Friday, February 24, 2017

Bo's bLAWg - Continuation Fees to Licensing Agents


 MJ Bogatin (“Bo”) of Bogatin, Corman & Gold, is an Arts and Entertainment Attorney in San Francisco.  He is also a long-time President of California Lawyers for the Arts. Bo is available to answer some of your questions surrounding the business of Art Licensing. - THANKS BO!

My Agreement with my licensing agent is expiring.  It is my understanding that she gets to receive her commission on licenses that she negotiated.  Can you tell me how long this goes on?  How it works?  After we terminate, aren’t I entitled to receive my royalties directly from the licensees and account to her?   Trudy

All Licensing Agents will include a “Continuation Fees” provision in their Agreement with you as the Licensor Illustrator.  The essence of this provision is to give the agent the right to receive their commission on your royalties -- for as long as you receive such royalties -- on a license they placed and/or negotiated on your behalf.  The Term of the Agency Agreement may expire (if it is not renewed), but the agent expects to “continue” to share in the benefits of her services for as long as you do.  Hence the name “Continuation Fees provision.”

The provision typically appears in association with the termination provision, but not always.  It reads something like this:

“It is further agreed, regardless of termination and/or cause, Agent will continue to receive its full 50% share of all Gross Revenue associated with all License Agreements procured by Agent during the Term (and any renewals, extensions and/or modifications thereof).”

I have left in the highlighted, “and/or cause” part of this provision, because this is the kind of term that might be slipped into the otherwise expected provision.  You might miss it if you were not aware of the implication.  What the “and/or cause” means is that even if the Agency Agreement were to be terminated for breach on the part of the agent, like non-payment of royalties due their illustrator client, they would be able to rely on the contract to continue to collect commissions on agreements they made for you!   I say, “No way!”  Commission continuation right should depend on the full, good faith performance on the part of the Agent.  If they screw up and breach their Agreement, all their commission interests should be put at risk.  

In an analogous situation, the California Labor Commission takes the position that if someone is operating as a musician Booking Agent without a license from the Commission, the musicians they represent can make a claim that all commissions earned be surrendered to them.  This includes both past and future “Continuation Fees” that Booking Agents as well include in their Agency Agreements.  Why should illustrators be treated any differently.”  While literary and illustration agents are not licensed, their clients should not have lesser rights than musicians.

As for the issue of continued accounting rights, as long as the Agreement has not been breached, and the Licensor Illustrator had all agency rights revert, it is reasonably expected that post-term, the agent will continue to collect royalties due under the licenses they negotiated.  They will continue to take their commission due, and then account to their former client on the balance due for as long as the underlying Licensing Agreement continues.  Some of the more comprehensive Agent Agreements expressly include this expectation:

“Upon expiration or termination of this Agreement, Agent shall continue to collect payments under any and all License Agreements negotiated during the Term (and any renewals, extensions and/or modifications of the same) unless otherwise agreed by the parties.” 

And, just in case there is any question of whether the Illustrator should contact the Licensee and request direct payment since they are no longer represented by the Agent, some Agreements also make clear they cannot as follows:

“Artist further agrees that Artist, after expiration or termination of this Agreement, may not make any changes in the payment instructions contained in any License Agreement or other arrangement covered by this Agreement to direct any licensees to make payments directly to Artist.”

I would like to offer one alternative to the standard agent Continuation Fees provision.  It is commonly called a “Step-down rate.”  In short, if the commission due is 50% when the Agreement is entered into, two years after termination it might step-down to 25%; two years later, 15%, two years later, it might thereafter remain at 5% or expire altogether.

This compromise term is especially appropriate in those instances when an agent may be taking on an illustrator who already has a significant body of business, but the pre-existing licenses are not necessarily excluded from the Agency Agreement.  Perhaps the illustrator is looking to have the agent review license terms when they come up for renewal and/or renegotiate them when possible.  I have also negotiated inclusion of a step-down rate where the illustrator’s reputation is already ‘made’ as it were, and prospective licensees are calling her for rights.  The agent need not shop her works so much as make the best deals possible.  Then again, you might ask for it with any prospective agent.  If they want to represent you badly enough in the short term, you might save yourself some significant commission fees over time by insisting on a Step-down commission rate post–term!

Disclaimer: The information contained in this website is not intended as legal advice. Because the law is not static, and one situation may differ from the next, we cannot assume responsibility for any actions taken based on information contained herein. Also, be aware that the law may vary from state. Therefore, this website cannot replace the advice of an experienced attorney. Receipt of this information does not create an attorney-client relationship. MJ Bogatin, Bogatin, Corman & Gold,

Have a legal question? email it to I will forward it to Bo. It might be a blog post! You can search "Bo's bLAWg" to read more posts. I am looking forward to your comments and thanks for sharing this great information on social media.


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Friday, February 17, 2017

Agent Spotlight - Debby Leggat, Blue Sky Art & Design


How long have you been in business and how did you come to be an agent?
My career as a licensing agent began in 1994 when I started the licensing division at Wild Apple Graphics. Wild Apple was an established poster publisher, and a licensing division was a natural extension since, with a treasure trove of art, manufacturers were already approaching them with requests to use images on their products. It was a wonderful opportunity for me. My first choice would have been licensed artist myself, but a decided lack of ability disqualified me so I got to do the next best thing, which is to find licensing partners for the very talented artists I represent. Before becoming a licensing agent I worked at House & Garden magazine, sold advertising at Travel & Leisure, and handled public relations for an international trade group. All my prior experience has been very useful in what I do now.

What do you love most about the art licensing business?
There are so many things! Among them are:
• Finding talent that I believe has licensing potential and being proved right;
• Sending (big!) royalty checks to artists. Really, the bigger the better. If the artists are doing well, so is Blue Sky;
• Putting artists and manufacturers together. It’s extremely satisfying to find the perfect fit between image and product;
• Developing relationships and friendships with artists, manufacturers, and other agents. There are a lot of wonderful, talented, interesting, and hard-working people in art licensing, and I have enjoyed and continue to enjoy getting to know them through working together.

What do you like least about the art licensing business?
No question, dealing with copyright infringement. It quite literally makes me sick. I’m happy to say that often we have been able to convert a piracy to a legitimate license. There are times when infringement is inadvertent and not malicious, and the manufacturer is usually anxious to making things right.  However there are also those times when the infringement is deliberate and there’s a ‘guess we didn’t get away with that’ or a ‘we dispute your claim and will keep the dispute going forever until you go away’ attitude, or a ‘we’re too big for you to fight’ approach which is infuriating. Art Licensing is a relatively small field so word can travel pretty fast about the bad actors, but there is still far too much.

Who are the manufacturers you work with - how did you establish those relationships?
We work with manufacturers across the board from stationery to decorative accessories, wall décor, rugs and mats, tabletop and ceramics, gift. Many of our relationships are long—standing, established years ago and are on-going. For the most part they began at a trade show where the licensees were exhibiting or through cold calling and e-mailing. There’s no magic or trick to finding licensees: perusing trade publications, shopping the stores, both big box and small gift shops, and attending the trade shows are the obvious ways to find prospects. After that it’s a matter of perseverance.

How do you market artists?
By attending the gift and trade markets in Atlanta and New York, which gives us the opportunity to meet face-to-face with our licensees. We exhibit at Surtex, but sporadically. Last year was very good for us, so we’ll be there again in May, but we evaluate after every show to determine it’s worth.

Beyond that we market artists largely through email: I believe in edited, tailored presentations designed to appeal to whichever category or specific licensee we’re targeting. I want my contacts to want to open the submissions that come from Blue Sky because they’re relevant to what the manufacturer is doing.  We’re conscious of not wanting to waste anyone’s precious time.

Finally, we use our website and facebook page as much as possible. Our website is up-dated frequently to reflect the newest images and facebook allows for regular up-dates on what’s happening with our artists and licensees.

What do you look for in an Artist?
We look for:
• Applicability of the artwork to a range of products. If I can’t easily visualize it on a minimum of three to four product categories it probably won’t work;
• The artist’s recognition that art licensing is a commercial venture. That means the work may have to follow trends, be altered to suit a licensee’s needs and might not be used at all;
• The artist’s commitment to licensing by producing new work regularly, ability to resist discouragement, and patience, since the payoff can be a long ways out;
• An artist that sees licensing representation as a partnership—neither of us works for the other, but we are working together to build something.

How much work do you expect an artists to create?
I’ve never understood this question. It’s a little like asking ‘How successful do you want to be?’ I know that every artist produces new work at his or her own rate, but the simple answer is the more art that’s produced the greater the likelihood of success. That said, one artist can produce ten pieces that don’t go anywhere, another can produce one that gets licensed all over, so in that case it’s a matter of quality over quantity.

There really is no short answer either, but I will say that Jane Maday, one of Blue Sky’s top artists is also the top producer of new work. She was already an experienced licensed artist when we started working together, but even so, she never stops pushing herself in new directions with techniques and approaches so her licensing program will move into new categories. She treats art licensing as the full-time job that it is and that discipline and ambition are largely responsible for her success

How has the Art Licensing business changed over the years?
When I started in art licensing there was a lot of resistance from manufacturers to using outside artists. Many companies had in-house design staff so they couldn’t see incurring additional expense for something they already had, they felt the accounting was going to be a hassle, and they’d have to increase prices to accommodate the royalty. Then, as it became clear that certain artists like Mary Engelbreit, Susan Winget and some others were selling a lot of product, those attitudes started to shift; before very long a lot of companies had given up their in-house artists and began to rely exclusively on outside artwork.

Then the internet provided a huge shift in the art licensing business. The advent of email and the now ubiquitous image software removed any barriers to entry for would-be art licensors. Many bloggers, Etsy shop owners and individual artists with computer connections are now successful art licensors. There’s more competition, but there are more opportunities as well.

What’s new at Blue Sky Art & Design?
There’s always great new artwork. Jane Maday is at work on a wonderful series of Vintage Journal Sketches that she’s painting in an old ledger bought online. There are already over 40 images of wildlife, Spring, coastal, inspiration, and holiday to name just a few of the themes. Veteran licensed artist Wendy Russell is adding to her Bird Dog series which got an immediate and enthusiastic response when first introduced.

In addition, Blue Sky has recently added several talented, experienced and FUN artists: Swirly Designs, comprised of husband and wife Paul and Lianne Stoddard make bright, colorful and imaginative ornaments from clay. Their work is already being developed for collectibles and gifts. Their images are also translated to flat art for multiple other uses; Nancy Archer is hard at work on new collections of patterns for stationery, fabric, tabletop and more; and artist Barbara Behr, well-known in Germany and new to the American market is making a big impression with her Victoriana collages and imaginative compositions. All this newness keeps things exciting!

You can find Blue Sky Art & Design
Surtex 2017 booth #2824 May 21-23, 2017

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Friday, February 3, 2017

Artist Spotlight - Amy Kirkpatrick


Tell us a bit about yourself: Did you go to school for art? Are you self taught? 
Art became my passion at a very young age. Living in South Florida, my parents set up a little art desk for me to keep myself entertained during their long hours working at a local newspaper they owned. I went through coloring books so fast that my mother finally gave me a stack of blank paper and told me to make my own.

I excelled in art through high school and received a BFA degree from Florida State University in Studio Art with an emphasis in graphic design. My first job was at a check printer, John Harland Company in Atlanta, Georgia. I have since created designs and illustrations for many Fortune 500 companies including high tech companies such as Oracle and Cisco, universities, power companies, hospitals and medical companies, industrial manufacturers, including fashion icons such as Adidas and my personal favorite, Ashworth Golf Wear.

Often my work was done through advertising agencies or design boutiques, but some were full time corporate jobs such as Oracle, where I created illustrations for web-based training. I have designed about every kind of corporate collateral you can think of along with logos, software user interface, and web advertising and design.

In 2000, I began freelancing and found myself often waiting for proofing revisions. To keep myself busy while I waited, I'd paint. I started selling my art on eBay just to see what would happen and they sold! As my confidence and sales have grown, I am only doing graphic design for my own art business now.

Do you work in just one medium? Several?
I started out painting with acrylic, but after taking a community class in watercolor, I became forever hooked with the way it blends and blossoms. I absolutely love it.

I have full knowledge of Adobe Creative Suite and spend a great deal of time on the computer.

I also do a lot of gel pen drawings. After I bought a pack at Costco on a whim, I fell in love with them. However, I have not released my gel pen drawings, yet. There's the issue of reproduction quality because of their reflective nature, so I do them for my own amusement. I have about 100 finished pieces but they are so different than my watercolor paintings that I'm still deciding the best way to market them.

What inspires you / where do you get inspiration from?
I am mostly inspired by nature. I love painting living things. I also enjoy taking art classes for inspiration and to be around other artists. I am lucky to live in San Diego with access to world class watercolor teachers and the San Diego Watercolor Society that brings in outstanding visiting artists. This year, I took a class with Charles Reid and for the first time, attempted painting portraits of people. Since then, I found a group of artists that meet every Friday at one of our libraries with uninstructed portrait drawing and painting with live models. It has been great fun.

How did you start licensing your art?
My first big break was with Better Homes & Gardens publications in 2011. I had painted a couple butterflies and shown them to a friend who immediately wanted to buy them. She was planning to remodel her kitchen for a BHG publication. My butterflies became the theme of the remodel and ended up in two magazines as well as online. I decided I better paint more before the magazines came out so I challenged myself to paint 100 butterflies in 100 days. My butterflies were immediately picked up by an art licensing buyer and have been selling worldwide.

More licensing opportunities have come to me directly through my Etsy shop where I sell my originals and signed giclées.

What are you working on now?
I have nearly 600 paintings and always have several I'm working on. I do all the scanning and processing for prints myself which is very time consuming. My goal for 2017 is to get them all scanned so I can begin showing them online. They can't sell if no one can see them! All this while I continue to paint.

I paint what makes me happy and hope my joy shows through to make someone else happy.

Any great advice for our readers?
A friend and I tease that whoever dies with the most paints wins! But in truth, it's not about how many colors you have, but what you can do with the colors you have. My advice is to always be practicing and try to come up with your own unique ideas and style.

The best advice I received when I first started selling was from a gallery sales trainer. He told me to decide what kind of artist I wanted to be. There are many paths an artist can take and each requires a different level of skill, subject, style, and self-promotion. For example, what sells in a gallery won't necessarily sell to a product manufacturer. He was the first person to talk to me about art licensing.

Anything else you would like to share with us?
I paint because I love it. I think it may be an addiction. I have so much in my head that I want to paint that sometimes I can become paralyzed with too many ideas. I keep an ongoing list and a sketchbook of my ideas. I surprise myself sometimes when I review them and see something I think is really good that I had forgotten about. I am always grateful for having the forethought to document it, because how many ideas have I lost because I didn't do a quick sketch?

I do not have an agent. I have done very little self-promotion with manufacturers but have been fortunate for those that have found my art and contacted me. My most recent licensing agreement has gotten my art in the wall art section of Wayfair.

Are you an early riser? or night owl?
I am not an early riser. Since my husband gets up at 6:00am, he thinks I've slept half the day away when, as he puts it, I "finally" get up at 8:00am. To me, that's my perk of self-employment.

What is your favorite food?

My favorite food is Thai food. I love a good Penang curry!

You can find Amy: (Etsy) (Fine Art America)

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