Demystifying Contracts: Where to Begin and What to Know with Alison Anthoine, Esq.
We recently sat down with Alison Anthoine, Esq. to discuss some basics around understanding and negotiating contracts as a creator – whether you are a speaker, writer, or both.
Alison Anthoine, Esq. is an entrepreneurial lawyer who has been running her own solo law practice for over 25 years where she handles primarily legal and business affairs for entrepreneurs and small businesses, including general commercial, copyright, and trademark.
Alison provides no-nonsense strategic and legal advice. As a long-time adviser to media companies, she’s able to offer solid insights into terms and conditions for a large array of business deals. Alison is currently the outside general counsel for Fast Company & Inc.
We were thrilled to host this event to open up the opportunity for our community members to learn from and speak directly with an experienced contracts lawyer.
To be clear, this isn’t to be construed as legal advice. But Alison shared tons of great information about contracts that you can find below.
What’s the role of a contract?
“The role of a written contract is as a record you can look back to and say who agreed to do what for whom, how much is going to be paid, if there are deadlines.
What you want in a written contract is a clear and unambiguous statement of everyone’s expectations. Who will be doing what and what will they be giving for it.
A contract that doesn’t have an actual exchange of value, where only one party is giving a commitment to another but not getting anything in return isn’t a legally binding contract.There has to be a trade-off of value for value.”
Do you always need a contract? Who should be providing the contract?
“The party with the greater power/leverage often controls the contracting process. The reality is an individual or small business doesn’t always have the means to have a form agreement to bring to a client. On the other hand, a publisher is going to have its own form of agreement and will make you work off of that.
With speaking engagements, more and more, most hosting companies have a form agreement.
The company wants to make sure the speaker is going to show up at the agreed time and the speaker wants to know who the audience is, who is going to be moderating (if it’s a Q&A) and what they’re going to be doing with it (the speaker’s presentation and/or appearance.)
The reason I want my clients to have an agreement is because every state has a rule that you can make editorial use of someone’s name or likeness without getting consent. But if you’re going to use someone’s name or likeness in any kind of promotional content, you must have their written (or affirmative) consent.
You can have a written contract, or something that is deemed a written contract by having an exchange of emails.”
If emails constitute a contract, why bother with a formal contract?
“With a contract, it’s all in one place and it’s absolutely clear. You don’t have to sift through a thread of emails. A contract formalizes the relationship but if you don’t want it to be a formal relationship, or if it’s easier to do it on a casual basis then do it on a casual basis.
You may not need a lawyer [to write every contract], but you need someone to write in a clear and unambiguous way. If there’s any misunderstanding it could be held against you.
[For example], if this is a contract where you expect to get paid and there’s a cycle of phases in the payment schedule, I would advise you to have a signed contract before getting started. If it’s a more casual situation where you’re not getting paid or only getting travel expenses reimbursed, you could start preparing [before a contract is in place].”
But Alison made it clear that you don’t want to set a precedent that you work for free. Having a contract can make your payment terms crystal clear to avoid any misunderstandings.
Another important point made during this event was that you’re building a relationship with your clients, and so you want to get a good feel for them. This will help you better align with clients that you will work well with.
“One of the most valuable reasons to negotiate a contract is to get a sense of who your client is. You get a sense of how responsive they are, do they turn things around quickly, and how hard are they to work with.
One of the greatest satisfactions you can have is to fire the client before you sign the contract. To know you don’t want to work with them because as difficult as it is to negotiate a contract, it only gets harder once a contract is signed. The relationship does not necessarily improve and rarely does once a contract is signed.”
How do you approach dissecting a contract?
“In basic terms it comes down to what am I doing for you and what are you doing for me?”
That includes but isn’t limited to:
- Are you paying for travel expenses?
- Is there a cap on expenses?
- Do you want the right to record the appearance?
- Do you want to use my likeness to promote this or future events?
“Another standard thing to include is a representation and warranty stating you won’t libel anyone or infringe on their copyright or trademark. You may also see a recitation that both are independent contractors.
There are also usually several sentences saying things like “this agreement sets for the entire agreement by the parties and can only be amended in writing by both parties.”
Often, I like to include that if there is a dispute, both parties will put in a good faith effort to resolve the dispute before starting litigation.
Book contracts will have things like the terms of the copyright, subsidiary rights, foreign licensing, publication of excerpts, and so on. Then when you get into more complicated contracts, there will be indemnification language.
Another thing to consider, is that if there is a sponsor of the event you are speaking at, you want to be sure that nothing will imply that you are endorsing the sponsor’s products. That’s something you should be paid for.”
Can you push back or negotiate a contract?
“Everything is always negotiable. In most cases you can pushback, especially with speaker agreements. Most book publishers don’t want to negotiate off their form but every literary agency has their own template of changes. Publishers will make changes in their form for the major agencies but not for an independent author.”
Alison also advised to approach a negotiation with humility but to ask for what you want.
“Ask. If you don’t ask, you have no chance of getting [what you want.]
If there’s something you don’t understand, just ask. There’s no question too dumb. Sometimes, companies expect you to feel intimidated by the contract but you need to break through that.
The larger companies, the more lawyers, the bigger the team, the more money they’ve had to invest in forms that no one wants to negotiate off of.
It’s always good to understand they’ve created a form that they may not want to negotiate off of, but they will listen. You just have to get the right person that has the authority to make changes.”
Are there red flags, or things you’ve seen in contracts that you advise people to look out for or push back on?
“A shorthand way that larger companies try to get all the rights they need is to say that when you’re creating [for them] is “work for hire” which gives away your copyright rights. No organization you’re working for needs to get that. In fact, I consider it to be an insult to an established writer. It’s important that the person who writes an article keeps the copyright and is able to use the material going forward and it’s disrespectful to a writer or to a speaker.”
Do you have any advice for when an event you’re speaking at will be recorded?
“What you can do is use this for your own promotion. I would ask that they send you a copy of the recording so you can use it for your website, post it on LinkedIn, etc.
Speakers should know if it’s recorded, where it’s going to be posted, and for how long. If a sponsor is going to get a recording, then you want to get the rights for a finite period of time and not indefinitely.
For people that are entrepreneurial, it helps to have it out there. It’s not a bad thing to have the recording out there.”
Do you have any language to cover your own liability at an event?
“Make it clear that you’re not providing specific advice to anyone and it’s all general information. What you could do is to ask to be indemnified by the sponsor of the event in case you get caught up in a suit.
There’s no worse way of resolving something with speed than going through the American legal system. The best thing you can do is negotiate.
With client contracts, you can’t afford to sue if you don’t get paid. That’s why you want to collect payment as you go and not allow your client to get behind on payment.”
Is there anything you can do to protect your intellectual property as a creator?
“With writing, you can put a copyright notice on what you deliver. You can also put it in an agreement that the copyright is yours. You can ask that they put a copyright notice on the bottom of the piece or with your byline.
If it’s going to be in print, ask to get a copy or several copies of the published work so you have it for your portfolio but also for your own records that it was done.”
Are there any common misconceptions with contracts?
“If you think you can collect payment on a signed contract by going to court from a bad apple client, then you’re in trouble. Protect yourself and do not extend yourself too far.
Slow payers are a risk and you have to hold your ground. It’s hard to say “Unless you pay that installment, I can’t keep working” but it is the best way to deal with a slow-paying client.
What advice do you have when a project gets extended due to the client?
“Include deadlines in the contract to show what time you have allotted for the project to be completed. You can include clauses that say if the project isn’t completed by that deadline then you can add a surcharge or put the project on hold while you handle other client work.
If you are willing to work past the deadline, you can add in a surcharge if it runs past the agreed upon due date. In another situation, if there’s an installment due upon completion of a milestone but that milestone hasn’t been met because of a delay by the client (or otherwise beyond your control) then you can provide in the contract that an alternate amount be paid by a specific date.
There are an infinite number of ways to articulate payment terms depending on the specific situation.”
Any advice on working with a kill clause?
“A kill clause [for example] is if we’ve assigned a writer a piece and the piece just doesn’t work for us, or the circumstances have changed for instance another outlet has already published a similar piece. My client’s standard kill clause is that if we don’t accept the article, there’s a 50% payment and the rights go back to the author.
That may be different if the article isn’t accepted because it just isn’t written well.
However, for different design projects, when the client has a right to terminate mid-stream, the client has to pay you for work that has been done. You can negotiate a minimum to be paid, or a clause that the client can’t kill it mid-stream or has to pay in full.
What happens a lot in creative work is that there are two pieces. There’s the production of whatever article or video that has to be done and then there is media placement. You want to get paid as much as possible up front and you want to protect that revenue stream even if the client changes their mind.
I have put non-cancellable clauses in many contracts. The clients balk but we say well if you cancel the project then you can apply the fee to something else but you still have to pay us this money.”
Is there anything to consider with international clients?
“There’s a lot of cultural issues that can come into play and create complications. What I try to do is to say this is the American Law/New York Law that will apply and so I can keep negotiating on the ground that I know about.
So signing overseas is at your own risk, but it will only come up if there is a dispute.
It’s most important to work out and understand how you get paid and to get paid as much as possible up front.”
What happens when the client tells you their needs during the scoping period but that ends up not being accurate?
“Clients who don’t understand design or don’t understand what it takes to get X done, clients who don’t understand advertising but are hiring an advertising agency for the first time [may not know what they need at first.]
To the extent that you can, articulate what the scoping period entails, then at the end of that period say ‘let’s pause because it turns out you need something completely different than you thought.’”
Don’t get into phase two if it has been articulated incorrectly. It’s reasonable to re-negotiate at that point. You can build that into the contract by saying during the scoping period, we will regroup and have a conversation mid-way through. You can have a change of scope of the project where you start the clock again.”
Do you have advice on how to protect yourself while still communicating trust with a new client?
All of this is relationship work so you want to form a relationship with your client and if you’re only doing that through negotiating an agreement, then that can be very limiting.
I’m not saying entertain them or take them to lunch but it’s helpful to know what makes them tick. Come across as a human being. This is the beginning of a relationship that we hope will last through multiple projects.
That attitude engenders a complimentary response.”
When do you feel you should have a lawyer review a contract versus using common sense?
“As a lawyer, my ideal client can hand me a term sheet. With experience, you learn how to articulate these things more and more clearly.
If you’re dealing with a very large project where you risk being overwhelmed by the client or their legal team [then you may want to hire a lawyer.] Also, if there’s a lot of indemnification language you’re concerned about, if there are things that are privacy related because the privacy laws are ever-evolving and complicated.
Lawyers should be involved in the heavy lifting. They don’t have to write the pieces you can write, we can just help you frame it better.”
What resources would you recommend, short of working with a lawyer, for standard language for smaller engagements?
“The graphic artists and photographer’s guild have model agreements that they’ve prepared for their constituencies that are free. It’s not apples to apples but there’s good stuff there.
There’s Volunteer Lawyers for the Arts (https://vlaa.ord.get-help/other-vlas/) with resources you can find online.
You can find an amazing amount of stuff online.”
Outside of contracts, what type of legal things might you consider?
“Each one of us has a career goal and things that we’re working towards. Having a speaking or writing engagement allows you to promote yourself in a different way. It’s a way to broaden your audience, if that’s what you’re looking for, whether you’re looking for employment or clients.”
Thank you to Alison for sharing her time and expertise. You can stay up to date with her on LinkedIn.
Watch the full recording below.