Minnesota Law
Minnesota Arts, Entertainment & Sports Law
Arts, Entertainment & Sports Law
The law of arts, entertainment, and media crosses over many lines. A person involved in one of these areas may be confronted with issues on contracts, copyright, trademarks, constitutional rights, business organization, and tax. This chapter will highlight some of the specific issues a person may encounter in the areas of art, entertainment, or media law.
Protecting Creative Work
It is essential for artists to protect their rights in their creation.The law provides artists rights when creating an original work. These rights are exclusive to the creator; however, the creator may grant licenses to the work. Although the law grants the rights to the creator, it is up to him or her to protect and enforce those rights.
Copyright Infringement
When a party uses a copyrighted work without authorization, and this use violates one of the artist's exclusive rights, infringement occurs. The owner of the copyright can bring a federal civil action against the infringer. The plaintiff in an infringement action must prove that he is the owner of the copyright and that the defendant infringed upon one of the plaintiff's exclusive rights. Copyright registration presumes that the person registered as the owner is the owner of the copyright. The plaintiff has the burden of proving that the defendant had access to the plaintiff's work and the defendant's work is substantially similar to the plaintiff's work. Once the plaintiff proves these two elements, the burden shifts to the defendant to prove that the defendant's work was created independently. Before the infringement issue is resolved through a trial or settlement, a copyright owner can go to court and ask for a restraining order against the defendant to prevent the defendant from continuing the alleged infringement activity. If the activity is determined to be infringement by the court, it may grant an injunction, permanently barring the defendant's actions. A plaintiff who prevails in an infringement case can recover money damages as provided by statute or actual damages incurred as a result of the infringement, plus any profits made by the infringer. The choice of damages is made by the plaintiff. Attorney's fees may also be granted by the court in a successful infringement case. A defense to an infringement claim is that one is an innocent infringer. This is a person who relies on an authorized copy where the copyright notice has been omitted and he or she had no other reason to believe the work was protected. An innocent infringer is not liable for actual or statutory damages.
Trademark Registration of Names
A trademark is a word, symbol, design, or a combination which identifies a party's goods and services and distinguishes them from another's goods and services. Artists and entertainers provide goods like paintings, compact discs, photographs, and poems, and provide services in live performances. An artist's or entertainer's name can sell merchandise and tickets. The name used by an artist or entertainer can be a trademark or service mark. Because an artist's or entertainer's creativity and work have gone into producing his or her goods and services, it may be prudent to protect his or her name by trademark or service mark registration. As in copyright infringement, a party who believes her trademark has been infringed may bring a private, civil action for money damages and/or injunctive relief.
Artists and entertainers doing business under a name other than their own, who are not incorporated, are required to file that name with the Minnesota Secretary of State's office.
Licenses
A person may derive income from reproducing, distributing, performing, or displaying a copyrighted work, or by creating additional works based upon a copyrighted work. This income can be generated by either the artist or by a party who buys the rights from the artist to do any or all of those activities. The buyer of rights in a work has a license. This license may be exclusive or non-exclusive. The artist or entertainer may receive a flat fee or a percentage of the profits for the license. It is important to receive legal representation before a person relinquishes rights and grants a license to a creation.
Artists' Moral Rights
It is believed that there is a unique bond between an artist and the work he or she creates. Based on this belief, there are rights which are specific for artists. These rights are known as moral rights (droit moral). Moral rights protect, among other things, the integrity of an artist's work so that it cannot be changed without his or her permission. Copyright protection is part of artists' moral rights.
Moral rights originated in France and are recognized in a number of countries including, in a limited way, the United States. However, the United States does not recognize all moral rights. There are also differences between states in protecting artists' moral rights. If an artist wants certain rights that are not provided by law, one option is to put these rights into a contract. The following are some of the moral rights.
Right to Create
The right of an artist to create or not create a work is included in moral rights. Disputes over the right to create usually arise when an artist refuses to create or complete a work for which he or she was commissioned. Artists are rarely forced to create because courts are reluctant to force someone to perform services. The party contracting for the work may also be reluctant to have the artist forced to finish the work. However, an artist who fails to fulfill his or her duties under a contract is liable for damages.
Name Attribution
In 1990, the federal Visual Artists Rights Act (VARA) was passed. This act applies to paintings, drawings, prints, or sculptures, and amends the Copyright Law by providing certain artists with attribution and integrity rights. VARA permits an artist to claim credit for the work he or she has created. The artist also has the right to stop the use of his or her name as the artist of a work if the work is distorted, mutilated, or modified, and credit to such work would be prejudicial to the artist's honor or reputation.
Integrity
VARA provides artists the right to prevent any intentional distortion, mutilation, or other modification of work which would be prejudicial to the artist's honor or reputation. VARA also provides the artist the right to prevent destruction of a work of recognized stature. What constitutes a work of recognized stature is determined by scholars, curators, and collectors. This protection may be limited if the work is placed on a building.
Artists' Economic Rights
Artists' economic rights give an artist the right to participate in the profits from resales of his or her work. Authors and entertainers typically enjoy royalty payments from subsequent reproduction and syndication. Fine artists, on the other hand, receive payment upon the initial sale only and unfortunately fail to receive profits from the resale of their work. The United States and Minnesota do not provide economic rights to artists. If an artist includes in a sales contract a provision requiring a share of profits from any resale, enforcement of such a provision may be a problem.
Independent Contractor or Employee
It is essential that an artist or entertainer who is hired to create a work determine whether he or she is an independent contractor or an employee. Copyright does not vest in an employee creating a work, but it does vest in an independent contractor hired to create a work. An employee creating work for her employer has created a "work for hire" and the copyright belongs to the employer. A person who has been hired to create work for another and is not an employee, retains the copyright unless there is a written relinquishment of these rights.
Taxation
The method of income taxation depends on whether a person is an employee or an independent contractor. Employers withhold and pay taxes for employees, while independent contractors are responsible for paying their own taxes. There are a few other tax issues on which an artist or entertainer may wish to consult a qualified attorney. If an artist or entertainer is conducting a business, expenses related to this business may be deducted from his or her income and result in paying fewer taxes. One should make sure he or she is applying for deductions to their fullest benefit. Also, because the income of artists and entertainers can be sporadic and result in years of low income and other years of higher income, a person may want to determine if there is a way that the income could be staggered to pay a lower tax rate and defer the payment of taxes. Finally, artists may wish to make charitable contributions of work and take a deduction on their tax return. Unfortunately, the Internal Revenue Service only allows artists to deduct the costs of the materials and supplies used and not the value of time, services, or the fair market value of the work.
Consignment
Minnesota Statutes state that when an artist delivers a work of art to an art dealer for the purpose of exhibition or sale on a compensation basis, the acceptance of the work by the art dealer constitutes a consignment unless there is an outright sale. A consignment of art means the art dealer is an agent of the artist for the purpose of sale or exhibition, the art is held in trust by the art dealer and not subject to the art dealer's creditors, the art dealer is responsible for any damage or loss of art while it is in his or her possession, and proceeds from the sale of the art must be held in trust for the benefit of the artist.
Entertainment Agencies
Minnesota Statutes require that any person involved in procuring, offering, or promising employment or engagements for three or more artists or groups of artists at any one time, or who has a written contract or a verbal agreement with an establishment or an individual to provide artists for one or more engagements, must be licensed as an entertainment agency by the Minnesota Department of Labor and Industry. Entertainment agencies are also required to submit to the Department of Labor and Industry the forms of contracts they will use and a schedule of fees to be charged and collected.
Contracts
It is essential that when an artist or entertainer contemplates relinquishing rights or signing a long-term performance contract, he or she receive legal counsel, as contracts such as these can be complex and have far-reaching effects. Also, it almost goes without saying that artists and entertainers should be cautious about the people with whom they enter into contracts. Although one may have a binding legal agreement, if it is with an unscrupulous person, enforcing such a contract may be very difficult.
Obscenity
Although the United States Constitution guarantees one the freedom of expression, this right has limitations, one of which is obscenity. Obscene material is not entitled to constitutional protection. The United States Supreme Court created the following test to use in determining whether material is obscene or not: whether the average person applying contemporary community standards would find that the work, taken as a whole, appeals to the prurient interest; whether the works depict or describe, in a patently offensive way, sexual conduct specifically defined by the applicable state law; and whether the work, taken as a whole, lacks serious literary, artistic, political, or scientific value. This standard is difficult to apply in the abstract, and can vary widely from community to community.
Defamation
The down side of free speech, however, is that injudicious speech can sometimes lead to a defamation suit. Defamation is a false statement which damages another person's reputation or character. Statements that falsely accuse one of a crime, dishonesty in business, or unchastity will probably be found defamatory. Libel is written defamation and slander is spoken defamation. There have been many defamation cases, and the requirements for proving a defamation case are many and varied depending on who the plaintiff is and what was said or written. This section will outline the basic components of a defamation case and the possible defenses. It should be noted that an estate of a dead person cannot bring an action for defamation.
A defamatory statement must be included in a statement of fact, not a statement of opinion, to be actionable. There is a difference between stating a person is "a jerk" (opinion) and a person is "a convicted murderer" (fact). Statements are defamatory if they injure a person's reputation, or expose him or her to contempt, ridicule, degradation, or hatred. The statement must also be false. No matter how damaging a statement, if it is true, there is no action for defamation, although there may be grounds for a slightly different lawsuit, such as harassment. In order to bring an action for defamation, the statement must be communicated to a third party. This is called publication. The statement must also identify the party being defamed. A person need not be identified by name, but a reasonable person must be able to identify the plaintiff from the statement.
Once a plaintiff in a defamation case has proven that the defendant published a false, defamatory statement of fact about the plaintiff, the plaintiff must prove that the statement was published with either actual malice or negligence. The standard used depends on whether the plaintiff is considered a public figure or a private person. A public figure can be a celebrity, politician, police officer, or citizen active in public policy. If the plaintiff is held to be a public figure, he or she must prove that the defendant acted maliciously by deliberately failing to verify the statements. A plaintiff who is a private person must prove that the defendant was negligent in publishing the statement and should have known that the statement was false.
As mentioned before, truth is a defense to a defamation action. Also, proof that a statement was an opinion or that the statement was made during a judicial or legislative proceeding, or made by a government official while conducting business, are defenses.
Resources
Minnesota Continuing Legal Education, 40 Milton Street North, Suite 101, St. Paul, MN 55104; (612) 227-8266 or 1-800-759-8840 (book: The Practical Musician: A Legal Guidebook to the Music Industry)
Resources and Counseling for the Arts, 75 Fifth Street West, Suite 429, St. Paul, MN 55102; (612) 292-4381.