When does the Sun Set on your Manager’s Commissions?
It is important to understand the language in your artist management contract and often artists skim over the provision addressing the manager’s earnings post-term.
Nearly all management contracts say the manager will continue to earn her commissions on contracts she entered into or substantially negotiated during the term (or some variation of that language), even after the management contract is over. Without limiting language, this means a manager could continue to collect her commissions for several years after the management deal ends!
You can provide limitations on post-term commissions by using a sunset clause – a date when the manager no longer collects commissions! You will likely need to negotiate a favorable sunset clause, but try to limit post-term commissions to songs actually recorded/exploited during the term and records recorded/released during the term. Additionally, try to have a definitive cutoff date for all commissions. For example, you might consider the initial term of the management agreement and simply match it (e.g., 3-year management agreement + 3-year sunset).
Also keep in mind that you will likely hire a new manager and she will get commissions, too (cutting into your profits even further). Another reason to pay close attention to post-term earnings language in your artist management contract!
There may be other factors to consider if you are on tour, endorsing products, etc., but addressing publishing and records in a sunset clause is often a good start for artists.
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Michelle is a Partner at Swanson, Martin & Bell, LLP and is licensed in Illinois and Indiana state and federal courts. With a Masters of Law in Intellectual Property, Michelle is the Vice Chair of the firm’s Entertainment and Media Practice Group and a member of the firm’s Intellectual Property Litigation and Transactional Services Practice Group.
Her copyright and trademark practice focuses on intellectual property prosecution and related transactions, including performing trademark availability searches and providing advisory opinions, as well as preparing and filing trademark applications with the United States Patent and Trademark Office, and copyright registrations with the United States Copyright Office. Michelle also assists with the oversight of the firm’s extensive trademark docket and conducts required monitoring and maintenance of clients’ trademark portfolios, as well as provides clients with corporate counseling and innovative corporate solutions to address their respective needs.
Michelle further provides comprehensive representation in the drafting, negotiating and executing of various entertainment-related contracts and licenses, including but not limited to band member agreements, artist management agreements, session player agreements, performance agreements, sound engineer agreements, recording and personal services agreements, publishing agreements and licensing agreements. As a former artist manager, she has implemented many facets of national and regional tours, assembled benefit and charity concerts, communicated with various industry personnel, facilitated radio and internet publicity campaigns, arranged radio, print and internet interviews, and assisted in the development of press kits and websites promoting local talent.
Michelle has also guest lectured on entertainment and intellectual property-related topics at The John Marshall Law School, DePaul University College of Law, Chicago-Kent College of Law and Azusa Pacific University (CA), as well as served as a panelist on various other entertainment-related continuing legal education courses. Michelle is an author and editor of the Litigation and Industry Updates Column of the ABA’s Entertainment & Sports Lawyers Journal and has also had numerous articles published by the Chicago Music Guide.
In addition, Michelle serves as Chair of Swanson Martin & Bell, LLP’s Community Service/Pro Bono Committee and proudly volunteers her time as President of the Associate Board and as a pro bono attorney to Lawyers for the Creative Arts, a non-profit organization that provides free legal services to eligible clients in all areas of the arts.
She also currently serves as Events Chair for the Chicago Chapter of Women in Music, a non-for-profit organization dedicated to fostering equality in the music industry through the support and advancement of women. She recently served as Chair of the Young Lawyers Division for the Illinois Association of Defense Trial Counsel, where she was recognized as the Rising Star recipient and received a Meritorious Service Award and President’s Commendation.
DISCLAIMER: The information contained in these articles constitutes general information and guidance and shall not be construed as legal advice applicable to or provided for any particular person or entity, and shall not be deemed to create an attorney-client relationship between Ms. Wahl and anyone who elects to read and/or rely, to any extent, on the material provided herein.
In that respect, Ms. Wahl hereby expressly and specifically disclaims any such legal relationship, but encourages any person or entity seeking a legal advocate pertaining to the issues addressed and discussed herein to contact her directly for further information. Ms. Wahl may be reached at Swanson, Martin & Bell, LLP (330 N. Wabash, Suite 3300, Chicago, IL 60611 or via telephone at her direct line: (312) 222-8585 or e-mail at: firstname.lastname@example.org.