Ten Books for the Professional Comics Creator

Any aspiring artist needs to study their craft if they want to be successful.

New talent entering the marketplace has to have an understanding of their industry to avoid making mistakes and wasting precious resources.

Comics are no different. A firm understanding of the art and economy of the business is the foundation of success. 

A lot of books have been published to help new and veteran creators navigate the craft. John Wilson of Complete Set recently offered ten titles that touch on the creation and sales of sequential art. Some of his books are classics from forty years ago. Some came out last year. All of them are worth looking into if you want to make and sell comics.

Read Ten Books to read Before You Start Creating Comics: http://bit.ly/2bAuyXA

Success in the comics industry requires an understanding of the business, creative, and legal aspects of the medium.

Sign up for The Professional Comics Creator to get monthly e-mail news, tips and advice on how to get the most from your characters and stories.

Have Fun.

Gamal Hennessy  

My Podcast Interview with Comics Pros and Cons

by Gamal Hennessy

Comics Pros and Cons is a podcast hosted by Derek Becker about the craft and creativity of comics. While most of his guests have been comics creators, he decided to bring me on to talk about the business and legal aspects of the industry. 

Our conversation covered a lot of ground, including a discussion of:

• Copyrights and trademarks
• The four types of comic book professional
• The fan art controversy
• When comics creators need to have a contract

We had a lot of fun recording the podcast and the topics will be of interest to anyone interested in the comic book industry. Feel free to click on the link below and subscribe to Comics Pros and Cons while you're there.

Gamal Hennessy interview with Comics Pros and Cons

Have fun.

GH

Why Can’t You Write the Contracts for Your Freelance Business?

By Gamal Hennessy

This might be the best time to be a freelance professional. The existence of so many online tools gives you the chance to take an idea and turn it into a business.

But can the DIY spirit be dangerous if taken too far? Is there a point where it is helpful, even preferable, to bring in a professional for certain jobs? 

This video talks about three reasons why it makes sense not to do it yourself when it comes to legal agreements, especially ones involving your intellectual property.

Have fun.

Gamal Hennessy, Esq.

NYS Bar Number 2917649

What is a Contract and Why Do Artists Need Them?

by Gamal Hennessy

If you’re a professional freelance artist, you already have a lot to worry about.

Do you need to concern yourself with contracts too?  

In a world of instant transactions and online business, do you really need to spend time and money on a piece of paper no one wants to read and few people understand?

And what is a contract anyway?

What’s the point of it?

When do you need to have one?

The first episode of my video series will touch on all these questions, and then talk about what could happen if you don’t have the right contracts for your work. 

Letters of Intent: Uses and Abuses

By Gamal Hennessy

            Contracts come in a variety of flavors. Some are simple one page affairs. Others run dozens of pages. They can be unchanging boilerplate or fluid documents with several amendments and changes overtime. Even a verbal agreement can be enforceable as a contract under certain circumstances. Every contract is a different animal. Being familiar with the variations can save you a lot of headaches in your business.

            A letter of intent (LOI) is a very curious beast. It is often used in major deals like business acquisitions or investments, but they are also used frequently in entertainment and media contracts. Sometimes they are called deal memos, short form agreements or memorandums of understanding. Each one has their own nuances and weight in a legal sense, but the basic concept behind each one is a sort of pre-contract; a meeting of the minds before a more formal agreement is negotiated.

            In some instances, an LOI is helpful, even vital (See Forbes: The First Step in a Big Deal). In other situations it can signal a dead deal or deceptive maneuvers by the potential partner. Here are some of the pros and cons of LOI’s and what you should look for if they come up in your freelance or small business.

Uses:

A LOI can help you close a deal in several ways, including:

• Wrapping Your Head Around the Deal: It can help you figure out what you’re getting and what you’re giving up. If you don’t understand the economics of your contract in a few pages, you probably won’t understand it in a few dozen pages. (See Considering Consideration)
• Understanding the Economics: A LOI is a good place to figure out who gets paid, how much they get and when they get it. (See Your Slice of the Pie)
• Getting a Feel for Your Negotiation Partner: Contract negotiation can be stressful or easy. A LOI can give you a sense of how hard it will be to both close the actual contract and work with the person once the deal is done. Someone who is easy to deal with for a LOI won’t always be the best business partner, but a difficult LOI negotiation can be a red flag for the road ahead.
• Creating Something Each Side Can Bring to Their Respective Camps: If you have partners, investors, attorneys or anyone else who has input on your business, it can be helpful to hammer out a LOI to get their sign off before slogging through a contract. One document with all the major deal points is a useful tool for getting buy in and advice on both sides.
• Creating Momentum: A LOI can generate a sense of inevitability in a business deal. Once everyone agrees on the major points, there can be more motivation to work together and close the deal. This psychological impact isn’t guaranteed and it might be fleeting, but it’s useful if you can get it.
• Space to Shop: Unless there is a specific prohibition in the LOI, both sides have the ability to continue negotiating with other parties while the deal terms are being laid out. Either side might feel jilted if the other partner decides to leave in the middle of the dance, but a LOI often gives both sides room to maneuver.
• Due Diligence: Related to the ability to shop around for a better deal and feeling out the other side, negotiating a LOI gives each side time to investigate and research the other side before the contract is negotiated. Potential problems and issues revealed in this stage can be corrected or avoided without much loss on either side.
• Savings: A LOI can be negotiated at a lower cost in terms of time and money than a formal contract. So if the deal breaks down at the LOI stage, both sides can often walk away without much loss.

Abuses:

There are also several ways a LOI can be used as a weapon, including:

• Contract Replacement: There are circumstances where one party might negotiate a LOI without any intention of executing a more comprehensive agreement. There have been several court cases where a LOI has been found to be an enforceable contract. If there are aspects of the deal one side was planning to negotiate in the main contract, they’ll never get the chance if the main deal never comes.
• Creating Confusion: A LOI often focuses on the business and economic aspects of the deal without much attention to the legal considerations. If this LOI is the only thing the parties have signed, many questions about the deal could go unanswered.
• An Inducement to Act: One side can use a LOI to pressure the other side to pay for something or perform some action before the final deal is in place. Once one side acts, their ability to negotiate might be hampered because they’ve already invested in a deal that may or may not exist. The other side can take advantage of this weakness and force a deal they couldn’t otherwise get.
• A Delaying Tactic: This is related to the Space to Shop benefit described above. If one side isn’t really looking to make a deal with you, a LOI might give them the space they need to find another partner and waste your time. In addition, if your LOI negotiations are not bound by a confidentiality agreement, the terms of your LOI could be used by your alleged partner as a negotiation tool to close a deal with someone else.

Considerations:

            When faced with the prospect of negotiating a LOI instead of a full contract, how will you know whether the document is being used or abused? Every situation is different, but consider these questions when analyzing the situation:

• Is a LOI necessary for this deal? Does it make sense to have a LOI given the nature of the agreement or the parties involved? If not, the other side could have ulterior motives. Keep in mind, the larger or more complicated the deal, the more a LOI can make sense.
• Can you get some specific benefit from the LOI? If you aren’t exactly clear on the terms or economics, a LOI might be what you need to get comfortable with the process.
• Do you see the potential for abuses from the other side? If you don’t see an upside to drafting a LOI, ask for clarification and don’t be afraid to walk away. (See How to Reject a Bad Contract)

If you do decide to move forward with a LOI for any deal, be sure to compare the terms in the main contract to the terms you agreed to in the LOI. It does you no good to make a good LOI and then sign a bad contract.

Have fun.

Gamal

PLEASE NOTE: THIS BLOG POST IS NOT A SUBSTITUTE FOR LEGAL ADVICE. IF YOU NEED A CONTRACT WRITTEN, OR YOU HAVE A CONTRACT YOU NEED EXPLAINED TO YOU, CONTACT ME ATgamalhennessy@gmail.com FOR A FREE CONSULTATION OR VISIT C3 athttp://www.creativecontractconsulting.com/ FOR MORE INFORMATION ABOUT MY SERVICES.

Are You Working for Free? (Considering Consideration)

by Gamal Hennessy

Consideration is one of the most important aspects of commercial contracts, especially for freelance professionals and small business owners. In a legal context, consideration is not about being thoughtful. It’s about an exchange of value between you and the other side.

In most cases, a contract is an agreement between two or more parties who trade something of value. A lot of things can be thought of as valuable in these situations: money, goods, services and even promises can be used as consideration under certain circumstances. As an independent artist, freelancer or small business owner, there are four types of consideration you should look for in your contracts. If you don’t find any of them in a particular deal, then the deal might not have any value to you.

The Four Types of Consideration

·         Delivery Based Consideration: You get something specific once you deliver the agreed upon material. For example, if you design a website for $300 per hour and you spend 22 hours on the project, then you get $6,600 upon delivery of the site. This type of consideration could be defined as a flat fee, based on some measure of performance. This type of payment is typical of work for hire agreements where you are hired to perform a specific task for a limited amount of time (See Contracts 101: Creator Owned vs. Work for Hire)

·         Performance Based Consideration: You get something specific once the project begins to generate some sort of profit. For example, if you are entitled to 20% of the gross revenue of a book, then you make money if and when revenue comes in from the sale of the book. This is a common form of consideration for collaboration agreements, self-publishing platforms like Kobo, KDP and creator owned agreements with certain publishers.

·         Combined Consideration: You get paid coming and going. In an extreme example, Robert Downey Jr. allegedly pulls in up to fifty million dollars in direct salary, box office bonuses and back end participation for playing Iron Man in the Marvel cinematic universe (See RDJ Pay Set to Hit Fifty Million). While you might never make as much as RDJ, these can be the most lucrative types of deals because they give the artists both protection against a poor performing project and the benefits of a successful project.

·         Production Consideration: You get someone else to pay for the cost of your project. For example, if you have a story you want to publish, but can’t cover the production and distribution costs of the release, someone else can pay those upfront costs to get your work out into the world. Sometimes this comes from single sources, like a production company or publishing house. Crowdfunding is another variation on production consideration. This can be the least lucrative kind of consideration. With a single source, the creator can lose all the rights to their characters and stories for a few thousand dollars that they never receive directly. With crowdfunding, all the revenue might go into the project or you may fail to reach your funding goals altogether. While many of these deals can provide exposure and ego gratification, many people regret signing these deals, especially if the project becomes successful and they have no ability to share in the financial windfall.

One of the first things you need to ask yourself when looking at a contract is ‘what am I giving up and what am I getting for it? Giving up your time and effort for cash is a way to make a living. Giving up your inspiration and creativity for the chance at future success is also a decent idea. Giving up everything for nothing is no way to manage your career. Always try to get some consideration in your contracts, even if the other side isn’t being considerate.

Have fun

Gamal

PLEASE NOTE: THIS BLOG POST IS NOT A SUBSTITUTE FOR LEGAL ADVICE. IF YOU NEED A CONTRACT WRITTEN, OR YOU HAVE A CONTRACT YOU NEED EXPLAINED TO YOU, CONTACT ME AT gamalhennessy@gmail.com FOR A FREE CONSULTATION OR VISIT C3 at http://www.creativecontractconsulting.com/ FOR MORE INFORMATION ABOUT MY SERVICES.

Get What You Give (Rights and Revenue in Creative Contracts)

By Gamal Hennessy

At its most basic, a contract is an agreement between one or more groups for the exchange of resources. The exchange could be time and skill for money, goods for services, property for future gains or any combination of those things. The best agreements exchange roughly equal resources. The worst ones have one side trading large amounts of resources for little or nothing in return.

This is the problem that freelance professionals run into with many of the contracts that I see. The most important service I provide is showing my clients what they are giving up in comparison to what they are getting. I’d like to provide an overview of the different types of rights and revenue streams as a general overview for creators looking to get their projects into the market. While independent artists will benefit most from this discussion, elements of it will be applicable to small business owners of all types.  

Types of Rights

As discussed in an earlier post, copyright law gives the creator of an original work the right to benefit from the distribution of that work (See Image and Story, Copyright and Trademark). There are various types of ways available for creators to exploit their work. Some of the major distribution methods include:

• Publishing (Print, novelization and Digital)
• Public Display (gallery displays and public performances of some of the methods listed here)
• Theatrical (Movies whether live action or animated)
• Television (including network, basic cable, premium cable, subscription, and PPV whether live action or animated)
• Home Video (including DVD, Blu-Ray, etc)
• Live Performance (including Broadway performances and theme park performances)
• Interactive (including console computer or mobile video games)
• Merchandise (as discussed in last week’s post)
• Audio (soundtracks and audio novelizations)

As new forms of distribution are created, new rights are created for the artists. These rights are universal, but they can be divided or carved out by geographic area, time frame, distribution channel, language and other factors.

Types of revenue

Just as there are different rights that creators can use to get their work into the market, there are various ways that they can be paid. Creators need to focus on four ideas:

1. A flat fee is a one-time payment that the artist earns upon the delivery of the finished work. For example, a copywriter might get a flat fee for work she does for a website or blog.
2. A royalty is a percentage that the artist earns for every finished unit that is sold. For example, an artist might receive 30% of every one of their comics that is sold to the public.
3. An advance is paid before the work is finished. For example, a writer of a novel might receive money up front for her novel based on the proposal not the finished product.
4. A minimum guarantee (MG) is money paid up before the work is finished, based on anticipated sales. For example, if a toy company plans to sell a new licensed toy for $10 and the creator gets 10% of that sale, then the creator gets $1 per unit sold. If the company expects to sell 100,000 units, then the MG that the artist gets for this deal is $100,000.

These are broad revenue concepts. They are often altered and refined by concepts like gross, net, recoupment, offsets and other variables. (This is a complicated subject that I can talk about later.)

Choices that Artists Must Make

In certain creative circles, the types and amounts of revenue are fairly straight forward. Writers for some mediums often get an advance. A work for hire artist (See Creator Owned vs. Work for Hire) for comics often gets a page rate. There is more confusion for creators pursuing creator owned deals or multimedia works. There is often no advance, no MG and a blanket royalty rate for all forms of distribution. This puts creators in a dangerous position since the lack of upfront money and the uncertainty of any profitable sales in the future means that the creators are really working on spec while at the same time giving up all their rights to their property.

It is understandable why a publisher or other distributor would take this stance in their contracts. Publishers protect themselves from risk by limiting exposure to projects that might not be financially viable. At the same time, they maximize their potential gain by securing as many rights as possible for projects that could be financially viable. Artists need to learn the same lesson. They need to counter the publisher’s position by attempting to limit the rights that a publisher gets for projects that are financially viable and maximizing revenue for every project they do.

I know negotiating power is often limited for artists (See David vs. Goliath in Contract Negotiations). But having a clear understanding of the relationship between revenue and rights and clear goals of where they want to go can help maximize their limited negotiating power and increase their chances of success.

Best

Gamal

PLEASE NOTE: THIS BLOG POST IS NOT A SUBSTITUTE FOR LEGAL ADVICE. IF YOU HAVE A LICENSEING OR INTELLECTUAL PROPERTY ISSUE, DISCUSS IT WITH YOUR LEGAL ADVISOR OR CONTACT C3 ATgamalhennessy@gmail.com FOR A FREE CONSULTATION.

Five Good Reasons Freelancers Need Contracts

By Gamal Hennessy

Before I had to focus all my attention on releasing my new book*I wrote an article about getting paid as a freelance professional (See Solving the Payment Problem). One of my main tips was getting your payment terms in writing. Recently, another contracts lawyer (my apologies I couldn’t find the author’s name on the site) recently posted a similar article entitled Why Freelancers Should Bother with a Contract. The article focused on the ways you could be hurt by agreeing to contractual terms you don’t know about because you didn’t use your own contract. I agree with the article and I encourage you to read it (it’s very short). I’d also like to offer my own reasons why every freelance professional should have a contract in place for each of their clients and vendors.

If you want more advice on freelance and small business contracts,

sign up for the C3 Newsletter

Five Ways Contracts Can Improve Your Business

1. You want clear payment terms. This one was important enough to get its own article. Unless your business is not designed to make money, or if you enjoy spending a lot of time chasing clients for missed payments, it helps for you and your client to know how much they’re paying, when they need to pay and how they need to pay. Those points all go in the contract.
2. You want clear deliverables. A client can order one service and then expect another. They can order one product and then change their mind. You can deliver the agreed upon product and the client could come back with endless requests for modifications, alterations and “one last change”. This pattern of behavior can be reduced with a contract. If your deliverables are in writing, there’s less chance for a dispute when they come back wanting more. You can always give it to them, of course, but with a contract you have the option of getting an additional fee for the additional work.
3. You don’t want to rely on memories, email chains or texts. Contracts do not have to be in writing to be enforced. Contracts can be created without the formal process of writing and signing something. You don’t want to deal with any of that. Memories and informal agreements suffer from a lack of accuracy, subconscious bias and interpretation. A written agreement can remove most, but not all of those problems.
4. You want accurate records for your taxes. At least once a year, you have to account for the truckloads of money you made to the IRS and your state taxation authorities. You could rely on Paypal and Fiverr CSV files, invoices and other receipts, but if you have a contract with each client and payment terms in each contract, it might be easier for you to figure out, and explain if need be, where your income came from.
5. You want to improve the perception of your business. Certain things make a business appear more professional. Your website, your logo, your address all send a message to your potential clients, vendors and competitors. When you put a contract in place with each client you increase the perception of legitimacy in your enterprise. This is more psychological than legal, but it can save you troubles in the long run.

I can feel your cynicism seeping through the internet. You’re right: 

• Contracts take time to draft and negotiate.
• Contracts are not guarantees that your business deals will go well.
• I do have a bias towards you getting a contract because I have a business writing contracts.

All these things are true, but they don’t reduce the value of having a written agreement in place. Whether you get your contracts from me or someone else, there are plenty of good ways contracts can enhance and protect your business.

Have fun.

Gamal

If you want more advice on freelance and small business contracts,

sign up for the C3 Newsletter

PLEASE NOTE: THIS BLOG POST IS NOT A SUBSTITUTE FOR LEGAL ADVICE. IF YOU HAVE SPECIFIC CONTRACT ISSUES OR QUESTIONS, DISCUSS THEM WITH YOUR LEGAL ADVISOR OR CONTACT C3 ATgamalhennessy@gmail.com FOR A FREE CONSULTATION.

* In case you didn’t know, I’m a writer in addition to running C3. My fourth novel, Smoke and Shadow, came out this week. It’s doing pretty well so far but it’s not selling like Harry Potter so I’m going to keep my day job for now…

Freelancer’s Union Endorses the C3 Contract Negotiation Concepts!

by Gamal Hennessy

The Freelancer’s Union is a non-profit organization created to advocate the rights of freelancers, consultants and independent contractors. It has more than 200,000 members across the United States and provides health care to more than 10% percent of its membership. Freelancers Union also maintains a blog called the Freelance Broadcasting Network to discuss issues and topics related to the freelance life.

A couple of weeks ago, I posted an article entitled Twelve Tips for Contract Negotiation. Early this week, Freelancer’s Union found my article and asked for permission to repost it to all its members. I’m always looking for ways to get the word out, so of course I agreed. I wanted to share the new post with you and suggest if you need support, ideas or networking opportunities for your freelance or small business, get involved with Freelancer’s Union if you haven’t done so already.                                          

Click Here to Read the Creative Contract Consulting Article on the Freelance Broadcasting Network

And if you want more advice on freelance and small business contracts,

sign up for the C3 Newsletter

Have fun.

Gamal

Avoiding the Trump Effect in Your Creative Contracts

By Gamal Hennessy 

National politics has been obsessed with Donald Trump since he announced his bid for the presidency. Whether you agree with him or not, his brand of political discourse creates an “us vs. them” mentality the media can’t resist. When he talks, people often react in extreme ways.

Many businesses reacted by terminating their contracts with Trump and his companies. After his now infamous quotes about Mexicans, Chinese and immigrants in general, NBC cut him from The Apprentice. Celebrities dropped out of his beauty pageant. High profile chefs refused to build new restaurants on his properties (See Trump Litigations Pose Questions for Restauranteurs). Trump responded by suing everyone who tries to distance themselves from his comments. While the Trump show has moved on to other acts in its political circus, I’d like to take a look at things creatives should consider when dealing with public image in their contracts

The Impact of Reputation on Business

Even before the rise of social media, the image of a person or company could be the difference between the success and failure of an entertainment release. Associating a new sneaker or film with a star could guarantee millions of dollars in sales. An arrest or scandal at the wrong time could destroy a franchise or an entire company. In the world of Twitter, Facebook and Instagram the same rules are applied with the speed of thought. No one is immune from the critical eye of public scrutiny. The most modest and low budget film, graphic novel or musical release needs to have some kind of escape route if one party pulls a Trump.

Types of Contract Protections

Contract law deals with damaged reputations in four distinct ways. The first two come into play more often in media employment and endorsement contracts, and the last two are more universal ideas. Each of them could deal with a Trump in a different way, with different levels of effectiveness.

• The Morals Clause prohibits a party from engaging in certain behavior in that party’s private life. For example, an actor for G-rated family films might have a morals clause in their contract making arrests for DUI, drug use, solicitation of prostitutes or other scandals grounds for terminating the deal.
• The Non Disparagement Clause prohibits a party from discrediting, dishonoring or lowering the esteem of the other party. So if a writer sells her book to a movie studio, a non-disparagement clause might prevent her from going to the press and criticizing the movie or the studio
• The Confidentiality Clause could prohibit any public discussion of any aspect of the agreement. In some cases, a party might not even be allowed to discuss the existence of the agreement itself. We sometimes see this when actors are put under a gag order to limit leaks for an upcoming release.
• The At Will Termination Clause is the broadest type of termination clause. It gives a party the right to walk away without giving any specific reason for termination. It often doesn’t allow for a cure period (where whoever is at fault gets the chance to fix things) and creates the most precarious type of contract.

It is unclear which if any of these clauses were in the restaurant or beauty pageant contracts, or how the cases against Trump will play out. It is clear that as more creatives and corporate executives get treated as public figures, the more these clauses will come into play for future deals.

Finding the Protection

When a creative person looks at a contract, the focus is often on the money, the deliverables, and the deadlines. They might not be willing to slog through the swamps of boilerplate language to consider the impact of confidentiality or morals clauses. Without professional advice, they might do or say something to put their deal at risk even after it’s signed. Or they might find themselves publicly connected to a media nightmare. In the modern digital landscape, it pays to have a professional review all the aspects of your deal to point out pitfalls unrelated to dollars or deadlines (See Why Artists Need Lawyers). Not all of us can be Donald Trump and say whatever we want. Over time, we might find out he can’t do it either.

Have fun.

Gamal

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PLEASE NOTE: THIS EMAIL IS NOT A SUBSTITUTE FOR LEGAL ADVICE. IF YOU HAVE A LICENSEING OR INTELLECTUAL PROPERTY ISSUE, DISCUSS IT WITH YOUR LEGAL ADVISOR OR CONTACT C3 AT gamalhennessy@gmail.com FOR A FREE CONSULTATION.