In the entertainment industry trademark law offers performers some degree of protection for artistic credits and moral rights. It can serve to supplement copyright law in affording protection against the use in other entertainment works of certain features of a product (for example titles and character names) that cannot be directly copyrighted.
In this article we explore how trademark law is applied in the entertainment industry and how a court will determine if a trademark infringement has occurred. In particular, we look at how this test was applied in the case of Hormel Foods Corporation v Jim Henson Productions. Whilst it is a US decision the law is relevant in Australia (it’s also not very often that we get to write on the law with references to Miss Piggy and processed meat).
The decision in Hormel Foods Corporation v Jim Henson Productions gives a detailed look at how the court applies this test to entertainment trademark cases. This dispute involved the character Spa’am in the movie, Muppet Treasure Island, and whether it had infringed upon Hormel Food’s trademark for SPAM luncheon meat.
What is a trademark?
A trademark is any word, name, symbol or device used to distinguish goods or services dealt with in the course of trade. Trademark protects consumers in their choices and use of goods by providing easy recognition of the product whose features consumers prefer.
This kind of brand name recognition gives producers an incentive to preserve or enhance the attractive quality of their product, but it also gives imitators an incentive to use the name without matching the product quality. The role of trademark law is to bar any use of a name or symbol that is identified with a product where such use may confuse consumers about the product they are seeking to buy and use.
Trademark infringement test
If your trademark is being used by someone else you have a right to bring a trademark infringement claim. When examining a claim for infringement, the court will address the question as to ‘whether an ordinary prudent purchaser would be likely to be misled or simply confused as to the source of the goods or as to the sponsorship or endorsement of the mark.’
Hormel Foods Corporation v Jim Henson ProductionsIn the Muppet movies Spa’am was the ‘high priest of a tribe of wild boars that worshiped Miss Piggy’. Hormel, makers of the well-known luncheon meat SPAM, felt that the use of the name Spa’am on Muppet Treasure merchandise such as clothes and toys may cause confusion to consumers and dilute the famous SPAM name. The court examined the following eight factors to determine if a trademark infringement had occurred:
1. Strength of the mark
Usually if the mark is strong the court will conclude that a consumer would be confused by another weaker mark. However, in this case SPAM and the Muppet brand of humour are both widely recognised household names in their own right. Due to the familiarity with both the brands, the court found it would be unlikely for consumers to be confused about the identity of the products and consumers would be likely to see the name Spa’am as the joke it was intended to be, namely to parody the luncheon meat.
2. Degree of similarity between the marks
The court examines the similarity of marks visually (side by side) and in the context they are being used. In this case, the court found a passing resemblance with the two names. Spa’am is divided in two by an apostrophe and has two ‘As’. But contextually, the two marks appear in strikingly different contexts and visual displays. Spa’am is depicted as a wild boar puppet and all products have the Muppet Treasure Island branding on them. Even though there are some similarities in the name, the court ruled there would be no confusion and that consumers would realise that the Muppets were parodying the SPAM name.
3. Proximity of the product
The next step is to look at whether the products are competing in the same market. In this case, the two products operate in two distinct merchandising markets. The consumers of merchandise in the SPAM market would generally consume luncheon meat and the other product is operating in the puppet entertainment market. For this reason, the court found it would be unlikely that consumers would be confused as the products are not in the same market.
4. Expanding into other markets
This test preserves the interests of trademark owners to expand into other avenues or related fields. As Hormel had no intention of entering any SPAM products into the puppet entertainment market, the court found that Henson’s Spa’am did not infringe on any future market opportunities.
5. Actual confusion
The court examines any actual evidence of consumer confusion*. In this case, there was no evidence presented and therefore the court dismissed this part of the test.
6. Bad faith
The court examines whether the mark has been used in bad faith. In this scenario, Henson’s parody of the SPAM name was not intended to be done deceitfully. Henson had nothing to gain from creating confusion among SPAM consumers nor wished to create a business relationship with them. For this reason, the court ruled that the mark was not created in bad faith.
7. Quality of the mark
The court examines whether an inferior product may cause injury to another’s trademark. Hormel was concerned that the Spa’am character would call into question the quality of SPAM luncheon meat. However, the court ruled that Spa’am was a positive character who was not unhygienic and that a simple comic reference to the fact that SPAM is made from pork would not damage the SPAM image, especially in light of the numerous other humorous references to SPAM in the community.
8. Consumer sophistication
In this test, the court examines the target audience to see if they would be likely to be misled. The court found that a child or adult would be likely to buy merchandise featuring Spa’am because they like the Muppets, not because they mistakenly think that it is a SPAM product.
Weighing all of these factors up, the court found that consumers were not confused about the marks and therefore no trademark infringement was found.
Artists have a right to protect the goodwill and reputation they have built up in their brand of work and consumers also have a right not to be misled. Trademark law can be used as an additional source of protection other than copyright law to protect and progress the rights of artists in the entertainment industry.
*McNote: It might be difficult to confuse a can of ham with an animated pig?
Authors of creative works such as visual art, films, books and songs naturally want the right to claim (or disclaim) credit for their efforts when their work appears before the public. Even more important to many artists is the right to protect the integrity of their work by preventing any significant alterations to its original form. In the world of copyright, this right is known as a ‘moral right’ and artists are protected under the law.
What are moral rights?
Under section 195 of the Copyright Act, artists have a moral right to the integrity of their work and right of attribution of authorship. This includes the right to “prevent a distortion, mutilation or other modification of or other derogative action in relation to the work which would be prejudicial to the author’s honour or reputation.” Under this moral right, artists have the right to have their work attributed to them in the form in which the artist created it.
Moral rights are different to copyright in that they cannot be assigned, transferred or sold without consent. Artists are entitled to terminate their agreement or sue for infringement if a licensee or purchaser of their work has affected its integrity.
Examples of moral right infringement
Any artist can claim that their moral rights have been infringed if their work has been changed in some way.
At present, the most hotly debated and controversial infringement of moral rights is in film colourisation and movie alternation techniques. Black and white movie favourites, such as Casablanca, are being altered and changed into colour. Recently, actress Angelica Huston, on behalf of her father Jon Huston, sued the Ted Turner Entertainment Company for non-consensual film colourisation of his film The Asphalt Jungle. The French Court returned a favourable verdict concluding that the colourisation of Huston’s film violated his moral rights. The court ruled that the colourisation of the film could not be shown without the consent of the creator and damages were ordered.
The publishing industry is also rife with moral rights claims by authors. For example, a publisher due to a limited budget may decide to abridge or condense an author’s book and delete certain photographs from its contents. This abridgement may affect the quality, style and literary finish of the book, amounting to a breach of the author’s moral rights.
Another example which we have seen recently was where a visual artist had licensed an artwork to an organisation that used his design on stickers, without identifying the author’s name. The organisation’s failure to attribute the author amounted to a breach of our client’s moral right.
Monty Python’s claim
Perhaps the most famous case that debated the moral rights of artists was Gilliam v American Broadcasting Company.
Television studios often try to fit the length of a movie into a standard schedule of network television. This process is called ‘Lexiconning’. Due to the extensive commercial breaks, scenes and language are often deleted or sped up to fit network timeframes and decency standards.
This is what occurred when the ABC and BBC licensed the rights to telecast Monty Python’s Flying Circus. The television networks managed to cut 24 minutes of Monty Python’s classic comedy by omitting the climax of skits and deleting schematic developments in the storyline. This constituted a mutilation of Monty Python’s work or as Judge Lasker stated, “The networks have impaired the integrity of Monty Python’s work causing the programme to lose its iconoclastic verve.”
Although the ABC and BBC had licensing rights to edit the program to fit in with television timeframes, the claimed revisions in the script exceeded the scope of their licence. The court ruled that the claimed revisions in the scripts and ultimately the program could only be made after consultation with Monty Python.
When can’t moral rights be claimed?
Moral rights cannot be claimed in every instance. In order to claim moral rights, the artist’s work must have been changed in some way or not attributed properly. For example, if you don’t like the format your work has been presented in but there is no change to your artistic work, you cannot claim this defence.
What can the courts do?
If your moral rights have been infringed, you may be entitled to injunctive relief (a court order requiring the party to refrain from an activity) or awarded an account of any profits. However, litigation should always be a last resort due to its timely and costly nature. Solving the problem through negotiation is preferable. If you do decide to sue for an infringement of your moral rights, you will still need to arrange how the remainder of your responsibilities under the contract will be carried out.
It is also very important to check whether the court has authority to hear your moral right claim in the country you are situated. For example, the moral right claim is not available under current US law.
Defences to moral right claims
If the person who changed the artist’s work can prove this was a reasonable act in all the circumstances, then this could be a possible defence to a moral right claim. The court will use its discretion to determine the ‘reasonableness’ of the change and will base their examination on the nature of the work and relevant industry practices.
There is a need to allow the owner of the underlying copyright to control the method in which the work is presented to the public. This right remains paramount in copyright law. Moral rights under copyright law are used to recognise the important role of the artist in our society and the need to provide adequate legal protection for one who submits his or her work to the public.
We recently had an enquiry from a theatre director wanting to know whether he could change the words of Madonna’s hit song, Like a Virgin for use in his theatre production. The legal issue here is what constitutes ‘fair use’ of a copyrighted work and what is simply copyright infringement. However, as we outline in this article, the issue is not always black and white.
What is fair use?
The fact that an artist’s copyrighted work has been copied does not necessarily mean that copyright infringement has taken place. The same law that gives copyright ownership to the original creator of a work also grants everyone else a general privilege of ‘fair use’ of that work.
The fair use doctrine is a defence against copyright infringement. It permits courts to avoid rigid application of the copyright statute when on occasion it would stifle the very creativity which the law was designed to foster, namely to ‘promote the Progression of Science and Useful Arts'.
Section 150-153 of the Copyright Act defines fair use as any dealing with copyrighted material for the purposes of ‘criticism; review; parody; news reporting; teaching or research'. If the work is used for any of these purposes, no copyright infringement can be found.
There has been considerable debate among the higher courts in Australia and America about what constitutes ‘fair use’. The courts have finally begun to commit themselves to judging this issue, albeit on a case by case basis.
Fair use factors
In the case of our theatre director, a court would consider the following factors in order to determine whether his use of Madonna’s work would constitute fair use:
Application of the law to parody
In the scenario we’ve discussed, the purpose for changing the lyrics was to parody or ridicule Madonna’s hit song, Like a Virgin.
The entertainment genre known as parody has long posed a challenge to the copyright doctrine. In fact, parody as an art form long predated copyright as evidenced by the work of Shakespeare.
The hoped-for benefits of parody are not only entertainment and enjoyment but also artistic innovation and social criticism. The legal problem though is that in order to parody a work, one also has to copy it sufficiently to create a recognisable ‘derivative work’. This is something that ordinarily requires consent of the copyright holder, which may not be forthcoming even for a fee.
America has led the way in facing this legal and intellectual dilemma, particularly in the case of Campbell v Acuff Rose. The court had to decide whether a rap song made by 2 Live Crew had violated the property right of Roy Orbison’s 1960s country rock hit, Oh Pretty Woman, the rights to which were assigned to Acuff Rose. 2 Live Crew did request permission from the copyright owner to use the work but were denied. They went ahead and published the rap song and were sued for infringement.
The court found that the material copied was a fair use of the work as it was a parody or play on words of the hit song. The court stated that even though there was “substantial copying” of Roy Orbison’s song, “when parody takes aim it must be able to conjure up at least enough of that original to make the object of its critical wit recognisable. It must therefore quote the most distinctive or memorable features that are contained in the song.” Therefore, although in most copyright cases any copying of work no matter how small or large is prohibited without the artist’s permission, in parody cases copying the ‘heart of a work’ is permissible in order for the parody to ‘take aim’.
It is uncontested in 2 Live Crew’s case, that there would be a copyright infringement but for the finding of fair use. Applying this precedent to the scenario of our theatre director, it would appear that as the theatre director significantly transformed the lyrics of Like a Virgin, to make fun of or parody the hit song, it would constitute a fair use and it is unlikely that copyright infringement would be found.
But not in all cases…
However, this is not true of every case and one needs to be reminded that this is a grey area of law to be judged on a case by case basis.
For example, in Dr Seuss Enterprises, L.P v Penguin Books, the court found that an author who mimicked the style of a Dr Seuss book to retell the facts of the OJ Simpson murder trial, was not entitled to claim the fair use defence to copyright infringement. The Court determined that the book entitled, ‘The Cat that is not OUT of the HAT’ was a satire, not a parody. The court emphasised that the book merely used the Dr Seuss characters and style to tell the story of the murder. As the book did not poke fun at or ridicule Dr Seuss, the court found that the author’s work was non-transformative and commercially affected Dr Seuss’ book market.
Fair use is a copyright principle based on the belief that the public is entitled to freely use portions of copyrighted materials for purposes such as commentary and criticism.
Unfortunately, if the copyright owner disagrees with your fair use interpretation, the dispute may have to be resolved by a court of law. Courts take a subjective view of this doctrine and it is hard to determine whether you will be successful or not. If the factors are weighed up and it is determined that your purpose is not a fair use, then you are infringing upon the rights of the copyright owner and may be liable for damages.
Over the course of two months we advised two artists on similar copyright issues relating to works they had been commissioned to create. What unfolded was a tale that had a very different ending for each artist. In this article we explore licensing copyright and the importance of clearly articulating exactly what it is you’re permitting your artwork to be used for.
In both cases, the artists were commissioned by large organisations to create a design and a piece of art. The first artist was briefed to create a piece of art for use on material for a specific event in 2012. The second artist’s brief was to create a piece of art for the organisation’s reception and for use on the cover of selected internal educational material.
Both artists came to see us for advice after they noticed their artwork being used in mediums they did not expect and in a way that provided commercial benefit for the commissioning organisation. The first artist noticed his design was being used on stickers, brochures, signs and in advertising material. The second artist discovered that the organisation was having her design reproduced on a large brick wall of their car park.
Both artists had written contracts in place for their commissioned work. As far as both artists were concerned, they created their designs for a specific use and the organisations concerned had misused their artwork and breached their contracts.
Plot line #1: Assigning v selling copyright
Copyright protects artists’ literary, dramatic, musical and artistic works. Some of the works protected under copyright law may include paintings, drawings, screenplays, sound recordings, novels or even computer programs.
Copyright protection ensures that no one can use or display your work. Under section 36 (1) and 101 (1) of the Copyright Act 1968 (Cth), a licence or express permission must be obtained from the owner of the Copyright work, namely the artist, before the work can be used in any way otherwise it is an infringement.
There is no question here that our two artists owned the copyright to their art and design and had the right to sell or licence it. In both cases the artist had agreed to licence (as opposed to sell or assign) their artwork. What we needed to determine was whether or not they had agreed to license their artwork for a specific or limited purpose and whether in fact the contract had been breached by the licensee.
Plotline #2: The licence agreement
If licensing your copyrighted work, like our artists you should have a contract in place (often referred to as a ‘licence agreement’. That contract should preferably be a formal document and at the very least must be in written form such as a Terms and Conditions document, a letter or even a statement made on a quote when pricing the transaction. In reality many contracts for artwork are formed by the quote and/or a letter or proposal.
Any contract must include a clause along the lines of this: “the artist shall remain the sole owner of the copyright in the Artwork.”
When licensing your copyright (i.e. you are not selling or assigning it), it is important that the contract details specifically what the design is to be used for, how long it is to be used for, in what formats and that you retain ownership of the design.
With that in mind, consider this clause which was in our first artist’s contract:
“Copyright in the Artwork and design remains with the Artist and any printing must attribute copyright to the Artist. Under this licence agreement, upon payment of the fee, the company may use the design for the use on sponsors T-Shirts, programs, tickets and advertising material for the event on 3 October 2012.”
This clause makes it very clear that the ‘buyer’ of this license would be breaching copyright should they seek to use the design after 3 October 2012.
Now, consider the following clause which was contained in our second artist’s contract – also a licensing contract:
“Title to the Artwork and all Intellectual property rights in Artwork will vest in the Artist. Upon payment for the Artwork the company is granted a permanent, irrevocable, royalty-free, exclusive licence, to use, exploit, reproduce, adapt, sublicense the intellectual property rights in the Artwork for any purpose.”
This clause allows the company to use the art for pretty much any purpose they want and to sell the design. As you can see, the ramifications of these two clauses – although both in relation to licensing - are vastly different.
After corresponding with each of the organisations involved, we managed to negotiate a further substantial fee for the first artist as the organisation was in breach of the contract.
For the second artist, she was not paid for the additional uses of her design but the organisation agreed not to use the design other than in its original style.
In both cases the organisations are now attributing copyright to the artists on all reproductions of the designs – an obligation that was in both contracts which the organisations “forgot” to do.
The moral of the story
Make sure before signing a written contract, you understand exactly how, when and what you want your design is to be used for. The fact that you are licensing, not selling your work, will not protect you from your artwork being used for other purposes unless specifically stipulated in your contract.
Do not rely on a conversation and a handshake. Be in control of your contract by creating and sending it to the licensee where possible. If you receive a contract, make sure that you understand the scope of what your artwork is to be used for.
A legal footnote
We have changed the facts above for confidentiality reasons. The issues dealt with in our advice to the two artists went well beyond the clauses in relation to licensing. One such issue for both artists dealt with moral rights; both artworks were reproduced and adapted in a way that effectively changed the meaning of the designs and their integrity.
When advising artists on copyright, we generally caution against selling or assigning copyright unless there is a considerable financial benefit involved.
Recently a customer of ours was introduced to the world of competing interests in online real estate. In short, the customer had registered a trademark in the name of a service it provided, but its competitor registered the exact same name as its domain name. To make matters worse, the name was synonymous with a specific type of service offered in what is considered a very specialised industry. Consequently, online traffic destined for the trademarked customer's company was redirected to the competitor.
This is by no means a novel issue, but it is a growing one. A company’s website is the first port of call for customers looking to gain immediate access to its business, and vice versa. Unfortunately, there remains a lack of understanding among business owners on the importance of the rights and the protections associated with trademarks and domain name registration.
This article will offer some perspective to business owners on the legal implications that can flow from these sorts of issues.
Trademark v domain name
Naturally our customer’s first question was, “Can they do this?” In short, no.
Registering a domain name does not give you proprietary rights to the name. A party that registers a domain name does not own the name but holds a licence to use it for a specified period, subject to terms and conditions. The licence may be revoked by the domain name regulatory body (auDA) in instances of trademark infringement (see Remedies for Infringement below.)
All that is required to register a ‘.com.au’ and/or ‘.net.au’ domain is that it must exactly match or be an acronym or abbreviation of the registrant's company or trading name, trademark, or otherwise be closely and substantially connected to the registrant.
A trademark is defined as:
"a sign used, or intended to be used, to distinguish goods or services provided in the course of trade by a person from goods or services provided by any other person".
The owner of a registered trademark has the exclusive right to use and authorise the use of the trademark in relation to the goods and services for which the trademark was registered.
A registered trademark is a perpetual right which may be sold to or licensed for use to other parties. Following the payment of the registration fee a trademark may be renewed every 10 years, indefinitely.
The only way to claim ownership of a domain name is to have it trademarked. If the owner’s rights are infringed, then they generally have a right to have a third party remedy the infringement or seek compensation for the loss and damage caused by the infringement.
Remedies for infringement
The auDA: .au Domain Administration Ltd, is the policy authority and industry self-regulatory body for the .au domain space.
The auDA offers a Dispute Resolution Procedure (auDRP) that brand owners can use when their brands, marks and IP are registered by unauthorised third parties.
The purpose of the auDRP is to provide a cheaper, speedier alternative to litigation for the resolution of disputes between the registrant of a ‘.au’ domain name and a party with competing rights in the domain name.
The dispute is handled by an independent provider (the Provider) of dispute resolution services that is approved by the auDA.
Brief outline of the process:
In Australia, some intellectual property rights can exist without registration, such as copyright and unregistered trademarks which have acquired a reputation. In these cases, there are two areas of protection.The first – common law – gives protection to those with a claim to unregistered trademark rights.
The act of ‘passing off’ protects the goodwill or reputation developed from the use of the unregistered trademark by the first trader, where another trader's conduct misleads or confuses a significant number of consumers.
An unregistered trademark does not provide any property rights in the trademark itself. The most common remedy for passing off actions is an injunction ordering the other trader to stop using the trademark and/or damages.
The second area of protection is Misleading and Deceptive Conduct, which prohibits a corporation from engaging in conduct that is misleading or deceptive, or likely to mislead or deceive. The remedy for Misleading and Deceptive Conduct is typically damages.
It is important to note that not every instance of trademark infringement is malicious and can occur by coincidence. More often than not a letter outlining your claim as the trademark owner to the alleged infringer proves to be the most efficient and cost-effective solution - as proved to be the case with our customer.
Nevertheless there will be instances where an apology and the removal of the domain name will not repair the financial damage caused.
It's difficult to put a price on a reputation. It’s a reference check on our character; it follows us throughout our lives and for many who rely on it to make a living, reputation can be “everything”.
Warren Buffett famously wrote: “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently”.
Professionals such as doctors and those in the public eye such as musicians and sports people, spend a lifetime shaping their image and creating a brand; it becomes an important, yet fragile asset.
Let's face it, if you work in an industry that places you in the public eye, and you are 'the product,' criticism comes with the territory. However, it is not an open license for others to lay waste to your reputation. The difficulty lies in knowing whether the line has been crossed.
Defamation is a term that is so widely misapplied in popular culture that it suffers from an identity crisis. It involves a strict test of liability, with parties succeeding in only the clearest of cases. Sometimes the right apology and retraction is enough to fix the harm inflicted; in rarer cases, court ordered damages may be the answer. If you feel your reputation has suffered from defamatory matter, then consider the following:
What is defamation?
It occurs when defamatory material relating to an individual is published. Defamatory material is that which could expose an individual to hatred, contempt or ridicule; cause people to shun or avoid an individual; or lower the public’s estimation of that individual. The law assumes that everyone is of good character, until proved otherwise.
What the Courts consider defamatory is a matter of context. For example, you may say I am a thoroughly decent person, but that I am showing signs of age; my eyesight is poor, and that my hands tremble. That is not a reflection on my character and is more likely to evoke sympathy rather than hatred, ridicule or contempt. But consider if I were a surgeon. To make these same comments would imply that I am a decent person but a dangerously incompetent surgeon, which is clearly likely to injure my professional reputation.*
In making a claim for defamation you do not have to prove financial loss, you do not have to show that the statement was false and you do not have to show that the person making the comment was motivated by malice.
Who can take legal action?
The following groups are eligible to bring an action in defamation:
What do I need to demonstrate?
Is taking legal action worthwhile?
Before commencing legal action you should be aware that there are certain instances where, otherwise defamatory matter attracts a defence in law.
Defamation claims can fail in whole or in part if:
Claims for defamation are often time consuming and expensive, and should not be commenced without careful consideration of the facts and expert legal advice.
Given the time it takes for litigation to run its course, the action is decided long after the publication was made (and in some cases forgotten.)
Sometimes the most appropriate remedy is the correct type of apology (which a court cannot order). You should keep this in mind, and whether the satisfaction of “winning the case” or receiving financial compensation will cure the damage caused.
Take this for what it is: a straight forward, easy to read summary of an extremely technical and specialised area of law. Do not use this as the basis to launch into claim against a multi-national media outlet (or your neighbour who posted a photo of your wheelie bin out the front of your house on a non-collection day).
* John Fairfax Publications Pty Ltd v Gacic  HCA 28, Gleeson CJ and Crennan J explain this concept.
For a very long time the legal profession has operated with time at the core of its business model. One of the key reasons lawyers struggle to offer true alternatives to hourly billing is that many believe that what they are selling is time. This is the disconnect: time is not what the customer is buying; time is what the customer is paying for, because the bill is calculated on time.
If your lawyer offers you a fixed fee, chances are the fee is based upon a calculation of the time a similar task or transaction has taken in the past multiplied by their (or the teams’) hourly rate, with a bit of ‘fat’ added for any potential overrun (read more on this in an article published in the Legal Affairs section of today's The Australian). Don’t get me wrong, it’s not an entirely bad thing (provided there are no backflips and uplifts) because it gives price certainty.
But offering fixed fees (which are based upon time) as an alternative to hourly billing is not a true alternative. Simply put, fixed fees based on time is still essentially time based billing.
What customers really want
In the ACLA survey released last month, 52% of in-house counsel surveyed believed that time charging was not ideal, but they still accepted it because they were not being offered alternatives.
When firms focus on the time it takes to do something, they drift away from what buyers are actually engaging them for –intellectual capital, outcomes and the value that they can provide. Customers aren’t overly concerned about how long it takes to draft a document, they want the document.
The gulf between the risk and the relationship between a firm and its customer can be unbridgeable when the relationship is based upon time. But when the relationship is centred upon the customer’s perception of value, the incentive shifts from capturing increments of time to focusing on the outcome and its value to the customer. The lawyer deserves to be rewarded accordingly.
Why time is firmly entrenched in law firms
Because the legal profession has centred itself around time for so long, time has permeated nearly every aspect of the business of law – people management, software and profit. This can make it difficult for a firm to move away from timesheets and the billable hour.
The first thing that practice management software will highlight in its sales literature is the ability to capture time more easily, and ironically, how it can save time. Banks may include a covenant in a firm’s financial arrangement relating to the level of unbilled time entered into a firm’s system. The list goes on.
A key mechanism used in performance managing a staff member is his or her time ‘in the system’ – billed or otherwise.
So it becomes quickly ingrained in the mindset of a lawyer to the extent that words such as ‘billables’ and ‘units’ are part of the vernacular when referring to one’s monthly performance.
Negative flow-on effects of time-centric business models to both individual lawyers and the profession are numerous. The high rates of depression among lawyers are well-known and I have no doubt that the focus on time is a key component. There’s the pressure of the internal time budget, the justification of the time billed with the customer, and the time with family and friends sacrificed in order to ‘hit’ budget.
All of these factors combined culminate in management discussions focusing on how time can be used to increase profit. How? By lifting rates, making sure that every minute is captured and then driving all of these minutes to be ‘billed’.
Unfortunately, even if it makes it to the table, talk of value, repeat business and an outcome for the customer is secondary.
I wonder if anyone measures the time it takes to enter time?
A fundamental shift
To offer true alternatives to hourly billing will require a complete mentality shift in the minds of lawyers and a fundamental change in the way a firm manages itself and its staff. For these reasons, hourly billing will stay for the foreseeable future.
For the sake of my firm I selfishly hope it does remain; for the sake of the profession and the individuals within it, I hope hourly billing becomes the ‘alternative’.
Bands break up, members leave, members join, a band needs to collect revenue (whether that’s from performances or royalties from records sales) and decisions need to be made. Without these things formalised it can get messy.
For most musicians and bands it the last thing they want to do when starting out but getting the right things in place early saves a lot of hassle, pain, distraction and cost down the track. There is a very long list of bands that 'made it' but had their careers stalled or even cut short because some simple things weren’t considered important early enough.
In this blog we give you eight things you need to think about when it comes to getting your band partnership agreement sorted.
Your band agreement can take a number of different forms; the two most common are a 'partnership' agreement or in the case of a company, a shareholders agreement. There are a number of different ways to structure your enterprise and how you do it will depend on your particular situation. Either way you will need an agreement that’s more than a handshake over a few beers and one that deals with the below at the very least.