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This article originally appeared on Sonicbids.com – it has been republished here with permission.
The artist management agreement is the deal that you, the artist, enter into with a personal manager or management company. Not only is it an important agreement, but because your manager is responsible for advancing and overseeing your career, your relationship with your manager will likely be the most important relationship in your professional career. Unfortunately, many new artists and managers do not realize the significance of the relationship.
The manager has the obligation to act in the best interest of the artist, even above his or her own self-interest (“fiduciary duty”). The legal relationship between the manager and the artist is known as the management agreement. While you can have a handshake deal (an “oral agreement”), a written agreement – even in an email – outlining the essential terms may help avoid misunderstandings between the parties.▼ Article continues below ▼
Consider outlining the following duties in your agreement:
While a manager may do some of the following activities – especially in the early stages of your career, and/or if you intend on remaining a DIY artist throughout your career – you should be mindful that managers usually do not take on the following roles:
That last one often comes as a surprise to both artists and managers – booking is handled by a separate member of the team. There are even some state laws against individuals booking gigs, i.e., procuring “employment” on your behalf without an employment license. Nonetheless, while your manager may not be providing these services directly, he or she would be expected to coordinate and liaise with the above-mentioned professionals.
The arrangement between you and your manager is customarily on an exclusive basis, meaning this one manager (or management company) would be managing you. You should understand, however, that the manager’s services to you are typically rendered on a non-exclusive basis, meaning the manager can manage other artists. Therefore, you may want to make sure in the agreement that the manager devotes enough efforts to your career and that the management of others will not substantially (“materially”) interfere with the management of you.
Also, you may want to ensure that throughout the duration of the agreement, your manager remains your day-to-day “point person” and that you have the right to approve another person managing you (“key man/person” clause). Examples of this include your manager expanding his or her company and hiring a new associate to manage you, or a co-worker taking over your account at the company where your manager works.
When it comes to granting your manager the right to act on your behalf (“power of attorney” or “POA”), such as signing your name to contracts (e.g., live performance contracts), hiring and firingmembers of your team, and cashing payments received, you’ll want to make sure that the POA you grant is limited to specific tasks your manager may handle (“limited power of attorney”) and that you aren’t granting a broad authority to act on your behalf (“general power of attorney”) like binding you to long-term contractual obligations, hiring any member of your team, suing others on your behalf, etc.
In addition, the scope of services the manager provides should be clarified. Will the scope of representation be the entertainment industry as a whole (which could include acting, modeling, literary areas, etc.), or are the services to be rendered solely with respect to the music business? It’s something that should considered on a case-by-case basis. Some factors may include:
Some of this depends on the relative bargaining power you and your manager have with each other. For example, your manager may just want to have the ability to manage you if your career develops in these other areas based on the rationale that his or her efforts were responsible for that success.
This is part one of a three-part series on the legal aspects of the artist/manager relationship. Stay tuned for future installments and more details about the all-important management agreement!
Disclaimer: This article is for informational purposes only and not for the purpose of providing legal advice. Applicability of any legal principles discussed may differ substantially in individual situations. The sample contract is for illustrative purposes only, and has not been verified for compliance with the law of any particular state. If you have a specific legal problem or concern, you should consult an attorney.
Barry Heyman is founder and principal attorney of Heyman Law. Barry has been practicing music, entertainment, intellectual property (copyrights and trademarks), and new media law for over 14 years. Barry is also the founding and current department chair of the recently established music and entertainment business program at the Institute of Audio Research, the world’s oldest audio engineering school. For more information, please visit the law firm website at heylaw.com.