Image Rights: Valuable Intellectual Property

The cult of celebrity keeps creating more and more wealth. And concurrent with protecting that, “Image Rights” have been receiving a lot of publicity – as well as the attention of tax authorities. Even “James Bond,” Sir Sean Connery, has just discreetly protected his brand and trademarked his name. Documents filed in both the EU and the US show the veteran star is ensuring that he and he alone can profit from his name. As The Scotsman, Scotland’s national newspaper noted: “It is a shrewd act which puts Scotland’s most famous actor in the same company as global superstars like rapper 50 Cent, former England footballer David Beckham and the singer Beyoncé.”

Cristiano Ronaldo of Real Madrid – the world’s highest paid athlete – has recently been accused of tax evasion stemming from his image rights. And his fellow soccer star Lionel Messi, playing for Barcelona, was recently convicted of tax fraud. His 21-month prison sentence (suspended) and €2m fine centered on image rights and using shell companies and tax havens to divert income from tax authorities.

Registration Creates Barriers to Infringement

Image rights are a broad bundle of rights. They can include rights over the use of the celebrity’s still, moving and animated images, name, signature, recorded voice and catchphrases, and associated iconic acts, logos, trademarks, and brands. Image rights are legally defined in some countries and in others, like the UK, are recognized less formally but are sufficiently accepted to form the basis of contracts, securitization, structuring and tax planning. Often one needs to file and protect one’s claim under more common law methods such as trademark, copyright, or “passing off” regimes.

Actress Katherine Heigl in 2014 sued Walgreen’s US pharmacist Duane Reade for the unauthorized use of her image. The case focused on unauthorized economic benefit, with Duane Reade having posted on its Twitter and Facebook account a photo of Heigl leaving a Duane Reade store with captions advertising the store. The case was settled with certain payments by the drug chain.

For many years intellectual property lawyers have urged personalities with valuable images and related rights to use conventional IP, such as trademarks (name, signature, effigy) and copyright, to protect their image, often together with a licensing and enforcement program that controls these.

In certain jurisdictions, real people have rights merely by existing, and US states such as California also permit certain posthumous publicity rights, although they may be limited to visual images and a timeline.

The UK Channel Island of Guernsey is facilitating further with the Guernsey Image Rights Register. Not just the representation of the personality that is registerable, but also the characteristics that make up that personality: voice, signature, likeness, appearance, silhouette, feature, face, expressions verbal or facial, gestures and mannerisms, and any other distinctive attributes. Icondia, a Guernsey-based image rights registration business, advises a registered personality can be owned during one’s lifetime and bequeathed at death like other personal property. It can be placed in a corporate holding structure in a jurisdiction of choice, and the rights can be renewed.

The value of rights can be very substantial. Golf superstar Rory McIlroy’s management and image rights firm, Rory McIlroy Management Services Ltd., has been showing an annual income of some $20m to $30m. At the start of 2016, the company had a $400 million book value for his image rights. And like any corporate asset, each year the value of these rights has an annual amortization, as well as a review for impairment. In 2017 this asset showed a $99m write-down for impairment, and non-cash amortization costs of $21m. The value of the McIlroy brand is underlined by the fact that in 2017 Nike entered into a reported $100 million ten-year contract extension with the 28-year-old.

Each story illustrates the importance of image rights – and that these are very valuable assets.

Image Rights of Important Value Deal Negotiations

Real Madrid football players Cristiano Ronaldo and Gareth Bale realize tremendous earnings through sponsorship and sell everything from underwear to soccer shoes. When Bale joined Real Madrid for £85m, he also ceded 50% of his image rights to the Spanish team, who will hope to leverage their share of the rights, including the sale of Bale branded replica shirts.

Athletes will aim to retain as much ownership as possible, notably by an image rights agreement between player and team for the purpose of merchandising.

Even team managers are getting in on the act. Jose Mourinho, the manager of Manchester United, had his 2016 agreement to lead the club held up by image rights issues. His name and signature had been registered as trademarks by his former employer Chelsea FC, a bitter competitor of United, for a range of goods including toiletries and clothing, and even talcum powder and lingerie. Mourinho also had personal endorsement contracts with car manufacturer Jaguar, Swiss watchmaker Hublot, and Paradise, a South Korean casino – some of which conflicted with United’s contracts and sponsors. A mutually satisfactory solution was essential, and reportedly Mourinho retained his image rights while limited his endorsements during his contract.

The International Dimension – Jurisdictional Examples

Any recognition or valuation of image rights needs to note that different jurisdictions have different approaches. Personality rights (or publicity rights as called in some countries) are enshrined in the constitutions of Spain, Germany, South Africa and many other countries. In Japan, privacy rights are recognized as a moral right and publicity rights as an economic right. In the UK, the statute does not specifically protect image rights but one can look to alternative claims for protection and copyright and actions in the fields of privacy and data protection. The US has perhaps the most complete set of laws. The American Law Institute’s Restatement of Unfair Competition helps define the rights of publicity, trademark and copyright law, and the appropriation of trade values in respect of a person’s identity and using without consent. The right of publicity is a state-based right as opposed to the Federal right, though still interacting closely with First Amendment rights. In most US state jurisdictions, without a specific statute, the right may still be recognized in common law and based in tort law.

Australia, New Zealand, and the UK do not currently embrace a discreet legal category such as right of publicity though one could seek to file a claim within common law or statutory IP regimes such as trademark and copyright law. In these countries and Canada, passing off is a common law tort which can be used to enforce unregistered trademark rights. Publicity rights are protected in Canada by the common law tort of wrongful commercial exploitation of a person’s name, image, voice or likeness. Japanese courts acknowledge privacy and publicity rights and constitutional, moral rights even though they are not explicitly mentioned in Constitution or legislation.

Tax Effective Planning

Valuable assets have always dominated the tax planner’s mind. For tax and commercial purposes, image rights are often transferred by outright assignment or sale, or by license to corporate structures.

This has come under the scrutiny of tax authorities. The IRS in the US took pro golfers Retief Goosen and Sergio Garcia to court over their image rights. And Goosen and Garcia both proved the savvy of their legal teams. Goosen was upheld in tax court for contracts with TaylorMade, Titleist and others that specified his compensation was 50% for personal services (personal appearances, playing in tournaments, and product testing) and 50% as royalty income for the right to use his image, signature, voice, etc. Similarly, Sergio Garcia was allowed to have 65% of his income from TaylorMade classified as royalty income for endorsement and use of his image, and – as a Swiss citizen and per a US-Swiss tax treaty – this 65% is not subject to US tax at all.


The starting point for valuing any such assets is consideration of any barriers to entry and economic ownership advantage, notably by legal protections and registrations. Separately, any sponsorship, merchandising and other contractual arrangements are reviewed to identify specific earning streams, and with consideration of survivorship curves, personal situations, and legal and economic scenarios, modeling the valuation of these rights under different scenarios. Income streams can be modeled individually in respect of the sometimes numerous legal agreements that control exploitation. Valuation can observe both exclusive and non-exclusive rights to an image, the right of use in specific situations, the right to further prospect and extend convoyed sales. Also, in the fields of sports or media, stars can exploit and earn income separate from any team, club or studio contract, for ‘non-competing’ sectors and services. Each income stream will be accorded a different risk profile.

Personality specific risk also needs to be included in any valuation model. As well as for contract renewal, and, if new agreements are a realistic and assessable prospect.

An expert valuation will include assessing another risk inextricably linked to an individual: reputational risk. Reputational damage may allow licensees to contest or rescind contracts for the use of rights. Injury, as well as the likelihood of the renewal of aging contracts, are considered. Ratios and analysis associated with remaining useful life, probable life, actuarial life, and marketing longevity are essential. The recent Harvey Weinstein allegations highlight how economically impactful reputational damage can be. Scandal clauses are becoming even more prevalent.

In sum, image rights are a growing and valuable asset, contracts are being structured to protect and monetize these, and tax authorities are watching.


Warning & Disclaimer: The pages, articles and comments on do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of

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