In the entertainment world, talent contracts are utilized by companies to engage the services of individuals (entertainers, artistes or social media influencers) to promote their brand or products. You often see product placements featuring your favourite artiste or entertainer plastered across social media platforms such as Instagram, Facebook, Snapchat, or in advertisements.

These types of agreements would stipulate among others, the duration of their engagement, the length of its promotion by the artiste/entertainer in their social media or appearances, and/or the company’s usage of their image for their promotion purposes.

However, what is the limit of their engagement with these companies?  Can you prevent an influencer from promoting other products?

The recent case of Miliyasutra Industries Sdn Bhd v Vanidah Imran [2018] 1 LNS 453, dealt with this specific issue involving talent contracts.

The Plaintiff, Vanidah Imran, was a prominent actress, TV personality and celebrity whom was engaged by the Defendant to promote their line of cosmetic and skincare products. The suit was premised on the unpaid sums due from the talent contract.

The Defendant in turn had counter-claimed and sought a repayment of the sums already paid to her, as they alleged she had breached the talent contract by promoting a competitor’s brand –  L’oreal. The talent contract had a clause restraining the Plaintiff from authorising or permitting her name or likeness to be used in connection with any products of any third party which are “similar in nature” with the Defendant’s products.

The Court in assessing the evidence found that the Plaintiff did not breach her talent contract by promoting L’oreal products as the nature of L’oreal’s products differed from the Defendant’s products. L’oreal was a brand that dealt with hair care products while the Defendant’s products were aimed at the cosmetic and beauty line.  As such, the Plaintiff was found to not have breached her talent contract.

The Defendant also argued that the Plaintiff was unjustly enriched as she did not fulfil all her obligations under her talent contract, which also stipulated that she was required to shoot several television commercials (TVC), voice recordings and other promotional activities. None of these works were carried out by the Plaintiff.

However, the Court found that there was evidence to show that the Plaintiff was ready and willing at all times to carry out her works under the talent contract. It was the failure of the Defendant to arrange for engagement dates for the work to be done that led to its non-performance.

Key Takeaways

Celebrities, entertainers and influencers may opt to take part in various talent contracts from multiple companies to promote a variety of products.

Companies who wish to have exclusivity arrangements with their talent should ensure that this is reflected in the talent contract, and properly worded. In the Miliayasutra case above, although there was an exclusivity clause in the talent contract, the Court made a finding of fact that there was no breach because the products being promoted were not “similar in nature”.

In the absence of an exclusivity clause, talent is not limited to having engagements from just one company, although it would be wise to ensure there is no conflict of interest regarding the product being promoted. For example, a celebrity should not take up a contract to promote both Nike and Adidas at the same time as both companies cater to the same subject matter (i.e: sports apparel).

As such, the case of Miliyasutra Industries highlights some important fundamentals of influencer or talent contracts:

  • Exclusivity clauses should be properly drafted where it is of paramount importance to the company that the influencer or celebrity be restricted from promoting similar or competing products;
  • Depending on how the contract is worded, the company that engages the celebrity or influencer would also share responsibility in ensuring proper arrangements are made to allow the celebrity or influencer to fulfil their promotional activities. For example, the company may have the contractual obligation to fix the date and time for promotional video shoots, failing which the company cannot allege that the influencer failed to hold up their end of the bargain.

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About the author: Amirul Izzat Hasri is an associate in the dispute resolution practice group at Donovan & Ho. He has experience in a diverse area of practice, including general civil and corporate litigation, judicial reviews, land related matters, defamation, debt recovery, and shareholder and boardroom disputes. He has also appeared in Industrial Court proceedings, having represented both employers and employees in unfair dismissal claims.

Donovan & Ho is a law firm in Kuala Lumpur, Malaysia. Our practice areas include employment law, dispute resolution (litigation and arbitration), corporate and tax advisory, and real estate/conveyancing. Have a query? Contact us.

 

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