Understanding Management Agreements in the Music Industry

Management agreements often leave the definition of what a manager should do up to the ambiguous idea of what a "first-class manager" would typically do for a recording artist. However, it's essential to understand what a manager should not do, as outlined in the contract, particularly regarding fiduciary duty.

Fiduciary Duty

• As a manager, you sometimes serve as the custodian of your artist's money.
• It is crucial that you do not breach the trust that the artist places in you when handling their finances.

Ownership of Intellectual Property

• A manager does not have any claim to own the intellectual property belonging to the artist. This includes:
  • Songs
  • Tracks
  • Artistic names
  • Brand images
  • Logos

All these assets are fundamental to the artist's identity and are owned solely by them.

Responsibilities of a Manager

In many ways, a management agreement delineates what a manager cannot do rather than what they should actively pursue. For instance:

• Success Is Not Guaranteed: No management agreement can guarantee success for the artist.
• Limited Duration: This is why a term of limited duration is essential:
  • If the manager fails to perform adequately, the artist has the option to take their business elsewhere.

Milestones in Management Agreements

It's important to note that there are often caveats and milestones included in management agreements. These may specify:

• By a certain point in the term (e.g., halfway through), the artist should achieve:
  • A major label record deal
  • A serious publishing agreement with a major publisher or significant indie
  • A distribution agreement that includes marketing funding

These milestones offer some structure to the agreement but do not create hard obligations for a manager.

Right to Terminate

Ultimately, you have the right to terminate the agreement at the end of the term. Additionally, many agreements grant the artist the right to terminate mid-term should certain milestones not be met. This flexibility ensures that if a manager is not meeting expectations, the artist can take their business elsewhere.