And the Winner Is… Unlikely To Be You

August 14, 2012

Lessons on Intellectual Property Law for Meeting and Event Planners

by Thomas Ishmael

Meeting and event planners are known for their creativity, but sometimes meetings and events are anything but. Consider the ubiquitous Disney character-themed birthday party. Or, perhaps the corporate award ceremony with red carpet and shiny gold statuettes? What about that groovy disco cover band?

As a meeting and event professional, you should have some understanding of how intellectual property laws impact the industry. If the event you are planning infringes on someone’s intellectual property, you could find yourself in a lawsuit.

United States intellectual property laws afford legal protection for one’s ideas. Industry professionals should be cognizant of the rights of both copyright and trademark holders. A “copyright” is a protection provided to authors of “original works of authorship.” Examples include literary, musical, artistic and other intellectual works, whether published or unpublished. Under the 1976 Copyright Act, the copyright’s owner has the exclusive right to reproduce a copyrighted work.

A “trademark” is usually a word, name, or symbol used in trade with goods to distinguish them from others. A well-known trademark instantly tells the public where a product came from. Logos are good examples of trademarked intellectual property. When one thinks of well-known companies like Nike, Apple, or IBM it is difficult not to envision their trademark logo at the same time. Trademarks attempt to protect brand recognition and integrity. There are several scenarios which expose meeting planners to legal liability for infringing on intellectual property rights.

The most common source of liability for intellectual property infringement in the industry is the pervasive use of “look-a-like” characters used in themed events. There is no shortage of examples of meeting and event companies being sued for use of popular images without permission.

In 2008, Disney Enterprises, DC Comics and Hanna-Barbera Productions sued Miami event company, Tio Fiesta Decorations & Events, claiming the company improperly profited from using trademarked costumes and decorations at children’s parties. Tio Fiesta was sued for damages in excess of a million dollars for providing costumed entertainers resembling trademarked designs.

Last year, the Academy of Motion Pictures Arts and Sciences threatened a copyright infringement suit against an event rental company in Atlanta. The defendant rental company was allegedly renting oversized Oscar statuettes for events. This year, the Academy filed a federal lawsuit against Edwardsville, Illinois event company and its president. That lawsuit claims the defendants rented and sold statues resembling the famed Oscar award.

Lawsuits brought against event companies for trademark infringement are increasingly common. Intellectual property laws impose an obligation on owners to protect their own property rights or potentially lose them. Can you imagine Disney losing its rights to its beloved characters? Neither can Disney. Intellectual property owners have no choice but to aggressively defend their interests. Many with well-known and lucrative intellectual property retain law firms to actively seek out infringements of their client’s property rights and take legal action.

So, rethink the shiny gold statues you planned to rent for the entry to the corporate awards ceremony you booked. Do not hire the dance troupe dressed as comic book heroes. Unless you have specific permission to use someone else’s intellectual property at your event, you risk liability for using it. When in doubt, leave it out.

Another common industry pitfall comes from infringement on copyrighted music. Most restaurants and bars play music for their guests. Most businesses playing music for public consumption run the risk of drawing a lawsuit if they fail to pay licensing fees for music. Even if it is just listening to a local radio station. Authors of “original works of authorship” like recorded songs, have enforceable copyrights to their music. Most recorded music is protected by performance rights societies like the American Society of Composers, Authors, and Publishers (ASCAP), Broadcast Music, Inc. (BMI), and others. These groups offer license agreements to commercial establishments for a fee. Many restaurateurs avoid licensing agreements by contracting with a third party music vendor, like MUZAK. Some rent a juke box.

Infringing on a copyright can be very costly. The statutory damages for infringements range from $500 to $100,000 depending on the circumstances. Any profits the proprietor made from the use of copyrighted work may be awarded to the copyright holder. Most restaurateurs know they are responsible to pay for the copyrighted music being piped into their dining rooms. But, the responsibility to pay for copyrighted music does not end in the dining room. For example, if you plan an event with a live band on a restaurant patio, the restaurant will owe licensing fees. Even though the band is required to pay fees to sing copyrighted songs, a restaurant owner is not relieved of the obligation to pay fees for allowing live performances of copyrighted songs.

In 2007 ASCAP sued the Ibiza Dinner Club in Seattle, Washington for copyright infringement. ASCAP’s federal lawsuit claimed that a DJ at Ibiza played three copyrighted pop songs without paying a licensing fee. The Ibiza Dinner Club was sued even though it subscribed to a third party music vendor, and the DJ reportedly paid for the music. Lawsuits for damages associated with companies profiting off of copyrighted music are not uncommon. Much like the Academy of Motion Pictures Arts and Sciences seeks out unauthorized use of its “Oscar,” ASCAP is known to fiercely protect its intellectual property. They hire investigators across the nation to visit bars, restaurants and public places where music is played and listen closely. The investigators check to ensure the property owner has paid a licensing fee for what they hear.

The copyright laws afford liability against an organization that knew, or reasonably should have known, of an infringement and participates anyway. Therefore, there are countless scenarios that expose meeting planners, exhibitioners, restaurant and hotel owners to risk. You are risking liability for copyright violations when using a popular poem on an event menu, booking a cover band for a reception, or hosting a trade show exhibitor who displays protected images.

Lawsuits seeking to enforce intellectual property rights are common and costly. I recommend you keep these risks in mind when negotiating your event contract. Retain an attorney to draft language minimizing the risks associated with intellectual property infringement at your events to be included your contracts. Your company should negotiate for, and reduce to contract, the right to immediately halt the use of trademarked exhibits, improperly costumed entertainers, publications, and music it believes infringes on others property rights. Seek indemnification for any costs associated with infringements which might occur as a consequence of doing business with an offending party. Hopefully, by being aware of how intellectual property laws impact your day-to-day work, you can avoid these common industry pitfalls.

Thomas Ishmael is an attorney with Hornbeek Vitali & Braun, PLLC in Oklahoma City. Hornbeek Vitali & Braun represents hotels, restaurants, bars, golf courses and others in the hospitality industry. Ishmael has more than 15 years working in the hospitality industry specializing in luxury hotel and resort management.

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This column is meant to provide practical advise, tips and rules of engagement you need in the meetings and events industry. However, please consult with legal, insurance and tax professionals before acting on any information presented in this column.

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