To protect their anonymity I’m not using the names of the designers I spoke with and I’ve changed any identifying details, although not in a way that affects their stories.
Last fall I wrote a post explaining how much fabric designers earn. Several designers emailed me afterwards about various other issues, one of which was contracts. Since then I’ve slowly been looking into contracts for fabric designers and I’ve discovered that the majority of designers working with two of the world’s leading manufacturers of premium quilting cottons are working without written contracts. At Moda and RJR, designers create collections based on a handshake deal, an oral agreement that they make with the company.
Does Working Without a Contract Make You More Free?
A Moda designer recalled being approached by a representative of the company many years ago and asked to design her first collection. She excitedly went home to tell her husband about the good news. He advised her to ask for a contract, but when she did she was told, “We do things on a handshake here.” Although startled at first, she went ahead with it because she felt there was a possibility that “they would have said ‘forget it’ about my collection if I’d insisted.” She’s produced four collections a year for Moda, working with them for nearly a decade, without a written contract.
“Quilters are fairly honest, fairly upfront. I haven’t had one serious issue. In fact, I’ve learned to like not having a contract. It gives me the freedom to leave when I want to,” she says, although she acknowledges some concern about the weaknesses of an oral agreement. “If a dispute came up, I wouldn’t have much say, I guess. There’s not even an email trail spelling out the agreement. There’s nothing.”
An RJR designer I spoke with expressed a similar sentiment, explaining that working without a contract is freeing. “The relationship is more symbiotic, more give and take,” she says. “Without a contract, as a designer I dig deeper and produce designs I feel will be printed and the customer would want. I don’t have a hard deadline nor am I given any directives. I create what is in me. There is freedom and flexibility to that and frankly, that is the only way I could design fabric.”
She feels that RJR as a company has to work harder to retain her because their agreement is not in writing. “On the other side of the table, not having a contract means that RJR must produce a quality product and deliver in a timely fashion. There must also be respect for what is created, as their designers could move to another company at any time….The company had been in business for a very long time with the same employees and some iconic designers. There must be something to that. The bottom line is I believe that ‘no contract’ means both a better product and a better working relationship.”
Our Word is Our Word
I asked Cheryl Freydberg, the Design Director at Moda, to explain their approach to contracts for designers. “Most of our designers do not have contracts. I’d say 80%-90% don’t have one,” Freydberg said. “If they want one, we’ll furnish one, but our thoughts are if they’re unhappy with us they’re free to go.” When asked if working with designers without a contract was a philosophical decision on Moda’s part she said, “There’s no philosophy behind it. This is the just the way we’ve always done it. Our industry is so small and we treat all of our designers the same so we feel no need for contracts.” When I asked Freydberg if she would advise her daughter to enter into a business relationship without a written contract she said, “I think if she was new to an industry she should request a contract, but our designers are people with whom we’ve already had a past history and are established in the industry. Our word is our word.”
I reached out to RJR’s Creative Director, Demetria Hayward, to ask about their approach, but she was away and not available for comment. Talking with several RJR designers past and present, though, it’s clear that although they’re offered written contracts, almost nobody has a written agreement (After emailing over a dozen designers in total between both companies I wasn’t able to find a single one who had a written contract, although there may be a few.)
Is an Oral Agreement Enough?
Contract law doesn’t favor oral contracts. Although an oral contract is as legally binding as a written contract, proving what it said can be difficult, especially without a witness. Handshake agreements are generally acceptable for simple transactions like trading goods with a friend, but for deals with many fine points a written contract is clearer and easier for both parties to defend.
Legal educator Kiffanie Stahle of the artist’s J.D. explains, “A handshake deal is a contract. Contracts can be formed in a variety of ways: conversations, email exchanges, or a formal written piece of paper. Just because a designer didn’t sign a piece of paper doesn’t mean she doesn’t have a contract. It just means that if the relationship sours, it’s harder to prove what the roles, responsibilities, and expectations were for both the designer and the company.”
A licensing deal with a fabric company is not a simple agreement. The designer is assigning her copyright to a company for a limited period of time to be used in a certain way. Terms have to be hashed out including where and how the work can be used and for what length of time, what the royalty structure will be, if there will be a kill fee or other compensation if the company cancels the project, if there will be a late fee if the company doesn’t pay on time, whether the license is exclusive to this company or can be assigned to another company at the same time or at a later time, whether the company can modify the work or create other works based on it, how many revisions they’ll ask you to make, what happens to the work if the company merges with another company or goes under, among others.
When you’re hashing out an agreement it’s easy for memories to differ. If you’ve talked about several different arrangements, a written contract can clarify what the project will be limited to. Oral agreements get even more complex if they’re amended with no written record, whereas a written contract can spell out that the agreement can only be changed by mutual written consent. Oral agreements can easily devolve into a he-said/she-said argument and if a company were to be bought out, the memory of the deal can be erased entirely.
Is There a True Choice?
If designers at Moda and RJR are being given a true choice between an oral agreement and a written contract why are so many choosing an oral agreement when it’s clearly the weaker option? Why would a designer, like one I spoke with who has written contracts for her other licensing deals for wallpaper and paper goods, have only an oral agreement for her fabric line?
Over the past week I’ve talked one-on-one with many fabric designers about their experiences and through our conversations one possible answer has become evident. The balance of power between a designer and a fabric company is not even. There are only a few major companies producing premium quilting cottons in the United States and each company works with a limited pool of designers – perhaps a dozen or two, but not many more. And yet there’s an abundance of talented people, mostly women (95% of Moda designers are female, as are 89% of designers at RJR), eager for a fabric line. As one designer said, “There are a hundred others right behind me that will do this with no contract just because they want it so badly.”
This massive pool of hopefuls has an affect on the few that are chosen. Several designers said that although the written contract was presented as an option, it was phrased in such a way that they felt uncomfortable accepting it. “You don’t need a piece of paper, do you? You can trust us,” was the thrust of the conversation according to the designers I spoke with. If a designer is made to feel that insisting on a written contract indicates that they don’t trust the company, or that they’re demanding more than everyone else, while all the while knowing that they are easily replaced, it’s possible to end up accepting a deal based on an oral agreement alone, even against their better judgment.
When a Relationship Sours
One designer I spoke with (who worked with companies other than RJR and Moda – the practice of oral agreements extends to other smaller fabric companies as well) explained that she wanted a fabric line more than anything else. “To see my name on the selvedge, to have my designs on bolts, that’s what I really wanted. I tried for three years,” she recalls, “and had a few opportunities fall through. When I was finally offered a deal, but there was no contract, I went ahead with it. I felt like it might be my only chance.” She was told that the reason there was no written contract available was “so that we could both get out of the deal when we wanted.”
After designing 12 collections, she was dissatisfied with her experience and wanted to move on to another fabric company, but it wasn’t easy. “I had copyrighted my work on my own, but they said I couldn’t bring my previous designs to my new company. They said they were theirs. It was really frustrating.” She hired a lawyer and tried to make headway for a year before giving up. “It was very costly,” she says. “I had trouble proving that the designs were mine. It was just vague. I’m trying to protect a polka dot and a line and a circle. I know there are only so many lines and dots, but those are my marks.”
With her new company she got a written contract from the start. “It was hard asking for it, but I want to protect my name. That’s important to me. Also I like knowing that there’s an end point. At that time I can renegotiate.”
It’s Not About Trust
A written contract is not a matter of trust. It’s a matter of clarity. Fabric companies including Moda and RJR need to invest in legal departments that can draw up and negotiate contracts for every designer with whom they work. The offer of a written contract should not be couched in intimidation at a time when a designer is vulnerable. Written contracts are standard business practice for good reason.