Singer of the finnish thrashmetal band Mokoma. (Photo credit: Wikipedia)Being in a band should be fun. Most people who play do it because they have to; it is part of their soul. What musicians need to know is that the band business is full of potential legal liability. Very few people see it that way, but they should. A band usually travels, it owns heavy electricity based gear and lights; much of which is very expensive. The band relies on as many people as possible coming too one place to see them if they want to succeed. A lot of the places that bands hang out serve alcohol and people are there to let loose, party,and have a good time.
As an active musician and a lawyer, I see both sides of this. The fun, rewarding parts as well as the potentials for legal disaster if your band does not take the proper steps. These potential disaster scenarios are present regardless of whether you are a small startup band playing in the bottom tier clubs or parties or have gained some popularity and are playing larger venues or the big stage.
There are many disaster scenarios. Legal training teaches you to think in these terms. I can't help it. It is as much a part of me as the guitar licks on Dark Side of the Moon. Here is just one such disaster scenario that I think everyone who has ever played in a band will realize is not at all far-fetched. There are many others, but here is one.
Disaster Scenario
You have worked hard to put your band together. Over the past 4 years, you have had several changes in lineup. First you replaced the drummer that was late on every fill and had the personality of Eyore from Winnie the Poo. Then you vocalists' wife was jealous and you ended up replacing him. The lead guitarist had a huge ego and was messing up the vibe. This story of building a band are common. We have all been there.
One night, you are playing one of the old clubs that you started out in, more or less for nostalgia but certainly not for the money. A couple of the members decide to make a party of it. These are old friends there and they keep buying drinks for the band. By the end of the night, a couple of the members are pretty lit up.
After the gig, Tom, the lead singer gets in his car to drive to an after bar party. On the way there he swerves into the coming lane and runs head on into another vehicle.
Toms has no insurance. Tom has no assets. His only income comes from the band. The other car involved files a lawsuit. Who are they going to sue?
If you have not organized your band through an official corporate or LLC entity, every member in the band is likely to be sued. The law is likely to deem you to be a partnership. Every partner is jointly and severally liable for all damages caused by other partners. That means everyone is potentially responsible for the full extent of the damages.
Now let's say the drummer, let's call him Jim, has a great job. He has amassed a ton of money in the bank and investments. He owns a million dollar home where the band rehearses in his plush rehearsal room. He owns multiple businesses. He is set.
Damages come down at $5,000,000. Each partner is liable for the full $5,000,000 under joint and several liability principles. There is no insurance. Everyone except Jim is poor. Jim is worth $10,000,000. Who do you suppose is going to pay the damages? Jim, who drank water all night.
The next thing that happens is that Jim gets summons to appear at a supplemental collections hearing where the other side asks him questions, under penalty of perjury, about what he owns, what he is worth, where his assets are etc.
The next thing you know, Jim's house is attached. His wages are garnished. Someone comes and gets his boat. All sorts of things start happening in Jim's life. All because he played in the band where the singer got drunk and swerved in the oncoming lane on the way home from the gig.
A lot of bands are pretty apathetic about their business structure. They go to gigs, collect cash and split it up at the end of the night. They give very little thought of legal liability or protection of assets.
So the lesson here is, if you are in a band do not assume that you are immune from possible liability just because you have not yet "made it" or you are just doing it on the side. The band business is filled with possible legal issues, regardless of the size or success of the band. You need to take the appropriate legal steps to protect yourself and your assets from exposure to these risks.
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