Entertainment Law: 6 Recording Agreement Red Flags

As an up-and-coming musical artist, it can be incredibly exciting when record labels start vying to sign you to recording deals. No matter how big or small the label, it is nice to feel recognized and validated for your talent. However, while some labels truly believe in you as an artist and will do whatever they can to help you achieve your goals, far too many are simply looking to make a quick buck by taking advantage of unsuspecting musicians.

Recording agreements can be your best friend when handled properly, protecting your creative control and personal cash flow resulting from the royalties that come from your work, or they can be a nightmare if you rush into them and neglect to fully understand every element of the agreement.

You should always seek out the services of a lawyer who is both knowledgeable and experienced when it comes to the entertainment industry before entering into any recording agreements. However, we’ve also detailed six red flags you should always be wary of when being offered a recording contract.

1) Upfront costs

A label that actually cares about helping you succeed will not require upfront costs to enlist their services. If they have faith in your ability, they will invest in your potential without forcing you to pay them money in order to represent you in the first place. You may have to pay some real costs out of pocket, like for studio time, etc, but upfront costs are a major red flag.

2) Pressuring you to sign right away

If a label is trying to shove a deal down your throat and pressuring you to sign right away without getting legal advice, do NOT sign the deal. There are likely aspects of the deal they think you will miss, but know a lawyer will catch, that are highly favorable to them at your expense.

3) Multi-album deals

You will want to avoid giving the label the power to choose to renew your deal or not without giving you a choice in the matter. Multi-album deals, even with perceived options to renegotiate yourself, could result in you losing creative control or any leverage to work for terms that are beneficial to you in the future.

4) No roster

If a label has no roster of other recording artists, you should be very wary. It is rare that you will actually be the first person a label signs, and if they do not have any other artists on their roster, there is likely a good reason for that. Startup labels are a possible exception, but you should still be very wary.

5) They want complete creative control

Giving up all claims to creative control over the music you create kind of defeats the purpose of being an artist in the first place. If a label is unwilling to cede you any creative control in a recording agreement, you should probably walk away because it is rare that their vision for your work will coincide with exactly what you want to create.

6) Bad percentages of net profits

When all’s said and done, what percentage of the net profits will you be entitled to if you sign this deal? If the label is attempting to take more than half of the net profits that result from your hard work and talent, walk away. You deserve a fair percentage of the net profits!

Do not allow yourself to be victimized by malicious recording labels, producers, or PR companies. If you have been offered a recording contract, beware of the aforementioned red flags and please contact the law office of Carla D. Aikens, P.C. to help ensure that the deal is fair and honest.

Share this on...Share on FacebookTweet about this on TwitterShare on LinkedInShare on Google+Email this to someone

Written by Carla D. Aikens

Carla D. Aikens

After years of working for large law firms on major corporate cases, Carla D. Aikens chose to go out on her own and found her own firm because she is passionate about helping people of whom others have taken advantage.