An Icon Wanted to Buy Their Band Name. Then Their Lawyer Found Out Why.

I’ve been an entertainment lawyer for 27 years, and I’ve seen a lot . A lot. I’ve Seen This Before is my Friday series that gives you a peek at some of the lessons my clients have learned the hard way. Some of the details may have been changed to protect client confidentiality.

Last week, I talked about what happened if a legend suddenly wanted to use a piece of a work you created. It occurred to me that a colleague of mine had an entirely different encounter with a legend. This musician was an artist that is an icon. A music industry veteran.

And he messed up.

That’s part of why this story is so surprising. At his level, this artist knew how the industry worked. This mistake shouldn’t have happened. And you don’t usually see it at that level.

So here’s what happened. My colleague was working with a small band that played the college circuit. They did mostly cover material, and they were popular enough that they made a small profit just playing at local bars and for frat parties. My colleague worked his way through law school booking bands, so he had the benefit of having a law degree and connections with a lot of start ups. So he gave them the advice we all give our new bands—before you use a name, make sure you aren’t using something that someone else has rights to.

A band name isn't just something you put on a poster. If things go well, it can become a brand—it goes on your website, your social media accounts, merchandise, album artwork. Maybe even the side of a tour bus someday. The more successful you become, the more valuable that name can become—and the more painful it can be if you eventually discover you shouldn't have been using it.

This band followed his advice. They asked him to check the name to be sure no one else was using it, and then they asked him to secure federal trademark registration. He did. And he assumed that would probably be the end of the story.

It wasn't.

About a year later, his phone rang.

"My Client Would Like to Buy the Trademark"

The caller was another lawyer. And when my colleague heard who he represented, that lawyer had my colleague’s full attention. The story was that the artist had been thinking about some new projects and had asked the lawyer to secure names with potential. He had come across their trademark in his research, and his client thought that name was one he might want to have in his portfolio. It was still in its early stages. Nothing urgent. He liked it and thought he might want to use it, if he could find the right project for it.

Would the band consider selling it?

There was even an offer. It wasn't life-changing money, but remember this band was playing covers at bars. For them, the offer was real money. In fact, it was enough to buy some new equipment they needed.

So when my colleague laid the offer out for them, they agreed to sell without further discussion.

Then My Colleague Happened to Read an Ad

My colleague was diligent about staying up to date with industry news. He had a subscription to Billboard magazine, and he read every issue when it came out. Before he had a chance to call the lawyer back, he picked up the latest copy.

And there it was.

A full page ad announcing that this icon was launching a new record label. The name of the new label?

The band's registered trademark.

Apparently, the name wasn't something the artist thought might be nice to have around for possible future use. He was already using it to launch a new business. His creativity had gotten ahead of his legal team. And now he was, publicly and in a big way, infringing our client’s registered mark.

That was useful information. And needless to say, the price went up.

The Band Hadn’t Yet Built a Brand

It wasn’t that my colleague’s client had built a valuable brand. It was something more important. My colleague had inadvertently learned that the trademark was now valuable to this particular buyer. There's a difference.

A piece of property, particularly intellectual property like a trademark, can have different values to different people. To the band, it was just a name they used on Friday and Saturday nights to make some side money. To the buyer, it had been launched as a new label that the industry would take note of simply because of who was launching it. And immediately embroiling that label in a trademark dispute where this icon was clearly in the wrong would not only be a PR problem, it would be an expensive one. That meant he had created more than a launch with his ad. He had created a liability. Securing that trademark would make that problem go away.

And that’s another way of looking at the value of your trademark. Some of it is what you think it’s worth. Some of it is what a potential buyer thinks its worth. Those are very different circumstances.

But There's Another Side to This Story

This story turned out well for the band. They did what they should have done—they had a name and they had taken the right steps to protect it. Then somebody with considerably greater resources wanted it and, in fact, was trying to purchase it before it could be discovered that there had been an infringement.

But imagine the facts had been reversed. Imagine the band had spent several years building its identity around the name without first investigating whether someone else had superior rights. Then one day, instead of a phone call, there’s a letter. The lawyer on the other end isn't offering to buy anything.

The lawyer is saying, “Stop using the name.”

Changing a name after you've built a following (or, as in this case, after you’ve launched a label) can be enormously disruptive. New website. New social media branding. New merchandise. New artwork. New marketing materials. Probably confusion among fans.

And, depending on the circumstances, potentially a much more serious trademark dispute.

That's very different than the situation our clients found themselves in, and honestly, it’s much more common.

Clearance Comes Before Use

This is why choosing a band or artist name shouldn't begin and end with, "I searched Google and didn't see anybody." Before committing heavily to a name, you want to investigate whether someone else is already using a confusingly similar name in a way that could create trademark problems.

That's trademark clearance. Then there's trademark registration. They're related, but they aren't the same thing.

Clearance is asking, "Can I safely build my brand around this name?" before you start to use it. Registration is asking, “Can I protect this name so no one else can use it?” Ideally, you think about both.

You may never even get to registration if someone else has superior rights. Simply running a Google search isn’t going to give you the information you need to make an informed choice.

Your Name Can Become an Asset

Artists sometimes think about trademarks only in terms of preventing someone from copying them. That's certainly important. But this story illustrates the other side. A trademark can become an asset. The band had created a little value in a name. But soon, somebody else wanted to buy that name. That made the mark worth a lot more.

That doesn't happen very often, but it demonstrates why intellectual property shouldn't be an afterthought. The music is an asset. The recordings are assets. And the brand you're building around them can be an asset too.

The Lesson

There are a couple of lessons here. The band originally came to my colleague because it wanted to protect its name. At the time, that probably seemed like routine legal housekeeping. About a year later, that same name had become something an icon wanted to acquire. That's the good version of the trademark story.

There's a bad version too. That's the artist who spends years building a name, starts getting attention, and then discovers somebody else has prior rights to it. Success makes that problem worse, not better. The larger your audience becomes, the more likely your use is to be discovered and the more expensive a forced name change can be.

So think about your name before there's something worth protecting. Clear it. Protect it when appropriate. Build value in it.

And that’s the second lesson. Your brand has value. Your music has value. If somebody unexpectedly offers to buy it, do some homework. Find out why.

Because your intellectual property is the business you’re building. It’s why you do what you do. Don’t undersell it.