In 2019, the Victorian Civil and Administrative Tribunal was required to interpret the implied terms of a verbal agreement between a prominent Influencer and a Victorian cafe owner. The Roberts v Con Katsiogiannis Legacy case centred around the cafe owner’s failure to pay the Influencer for her posts on her Instagram account, which featured her eating at the cafe, after he claimed she had later archived the sponsored posts.
CONTRACTUAL TERMS AS DETERMINED
As there was no formal Influencer Agreement in place, it was accepted there were no express terms and conditions beyond the agreement that the cafe owner would pay the Influencer $200 (which was subsequently agreed to be increased to $300 after her following grew) for each post on her Instagram page which promoted the cafe. The implied terms were found to be as follows:
- the Influencer would do a “reasonable number” of posts promoting the cafe;
- the Influencer retained creative control of her Instagram page;
- the Influencer’s fee could be varied by agreement;
- the duration of the agreement was not set, and the agreement could be determined by either party on giving notice; and
- the Influencer’s fees would be paid within a reasonable time.
THE DISPUTE
According to the case report, the dispute arose when the cafe owner failed to pay the Influencer for the sponsored posts when he could not find the posts on her Instagram page to determine the amount due to her, as he felt that she was seeking payment for nothing. The Deputy President found that based on the evidence and given that there was no complaint as to the quality of the images, but that the posts were deleted prematurely, the Influencer was in fact due two-thirds of the invoiced amount and ordered the cafe owner to pay to her that amount, plus an amount for the filing fee.
COMMON PROBLEM WITH INFLUENCER MARKETING CAMPAIGNS
The case highlights a common problem in the industry, being a failure to properly document the commercial terms of the influencer marketing arrangement. Agreeing the terms verbally, or informally via email or direct message commonly results in significant issues arising, due in part to a failure to specifically address and agree material terms of the arrangement. Failing to properly document the full commercial terms of the arrangement leaves the parties open to disputes, which may result in a court having to interpret the terms.
In this case, not only did the Influencer receive less than was found to be verbally agreed for her posts, but the parties had to spend time and money on having the issues determined by a court.
MEDIA ATTENTION AND REPUTATIONAL RISK
The case also attracted significant media attention, with news reports featured on various major news sites, such as ABC news, news.com.au, the Age, Herald Sun, Daily Mail and 9news. Some of the news reports have reported on backlash experienced as a result of the proceedings, which is a real risk to Influencers and Brands alike, who fail to properly document these arrangements.
HOW TO AVOID SIMILAR DISPUTES
Such a dispute may have been avoided if the parties had have entered into a suitable Influencer Agreement setting out the rights and obligations of each party, including whether the Instagram posts could be archived after a certain period of time.
In order to avoid a similar situation, contact us to obtain an Influencer Agreement for your next influencer marketing campaign.
You can view the full decision and reasons for the above mentioned case here.
