Term Explanation: Pitch in a Legal Context
The term pitch originally refers to the short and concise presentation of an idea, concept, or project with the goal of convincing potential investors, clients, or cooperation partners. Pitches are used in various sectors – for example, in advertising, corporate contexts, creative industries, startups, the music and film business, as well as in the technology sector. From a legal perspective, pitches raise a variety of questions, particularly regarding copyright, competition law, contract law, confidentiality, and employment law conditions.
Legal Classification and Distinction
Pitch as a Pre-Contractual Stage
A pitch typically constitutes a pre-contractual action that takes place as part of a selection or tender process between a potential client and several providers or applicants. The process usually remains informal, but is gaining increasing legal significance in professional procurement procedures.
Distinction from Binding Offers
Legally, a pitch must be differentiated from a binding offer. While a pitch generally serves only to present ideas, a binding offer is already a declaration of intent aimed at concluding a contract. In legal disputes, it must always be examined whether, due to the specific circumstances, a legal offer has already been made or whether only a pitch took place.
Copyright Aspects of Pitches
Protection of Presentation Content
Presented works such as texts, graphics, photographs, drafts, designs, and software code can be protected under copyright law, provided they reach the necessary level of creativity. Such protectable works can arise or be presented during a pitch as well.
Requirements for Copyright Protection in Pitches
Copyright arises automatically upon the creation of a given work. Mere presentation within a pitch does not limit this protection. However, in individual cases, proving authorship and the time of creation can be particularly challenging.
Use and Exploitation
If a work or specific idea presented in a pitch is used by the client without separate consent, this may constitute a copyright infringement. The use of materials presented during a pitch is generally not permitted without the express granting of usage rights.
Protection of Ideas
Copyright protects only concrete works, but not mere ideas, thoughts, or concepts. Therefore, the protection of ideas and concepts in the context of a pitch is limited. Situations in which the creative individuality is sufficiently documented during a pitch may, however, in individual cases, establish a legal claim for injunctive relief and damages.
Competition Law Aspects in Pitches
Unfair Competition and Imitation
The adoption of an idea or presentation shown during a pitch by a third party may, under certain circumstances, be inadmissible under the German Act Against Unfair Competition (UWG), particularly in cases of protection against imitation (§ 4 No. 3 UWG). The prerequisite is that a substantial achievement – for example, in the form of an original presentation – has been provided and this achievement is deliberately exploited or unfairly copied.
Distortion of Competition
Pitch procedures must be designed to be transparent and free from discrimination. This serves to protect the interests of potential providers and to prevent distortions of competition, particularly in public procurement law. Discrimination against individual participants or the preferential treatment of certain providers may constitute a violation of competition law provisions.
Contractual Issues Related to Pitches
Pitch Agreement and Confidentiality Arrangements
It is common for the initiator of the pitch and the participating parties to enter into contracts governing key legal aspects, particularly confidentiality or remuneration. A typical element of such agreements may be a so-called Non-Disclosure Agreement (NDA). This regulates, in a binding manner, that information received during the pitch is not disclosed to third parties and is used exclusively for the intended purpose.
Pitch Fees and Compensation
It is often the case that so-called pitch fees are offered, in which a modest remuneration is agreed upon for the efforts and time of the participating parties. The agreement of a pitch-fee is permissible, provided it is done transparently and without discrimination. Arrangements on remuneration and further use of the content presented during a pitch should always be set out in a contract.
Legal Binding Effect of a Pitch
A pitch alone does not in principle create a direct contractual obligation, unless an intention to be bound is clearly derivable from the process and the conduct of the parties. Otherwise, there remains the possibility to withdraw or not to accept the offer.
Confidentiality and Know-How Protection in Pitches
Trade Secrets and Protective Measures
The presentation of sensitive trade secrets and internal corporate information during a pitch carries the risk of breach of confidentiality and disclosure of know-how. The protection of such information is particularly regulated by the Trade Secrets Protection Act (GeschGehG). Companies should consider security measures such as confidentiality agreements, restricted access, and documentation of presentation content.
Obligation of Confidentiality
A duty of confidentiality often arises from an appropriate contractual arrangement prior to the pitch. In the event of a breach of this agreement, claims for damages may be asserted.
Employment Law Dimensions
Pitch in the Corporate Environment
The involvement of employees in a pitch during working hours generally falls within the responsibilities of the employer. Presentation and work results arising from company activities are subject to the employer’s right to issue instructions and are usually attributed to the employer.
Liability Issues in Pitches
Liability Risks in the Pitch Phase
Various liability risks may arise during a pitch, especially in cases of infringement of copyright, confidentiality commitments, or competition law provisions. Furthermore, liability may arise due to deception about essential contract terms or violation of strict protective duties.
Claims for Damages
In the event of unauthorized use of a work presented in a pitch, violation of confidentiality obligations, or unfair imitation, claims for injunctive relief and damages can be asserted according to various statutory regulations.
Summary and Practical Notes
A pitch is a legally complex instrument whose structure and execution involve numerous legal aspects. The most important areas of law include copyright, competition law, contract law, and confidentiality protection. The legal design of pitch procedures is based on careful documentation, clear contractual agreements, and effective protective measures to safeguard the interests of all parties involved. Participants and initiators of a pitch should therefore exercise particular care in preparing and structuring the corresponding processes.
References
- Trade Secrets Protection Act (GeschGehG)
- Act Against Unfair Competition (UWG)
- Copyright Act (UrhG)
- German Civil Code (BGB)
- Relevant case law on the subject of pitches and the protection of ideas and concepts
This article provides a comprehensive overview of the key legal aspects of the term pitch in the respective context and serves to inform about the main statutory requirements and principles.
Frequently Asked Questions
Who holds the rights to the presentation materials of a pitch?
As a general rule, the copyright for materials created during a pitch belongs to the person who achieves the level of creativity required under § 2 UrhG – typically the presenting agency, consultancy or individual. This particularly applies to texts, graphics, and layouts considered personal intellectual creations. The organizing company does not automatically acquire rights simply by being given the materials for evaluation. To obtain usage rights, an express agreement is necessary, ideally in writing, specifying the rights to be transferred, their scope, duration, and any compensation. Without such an agreement, all usage and exploitation rights remain with the creator of the pitch documents.
What risks exist with the unauthorized disclosure of pitch content?
Unauthorized disclosure or use of pitch content constitutes a violation of copyright law and, where applicable, competition law (§§ 3, 4 UWG). For example, if a concept presented in a pitch is subsequently used or passed on to third parties, this may give rise to claims for injunction, removal, and damages. Competition law consequences such as warning letters from competitors are also possible, especially if trade secrets according to § 2 GeschGehG are involved. Organizers and third parties must therefore ensure that pitch content is used solely for the agreed purposes and that there is no copying or unauthorized disclosure.
What statutory protection is available for ideas in the context of a pitch?
Purely abstract ideas as such cannot be legally protected – protection begins only once they are expressed concretely, for example as texts, presentations, prototypes, or design solutions (§ 2 UrhG, § 3 UWG, § 2 GeschGehG). For pitch content, protection may also be available under the Trade Secrets Protection Act (GeschGehG) if the creator has taken appropriate confidentiality measures. Contractual protection through Non-Disclosure Agreements (NDA) is also recommended, as these secure contractual claims for injunctive relief and damages in the event of breaches.
How can the protection of pitch content be regulated by contract?
Specifically, pitch tenders should define at an early stage who acquires which rights to submitted content and how it may be used. Confidentiality agreements (NDAs) can contractually ensure the confidential handling of information and materials, and prohibit their use after a presentation has been rejected. It is also advisable to determine in the pitch contract whether and to what extent usage rights should be transferred, whether compensation will be paid for the presentation of the concept, and what consequences a violation of these agreements will have (e.g., contractual penalty or damages).
What should participants consider to protect their pitch concepts?
Agencies and service providers should document every submission of pitch materials and, if possible, mark them with a copyright notice and a confidentiality statement. It is also advisable to communicate that the materials are to be used solely for the selection process and to have a written confidentiality agreement signed before the pitch. Ideally, innovative or especially valuable elements should be prepared separately and otherwise protected (e.g., trademark registration, design protection). These preventive measures make it easier to enforce claims in the event of a dispute.
Does a claim for compensation for the pitch exist if no contract is awarded?
There is no statutory entitlement to compensation for a conducted pitch unless a corresponding contractual agreement or industry practice exists. In many cases, participation in the pitch is considered self-promotion. However, if a service is expressly required beyond the mere offer, such as the development of market-ready concepts or comprehensive creative performances, reimbursement of expenses or compensation in accordance with §§ 612, 670 BGB may arise under commercial custom. It is therefore advisable to agree any claims for compensation in writing beforehand.
