Tuesday, April 15, 2008

Michael Moore Use of Clip Did Not Defame Army Veteran

Sgt. Peter Damon filed a defamation suit against Michael Moore alleging that his non-consenting appearance in the documentary “Fahrenheit 9/11” lowered his reputation and subjected him to scorn in the military community.

Damon lost both arms to an explosion in Iraq, and participated in an NBC News Interview about a new type of pain blocker while being treated at Walter Reed Army Medical Center. Moore obtained rights to the clip of Damon and included it in “Fahrenheit 9/11.”

Damon claimed that Moore used the clip out of context and that it voices a “complaint about the war effort” instead of complaining about the “excruciating type of pain” Damon suffered. He further claimed that he was criticized by fellow veterans who believed he shared and endorsed Moore’s attack on President Bush and the war effort.

However, the court held that a “reasonable viewer” would not construe Damon’s clip as supporting Moore’s message. The clip ran 16 seconds out of a two-and-a-half hour film, and in the brief scene, Damon appears with two other veterans who do not express anti-war sentiments. While the film does convey an anti-war message, no viewer could reasonably conclude that Damon shared any type of political or ideological kinship with Moore.

Thus, the court found that Moore did not defame Damon.

See Damon v. Moore (1st. Dist., March 21, 2008) No. 07-1365 at http://www.ca1.uscourts.gov/pdf.opinions/07-1365-01A.pdf

Wal-Qaeda, Walocaust Are Not Trademark Infringements

Charles Smith created certain expressions such as “Wal-Qaeda” and “Walocaust” (sometimes including a smiley face) which appeared on his websites and products he sold on cafepress.com. Wal-Mart felt that Smith was infringing on its trademarks; however, Smith disagreed and filed suit seeking a judgment that his use of the catchphrases was lawful.

In Smith v. Wal-Mart Stores, Inc., a federal judge ruled that these expressions did not infringe on or tarnish trademarks held by Wal-Mart. The expressions were successful parodies, and were not confusing to customers. Smith disclaimed affiliation with Wal-Mart in an attempt to avoid customer confusion, and furthermore, Wal-Mart did not own a trademark for the smiley face. The court found that no fair-minded jury could find a reasonable consumer would likely be confused by Smith’s marks.

Further, Smith did not dilute Wal-Mart’s marks through tarnishment. A trademark must be used in an unsavory context so as to create negative public opinion to dilute through tarnishment. However, dilution claims only apply to commercial speech and Smith’s parodies were noncommercial and thus protected by the First Amendment. Therefore, Smith was granted summary judgment.

See Smith v. Wal-Mart Stores Inc., No. 06-526, 2008 WL 760196 (N.D. Ga., Atlanta Div. Mar. 20, 2008).

Michigan Raises the Tax Incentive Bar

Michigan is now offering the most generous film tax incentives in the United States. Michigan doubled its existing tax rebate from 20% to 40%, even offering 42% for doing business in certain Michigan communities.

This is a refundable and transferable tax rebate equal to 40% of qualified production expenditures, not a credit against taxes owed. There is no project, annual cap, or sunset, and only a $50,000 minimum spend. Qualified expenditures include prep, production, or post-production costs incurred in Michigan including cast and crew. Wages are capped at $2 million per person.
Further, Michigan provides a 25% tax credit for companies that invest at least $250,000 into infrastructure (studios, equipment, or other facilities); however, a $10 million cap exists for all infrastructure credits per year.

An opportunity also exists for production loans in conjunction with the Jobs for Michigan Investment Fund. Qualifying films with at least a $2 million budget are eligible for investment loans up to $15 million, with 0% loans available in exchange for backend participation. A guarantor for the loan is required. Productions can be eligible for both the loan and the 40% tax credit. Production loans (with an interest rate of up to 2%) are available for a production to receive all or a portion of the value of discounted tax credits the company is eligible to receive in the form of a loan.

The new Michigan law also includes a workforce development incentive which covers 50% of on-the-job training expenses for Michigan residents working as advanced below-the-line crew members.

For more information on Michigan film tax incentives, please visit http://www.michiganfilmproduction.com/ or http://michigan.gov/filmoffice/0,1607,7-248--186660--,00.html

Bob Yari Loses Producer’s Credit Battle

Producer Bob Yari contended that he should have received a screen producer credit for the film “Crash,” which entitled him to an Academy Award when the film won Best Picture in 2006.

In 2005, The Academy changed its procedure for determining eligible producers for a nominated film, deferring to Producer’s Guild designations of which producers performed the major portion of the producer function. Mr. Yari’s application was unsuccessful; therefore, he was not given Academy credit for being a producer of “Crash.”

Yari subsequently sued the Academy and the Producer’s Guild alleging that he was entitled to a common law right of fair procedure. He argued that the defendants were obligated to protect against arbitrary administrative interference and allow for substantively rational and procedurally fair decision-making.

However, the court disagreed, saying that the right of fair procedure only applies to private decisions which can effectively deprive an individual of the ability to practice a trade or profession. Here, the Guild did not control Yari’s ability to produce; in fact, he received a screen credit on “Crash,” and he has also continued his career as a film producer.

The judgment against Yari was affirmed. See Yari v. Producers Guild of America, Inc., Et Al. (2nd Dist., Div. 5, March 25, 2008) No. B196817 at http://california.lp.findlaw.com/ca02_caselaw/3_2008ca.html