This article is written by Hemnaag, pursuing a Diploma in Advanced Contract Drafting, Negotiation and Dispute Resolution from LawSikho.

Introduction

Once a music distribution agreement is entered between the Artist and the distributor then clauses relating to copyrights kicks in. But that isn’t all, we often miss something called trademarks and its importance in music distribution. It is so important to mention the clauses relating to trademark licencing in a music distribution agreement as well. Only then the Artist’s Trademark can be used by the Distributor and both the parties can avoid the conflicts relating to trademarks. 

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Let’s see how trademark clauses place a role in the music distribution agreement.    

Music Distribution 

Music distribution is a process by which an artist’s permits an outlet to distribute his music to the public for purchase and hearings. The same process is followed irrespective of the fact if the outlet is a physical or digital music store. 

• Physical Music Distribution 

This is a traditional method of distribution and this is how an album gets into a store where consumers can purchase the music. A music distribution company signs a deal with record labels or independent artists which then gives them the right to sell their music to shops. In exchange the artist receives royalty as consideration. 

To put in simple terms the distribution company acts as an intermediate between the artist and the store. 

• Digital Music Distribution    

Digital music distribution works in a similar manner in all kinds of platforms. Instead of transferring albums to a physical store the distribution company will distribute music in digital format. The music is sent to online music platforms such as “Itunes” “Amazon Music” and “Spotify” etc.

Trademark 

A trademark is a unique symbol or words used to represent a business or its product. Once registered that same symbol or series of words cannot be used by any other organization or business in the same line of field.

In simple words a trademark is an identity/recognition to a company, business, organisation or any brand i.e. think of a Smartphone which has a logo with an apple shape with a bite taken. That product is manufactured by Apple Company, where a trademark logo represents its company. 

What can be protected under trademark?

1. Album Name

Many artists take trademark registration for the name of their creation.

For example, “Taylor Swift Fearless”, “Red”, “Starlight”. These are the well-known albums of the famous singer Taylor Swift.

2. Band Name 

Even the band name of the artist can be registered under trademark. 

For example, “The Agency”, Taylor Swift’s band name.

3. Product Name 

Many companies take trademark registration for the name of their products.      For example, “PS2”, “PS3”, “PS4”, “PSP”, etc. All these are product names of “Sony PlayStation” Corporation on whose behalf the trademark has been registered.  Similarly, the artists do trademark registration of their products i.e. their albums or songs.           

4. Business Name

A trademark can be taken in the name of the business or company. For example, “McDONALD’S”, “KFC”,” COCACOLA”, “ADIDAS”, “RELIANCE FRESH”. These all are business names which are trademarked similarly the artist does trademark registration of their band name or album name 

5. Name of a person

 The name of a person can also be trademarked if the person earns through such a name. Or such a person can allow his name to be used by any other person. In this case, the applicant has to provide NOC from the person whose name has been used. These types of trademarks are very common for celebrities. For example, “JUSTIN BIEBER”, “TAYLOR SWIFT”. They have trademarked their name.  

6. Surname

Running a business in the family name is common in India. Trademarks on surnames on which business is carried on can be taken. For example, “TATA”, “Mahindra”, “BAJAJ”. But the Ministry does not allow the trademark on very common surnames.

7. Logo or Symbols 

If you have a specific logo for your brand or product or service, then such logo can be trademarked under the Trademark Act. It is also known as “Device”. It must be unique. Such symbols create its own identity and there is no need to describe it with its brand name. For example, “Sony Music”, “Your Voice”, “The John Lennon”.

8. Tag Line 

The tagline is a slogan used to define the thought behind the product or service. Hence these days, most businesses have a tag line for their products or services. It adds a dramatic effect. As they are simple and catchy, people remember them easily. It represents the brand and hence it can be trademarked. Some well-known taglines which are trademarked are “Justin Bieber is a singer” “yo yo Honey singer” “Eeeeyo!”. 

9. Sound Mark 

Any sound which can be represented by musical notes can be trademarked. It must be distinctive. The first sound mark registered in India was Yahoo!’s yodel. There are other sound marks such as tunes of Nokia or Intel, Britannia’s 4-bell sound.   

10. Scent Mark 

It is very tough to graphically represent the scent and to be trademarked. However, one can trademark the smell by representing its chemical formulae.  

11. Shape 

A trademark can be taken which is capable of graphical representation which includes shapes. The shape of goods to be trademarked must not be the natural shape of such goods. Further, the 3-dimensional shapes of products can also be trademarked. Following are the products for which trademark has been taken for its shape. 

12. Motion Mark

Motion mark means a moving logo or hologram. It is adapted to expedite the market reach. As the motion mark can be represented graphically it can be trademarked. The images of the movement of such marks must be represented in sequence. The best example of a motion mark is the logo of Microsoft.

          

Trademark Licencing 

In trademark licensing where the registered owner/proprietor (Licensor) authorises a third party (Licensee) to use that trademark on mutual agreement between the parties. The right to use the trademark can be on an exclusive basis or non-exclusive basis. 

Licensor- The actual owner of the trademark.

Licensee- Third part to whom only the authority to use the trademark is given by the owner. 

Law governing Trademark Licencing 

Though the terms like licencing or licence is now where found in the Trademarks act 1999 the statutory provisions governing the law related to trademark licencing in India is contained in section 48 to 55 wherein Licensee are actually referred as registered users.   

Role of Trademark in Music

In Trademark you can register and protect the song’s name provided you use that name to market your song you can also register the band name, logos of the band, product or music group’s name can also be protected under trademark.

Can you protect the whole song under trademark?

No, the song itself cannot be protected under trademark. Trademark protects the way that material is marketed towards the customer rather than the material itself. To protect the music and lyrics of the song from duplication or imitation it can be protected under copyright.      

Role of Trademark in Music Distribution Agreement 

When an artist enters into a music distribution agreement with the distribution company the artist gives licensing to copyrights along with all the trademark rights of his/her creation, only then the artist’s song name, logo and band name can be used by the licensee.  

Trademark Licensing Clauses in the Music Distribution Company

The details that are mentioned in this clause are:

1. The Artist gives authority to use the trademark rights to the licensee/Distributor.
2. The Term period for the usage of Trademark is mentioned.
3. Royalty for the Trademark usage is mentioned.
4. Information regarding the sub licensing authority to the licensee is mentioned.

Trademark Licencing (Sample)   

1. Subject to the terms and condition of this Agreement, Licensor hereby grants Licensee an irrevocable, non- transferable authority to use his/her Trademark rights for a period of ____ from the date of execution of this Agreement. 
2. The Licensee shall pay ___% as royalty to the Artist/Licensor for every ___ days.
3. The Licensee shall not grant any sublicenses of the Trademark rights to any third party without the prior express written consent of the Artist which may be withheld for any reason.

Other important clauses in Music Distribution Agreement

Term and Termination 

Information that are mentioned in this clause are:

1. Commencement date of the agreement.
2. The time period of this agreement.
3. The right of both the parties to terminate this agreement.
4. The time period of notice to be sent in the event of termination. 

Term and Termination (sample)

1. This Agreement shall commence from ____ and shall last for ___ years continuing automatically thereafter until Artist serves written notice to the Distributor terminating the Term of the Agreement giving no less than ___ month written notice.
2. Both the Parties have the right to cancel this Agreement at any time by giving ___ days’ notice to the other Party.
3. Any Party can terminate this Agreement in the event of no performance of duty by the other Party.  

Territory 

The territory till/to which the distributor is allowed to sell the creation are mentioned (This is up to the interest of both parties).

Territory (sample)

The distributor shall distribute the music of the Artist throughout the territory of India.  

Grant of Right 

The following details are mentioned under this clause:

1. Authority to use the copyrights and trademark rights of the artist.
2. Delegation of the trademark and copyrights.
3. Time period for the use of trademarks and copyrights.
4. The owner of the trademark and copyrights are not transferred.

Grant of Right (Sample)

1. The Licensor shall hereby authorise the Licensee to use the Trademark and copyrights to publish, advertise and otherwise deal in and for the benefit of this Agreement. 
2. The Licensee is nowhere authorised to delegate the rights of the Licensor to any third party. 
3. The Licensee is authorised to use the rights of the Licensor only till the event of termination of this Agreement.
4. The ownership of the trademark and copyrights of the Licensor is not transferred, only the authority to use the right is transferred to the Licensee.

Royalty

1. The amount of royalty that is payable to the artist is briefly stated in this clause.
2. The method of payment of royalty is stated.      

Royalty (Sample)

1. The distributor shall pay __ % as royalty to the Artist on every single sale of his own music in the market.
2. The distributor shall pay the royalty to the bank account mentioned by the Artist on every single sale of his music. 

Confidentiality

The information shared by the parties must be confidential. The time period with which the information to be kept confidential can also be mentioned here.

Confidentiality (Sample)

The Distributor agrees to maintain the royalty and the marketing strategy of the Artist confidential, and will not disclose to any third party, without written authorization from the Artist (which authorization can be provided by email or telephonic text message).

Conclusion

Thus, trademark licencing has a huge emphasis in a music distribution agreement and the music distribution industry in general, so when an artist enters into a music distribution agreement must make sure that he/she has a trademark licencing clause. Only then can it prevent the conflict between the parties. This will make sure that Artist’s trademarks can be used by the distributor and can prevent trademark infringement.

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