When the global pandemic hit, attention was focused on the agreements among parties: advertisers, agencies, production companies, talent and rights holders. Conversations focused on termination rights, contingency provisions, insurance and force majeure.
To restart advertising production, new agreements and provisions have been drafted. While the parties negotiate and debate, there remains an almost insatiable need for new advertising content that both fits the needs of the moment—a world of stay-at-home orders and the needs of tomorrow—and the drive to increase sales and growth.
In the quest for new advertising materials, policies and procedures have been developed to allow for advertising production where groups of people come together. On a parallel pathway, there has been a heightened focus to create new advertising from the materials and content already produced, whether it is by simple use of clips or edited footage or photography, or more advanced digital manipulation. An interesting example is State Farm’s commercial used in ESPN’s high-profile documentary The Last Dance featuring doctored footage of SportsCenter anchor Kenny Mayne.
Advertising and creative materials, once produced, may be viewed as a tangible product—the property of the advertiser suitable for mining to create new work. Avoiding the problems of advertising creation amid Covid-19 is possible only if the path chosen provides an effective creative and business solution with fewer, not more, legal risks.
Here are some of the legal considerations when creating new advertising from already produced advertising materials:
What is in the talent agreement? Does SAG apply? If SAG does not apply, what do the releases or contracts provide? What is the allowed scope of any future use: term, territory and time periods?
Photography and music
The most likely scenario is a limited-use license. What are the terms of the license? Even if the brand is the copyright owner, consider whether there are still payment obligations and use limitations.
Rights holders to artwork, logos, graffiti, tattoos, trademarks and copyrighted works will usually be subject to comprehensive agreements or written permissions. A core element of such documents is a limitation to the original intended use. As such, any further use will require negotiation and agreement.
Even assuming use rights exist or are secured, if the use is for a different product category or brand, what about exclusivity? Does the advertiser have and/or want exclusivity? Are the talent and third-party rights now tied to a competitor?
Use or digital manipulation
Even if use rights beyond the term, territory or product exist, what about rights to digitally change, manipulate and/or sample the original work?
Assuming all use rights have been secured, the advertiser must consider another area of concern: advertising law regulatory issues. Advertising law is based on the fundamental legal principle that advertising must be truthful, not misleading and not deceptive. Further, there must be substantiation for all claims made at the time the advertising is run, not when it was created. Consider the following:
Use of clips or scenes from currently existing advertising approved as compliant with the existing advertising law rules at the time must be reviewed again for the new use. This applies to new product claims and substantiation of such claims as well as legal issues that arise out of a specific type of advertising—demonstrations.
A demonstration makes a claim about what a product can do (e.g., how much liquid spill a paper towel can absorb) and then shows the viewer that the product is doing it (e.g., the actual spill is being wiped up and absorbed). If content, by editing or manipulation, is changed in a material way but presents this to a consumer as a real demonstration, then there may be a need to add a disclosure or not use the manipulated footage. The facts will determine the action needed to ensure legal compliance.
As you seek to avoid the risks that could arise out of in-person advertising productions during this time, you must be sure that your action does not cause other damage, claims or injures. The last thing you want is a litigation by a third-party alleging failure to secure all necessary rights or a claim by a regulator that the new advertising created is false, deceptive or misleading.
Make sure you follow the rules—whether they relate to social distancing and masks, or third-party rights and advertising laws—as they are all extremely important.