• Four A's Tell Ad Shops to Fight for Idea Rights
  • March 6, 2007 | Authors: Jeffrey S. Edelstein; Linda A. Goldstein
  • Law Firm: Manatt, Phelps & Phillips, LLP - New York Office
  • In advising agencies asked to give away rights to ideas they present in pitches for new business, the American Association of Advertising Agencies takes the Nancy Reagan approach -- just say no.

    It is the first time the agency trade group has taken a position on the issue. It says that it decided to act (via a white paper) because “in the last few years, there’s been a tendency for marketers to ask for ownership of ideas.”

    Marketers request ownership for two reasons, according to the Four A’s paper. One is to bank ideas. The other is to avoid being sued in the event that an idea or concept created by an unsuccessful review participant is used -- intentionally or not -- in a campaign created by a different agency.

    Still, agencies need to know that they don’t have to sign a document asking for rights. As an alternative, the white paper suggests asking a prospective client to agree in writing that ideas presented in a pitch are owned by the agency.

    According to agency executives, developing speculative creative output during the review process started about 20 years ago. During the past two decades, marketers have become more specific in their demands for creative output during a review. Agencies receive compensation for their costs and ideas less than half of the time.

    Significance: Given the industry trend of expanding advertising beyond the confines of traditional media -- TV, print, or outdoor -- intellectual property ownership issues are more critical than ever. Both agencies and clients are well advised to square away in writing who owns which ideas in advance of a pitch.