Why Should my Client get a Guernsey Image Right?

27 October 2015

We all know that the legal systems have failed to keep up with celebrity and we all know that individuals have tried various ways to maximise the value of their personal brand and their image rights. Whether it is trademarks, privacy, data protection, publicity rights, confidentiality or advertising codes, all of the previous 'protections' have significant limitations.

At the end of 2012, Guernsey introduced the world's first registrable image right - giving the ability to register, licence, clarify and protect what has, to date, been a rag bag of limited rights. Since the end of 2012, the register has seen applications from DJs, hairdressers, tennis players, brand consultants and musicians. Apart from being on the register, these people all have in common an ability to generate significant wealth from the use of their image quite apart from what they might do for their day job. It is important that, as professional advisers, we are able to tell clients why it would be useful for them to have a Guernsey Image Right - this paper aims to achieve just that.

To our mind, there are several key advantages to having a Guernsey Image Right. These include clarity of right, the ability to incorporate such a right into a licence, succession planning, taking security, wealth management and the potential to use as an enforcement tool.

Guernsey Image Right allows your clients to register their images, nicknames, videos, mannerisms and any distinctive characteristics that identify them

Clarity of right

The Guernsey Image Right allows your clients to register their images, nicknames, videos, mannerisms and any distinctive characteristics that identify them. These rights will be registered on the register and can include all of those features that are so difficult to define in a contract. We have all grappled with what a 'gesture' or 'mannerism' means in that definitions section before - now it really means something and can be directly referred to in relevant contracts. If you were involved with drafting the licence agreement between Morgan Freeman and More Than, you may have struggled to describe that gravelly southern drawl that is so distinctive and instantly recognisable. You do not need to struggle anymore.

Incorporation by way of reference

Every time I draft a copyright licence, I am always concerned about ensuring that the schedule describing the copyright is absolutely watertight. I go to great lengths to discuss it with the client to make sure that we have accurately described the software or other copyright material - and there is always a nagging doubt in the back of my mind - have we have covered what needs to be covered and have we got the full picture as to who was involved in the creation of that copyright?

Conversely, when I am asked to do a trademark licence, the actual subject matter of the licence is very easy to identify - they are on a register and it is easy to determine who owns what, where and for what.

The Guernsey Image Right will give you the ability to be much clearer about what you and your clients are looking to licence and contract over. It does not matter whether your licence agreement is governed by English, US or Spanish law, you can still incorporate the Guernsey Image Right by reference. The governing law of the contract (be that US, English, Indian or Australian) will be applied to any contractual dispute but you will at least have been able to be very clear as to what you are contracting over.

Guernsey Image Right is a renewable right that can last in perpetuity

Succession planning

At the moment, it is not clear what happens to the rights to someone's image after death. The closest we get is in some states in the US where publicity rights can last after death - for varying lengths of times depending on which state they died in and only then if they are famous. Under English law, where image rights are not recognised, it is very difficult to see how the image rights of an individual can go on beyond their lifetime. The Guernsey Image Right is a renewable right that can last in perpetuity. It can be registered for individuals who have already died (provided that they died within 100 years of the application being made to the registry) and there are a number of estates who are talking to us about registering the image rights of individuals who have already died. If you have a client who is famous and would wish their image to be passed to the next generation or who would wish to try to protect their image after death, then a Guernsey Image Right really should be considered. Like the licensing points above, reference can be made in any will to the Guernsey Image Right and this clarity of right is extremely useful when drafting a will.

By way of example, it is widely reported that the Seve Ballesteros foundation was run by Seve's nephew. It was also reported that there was an unfortunate dispute between this nephew and Seve's sons. The sons felt that they had the right to use the naming rights of their father for endorsement contracts. The nephew considered that such rights were owned by the foundation. One way or the other, a Guernsey Image Right would have provided clarity for them - by incorporating a reference to the Guernsey Image Right in his will, Seve could have been very clear about what his intentions were in relation to naming rights.

With such valuable assets, it seems silly to leave such ambiguity to the drafting and the potential for misinterpretation. Having a registered right eliminates this ambiguity. While the litigators may thrive on such ambiguity, the clients tend not to benefit. Being clear up front is always a better solution - the image right provides us with that clarity.

Guernsey Image Rights creates a clearly definable right that is very much assignable - the law says that it is assignable and allows this to be a registered transaction on the register

Taking security

Image rights are valuable and can be used as security for borrowing and more heavily structured forms of finance. While there may not be many banks out there willing to lend to small businesses at the moment, the value of celebrity has demonstrated an ever increasing value over the last decade! The ability to clarify this right in law and to register the taking of security as a registrable transaction will give lenders much greater control over the underlying asset that is often of most value - the client's image. Taking security over a form of registered IP - the Guernsey Image Right - is much more attractive to a bank than taking security over a right that is not recognised in law - again the right itself provides the clarity that is much needed in the commercial world.

Wealth management

The licensing of image rights and the ability to exploit an individual's image can be extremely valuable rights. The case law in the UK allows the different income streams to be treated differently for tax purposes. Having a Guernsey Image Right helps to give certainty to this structuring. There are some arguments that an image right is nothing more than personal goodwill. The argument runs that personal goodwill is not assignable. However, registering and assigning a Guernsey Image Rights creates a clearly definable right that is very much assignable - the law says that it is assignable and allows this to be a registered transaction on the register. An Image Rights company would typically hold a portfolio of IP rights, including some trademarks. Having an image right in that portfolio is helpful in managing and exploiting the rights and also potentially in assisting in the robustness of the structure.

Potential enforcement

The Guernsey Image Right grants much wider protection than any other current form of intellectual property in the field of image rights and personal branding. Like any form of IP, it is a territorial right. So, while trademarks have the potential for worldwide protection, they are veiy narrow in this field of image rights and personal branding. The Guernsey Image Right is, by comparison, much wider in scope of protection but potentially much more limited in terms of territorial scope. While some commentators have suggested that this right is a silver bullet for worldwide enforcement, we are much more cautious. If there is an infringement of the Guernsey Image Right on the internet there is an argument that a claim for significant damages could be made and other remedies, such as an injunction, may be available. However, we do not consider that this territorial right provides worldwide protection. I suppose the question to ask is how many of your clients have you advised to get trademarks and of those how many have worldwide protection of their trademark portfolio -1 suspect that the answer is not many, if any. So, this new right should be seen as an additional tool in the armoury for potential enforcement - for more detail on this use, please see our related note 'The thorny question of enforcement'.

Conclusion

If you have a client who has an image that is likely to be or already is valuable, you should be considering whether they could benefit from registering their image rights. Clearly everyone's circumstances are different and your clients will have different needs that may be met by the benefits set out above at different times of their career. If you would like to speak to anyone on the issues raised in this note or would like us to register an image right on your client's behalf, please contact us.