Entertainment

In the course of content distribution and supply, breaches of license agreements, conflicts of rights between OTT platforms, and violations of overseas copyright law frequently arise.

In particular, as the distribution of content through OTT, YouTube, and global SNS channels increases, infringement reports and legal warning measures by overseas copyright holders are also rapidly increasing.

To prevent this, it is important to thoroughly review, before concluding a content distribution agreement, whether there is a violation of the broadcasting law, advertising law, or copyright law of the destination country of export, and to confirm in advance the content review and rating classification criteria so as to adjust the direction of production.

In addition, for export content, an approach that minimizes risk by carrying out legal advisory of the relevant country in parallel is recommended.

In the course of entertainment advertising, sponsorship, and SNS content production, cases of infringement of the portrait rights, name rights, and right of publicity of celebrities or public figures are frequent.

Using an image or name without prior consent, or using content even after the contract has ended, may lead to a legal dispute.

Recently, as AI virtual figures and virtual character content have also increased, issues regarding their portrait rights and the attribution of rights are newly emerging.

To prevent this, parties should conclude a consent agreement for the use of the right of publicity before any advertising, marketing, or content production, and clearly organize the scope of use, the period, and the attribution of rights after termination.

For AI and virtual characters, the attribution of rights should be clearly established from the production stage, and whether secondary use is permitted should be defined through a contract, in order to avoid future legal disputes.

There are not a few cases in which an exclusive contract has been held to violate the Monopoly Regulation and Fair Trade Act due to an excessive contract period, unfairness in profit distribution, restrictive termination clauses, and the like.

To prevent this, when concluding an exclusive contract, the appropriateness of the contract period, the termination requirements, and the profit distribution ratio should be confirmed by referring to the standard contract recommended by the Fair Trade Commission or by obtaining a review from a legal expert.

Advertising contracts may also become subject to sanctions by the Fair Trade Commission and advertising review committees due to false or exaggerated advertising, omission of statutory advertising statements, and the potential to mislead consumers, so it is important to review advertising drafts and statements so that they conform to prior review, and to clearly define the rights and responsibilities among the advertiser, the advertising model, and the agency in the advertising contract.

The investment agreement and profit distribution structure are also among the types of disputes that frequently arise in the entertainment industry.

Given the nature of the entertainment industry, in which numerous investors, production companies, distributors, and platform operators jointly invest in content, if the method of profit distribution and the attribution of rights are not clear, disputes can easily arise after a commercial success.

To prevent this, at the stage of concluding the investment agreement, the criteria for profit distribution, the equity ratio, and the provisions on damages in the event of the content's failure should be specified in detail, and the mediation and arbitration procedures in the event of a dispute should be clearly established.

In particular, in preparation for contract termination, production failure, or the situation of content not being broadcast, parties should specifically state in the contract the scope of liability for damages and the requirements for exemption.

In new business areas such as NFT content, metaverse content, and AI virtual figure content, legal debate over copyright, portrait rights, and content ownership issues is actively taking place.

In the case of NFT content, if an NFT is issued without the consent of the original author, or if the attribution of copyright and the profit distribution structure are unclear in the course of an NFT transaction, there is a high likelihood that it may lead to a legal dispute.

To prevent this, a license agreement with the original author should be concluded before issuing an NFT, and provisions on the attribution of rights and the distribution of profits must also be clearly stated in the terms of use of the NFT trading platform.

For metaverse and AI content as well, the attribution of rights should be clearly determined from the early production stage, and the scope of use of the AI character's portrait rights and name rights and the allocation of responsibility should be defined in the content use agreement, in order to prevent future disputes.

When distributing content domestically and overseas, the content becomes subject to various regulations, such as content review, rating classification, music recording review, advertising review, and whether there is an unfair trade practice under the Monopoly Regulation and Fair Trade Act.

If a content review results in a disposition prohibiting broadcast or screening, both the production company and the investor may suffer significant harm, so a procedure to confirm, from the early production stage, whether the nature of the content and its key scenes conform to the review criteria is necessary.

For export content, an approach that minimizes risk by reviewing in advance the relevant laws and review criteria of the destination country of export through a review by a local legal expert, and by carrying out prior coordination with the review body of the relevant country before broadcast, is recommended.

When operating an entertainment business, the legal checklist by field is as follows.

■ Exclusive Contracts and Management Contracts
☐ Appropriateness of the contract period, renewal clauses, and scope of exclusivity
☐ Whether there are unfair penalty clauses or excessive penalty provisions
☐ Clarification of contract termination, grounds for breach, and liability for damages
☐ Whether the Fair Trade Commission's standard exclusive contract is complied with
☐ Securing the consent of a legal representative for a contract with a minor

■ Copyright and Portrait Rights Management
☐ Clarification of the attribution of rights to music tracks, footage, photographs, characters, and content
☐ Whether consent for the use of portrait rights and the right of publicity has been obtained
☐ Whether a work use agreement (license) has been concluded
☐ Review of the rights to use SNS content and advertising footage
☐ Confirmation of permission for the production and distribution of secondary works

■ OTT and Online Content Distribution
☐ Confirmation of the rights and obligations in the content license agreement
☐ Clarification of the profit distribution ratio and payment conditions with OTT operators and MCNs
☐ Whether content review regulations and rating classification are satisfied
☐ Establishment of a process for responding to copyright infringement reports
☐ Whether personal information protection and the Location Information Act are complied with for each platform

■ Personal Information Protection and Information Security
☐ Securing consent forms for the collection and use of the personal information of affiliated entertainers, clients, and audiences
☐ Notice of and consent to CCTV, video recording, and audio recording
☐ Lawfulness of the procedures for membership registration and marketing consent for online services
☐ Review of the personal information processing policy and whether there is provision to third parties or transfer abroad
☐ Preparation of a response manual in the event of a personal information leak