In the context of business and entertainment law, a licensing agency is an organization that monitors the legal use of the business’ products or work. For example, a licensing agency may check to see that a business’ logo is always being used with permission when displayed by another company.
One of their main functions is to handle temporary or permanent usages of the business’ copyrighted material. Licensing agencies are also sometimes entrusted with the task of promoting the business or artist. Most licensing agencies have extensive marketing and promotion contacts, and seek ways to introduce the business’ product into the appropriate retail channels.
The specific tasks and duties of a licensing agency will mostly depend on the individual needs of the client. For example, one client may be interested more in copyright protections, while another may be interested more in the promotion of their services. The exact tasks will be negotiated and finalized into a written contract.
Some common tasks that licensing agencies perform can include:
- Informing the client of the various trademark and copyright protections available to them
- Recognizing improper usages of the client’s patents, trademarks, or licensed products
- Creating and implementing a strategy for marketing
- Identifying the appropriate channels for selling the product
- Identifying the appropriate consumer base that would likely be interested in the product
- Suggesting other types of products that might help increase the business’ visibility
Licensing agencies may also act as representative for the client when negotiating various deals or opportunities for the artist or business. The agency will often charge fees and commissions based on the business’ performance in terms of sales.
One of the main types of legal disputes between a client and their licensing agency is a breach of contract. Since the agency-client relationship will be very highly specific from case to case, the contract needs to be very thorough in order to cover all the needs of the client. For example, a common legal claim involving the contract is a failure by the agency to exercise a good faith effort to market the product.
Other legal issues to watch for when dealing with a licensing agency may include:
- Copyright Infringement: The agency may often be entrusted with access to the company’s logos, trade secrets, or other protected information; unauthorized appropriation of the client’s material is a major legal violation
- Unfair Business Practices: It can sometimes happen that the agency engages in unfair business practices when promoting a client, such as false advertisement. This frequently happens without the client even knowing it, but it can be damaging for the client’s reputation nonetheless (people will usually not purchase products that have been “tainted” by illegal marketing techniques)
Thus, businesses and artists need to be very alert and wary when it comes to working with a licensing agency. These types of legal disputes can result in negative consequences for the business’ success.
While licensing agencies can be helpful and at times even necessary, it’s usually best to hire a business lawyer for help in dealing with an agency. A qualified business lawyer in your area can help you negotiate and finalize your contract with a licensing agency. This will help ensure that your legal rights aren’t being violated in some way. In the event of a lawsuit, an attorney will be able to represent your interests in court.