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Crash Course in Entertainment Law - Interview with James Elam Esquire
Listen to the interview in RealAudio
I think those of you who are serious about the music industry and know the
least bit about it are fully aware that it can be very shady at times...
Scratch that, all the time! You will find this article info packed. It will tell
you all you need to know without going for an actual lawyer consultation
here. We are not saying this is the last stop, because as if and when you
read on, you will learn that there are many, many aspects of the business,
that most creative minds don't want to bother with. So since you don't really
want to go there. I did, I found the DL on contracts, tips to stay focused
and of course more.
This is where I stop. It is up to you to continue the process and if you are
as serious about the biz as we @ Black Hole think you are, then trust me (and
I am no politician you can trust me) our interview with James Elam Esq. will
be the place to get started.
James Elam Esq. was down to earth person. He seemed too modest about his
accomplishments. I will be sure to boast of his accomplishments here and now.
Entertainment/Corporate lawyer based in Philly, his home town at the
Dilworth law firm. The only African American in a law firm that has over 100
lawyers. His roster of clients he represents/ed include Guru from Ganstar, King Tee, Philadelphia Int'l Records, Jill Scott, RAM Squad, DJ Cash Money
and DJ Miz, Major Figgas, Mekka Star, Men at Large, Born Jamericans & many
more.
Here goes the interview. Remember this is the initial step. It is up to you as
to where you want to take it from this point! Good luck where ever you plan
and may it be a fulfilling destiny!
babyBREE: It's babyBREE and we are here with James Elam Esq. How are you today
James?
James: I am doing all right.
babyBREE: Great given that you are an entertainment lawyer. First of all tell us
how you got involved with being an
entertainment lawyer give us a brief summary as to who you are?
James: I started out a long time ago being a DJ and producing actually.
babyBREE: A DJ?
James: Yes, I DJed for a long time, and I always had a love for the business.
But I was one of those people who had the
fortune to have a reality check and I decided that I didn't want to be the
next Premiere or the next great producer. I
decided that I wanted to go into the business aspect of it. Which is probably
a wiser choice.
babyBREE: Right
James: So I kept up with the same people and the same contacts
babyBREE: Right, DJ Miz? Isn't he one of your old friends?
James: Yes, He and I actually went to the same high school together. So I have
known Miz, before he was Miz. And he
knew me before I was James Elam Esquire. I kept up with the same people and I
just decided to come at
entertainment in a different way and it's working well so far.
babyBREE: What are your responsibilities as an entertainment lawyer? Give us a clue
as to what you go through on a
weekly basis?
James: Well my job, I like to see it as the gate keeper for my artists and for
my clients overall. I like to be the guy that
protects them from the unknown. To help them negotiate the terms that they
aren't very familiar with. And to elude
some of the traps that are set for artists and by artists in the
entertainment industry, depending on who my client is
and I like to protect them and I see that as my role.
babyBREE: So what types of artists do you deal with mainly, is it mostly people
involved in the music aspect?
James: Most of my clients are music based, be they artists or independent or
major record labels or producers, managers.
It really is a wide variety.
babyBREE: It sure is. What are the most common mistakes artists make when they
enter the business world?
James: I think the biggest mistake that artists make are to not educate
themselves on what they are walking into. I think
that artists need to decide that this is a business if it is going to be a
business for them and to treat it just as you were
to open a store or to but some real estate. You have to realize and
understand the processes going on around you
and to dig into to what is operating around you. Who makes money and why they
make money and who has been
successful ahead of you. Read some books on everything that you are going to
be involved with operates.
babyBREE: Right. And most people are there for the art and they don't realize the
business. So people can take advantage of
them right?
James: Right I have seen time and time again artists who come in and say, "Well
I just want to come in and make
music." Well that is fine and good, but these are the same artists that you
hear 10 years down the line after they have
sold multi platinum albums, going bankrupt.
babyBREE: Speaking of going bankrupt. What can people look out for when they are
signing a contract. When they first get
to that point, what is the ideal contract for an artist just starting out?
James: As far as for a record label?
babyBREE: Yeah. Exactly
James: Even that is kind of a loaded question since there are so many different
levels of record labels. If you are talking
about a direct contract with let's say Warner Bros., that is a different
contract that you would get from a Production
Co. signed from Warner Bros.
babyBREE: What's the difference between the 2? Say something as big a Warner Bros.
We are not saying specifically
(Warner) but a label as big as Warner Bros.? What is the ideal. What is the
highest/lowest point?
James: It all depends on the strength of your negotiations. I have artists
that I with that are very much in demand and I
get called and I get calls every day from different record labels asking me
for Status, "What's going on?" To "What
is the highest bid so far?" "Do we have to make it a $10,000 dollar advance
or a $50,000 advance or a $200,000
advance." It all depends on your power and I think that the key for any
artist is to market yourself constantly
regardless of how great you think you are. How great of a rhymer or singer or
whatever your craft is, you always
have to keep marketing yourself because that helps you all the way through
your career. The more people that know
your name, the more demand you create. People have to realize that this is
the kind of business where whatever is
hot, everyone wants it. If you are an artist that no one has ever heard of
then you don't have as much power as an
artist who everyone has heard of.
babyBREE: So for an artist that doesn't have as much power, first of all you
mentioned something called advances. when you
say advances. When a record company gives you an advance is that something
that is yours for good or is there a
little something people should know when they get those advances?
James: Money from record labels including the money that you record with.
Including your jewelry money, your car
money. Anything that is money from a label typically is what is called
recoupable.
babyBREE: Can you explain that in laymen's terms?
James: Yes. Recoupable means that it is a loan. That means that everything that
they spend on you, they get back
before you make a dime in your pocket. For example if you get a $100,000
advance and then you spend $300,00
recording your album. you spend another $600,000 just marketing yourself
including videos and street teams. Now
you have spent a million dollars walking in the door. what that means that
out of your royalties that you make, if you
make less than a million dollars, you owe them money. And this is not money
that you have to physically come out
of your pocket and pay. But this means that regardless if you sell 500,000
copies of your record. If your royalty
structure is not so that you make $500,000 or rather I am sorry a Million
dollars then you won't get any money
from the record label
babyBREE: What is the likelihood of that happening with new artists. Is that
something that is common?
James: It's a high number. People don't realize that last year, I think
approximately 40,000 new albums came out and
that is in the stores, so there is some fierce competition.
babyBREE: Definitely
James: Then you have the upper echelon artists that always sell multi-millions.
So that takes even more sales away from
the lower level artists. Over 90% do not recoup on their first album.
babyBREE: That is scary.
James: And this is a product of a lot of different things, given that artists
often don't take the business aspects seriously.
They don't get out and minimize their costs in the studio. They don't stay
on top of the marketing plan to find out
what is going on.
babyBREE: Speaking of minimizing costs, how would someone minimize their costs in
the studio, because I know a lot of
people who are out there just starting off who just don't know how to do
that? What are some tips that you would
give a person?
James: People have to realize that they are working in a studio. It's like
riding a cab. The minute you sit down, the
meter is ticking. So when you book a studio time and you don't show up, you
still pay for that. You book studio for a
day, you can spend four, five, ten thousand dollars at a major studio and if
you don't show up you just spent four or
five of your thousand dollars.
babyBREE: Down the drain
James: Down the drain, that is money that you'll never see. You have to show up
when you are supposed to be there
and show up ready. Show up ready to record, when you sit down. Your producer
should be there before you and the
music should be loaded into the board. And when you get to the studio you
should be ready to step into the booth.
Because that is money saved, if you can record a track in 3 hours as opposed
to 8 hours, I mean the obvious
difference in price is tremendous.
babyBREE: Right. And a lot of the artists that are just starting out aren't aware
of this. I mean they are to a certain extent
but they don't realize that every second is money. When a young artist is
starting out what is the ideal contract for an
artist just getting started? Are there some keys/highlights that a person can
look for in a contract.
James: Well I will try to give you few, it is a tough question to answer. But I
will say that you should try to control your
publishing, there is lots of contracts nowadays where people ask you for half
of your publishing or all of your
publishing and for minimal return Try to control your publishing and try to
keep your royalties out of the "all in
range."
babyBREE: Right and there is a difference between the royalties. Right? There is
the mechanical right? And then there is the
artists? Can you touch on that?
James: They both come from the record label but they are both based on different
principles. The sales royalties are
based on how many units you actually sell. Where as the mechanical royalties
are based on the same principle, but
they are also based on the number of songs. And the number of songs in
particular that you write. Or if you don't
write any songs that actually takes a lot from your mechanical royalties.
babyBREE: Uh Oh
James: Mechanical Royalties are based on publishing. Publishing has to do with
who writes and produces the songs. If
you don't write any of your own music then you are basically going to give a
substantial amount of your mechanical
royalties.
babyBREE: This is very sticky ground. Everything right here is definitely not what
a person just staring off would know at
what point is it necessary to get help from an entertainment lawyer?
James: I think you should have help from an entertainment lawyer at any point
when you enter an agreement with
people. Now you should understand that you don't have to have a written
contract to have an agreement with
someone.
babyBREE: Oooh what does that mean?
James: I'll explain if someone says, "I want to produce an album for you and
in exchange I want X." And you go into
the studio with them and you get signed, it is very likely that you can be
sued and you will owe this person money
regardless of whether you signed a contract with this person or not.
babyBREE: WOW!!!
James: That is based on the principle that if you talk someone into doing some
work for you and they do the work in
exchange for something for you then you owe them... I will give you a great
example. If I say to you, "I'll build you a
house for a thousand dollars." And you say, "Fine." And we never sign a
contract but I build you a house, you owe
me a $1,000 dollars.
babyBREE: Right. So it's an oral contract even if it is not written out it is
still cause for, someone can come and sue your
behind?
James: It can happen. But only if there is some action taken. If you and I agree
to form a contract and we don't do
anything then there is no contract. But if I ask you to do something and you
do it then there is a great claim for a
contract being there. The point is when you enter into any kind of agreement
with someone you should have that
agreement immortalized on paper.
babyBREE: Could anyone do that? Could anyone just write up something and have
another person sign it? Or is it
necessary to get further into it before you are even at that point? If I were
to write something out write now in ink
and paper and have a little paper that I write out would that be possible?
James: It is possible, but the problem with that is that there is always
something you might not be aware that is
necessary to have in a contract. Every state has different laws. So depending
on the state that you are in. you
might need some magic words or some magic paragraph that make it a contract
and if you don't have that, then you
don't have a valid contract.
babyBREE: I see.
James: So it is always better just to have it. I mean it is pretty sad. I mean I
get more calls about people who want to get
out of contracts then people who want to get into contracts.
babyBREE: Too late.
James: Yeah, they try to skip and save on a lawyer and say "Well look I'll just
sign it." Then (Later) they will say, "well
how do I get out of this?" And I will tell them, "You can't get out of it,
you signed a valid contract." You try to save
a few dollars. And you have to realize that most entertainment agreements are
long term agreements. Particularly
between artists and labels and artist and managers, or artist and production
companies. These are agreements that last
3 to 7 or 8 years. If that is something that you want to sign. You should
make sure that is really something you
want to sign before you go ahead and sign something.
babyBREE: Right. There are endless accounts of this that are publicized I don't
understand why people don't just get this
through their heads, but it is always publicized that someone is unhappy and
wanting to get out if there contract that
signs them down for 3 albums or whatever.
James: Right.
babyBREE: So since you have seen and dealt with a lot of artists, what is the key
to staying power? Is it the drive and the
motivation that keeps a person strong and keeps a person in the right
direction?
James: Staying hungry. I hope that is the right word to use, but I think that is
the key. I mean you look sat guys like LL
Cool J for example he comes back every time and you can see that he is still
as hungry and he doesn't mind the
challenges that go a long with being a young artists. A lot of guys get a lot
of cocky after their first success. And
then you find that they fall off because your product is not up to date or
you have everyone giving you "You're the
greatest" speech. When that is not actually the case, and you have to stay
hungry and keep those creative juices
flowing. You have to always treat every album like it's going to be your
last. You have to pour your heart and soul
into it.
babyBREE: Alright, any final words for those artists out there? I mean there was so
much, but it just topped the cake for me.
Anything that you would like to say for people who would like to say for
people that would like to get into the biz?
Any words from an entertainment lawyer in Philly?
James: Yeah actually I do. I mean I said it before and I can't say it enough.
Read a book about music! And read
multiple books about the industry and treat the business like a business.
babyBREE: True and you don't have to go to buy the book either. Just go to the
bookstore, I know that James Tingle was
talking about that at the PMC 2000 conference. If people want to find out
more information how do they go about
contacting you?
James: You can contact me on the Internet through my email address:
ElamJE@Dilworthlaw.com or you can call me @
(800) 220 - 7700.
babyBREE: Great thank you so much James Elam Esquire.
James: Alright babyBREE.
Note: In addition James Elam also writes a regular column featured in the
'Philly Word.' Check out their online site @ http://www.phillyword.com
Listen to the interview in RealAudio
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