Thursday, June 14, 2007

When Your Agent is Not Your Friend

For some time, I've been critical of photo agencies who are not looking out for the best interests of those they are agents for. Photographers seem to forget that without them, agencies are nothing more than an office with empty file cabinets and blank hard drives. There are very few agencies any more that actually look out for photographer's best interests. Three that I know do are - Marcel Saba's Redux, Scott McKiernan's Zuma Press,and the one that represents me - Black Star. They truly do care about their photographers, and have a long history of doing so, or of being photographers themselves.

In a departure from my normal musings, I am presenting, with permission, highly regarded attorney and friend of many a photographer, Ed Greenberg's thoughts on this subject, and I commend it to you for serious consideration. Ed uses, for example, Corbis, and I would submit that Getty is also not really suited to the category "agent/agency".

We have written and posted several times on the topic of “Why Words Matter,” and that the acceptance of the vocabulary of your enemies is dangerous to your economic health. Some of you may recall our post in March of 2007 regarding the importance of the word “agent” and the efforts by agents, agencies and reps to retire the use of the word. We referenced a large agency making a concerted effort to distance itself from reality in a distinctly Orwellian manner.

We wrote in part that: “A mere independent sales representative or distributor rarely is burdened by such responsibilities and legal obligations (as an agent). He/she can sell one product over another as is his/her whim. An independent distributor selling various brands of coffee, wine or widgets to retailers rarely has any obligation or allegiance to one brand over another. He/she may even give away product or services favoring one brand over another. A mere salesperson can act, sell (or not) anything he/she believes to be in his/her own self interest. It logically follows therefore that no one cares, not even the courts, what products a regular salesperson sells.

So recently a well known agency, whose name is known to you all, has denied by its lawyers, in writing (twice), that even though: its own contract heading identifies itself as the "agent", it promotes and advertises itself to its clients and prospective "content contributors" as an "agency and agent for content", it uses the word "agent" on its website --- it is NOT an "agent" for any of its contributors, content providers or partners.

Yes, it sounds illogical. Yes, it is counter intuitive. Yes, it is utterly bereft of a semblance of merit.

Mega agency Corbis maintains that despite the legal, industry and lay definitions of the words, “agent/agency” it is not. Corbis maintains that it, “does not act as an agent but rather photographers license copyrights in selected images to Corbis and Corbis in turn re-licenses(d) those same copyrights to various third parties”. I bet that as Johnny Carson used to say, “You did not know that!"

Such a position could enable one or more of these companies to avoid one or more of the numerous legal or tax obligations which are imposed on “agents/agencies” by any number of governmental agencies. Significantly, if deemed not to be an agent, its obligations to its contributors are reduced dramatically. Corbis is not of course, a public company.

Even though Corbis has been referred to by several court decisions and courts as an “Agent/Agency”, has used such words on its own web site, seeks to represent the works of photographers and illustrators and represents to clients and potential clients that it has the authority to negotiate and make deals with third parties on behalf of creators, etc., etc., it chooses to run away from the English language and countless obligations to its creators which agents by law, have.

Don't take my word for it. Look up the words “agent” and “agency” in any dictionary – legal or otherwise. Google “Corbis” and see if you come up with the words agent/agency linked to its name.

So maybe you are still asking why this matters to you. Well, if you license work outside of the US of A and the agent is not an “agent”, it may take the position that it need not pass on foreign tax credits on to you for your, heaven forbid, benefit. My guess is that you never knew that Corbis “re-licensed” to third parties “the very same copyrights that (you) licensed to Corbis”. Such are the positions that Corbis has taken.

Transactions made in foreign countries concerning the licensing of your work there and any monies generated thereby may be subject to foreign taxes. Agents, agencies, syndicators and others authorized to make these transactions on your behalf may pay the foreign taxes due in that country on such deals. You are entitled and ought to know the nature and extent of any taxes paid so that you can advise your accountant and he/she can then obtain the proper credits on your behalf when preparing your tax returns. You may be entitled to substantial savings resulting from fees paid in foreign countries.

If your agent, agency, so-called “re-licensor” etc. is too lazy to report such payments to you, it is time to speak up. Some agents refuse to disclose to their contributors the gross licensing fees earned by the image(s), especially on foreign “sales”. Such practices are engaged in frequently to your detriment and often for the convenience and benefit of your agent. The exact amount(s) of money that you are overpaying in taxes and/or the exact amount(s) of money that you are under- receiving in royalties resulting from your agent’s laziness, negligence, malice or stupidity will remain unknown to you unless and until you demand appropriate accounting procedures.

READ your statements. Review them with your accountant and/or attorney. The statement should provide all information as to how the net royalty paid to you is calculated. This includes the gross amount of the royalty paid to the agent by the ultimate licensee of the image, and all deductions and adjustments from that royalty, including, fees paid to the agent and
subagent(s), and other expenses and foreign taxes, if any.

Request and insist upon receiving the name of a contact person who is knowledgeable about the net royalty calculation. You should compare these calculations with what you are entitled to under the provisions of your contract or otherwise what your understanding is.

Have all questions with regard to procedure, practices and transactions answered by your agency in writing in such manner as you are able to understand them. Do not do business with any purported agency whose practices your accountant and/or attorney are not satisfied with, period. If BOTH your accountant and attorney are unhappy with the business operations of your agency, run away from it like the wind. Such agents and agencies despite what nomenclature they want to impose on you dear "content providers", are out for themselves - only.

Edward C. Greenberg, PC
570 Lexington Ave.
17th Floor
New York, NY 10022

I couldn't have said it better myself. Perhaps a second look at the likes of PhotoShelter or Digital Railroad would be in your better interests.

Please post your comments by clicking the link below. If you've got questions, please pose them in our Photo Business Forum Flickr Group Discussion Threads.


Anonymous said...

ZUMA SUCKS! they steel money from their photographers! it's a piece of shit "agency" that takes advantage of their photogs. everybody i know who started working with them got fucked over.
and another perfect examples of exploitation is their magazine double-truck that makes money but doesn't pay photographers for their images.

John Harrington said...

Wow. I know Scott personally, and I know he does not suck, nor would he hire people that suck, and I don't know anyone who's been taken advantage of by them. If you have that much of a substantiated position on them, perhaps you'd like to reveal your name, or sources to back up your allegations?


David Honl said...

The fact that the comment was done anonymously, and with childish language shows the character and validity of the poster. Scott McKiernan is a real stand-up guy and his staff have always gone above and beyond for me-- something that is not easily found these days. I know a little of what I speak, with 20+ years agency having been a Gamma-Liaison photographer in the 80's.

John- thanks for the real-world business advice for photographers. You are selflessly performing a valuable service to those of us that are more creative brained than business brained.

Dave Honl

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