Photo Attorney

Jan 26, 2006

Retainers, Deposits, and Liquidated Damages

Photographers often ask for a nonrefundable payment to hold a date for a client's future job. If the client's plans change, the photographer has some compensation for the loss of business. But what should you call that payment when dealing with a client - a retainer or deposit?

The California Supreme Court examined the differences in how the word retainer is used in Baranowski v. State Bar, 24 Cal.3d 153 (1979). The Court explained that a "true retainer" is paid only to ensure the person's availability and not for the performance of any services. True retainers are nonrefundable and earned when paid. But a retainer that merely represents an advance payment or security deposit for actual services to be performed in the future is not a true retainer. That payment is refundable unless fully earned.

A bride may be willing to pay for a photographer's promise to hold a certain date for her wedding, but that is probably rare. The more likely use of an advance payment to photographers is to secure future services or products. According to the court, that makes the payment refundable unless earned.

But if the client backs out of an agreement, you may be damaged because you've made travel plans or have turned down other jobs. Money can compensate you for that damage. Agreeing ahead of time on an appropriate amount of compensation is known as liquidated damages. In essence, you are fixing the amount to be paid in lieu of performance of the contract. As long as the liquidated damages are reasonable, they are enforceable.

To make sure that you are paid the liquidated damages, you can make the security deposit equal to or more than the amount of those damages. You then have your liquidated damages in hand if the deal falls through and can return the excess to the client, if any.

In sum, don't use the word retainer for the deposit unless it is refundable, and include a provision in your contract such as:

If Client fails to perform, liquidated damages shall be charged in the reasonable amount of $____.

Whatever you do, be clear and up front with your charges and services. Your clients will be satisfied and you will keep your business.

Take my advice; get professional help.
PhotoAttorney

Jan 18, 2006

Breach of Contract Claim for Copyright Infringement

Many copyright infringements come from clients who use your image beyond what you believe are the terms of your license or just don't pay your invoice in part or full. That's the bad news. The good news is that you have a couple of options, depending on the circumstances, to get what you are owed. You may sue in federal court for infringement after registering your copyright with the U.S. Copyright Office or you may sue in state court for breach of contract.

This was the situation in the case of Effects Associates ["EA"] vs. Cohen from the 9th Circuit Court of Appeals. Cohen verbally hired EA to prepare some film footage. Because he was not completely satisfied with the footage, Cohen paid EA only half of the agreed amount, but used the footage anyway. EA sued Cohen for copyright infringement. The court held that EA had granted Cohen an "implied" license for the work based on its conduct. Although it dismissed the infringement case, the court noted that EA could sue Cohen in state court on a breach of contract claim for not paying for the license.

We can learn a few things from this case. First, put your licenses in writing. You don't want a court deciding what you meant to do. As the court in the EA case explained, "[putting agreements in writing] prevents misunderstandings by spelling out the terms of a deal in black and white, forces parties to clarify their thinking and consider problems that could potentially arise, and encourages them to take their promises seriously because it's harder to backtrack on a written contract than on an oral one."

Second, make your licenses subject to being paid in full. This language can include: "Until we have agreed to the terms under which you will use [the work] and have paid me the agreed-upon fee, you have no rights to make any use of this work. Any unauthorized use constitutes a willful infringement." A court will not input such requirements into a contract absent "plain, unambiguous language." Without that condition, like EA, you may forego your right to pursue an infringement claim.

Finally, as a copyright holder, you are the "master of your claim" and can opt to pursue copyright infringement or breach of contract when someone uses your work without permission. The facts of your case may dictate which option is best for recovery. An attorney can help you make that decision. But whatever you do, decide to protect your work.

Take my advice; get professional help.
PhotoAttorney

Jan 10, 2006

Editorial Use May Not Always Be Fair Use

Copyright law includes the doctrine of "fair use" that allows unauthorized use of copyrights in certain circumstances. The courts recognize that free expression and avoiding law suits over minor issues are more important than protecting intellectual property rights. The doctrine of fair use means that copying will not infringe a copyright when it is "for purposes such as criticism, comment, news reporting, teaching, scholarship or research."

Newspapers generally use copyrighted materials freely, depending on fair use. But they may have gone too far this time.

Chris Harris is a photographer who has shot for The New York Times and Time and Newsweek magazines. He now teaches mass communications at a university in Tennessee and leases photos from his collection shot over a 25-year career. The San Jose Mercury News took one of Harris's photos, removed the copyright notice from his photo (which may violate Section 1202(b) of the Digital Millennium Copyright Act), and used it with a book review without Harris's permission.

The Mercury News claimed it was a "fair use" and is common practice for metropolitan newspapers to use copyighted photos with book reviews without permission. The newspaper's motion for summary judgment, asking that the case be dismissed, was denied on January 2, 2006. Judge Stephen Breyer of the United States District Court for the Northern District of California held:

Defendant argues that use of the photo was the equivalent of a pictorial quotation from the book and similarly falls under the fair use exception. Yet the photograph was obviously marked as a copyrighted photograph in the book . . . . As a result, the Court cannot say as a matter of law that use of a copyrighted photograph in a book review, in which the book clearly states that the photograph is copyrighted, constitutes fair use. Accordingly, defendant’s motion for summary judgment is denied.

Robert A. Spanner, lead attorney for Harris, explained that,
A photographer's right to limit distribution and reproduction of his or her copyrighted photographs is a fundamental tenet of copyright law, and the notion that a newspaper can override that right and freely reproduce and distribute – without a license and for free – photographs which the photographer had licensed to a book publisher for a fee, would obviously be a matter of grave concern to the photographers’ profession. Mr. Harris stood up for the rights of his fellow photographers because he believed it was the right thing to do, and we are gratified that his efforts have been vindicated.

The trial is scheduled to begin January 20, 2006.

Cheers to Mr. Harris for standing up for his rights and doing what he can to protect his work. We all may benefit from the trail he is blazing.

Take my advice; get professional help.
PhotoAttorney

Jan 9, 2006

Early Signup Deadline for The Photographer's Legal Toolkit Seminar

"The Photographer's Legal Toolkit Seminar"
at the Carter Presidential Center, Atlanta, GA
Saturday, March 18, 2006
9:00am - 5:00pm

$89.00 for early signup prior to January 31, 2006

Sponsored by the PhotoRoad Show, please join me on March 18 if you want to learn what you can do to protect yourself and your work. It does not matter if you shoot weddings, portraits, products or events; if you are just getting started or are a veteran in photography; or if you are a hobbyist or professional photographer; the program is full of legal information that every Photographer should know.

This seminar will cover intellectual property, including copyright and trademark law, model releases and contracts, as well as business issues such as licenses, taxes, and more. The information presented will be specific to your photography needs and profession.

For more information and to sign up, go here: PhotoRoadShow Pro Lecture Series

See you there!
PhotoAttorney

Jan 5, 2006

Trademarks in Photographs

Photographers often take pictures that contain trademarks or trademarked items. Trademarks are words, symbols, packaging, colors, sounds, scents or a combination of these that allow people to identify the source of goods or services. So when you include a trademarked item in a photo, have you infringed the trademark? The University of Alabama apparently thinks so.

Daniel Moore is well known for painting some of the greatest moments in Alabama's football history. They usually include one of Alabama's trademarks - a script "A," Alabama's mascot (an elephant), or the words "Crimson Tide," "Bama," and "Roll Tide." Moore's prints have increased in value over the years, with some now worth $2,500. He has a strong following of Alabama fans. But he has sold his artwork for years without a licensing agreement with the University. After several threats, the University sued Moore this past spring, demanding that he pay royalties on all of his paintings.

Licensing of trademarks is a source of tremendous income for many businesses, especially sports teams. Further, the University claims that Moore's failure to pay royalties dilutes the value of their assets.

In a similar case in 1998, Tiger Woods sued Rick Rush's company for selling copies of a print of the golfer without his permission. The artist successfully claimed that First Amendment rights trumped the celebrity's ability to enforce the rights to his likeness. But that case turned on an analysis of Woods' rights of privacy/publicity. Here, the issue is whether trademarks have been infringed.

Trademarks are infringed when there is a "likelihood of confusion" as to the source, affiliation, or sponsorship of the good or service. The evidence often used in such cases is an extensive survey of consumers as to whether they are confused about who is the source of the product. According to polls taken by the University of Alabama, more than 10 percent of those asked believed that the school was sponsoring or approving some of Moore's unlicensed work.

"All this is hurtful to Daniel because they've made it seem as if he has made himself wealthy by traveling on the tradition of Alabama as if he is a hitchhiker who has no merit of his own," said his attorney, Stephen Heninger. "Both Daniel and the University have benefited from his work."

Moore has promised other artists that he will not settle the case if it infringes upon his First Amendment rights. If he loses, he'll have to pay three times the amount of royalties he would have paid the University if he had licensed the prints. Interestingly, the University has not sued other artists who have produced work without the University's approval.

It will be some time before the court issues its opinion. In the meantime, be aware that when you sell photographs of trademarks or trademarked items, the trademark owner may aggressively attempt to stop you from selling your work or seek licensing fees from you.

Take my advice; get professional help.
PhotoAttorney