Photo Business News & Forum: 2008-04-20

Friday, April 25, 2008

Conde Nast/CondeNet Contract: Recitals and Term 1

Commentary and analysis begins:

As of {Month}, {Day}, 2008, {publication} owned by CondéNet Inc. (“Company”) and (“Freelancer”) agree as follows:

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1. Scope of Agreement/Services: This agreement will govern each assignment performed by Freelancer for any current or future service owned or operated by Company and all photographs, illustrations, or other visual works or copyrightable material taken at or created as a result of each assignment or otherwise submitted to Company for a service owned or operated by Company or its affiliates (the “Works”). For purposes of this agreement, an “assignment” is a project agreed upon by Company and Freelancer. Company and Freelancer will separately, on a case-by-case basis, arrange the specifics of each assignment or submission, including fee, due date, and subject matter. The fee for any assignment or Work encompasses all the rights granted herein. Reimbursements for expenseswill be negotiated on a per-assignment basis, are subject to approval in writing in advance by Company, and receipts and proper documentation must be provided within one month of expenditure. The results of each assignment must be satisfactory in form and substance to Company, and must be submitted by the agreed due date. Freelancer must provide a selection of photographs, as determined by Company, from each assignment, from which Company may choose what it wishes to publish, and upon request of Company, Freelancer will provide additional (or all) photographs. Freelancer will retain an original or other high-quality copy of all material submitted to Company.	1. Scope of Agreement/Services: This agreement will govern each assignment performed by Freelancer for any current or future service owned or operated by Company and all photographs, illustrations, or other visual works or copyrightable material taken at or created as a result of each assignment or otherwise submitted to Company for a service owned or operated by Company or its affiliates (the “Works”). For purposes of this agreement, an “assignment” is a project agreed upon by Company and Freelancer. Company and Freelancer will separately, on a case-by-case basis, arrange the specifics of each assignment or submission, including fee, due date, and subject matter. The fee for any assignment or Work encompasses all the rights granted herein. Reimbursements for expenses will be negotiated on a per-assignment basis, are subject to approval in writing in advance by Company, and receipts and proper documentation must be provided within one month of expenditure. The results of each assignment must be satisfactory in form and substance to Company, and must be submitted by the agreed due date. Freelancer must provide a selection of photographs, as determined by Company, from each assignment, from which Company may choose what it wishes to publish, and upon request of Company, Freelancer will provide additional (or all) photographs. Freelancer will retain an original or other high-quality copy of all material submitted to Company.
COMMENTS: These two terms are identical. It is of interest to note that the fees in either contract are not defined. Further, this contract would also cover any type of video (often “behind the scenes” video) that some photographers are producing now, and that appear, as below on the CN family of websites, like here, on the Vanity Fair site. It is also worth noting that they refer to expenses as reimbursable. In other words, this seems to imply that you are not entitled to any markup. So, if a lighting kit rental costs you $250, you need to account for your 30 minutes arranging the kit and coordinating it’s pickup with the assistant (or courier company), as well as those costs to pick up and return the lighting, including the assistant’s mileage and charges for their time. Further, they are requiring receipts. There is no tax code regulation that requires Conde Nast to have your receipts. Their receipt is/would be your invoice listing each item. Beware – your supplier base is, and should remain, proprietary. If you know the best assistant/pilot/gear house in off-beat locations, that is of value to you. Sure, it’s one thing to share it with a colleague heading there. However, for Conde Nast to have the receipts gives them supplier names, and that information, properly leveraged, could diminish the value you bring to them in the future. < Also, there is some confusion here. It says you’ll keep “an original or other high-quality copy of all material submitted to Company”, yet, is that material the receipts, images, or both? If it’s images, and you’re shooting film (i.e. Polaroid transfer, 120mm in a Holga, etc) you are then required, as noted here in the contract, to keep copies, which means scanning. Be certain that your invoice includes the cost to scan everything!

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2. Exclusive Rights: Freelancer owns the copyright in the Works and hereby grants to Company the exclusive first worldwide right to reproduce, publish, transmit, disseminate, display, perform, or otherwise use each Work, which exclusivity lasts until ninety (90) days after the initial publication or public dissemination of the Work by Company. Freelancer will not publish, disseminate or use or allow anyone else to publish, disseminate or use any of the Works for any purpose until the exclusivity period has expired. Company’s exclusivity extends to each and every Work taken at the shoot or as a result of the assignment until the exclusivity period has expired.	2. Grant of Rights Work-Made-For-Hire: It is agreed that the Works shall be works-made-for-hire within the meaning of the U.S. Copyright Act, and Company shall own all rights, including copyright, therein throughout the world. In the event any of the Works are determined not to be works-made-for-hire for any reason, Freelancer hereby transfers and assigns the entire copyright (for the full term of copyright), throughout the world, in any and all media and forms of publication, reproduction, transmission, distribution, performance, adaptation, enhancement and display now in existence or hereafter developed, in each Work to Company.
COMMENTS: Here’s where the major difference between the two contracts is. OL2 is a work-made-for-hire contract. OL1 is not, but has many many restrictions on what you can do with the work. What is problematic though, is how they define the exclusivity. For example, OL1 says “Company’s exclusivity extends to each and every Work taken at the shoot…until the exclusivity period has expired.” The problem here is that, suppose I were to take a portrait of Person X, and I made 40 images of Person X in pose 1, and 40 images of Person X in pose 2 in a second location. They are only going to publish one, maybe 2 or 3, throughout the story. This leaves about 78 other images that fall under the “each and every Work” classification, that are still exclusive to Conde Nast, You may not read it this way, and an editor may tell you that’s not what they mean, but Conde Nast’s legal department surely has been clear – “each and every Work.”

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4. Syndication Rights: Freelancer further grants Company the non-exclusive, unrestricted, royalty-free right, for the full term of copyright, to syndicate and/or license the Work to one or more third parties throughout the world in all languages, to retain third parties to do so and to retain all proceeds therefrom. The Rights, Warranty, and Miscellaneous provisions of this agreement shall apply to all such syndicated or licensed use. This provision does not affect Freelancer’s non-exclusive, unrestricted right to syndicate the Works and retain all proceeds therefrom.	{does not apply.}
COMMENTS: You are granting to Conde Nast the right to take every image you’ve shot for them and set up their own photo agency/syndication service, and you get no additional revenue, as granted by “Freelancer further grants Company the non-exclusive, unrestricted, royalty-free right, for the full term of copyright”. Of course, they try to be nice by saying it does not affect your non-exclusive right to syndicate them yourself. However, in point-of-fact it does, as evidenced by some photo agencies requiring exclusivity clauses in order to represent your work. Back in 2002 the Illustrators Partnership of America, as the IPA notes in this article, entered into negotatiations, in part, related to "Condé Nast representatives have written to both the IPA and to the Guild, as well as to various individual members stating that the warnings on our websites are inconsistent with Condé Nast's current intentions not to license work by contemporary contributors. We have relayed Condé Nast's statements to our members. But we must remind everyone that the language of the Condé Nast contract wholly justifies our warnings. For Condé Nast's recent assurances to become binding, the language of the contract itself must be changed." The language remains essentially the same since that time.

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5. Miscellaneous Rights: Company has the sole discretion to decide whether, when, and how to publish any Work and the right to crop, retouch and otherwise modify the Works. Upon Company’s request, Freelancer will be available for and will cooperate with Company’s fact checking and will supply Freelancer’s research material relating to the Works. In the event Company returns any original material to Freelancer, Freelancer shall promptly loan them to Company upon Company’s request.	Miscellaneous Rights: Company has the sole discretion to decide whether, when, and how to publish any Work and the right to crop, retouch and otherwise modify the Works. Upon Company’s request, Freelancer will be available for and will cooperate with Company’s fact-checking and will supply Freelancer’s research material relating to the Works. In the event Company returns any original material to Freelancer, Freelancer shall promptly loan them to Company upon Company’s request.
COMMENTS: These two terms are identical, save for the fact that they have different positions within the contract. Here, when referencing that Conde Nast can “: Company has the sole discretion to decide whether, when, and how … retouch and otherwise modify”, your images could very well be leaving the realm of “editorial”, and into a “photo illustration”, where people are added/removed/merged, and faces of celebrities are retouched. What would happen if you licensed that work after the 90 day embargo, unretouched? Tucked into OL1 Term 16/OL2 Term 9, below, is the language “and will indemnify Company against any claims of any nature arising from said agent or representative’s execution of this agreement.” So, when you publish unretouched photos of a celebrity, and someone does a comparison of the Vanity Fair versions compared to the Time Magazine version, and the celebrity sues, you are the one on the hook, not Vanity Fair. This also indemnifies them in Term 9d below “If Freelancer makes any subsequent or other use of any Work, Freelancer is solely responsible for obtaining any necessary releases from any models, persons, or owners of property pictured in the Work. Freelancer will hold Company harmless from and against any claims by any person arising from any subsequent or other use.” In addition, it says “Freelancer shall promptly loan…” but doesn’t say you can’t charge a research fee, loan fee, or other such reasonable fee for your work involved in getting these images to them.

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6. Exercise of Rights: Company may exercise the rights granted herein in any media now in existence or hereafter developed, throughout the world. In doing so, Company may arrange with third parties for distribution, transmittal, publication, promotion or other dissemination of its service(s) containing the Work(s) or portions thereof, or material from Company or its service(s), in a collection, section, manner, or area identified as being associated with or containing material from Company, including with any database operator or other service (e.g., Nexis), and may provide links and other enhancements to the Work(s).	{Does not apply}
COMMENTS: Again, no mention of additional monies due you for these rights. Recognize that every time a Conde Nast publication has it’s content re-purposed, they are generating additional revenue from them. Yet they seem to not care that you are not a part of that equation.

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7. Foreign Rights: Company may allow any of Company’s or its affiliates’ owned or licensed services outside of the United States, and/or foreign language services in the United States (in each case “foreign service”) to acquire publication and dissemination rights to each Work in that service’s country and/or language of publication. The foreign service may acquire the rights by giving notice thereof within one (1) month of the initial publication or public dissemination of the Work by Company and by agreeing to pay a fee to Freelancer upon publication that is twenty percent (20%) of the fee paid to Freelancer for the Work. The other Rights (not including exclusivity), Warranty and Miscellaneous provisions of this agreement shall apply to such use by the foreign service.	{Does not Apply}
COMMENTS: Here’s where that breakdown of photo fees and expenses gets you. If you’re paid $400 as your fee, a Euro-edition of the article, for example, need only pat you $80USD to use the work, and that well could be a full page photo.

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8. Reservation of Rights: All rights not granted herein are retained by Freelancer.	{Does not apply}
COMMENTS: This is, to a degree, stating the obvious. However, it’s appearance is much more likely to be an attempt to make it look like they’re not taking everything, and are somehow compassionate to the creators of the works.

Version OL1	Version OL2
9. Releases/Restrictions: a. Releases: Freelancer will obtain releases, on a form to be obtained from Company, from all persons and owners of property pictured in any of the Works. Freelancer may not agree to any restrictions, limitations, or right to review requested or imposed by any persons, including models, owners of property pictured in the Works, or others. Freelancer will immediately advise Company of any such request or attempted imposition. b. Borrowing Property: Freelancer may not obtain or borrow any objects or property having an aggregate value in excess of $1500, or lease any location, or enter into a legally binding commitment to a third party, on behalf of Company without first obtaining Company’s express written consent. c. Commercial/Advertising Use: Freelancer will not allow any of the Works to be used at any time for any commercial or advertising purpose, whether or not Company’s period of exclusivity has passed, unless Freelancer first obtains Company’s express written consent, which Company may withhold in its sole discretion. d. Subsequent Use: If Freelancer makes any subsequent or other use of any Work, Freelancer is solely responsible for obtaining any necessary releases from any models, persons, or owners of property pictured in the Work. Freelancer will hold Company harmless from and against any claims by any person arising from any subsequent or other use.	2. Releases/Restrictions: Releases: Freelancer will obtain releases, on a form to be obtained from Company, from all persons and owners of property pictured in any of the Works. Freelancer may not agree to any restrictions, limitations, or right to review requested or imposed by any persons, including models, owners of property pictured in the Works, or others. Freelancer will immediately advise Company of any such request or attempted imposition. Borrowing Property: Freelancer may not obtain or borrow any objects or property having an aggregate value in excess of $1500, or lease any location, or enter into a legally binding commitment to a third party, on behalf of Company without ﬁrst obtaining Company’s express written consent.
COMMENTS: Here you are required to secure releases that are Conde Nast specific. There are many times where this will be problematic. Most people that they would want photographed have lawyers, and the releases you present to them would need to be read by lawyers, and they’d say as much when you presented the release to them. When the release doesn’t get signed, is that going to be satisfactory to Conde Nast? You can bet not. Thus, pursuant to Term 1 “…The results of each assignment must be satisfactory in form and substance to Company…” you are likely to not be paid. Further, in order for you to leverage the images yourself, you'll need to get your own releases signed. It is good that they specify that you can’t enter into any agreements to pre-approve the images, or any property ownership demands. The “Borrowing Property” term is probably in large part, in response to photographers borrowing clothing and jewelry for shots, and the problems that might result. It also may be a limit for contracts in New York State, however, this term inadvertently applies to renting lighting equipment, since they are not specific about what they mean by property. The Commercial/Advertising restriction is a really bad one. It would surely apply to an author who wants to use the portrait you made on the cover of their next book. As a poster, post card, or ad campaign. This is such a significantly onerous restriction, that it essentially restricts all future uses to “editorial”.

Version OL1	Version OL2
10. Confidentiality: The subject of Freelancer’s assignments and Work(s) under this agreement and all details relating to them will be held confidential by Freelancer and may be discussed by Freelancer only with those individuals necessary for the preparation of the Work(s). Freelancer will not allow anyone outside of the applicable publication or service (including but not limited to the subjects and the subjects’ representatives) to view the Work(s) or portions thereof before publication.	3. Conﬁdentiality: The subject of Freelancer’s assignments and Work(s) under this agreement and all details relating to them will be held conﬁdential by Freelancer and may be discussed by Freelancer only with those individuals necessary for the preparation of the Work(s). Freelancer will not allow anyone outside of Company (including but not limited to the subjects and the subjects’ representatives) to view the Work(s) or portions thereof before publication.
COMMENTS: These two terms are identical, save for the fact that they have different positions within the contract. This is a fair clause. The phrase “Freelancer will not allow” should better be changed to “Freelancer will take reasonable precautions to not allow”, since they can’t be held responsible for the actions of third parties with access to the images (couriers, retouchers, post-production houses, and so forth).
11. Non-Compete: Freelancer will not, until ninety (90) days after the initial publication or dissemination of a Work, photograph, submit, publish or cooperate in the publication or dissemination of, in any form, works on the same or similar subject or similar in appearance as the Works, unless Freelancer has received written consent to do so by Company.	4. Non-Compete: Freelancer will not, until ninety (90) days after the initial publication or dissemination of a Work, photograph, submit, publish or cooperate in the publication or dissemination of, in any form, works on the same or similar subject or similar in appearance as the Works, unless Freelancer has received written consent to do so by Company.
COMMENTS: These two terms are identical, save for the fact that they have different positions within the contract. A non-compete clause is pretty fair. 90 days is fairly onerous, but on the outskirts of the realm of reason. The problem that exists here, is that “a Work” is very much considered any of the images that were not chosen to be published by Conde Nast, as outlined in the comments about Term 2.

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12. Warranty: Freelancer represents and warrants that the Work(s) will be original work by Freelancer, will not have been previously published in any form, and will not infringe upon the personal or proprietary rights of or give rise to any claim by any third party. In addition, in the event any complaint relating to any Work is made by any third party at any time, whether by a formal legal claim or otherwise, Freelancer will fully cooperate with Company in responding to and defending against such complaint or claim.	5. Warranty: Freelancer represents and warrants that the Work(s) will be original work by Freelancer, will not have been previously published in any form, and will not infringe upon the personal or proprietary rights of or give rise to any claim by any third party. In addition, in the event any complaint relating to any Work is made by any third party at any time, whether by a formal legal claim or otherwise, Freelancer will fully cooperate with Company in responding to and defending against such complaint or claim.
COMMENTS: These two terms are identical, save for the fact that they have different positions within the contract. These are reasonable warranties to require. However, it’s not unreasonable to expect to be paid for your time when you are asked to “fully cooperate”. In some instances, this could involve a fair amount of time.
13. Independent Contractor: Freelancer is an independent contractor and will not be treated as an employee of Company for any purpose, including but not limited to employee benefits, the Federal Insurance Contribution Act, unemployment taxes and income tax withholding at the source. Freelancer is responsible in all respects for any assistants Freelancer may retain.	6. Independent Contractor: Freelancer is an independent contractor and will not be treated as an employee of Company for any purpose, including but not limited to employee beneﬁts, the Federal Insurance Contribution Act, unemployment taxes and income tax withholding at the source. Freelancer is responsible in all respects for any assistants Freelancer may retain.
COMMENTS: These two terms are identical, save for the fact that they have different positions within the contract. Again, this is a pretty fair and standard term. It’s of value to note that they are defining you, the photographer, as “responsible in all respects for any assistants”. So, an assistant can’t make a claim against Conde Nast if they’re injured, without that claim coming back around to your being liable.

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14. Termination/Breach: Either party may terminate this agreement by giving thirty (30) days written notice to the other party. If Freelancer breaches this agreement or fails to fulfill Freelancer’s responsibilities Company may, in addition to its other remedies, immediately terminate this agreement and/or cease making payments. The Rights, Warranty, Confidentiality, Subsequent Use and Miscellaneous provisions shall survive any termination or expiration of this agreement.	7. Termination/Breach: Either party may terminate this agreement by giving thirty (30) days written notice to the other party. If Freelancer breaches this agreement or fails to fulfill Freelancer’s responsibilities Company may, in addition to its other remedies, immediately terminate this agreement and/or cease making payments. The Rights, Warranty, Conﬁdentiality, Subsequent Use and Miscellaneous provisions shall survive any termination or expiration of this agreement.
COMMENTS: These two terms are identical, save for the fact that they have different positions within the contract. This is also a fairly standard term. One problem is the conflict between the phrase “may…cease making payments…” and “subsequent use” terms are an issue. This means, that the 20% of payments due you for any foreign uses are no longer due you. Further, there’s no “subsequent use” sub-item in OL2.
15. Miscellaneous: This agreement sets forth the entire agreement of the parties, supersedes all prior agreements between the parties with respect to the subject matter hereof, will not be binding on either party until fully executed by both parties and may not be altered except in a document signed by the party to be bound thereby. No contrary or inconsistent terms, conditions, restrictions, or other provisions in delivery memos, invoices, letters, or other documents will be binding on a party unless expressly agreed to in writing by that party. This agreement and any rights hereunder are assignable in whole or in part by Company as part of a transfer or reorganization of any part of the business to which it relates. Any notice to Company must be sent by Certified Mail, Return Receipt Requested, or delivered personally, and must be addressed to the attention of Contract Department. This agreement will be governed by the laws of the State of New York applicable to contracts to be wholly performed therein; any action based on or alleging a breach of this agreement must be brought in the state or federal courts in New York, New York, and the parties hereby consent to the exclusive jurisdiction of such courts.	8. Miscellaneous: This agreement sets forth the entire agreement of the parties, supersedes all prior agreements between the parties with respect to the subject matter hereof, will not be binding on either party until fully executed by both parties and may not be altered except in a document signed by the party to be bound thereby. No contrary or inconsistent terms, conditions, restrictions, or other provisions in delivery memos, invoices, letters, or other documents will be binding on a party unless expressly agreed to in writing by that party. This agreement and any rights hereunder are assignable in whole or in part by Company as part of a transfer or reorganization of any part of the business to which it relates. Any notice to Company must be sent by Certiﬁed Mail, Return Receipt Requested, or delivered personally, and must be addressed to the attention of Contract Department. This agreement will be governed by the laws of the State of New York applicable to contracts to be wholly performed therein; any action based on or alleging a breach of this agreement must be brought in the state or federal courts in New York, New York, and the parties hereby consent to the exclusive jurisdiction of such courts.
COMMENTS: These two terms are identical, save for the fact that they have different positions within the contract. This is a fairly standard term, except the laws of New York should not govern. The assignment takes place in many cases in your state, and your business is in your state, so it’s unfair to apply laws from a foreign state. Also, if you’re in a foreign country, certain terms of this agreement may not be applicable. In any case, I understand that they would like it to be convenient for them if they have to go to court, but it’s better handled in a court near you, and also where the assignment took place.

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16. Power of Attorney: If this agreement is executed by an agent or representative on Freelancer’s behalf, said agent or representative represents and warrants that it has full right and authority, pursuant to a currently valid Power of Attorney from Freelancer, to make this agreement on behalf of and to bind Freelancer, including the grant of rights and warranties and representations specified herein, and will indemnify Company against any claims of any nature arising from said agent or representative’s execution of this agreement. Upon Company’s request, said agent or representative will provide to Company the above-specified Power of Attorney.	9. Power of Attorney: If this agreement is executed by an agent or representative on Freelancer’s behalf, said agent or representative represents and warrants that it has full right and authority, pursuant to a currently valid Power of Attorney from Freelancer, to make this agreement on behalf of and to bind Freelancer, including the grant of rights and warranties and representations specified herein, and will indemnify Company against any claims of any nature arising from said agent or representative’s execution of this agreement. Upon Company’s request, said agent or representative will provide to Company the above-specified Power of Attorney.
COMMENTS: These two terms are identical, save for the fact that they have different positions within the contract. This is to cover Conde Nast in the event they assign a photographer from a photo agency, or Photo Rep. I submit that Conde Nast should exercise the requirement of producing the Power of Attorney, since I can’t say I’ve ever seen the Power of Attorney language in contracts from Getty, or other agency contracts I have reviewed. They may be in some problematic waters on this.

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