How One Contract Clause Created Big PR Problems for SXSW

Author: David McMillin       

As SXSW organizers made final preparations for the festival’s opening day on March 10, they were forced to deal with a public-relations crisis that stemmed from a leaked performance contract. A band scheduled to perform for the festival in Austin shared a portion of its contract on Twitter, which included language that spurred backlash from the musical community. The festival’s performance agreement stated:

If SXSW determines, in its sole discretion, that Artist or its representatives have acted in ways that adversely affect the viability of Artist’s official SXSW showcase, the following actions are available to SXSW:

  • Artist will be removed from their official SXSW showcase and, at SXSW’s sole option, replaced.
  • Any hotels booked via SXSW Housing will be canceled.
  • Artist’s credentials will be canceled.
  • SXSW will notify the appropriate U.S. immigration authorities of the above actions.

Immigration reform is a particularly sensitive topic in today’s political climate, so it’s no surprise that the language touched off a firestorm. A number of bands signed an open letter to the festival expressing their anger over the language. “We’re outraged to learn that the festival has been threatening artists who are not U.S. citizens with targeted immigration enforcement and deportation for playing at unofficial showcases,” the letter stated. “We are calling on SXSW to immediately drop this clause from their contract, and cease any collusion with immigration officials that puts performers in danger.”

Clearing Up Contract Confusion

SXSW CEO Roland Swenson defended the performance contract wording to popular music publication Pitchfork. “If you take any contract and just pull out a few clauses,” Swenson said, “it always seems a lot worse than it is when you read it all together. The reason we have those clauses is, one, we need the artists to know the conditions of their visa. It’s really serious business. To get their attention we have some very stern wording there.”

Swenson added that the language had been in the contract since at least 2013, but he acknowledged that times have changed since then. “We’re going to make it through this year with things the way they are, and then we’ll go back through and look at it with the eyes of a person who is living in the world of Donald Trump,” Swenson said. “Which was not the case when we sent this out back in September.”

However, Swenson and his team later determined that they did not need to wait to reevaluate the contract. In a statement issued on March 7, organizers announced that they will change the language in the artist invitation letter and performance agreement for 2018 and beyond, and they also highlighted that they have never reported any artist to any immigration agency in SXSW’s 31-year history.

Confidential Contracts in the Age of Public Everything

The SXSW contract brouhaha raises a major concern for all event organizers: Shouldn’t contracts be kept private? For a legal perspective, I reached out to Tyra Hilliard, PhD, Esq, CMP, to discuss how meeting professionals should approach private contract negotiations in the social- media age. “Add a confidentiality clause that indicates that neither party will disclose terms of the contract with anyone except their fiduciary,” Hilliard said.

However, Hilliard believes that the entire situation could have been avoided. “The festival organizers have the right [to report someone to authorities] whether they put it in the contract or not,” she said. “They can remove the language, but it doesn’t mean that they can’t do it.”

Still, she added, “the CEO made good sense” in his explanation for why the festival’s lawyers would include the language. “They wanted to make sure that people know the terms of their visas,” Hilliard said. “For organizers issuing invitations to perform or speak at an event, there can be a real concern over what happens if those people come to the United States and then disappear [instead of going back home]. It’s easy to understand why organizers would worry about potential liabilities.”

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