no more than the initial $250 per shoot.

If you design an ad for a controversial employer, such as a tobacco or liquor company, your contract should have an indemnity clause. A customer who feels he’s been harmed by the product could sue everyone involved. Vaughn-Flam recommended incorporating your business so that your personal belongings can’t be attached if you’re sued for business reasons. Watson pointed out that this was another good reason to join an artists’ advocacy group.

Vaughn-Flam noted that whether you become the target of a lawsuit can have a lot to do with how much success and money you’ve gotten from the design. “Only a small percent of jobs ever become problems,” he said, “but a hundred percent of those are jobs involving a lot of money!”

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