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Talk To Our Lawyer | 03.06

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The band agreement should be negotiated toward the beginning of the relationship, when everyone is happy with everyone else.

 

A band agreement is to a band what a prenup is to a marriage or a will is to an individual. It addresses some important (and sometimes difficult) issues so a plan is in place—outlining how things will go, who is responsible for what, and who gets what—just in case the unexpected or unimaginable happens. The band agreement should be negotiated toward the beginning of the relationship, when everyone is happy with everyone else. Perhaps even more importantly, if your band doesn’t have its own written agreement, then state or federal laws may determine your band’s business relationship by default. As with most relationships, if you wait until there are problems (or your band starts making money), it could be much more difficult (i.e., emotionally and financially draining), if not impossible, to resolve these issues.

Band Members
Who are the members of the band? Is one or more band member(s) the “owner” of the band and the other “band members” really just employees or hired hands? What happens when a new member is hired or an existing member leaves the band? How can band members be fired? Can a member quit at will?

What if a member becomes disabled or dies? (This may be important so surviving spouses/parents are[n’t] involved with the group’s business.) What is required of each member? Does a member need permission from some or all of the other members to perform with another group while he’s a member of the band? What if the band breaks up or decides to go their separate ways?

MONEY
Who will pay/get paid for what? How will band profits/debts (royalties, performance fees, etc.) be distributed? Do some members receive/contribute more than others? Who will keep track of band monies? Will band members receive payment for projects completed and/or be responsible for debts incurred prior to leaving? (Does this change depending on whether the person leaves or is removed?) Does the band have to “buy out” the leaving member?

Acquisition of Assets
How will the band acquire gear/assets (instruments, PA system, lights, van, merchandise, Web site/domain name, etc.)?

Business Decisions
How will band business decisions (hiring/firing lawyers, managers, agents; spending band money; signing with a record label; etc.) be made? Majority vote? Unanimous vote? Veto power? Tie-breaker? Majority vote for some decisions and unanimous vote for others? How can the band agreement be changed?

Creative Decisions
How is songwriting credit determined for songs band members write? Will the band agreement govern this issue, or will ownership be determined on a song-by-song basis in a separate songwriting split acknowledgement? (Note: You may want to seek advice on copyright law prior to deciding this, as he who writes the songs gets the publishing royalties. By the way, the U.S. Copyright Act will determine this if you don’t agree on the splits in a signed document.) Who decides which songs to perform/record? Who decides what gigs to play? Who decides if everyone has the same haircut and wears the same outfit on stage?

Band Name
Who owns the band name? What happens to the band name if the band breaks up or a band member quits/is fired? Who, if anyone, can still perform using the name? (Everyone must still be involved? The key player[s]/founder[s] must still be involved? No one can use the name?) (Note: You may want to seek advice on trademark law prior to deciding on a name and/or to determine if you want to apply for a federal trademark registration for the name.)

Corporate Entities

Partnership | Partnerships are easier to set up, but expose you and your personal assets to liability. You may want to start as a partnership and convert to a corporation once things get going. (Note: Unless a band has formed a corporate entity or created a written partnership agreement, state partnership laws will govern the bands’ business relationship.)

Corporations and Limited Liability Companies | Corporations are somewhat more expensive to set up, but provide more protection and shelter your personal assets. A Limited Liability Corporation (LLC) provides the flexibility of a partnership with the limited liability of a corporation.

This checklist provides some of the business and legal issues you should consider if you are engaging in activities in the music business as a musical performing artist. Please consult with an attorney who has music industry experience for advice regarding your particular needs and issues. You may also want to engage the services of an accountant or CPA to help you with tax preparation and entity-related decisions.

| Danica L. Mathes is an entertainment and intellectual property attorney with Blackwell Sanders Peper Martin LLP and an adjunct professor of entertainment law at Washington University School of Law in St. Louis. For more information, contact Danica at This e-mail address is being protected from spambots. You need JavaScript enabled to view it . If you have topics you’d like to see addressed in future columns, let us know at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

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