A good lawyer can help you read and fully understand any contract you sign, but be careful of overcomplicating the relationship with your agency.
Here’s the standard disclosure that I am not a lawyer, and you shouldn’t take anything here as legal advice. When you are reviewing contracts, a good lawyer is a great person to have in your corner.
SELECTING A LAWYER TO REVIEW AGENCY CONTRACTS
Oftentimes, you’ll have a pre-existing relationship with a lawyer or law firm or have a legal department as your go-to resource. If this isn’t the case, the ideal lawyer will have some experience with ad/marketing/digital agency contracts.
For most companies, it’s not necessary to run every agreement past a lawyer, but depending on the complexity and size of the engagement it could be a good idea. I recommend finding a lawyer who shares your tolerance for risk. This can be difficult to find and determine without discussing a specific matter. In my experience, lawyers—for obvious reasons—are risk averse. This is more the case at larger firms. The problem with this caution can sometimes be that you end up spending time and money in lawyer's fees when protecting yourself against extremely unlikely scenarios. Alternatively, you could be protecting yourself against something that you would not be prepared to take legal action against even if that unlikely scenario were to occur.
At S4, we use an attorney from a large local firm for run-of-the-mill business questions or concerns. For agency-specific requests or contract revisions, we use an attorney that specializes in digital agencies. In my opinion, a good lawyer will be confident enough to outline risks and give you a straightforward assessment of whether those risks are really worth bothering with.
THE INFINITE LAWYER LOOP
If you send a contract to a lawyer, they will find something to change. Lawyers have their opinions on what matters in a contract. They have their own versions of common provisions they would be more comfortable defending if it came to that. They also have the instinct to make notes if they’re being paid to review something. Unfortunately, so does the other party’s attorney. This can lead to what I call the ‘infinite lawyer loop’— your attorney makes notes and revisions to the other party’s standard contract, then their lawyers make revisions to the revisions, then your lawyer makes revisions to the revisions of the revisions, and so on. Before you know it, a month or so has passed and you’ve spent a ton in legal fees.
At S4, we got a verbal go ahead on a project for a major sports league that needed some work on a series of events. In retrospect, we should have asked for their default contract and gone from there. Instead, we sent over our standard agreement.
After months of back and forth, would-be project deadlines were missed, and they ended up pulling the project and keeping it in house. Goodbye fancy recognizable client logo on our portfolio. The sad part here is that, even if the worst were to happen, it’s unlikely the dollar amount of the statement of work would justify taking a billion-dollar sports league to court. There was a massive likelihood that just signing their standard agreement would have resulted in us doing great work and getting a foot in the door with a potentially amazing client.
The point of this story is that you should make sure to evaluate the situation and, if you do include your lawyers, make sure they are working in your actual interests and not blindly mitigating risks that are unlikely to hurt you.
In my experience, clients of all sizes pay less attention to the details of the contract than they should. That being said, getting lawyers from both sides involved in contract revisions can sometimes seriously delay or even threaten the possibility of reaching an agreement. Find the right balance based on the contract amount and your organization’s tolerance for risk and make sure you understand key provisions around copyright and ownership.