Wednesday, November 19, 2008

Risky Business at UCLA February 21, 2009

Mark will once again present his yearly "Risky Business: Financing & Distributing Independent Films" all day seminar at the UCLA campus on February 21, 2009. Those who attend this comprehensive seminar will learn how independent films are financed and distributed. Topics include organizing your company, raising financing via pre-sales, debt and limited partnerships, negotiating tactics, principal terms of the acquisition/distribution agreement, cross-collateralization and creative accounting.

Particular attention is paid to how producers and filmmakers can protect their interests by watering down warranties, getting added to the E& O policy, using lab access letter to retain possession of the negative, and utilizing termination and arbitration clauses.

The seminar is all day Saturday. There is limited enrollment so enroll early to assure a place.

Registration number: U6442. Attorneys may receive 7 hours of MCLE credit.

More info at:

An extensive handout accompanies the course. The handout covers:


Choice of Business Entity
Sole Proprietorship
General Partnership
Limited Partnership
Company Formation Checklist
Limited Liability Company (LLC)
Comparison of Entity Choices

International Co-Productions
Co-Production Checklist

Pre-sale Agreements
Contract: IFTA International Schedule of Definitions
Entertainment Finance Companies
Equity Investments

How Much is My Film Worth?
How Distributors Evaluate a Film
Sources of Revenue
Increasing Your Leverage
Film Festivals
Working the Festival Circuit
Balancing Risks and Rewards
The Acquisition/Distribution Agreement
Tactics and Strategy
Markets and Festivals
Investigate the Distributor

Distribution Fee
Distribution and Marketing Expenses
Advances and Guarantees
Consultation Rights
Warranties and Representations
Allocation of Package Revenue
Security Interest
Governing Law
Territorial Minimums
Retain Your Masters
Return of Materials
Contract: Lab Access Letter
Contract: IFTA Rider to International Distribution Agreement

Selecting a Distributor
Creative Accounting
Conducting an Audit
How Revenue is divided
Creative Accounting Pitfalls
Accounting Terms
Defensive Tactics


The copyright office has joined the internet revolution and now prefers that you register your work online through the Copyright Office online system (eCO). This is now the primary method to register works.

The advantages of this new system include a lower filing fee of $35 for a basic claim, faster processing time, online status tracking, secure payment by credit card or electronic means and the ability to upload certain deposits directly into the system as electronic files.

For works that require a hard-copy deposit, one may submit an application, make a payment online, and then send copies to the Copyright Office via mail or express courier.

For the registration of motion pictures there are two other methods. There is now a new fill-in Form CO. Using 2-d barcode scanning technology, the Copyright processes these forms much faster and more efficiently than paper forms completed manually. Simply complete Form CO on your personal computer, print it out, and mail it along with a check or money order and your deposit. To access Form CO, go the Copyright Office website and click on Forms.

One can still rely on traditional paper Form PA (performing arts works, including motion pictures). However, these forms are no longer downloadable from the Copyright Office website. One has to request that they be mailed to you.


The Supreme Court will hear an appeal from a conservative group that wanted to promote its anti-Hillary Clinton movie without complying with the campaign finance law. The McCain-Feingold Act forbids corporate-funded broadcast ads that attack a candidate within a month of a primary or general election. Moreover, political groups are required to disclose who paid for the advertisements.

The Federal Election Commission found that the group could not broadcast the film on television or air ads close to the election. A lower court ruled that the 90-minute "Hillary: The Movie" was clearly intended to influence people to vote against Clinton in her run for the presidency. A three-judge court in Washington said the group had to attach a disclaimer and disclose its donors in order to run ads promoting the movie.

Attorneys for the conservative group Citizens United claim the law limits "core political speech rights" and is unconstitutional. Citizens United v. FEC, 08-205.



The SEC has charged the dot-com billionaire Mark Cuban and owner of 2929 Entertainment with insider trading. Cuban also has interests in HDNet and Landmark Theatres, a chain of arthouse movie theaters.

The complaint arises from Cuban's sale in 2004 of 600,000 shares in the search engine company (aka Copernic, Inc.). The SEC claims that Cuban dumped all of his shares the evening and day after he received material non-public information from the company's CEO, avoiding a loss in excess of $750,000.


Friday, October 31, 2008

The Middle East International Film Festival

I recently had the great pleasure of serving as a juror at the Middle East International Film Festival, held in Abu Dhabi, in the United Arab Emirates, from October 12 – 19. The Middle East Film Festival, in its second year now, was organized to bring together filmmakers from all over the world, particularly filmmakers from the Middle East. It’s part of the country’s multi-pronged approach to building a film industry from the ground up in Abu Dhabi. That approach includes building studio space to attract film production, offering budding filmmakers a focused education through the soon-to-be opened New York Film Academy, and providing financing for both international and local films.

MEIFF Director of Programming Jon Fitzgerald (who was also the founder of the Slamdance Film Festival) put together a fabulous line-up of Hollywood films, Bollywood Films, and student films, which shared the venues with a smorgasbord of films from the Middle East. The festival was headquartered at the stunning Emirates Palace, a luxurious seven- star hotel in the heart of Abu Dhabi; additional screens at the nearby Marina Mall and the Abu Dhabi Mall were also enlisted for the eight days of non-stop film showings. Hollywood star power was in residence, with Actor Adrien Brody and Director Rian Johnson present for the Opening Night Film, “The Brothers Bloom.” Susan Sarandon participated in a “Spotlight on Women” panel about environmental and cultural issues facing women throughout the world, which were addressed in the film “The Shape of Water,” which Ms. Sarandon had narrated. Catherine Deneuve participated in a debate about humanitarian concerns in Lebanon; and Jane Fonda was there to receive the Cinema Verite Lifetime Achievement Award. Famous Egyptian actress Youssra served on the Feature Jury.

At MEIFF, Middle Eastern film was represented by films from the United Arab Emirates, Morocco, Palestine, Egypt, Iran, Jordan, Syria and Lebanon. Nashwa Al-Ruwaini, the Executive Director of MEIFF introduced many of the films and filmmakers. Of course the government of Abu Dhabi supported this effort, led by Sheikh Sultan Bin Tahnoon Al Nahyan, Chair of the Abu Dhabi Authority for Culture and Heritage.

I am probably not alone when I say that MEIFF took networking and hospitality to a whole different level, with some of the best parties ever hosted at a film festival. After the last screening of the evening, festival participants would gather in the gardens outside the Emirates Palace, overlooking the Arabian Gulf, for entertainment that was truly out of 1001 Arabian Nights. At the Bedouin Party, festivalgoers lounged on couches in Bedouin tents and smoked shisha (Arabic tobacco) with a water pipe (hookah); camel rides were offered to the daring, animal lovers could get up close and personal with a trained falcon, and a sensational belly dancer entertained the captivated audience. On Bollywood Night, we were treated to the ritualized, gracious dance of India; and after the screening of the documentary “Youssou N’Dour: I Bring What I Love,” N’Dour himself, one of Africa’s most adored musicians, gave a concert, accompanied by his band. The Middle Eastern cuisine, the hospitality, and the graciousness of our hosts was truly incomparable.

It is amazing that oil was only discovered in the Emirates in the 1970s. They are now the world’s 10th largest producer of oil—and of course it has transformed their society. It was an eye-opening, mind-bending experience to witness this transformation, and to be part of the blossoming culture of film, art and architecture in the UAR.

Congress Extends Federal Tax Incentive

The Section 181 tax incentive has been extended through December 2009. This program which was first enacted in 2004 was extended and enhanced by being attached to the $700 billion financial markets rescue plan passed by Congress.

The new legislation improves upon the prior law by applying the tax incentive to the first $15 million of all motion picture productions in the USA. The prior legislation was flawed because this threshold amount included all costs, including difficult to predict residuals and participations. This quirk in the law made it risky to accept the incentive if your budget plus these extras might exceed $15 million.

The new provisions are retroactive to January 2008.

Film L.A. has new Online Permit System

FilmL.A. is a nonprofit organization that coordinates and processes permits for on-location motion picture, television and commercial production in the Los Angeles region. FilmL.A has a new Online Permit System (OPS), which will change how permits to film on-location are applied for, coordinated and delivered. Applicants will be able to apply online and create and save templates for future applications, receive instant confirmation that permit applications were received, track permit progress and status of agency approvals in real-time and download paid-for and finalized permits at their convenience.

Additional information at:

Middle East International Film Festival (MEIFF)

Mark will be serving on the short film jury at the upcoming MEIFF from October 10-19 in Abu Dhabi. The festival celebrates world cinema by presenting quality films from across the globe. Competition sections include world premiere screenings and highlight up-and-coming films making a splash on the festival scene. Gala screenings and the Festival of Festivals showcase new work by established filmmakers and films that have garnered prestigious awards.

Additional info:

Libel Tourism Bill Passed

The House of Representatives passed a bill that would prohibit U.S. courts from enforcing foreign libel judgments that undercut First Amendment rights. The law is designed to address the phenomenon known as “libel tourism,” or the exploitation of defamation laws in foreign countries that lack the broad protections of free speech guaranteed by the First Amendment in the United States.
The bill was introduced as a result of a lawsuit involving New York author Rachel Ehrenfeld. She was sued in Britain by Khalid bin Mahfouz, a Saudi Arabian businessman, for her book “Funding Evil: How Terrorism Is Financed and How to Stop It.” Ehrenfeld lost the libel suit, and as a result the New York Legislature passed a law preventing state courts from recognizing foreign libel judgments.

The New York law was the first of its kind in the United States. "As our world becomes more and more interconnected, we need new laws to ensure that Americans’ First Amendment rights won’t be hindered by more restrictive, foreign mandates," Congressman Steve Cohen of Tennessee said. The bill will prohibit domestic courts from recognizing or enforcing foreign defamation judgments unless the domestic court finds that the foreign judgment comports with our First Amendment.

The Association of American Publishers (AAP) has applauded Congressman Cohen’s legislation, and the bill has already received wide, bipartisan support in the House Judiciary Committee.

Wednesday, September 10, 2008

Jackson Browne Sues McCain

Jackson Browne has sued John McCain and the Ohio and national Republican in U.S. District Court in Los Angeles alleging that they are using his song "Running on Empty" without his consent. The suit claims the song's use is copyright infringement and will mislead people to conclude he endorses McCain.

Browne is a lifelong liberal associated with various progressive and environmental causes. The ad criticizes Democratic presidential candidate Barack Obama who Browne supports. The song "Running on Empty" plays in the background of the ad criticizing the candidate.

The chairman of the Ohio party claimed the ad was pulled when Browne objected. McCain spokesman Brian Rogers said the ad was not from the McCain campaign. Browne's lawsuit contends the Ohio Republican party released the ad on behalf of McCain and the RNC. The singer claims is seeking more than $75,000 in damages.


Congratulations to our clients the producers of the independent film Greetings From The Shore which opens theatrically in numerous theaters in New Jersey and New York.

Since its debut at the Montreal World Film Festival, "Greetings" has been in numerous films festivals including those in Fort Lauderdale, New Orleans, and Boston. It has won 25 awards, most importantly five Audience Awards for "Best Feature." The film is a coming-of-age romance starring an ensemble cast that includes Paul Sorvino ("Goodfellas"), David Fumero ("One Life to Live"), Jay O. Sanders ("Half Nelson"), and the debut of newcomer Kim Shaw (upcoming "Sex and the City" movie).

The story is a tribute to the Jersey Shore based on the life of Writer/Producer Gabrielle Berberich, who spent every summer in the same seaside town where the feature was filmed. It's reminiscent of such coming-of-age classics as "Dirty Dancing" and "Mystic Pizza."

The film was shot on 35mm by Writer/Director Greg Chwerchak, who has created music videos for hundreds of artists such as Britney Spears, Duran Duran, and Destiny's Child, as well as commercials for McDonald's and ESPN. He previously directed award-winning short films, "The Hook-Armed Man" and "The Quarry." Additional info at:

Thursday, July 10, 2008

Manzarek v. St. Paul fire & Marine Ins. Co.

Ray Manzarek of "The Doors" classic rock group filed suit against his insurance company, St. Paul Fire & Marine, after St. Paul's refused to provide a defense under Manzarek's general liability policy.

Manzarek was sued by John Densmore and Jim Morrison's parents for infringing on "The Doors" name, logo, and trademark. Manzarek incurred more than $3 million in legal fees. However, St. Paul's argued that the policy had a "field of entertainment" exclusion, barring "personal injury or advertising injury that results from the content of, or the advertising or publicizing for, any properties or programs which are within your field of entertainment business." The District Court dismissed Manzarek's case with prejudice, citing the exclusion as conspicuous, clear and unambiguous.

However, the 9th Circuit reversed, finding a contractual duty to defend. The Court of Appeals said the lower court did not apply the exclusion language to the facts. If the language was narrowly construed, advertising injury could occur, and thus St. Paul must defend, in distribution channels not listed in the exclusion. Thus, specifically, the court found that Manzarek was entitled to advertising injury coverage for marketing t-shirts and guitars with "The Doors" logo. Further, the underlying lawsuit never specified the type of product allegedly being sold, which, if stated, might have allowed St. Paul to escape liability under this exclusion.

Finally, the court held that Manzarek should have been allowed to amend his complaint to show the exclusion did not bar coverage, which was the reason for the initial dismissal. For more information, please see: Manzarek et al. v. St. Paul Fire & Marine Insurance Co., No. 06-55936, 2008 WL 763385 (9th Cir. Mar. 25, 2008).

Completing Form PA for Screenplays and Films

Screenwriters and Filmmakers often find it confusing to complete copyright form PA which is used to register scripts and completed films. Here is quick guide: If the motion picture is finished, you should register it by sending in Form PA with a copy of the finished film and an attached synopsis describing the film. If you are still at the script stage, you can register the script now and register the film when complete. In either case, closely follow the instructions on Form PA. The following guide addresses those sections that applicants often find confusing when registering scripts or motion pictures. Remember to complete all applicable sections of the form, not just those discussed below.

Registering a Script

Under #1, Nature Of This Work, you could write "Screenplay for Motion Picture."

Under #2, "Name of Author": Note that if a screenplay has been written for you or your company, in other words, if you hired someone to write the screenplay, then it may be a work-made-for-hire. In this case, you or your company is the copyright holder and should be listed under "Name of Author." On the other hand, if a writer has created the screenplay on his own, and he is then selling it to you, the writer would be the author. If this writer has already registered their script with the Copyright Office, you should not register it again, but merely record the transfer (assignment) of the copyright to you. The copyright should be assigned to you or your company with a written contract, and a short form copyright assignment recorded with the Copyright Office.

Under "Nature of Authorship," you should give a brief general description of the author's contribution to the work. If the author wrote the entire script you might write: "Entire Text." If you are claiming copyright to something less than the entire script, describe your contribution, for example, "Editorial Revisions."

Then enter the year in which the creation of the work was completed and the copyright claimant (the author or whomever has legally acquired the copyright).

Under #5, if the screenplay contains a substantial amount of previously registered material, answer "Yes," to the first question and check the box indicating the reason for this registration. Add the registration number and year of the previously registered material. If no portion of the work was previously registered, write "No" to the first question and leave the rest of the space blank.Fill out #6a & b only if the work has a significant amount of previously registered, previously published, or public domain material.

Under #6a, "Derivative Work or Compilation," you might write "Previously registered screenplay."

Under #6b, "Material Added to This Work," you might write "additional dialogue and text."
Registering a Completed Film

Under #1, "Nature Of This Work," write: "Motion Picture."

Under #2, "Name of Author": Usually this will be the name of the production company or entity that hired everybody who made the motion picture. If this is project was entirely a work made for hire, check "Yes" under "Was this contribution to the work a 'work made for hire'." Under "Nature of Authorship," write in "Screenplay and adaptation as motion picture."

If this motion picture was not at all a work for hire, fill in the name of the person(s) who made the motion picture, and check "No" under "Was this contribution to the work a 'work made for hire'." Under "Nature of Authorship," write in "Screenplay and adaptation as motion picture."
If this motion picture was partly a work for hire, and partly not, you'll need to fill in a space for each part. For example, if your production company made the motion picture as a work for hire but bought a completed screenplay from a writer who was its author, then you would fill out two spaces: In one space, you could fill in the writer's name as author, check NO under to the question of whether it was a "work made for hire," and fill in "Screenplay" or "Script" in "Nature of Authorship."In another space, you could fill in the production company's name, check YES indicating it is a "work made for hire," and fill in "All other cinematographic material" under Nature of Authorship."

Under section 5, if the motion picture contains a substantial amount of previously registered material, answer "Yes," to the first question and check the box indicating the reason for this registration. Include the registration number and year of the previously registered material.
Fill out #6a & b only if the work has a significant amount of previously registered, previously published, or public domain material.Under #6a, "Derivative Work or Compilation," you could write in "Previously registered screenplay."

Under #6b, "Material Added to This Work," write "Motion Picture."You are required to deposit a copy of your film within 3 months of publication. If you do not, you may be subject to fines and penalties. In descending order of preference the format for the copy should be 70mm, 35mm, 16mm film print, Betacam SP, Digibeta, DVD or VHS cassette.

In General Complete #4, "Copyright Claimants," even if the Claimant is the same as the Author. The Claimant is the person or company that has legally acquired the copyright. It will be either the Author or the entity to which the copyright has been transferred. When the Claimant is not the Author, you need to describe under "Transfer" how the copyright was obtained by the Claimant. You could state, for example, "by written assignment."Don't forget to include a copy of your script or film when you send in your registration form.

You need to sign Form PA and send it in with a check for $45 payable to "Register of Copyrights." Retain a photocopy of everything you send the Copyright Office including the completed Form PA and your cover letter. It is a good idea to send your package by certified mail.

If you would like to put your attorney's name under "Correspondence" so that he/she can answer any questions the Copyright Office may have, you may do so. In this event, you should send your attorney a photocopy of the form and your cover letter so he/she will have a record of what you have submitted.

Mail to:Library of CongressCopyright Office101 Independence Ave., S.E. Washington, D.C. 20559-6000Copyright circulars and forms are available from the Forms and Publications Hotline, (202) 707-9100 (leave a recorded message requesting the documents you want mailed to you), or on the Copyright Office website,

The website also offers extensive copyright information. Circular 45 found at specifically addresses copyright registration for motion pictures. To speak to an information specialist, call (202) 707-3000.

Tuesday, May 13, 2008

Screenwriter Sues Mel Gibson for Fraud

Mel Gibson has been sued for fraud and unjust enrichment by Benedict Fitzgerald, one of the screenwriters for Gibson's "Passion of the Christ." Fitzgerald claimed that Gibson misrepresented facts regarding the film's budget and Gibson's financial take, leading him to believe the film had a $4-7 million budget and Gibson would take no percentage of profits.

Fitzgerald was paid as a writing a fee of $75,000, while Gibson took home a $5 million salary for directing, as well as his producer's share of profits derived from the $600 million of the film's worldwide receipts.

Fitzgerald alleges that Gibson had the express purpose of depriving him of the full fruits of his efforts as the screenwriter, and that Fitzgerald experienced severe cash-flow problems due to his devotion to the project.

Law Banning Violent Videogames Held Unconstitutional

The state of Minnesota is fighting an 8th Circuit decision regarding violent video games. In March, The 8th Circuit Court of Appeals affirmed an injunction against enforcement of a 2006 state law banning minors from buying violent video games (rated "M for Mature" or "AO for Adults Only.) Residents under age 17 faced $25 fines if caught buying or renting games with the mature ratings.

The court found that violent video games are protected free speech under the First Amendment and the burden of proof required "incontrovertible proof of a causal relationship between the exposure to such violence and subsequent psychological dysfunction" to overcome the burden and uphold the state law.

The state has now petitioned the Court of Appeals for a rehearing en banc (by all of the judges rather than the customary 3 judge panel) to reconsider its previous ruling, as well as question the "incontrovertible proof" standard set forth by the court, which would create an "unprecedented and unreasonably high evidentiary standard" regarding the well-being of children. The state argues that the "grossly repugnant" video games are not worthy of First Amendment protection because they do not communicate or express ideas or information.

For more information, please see: Entertainment Software Association et al. v. Swanson et al., No. 06-3217, petition for rehearing filed (8th Cir. Mar. 28, 2008).

Legal Ease, A Legal Rights Workshop for Writers

June 21, 2008, 11:00AM – 12:30PM at GREAT AMERICAN PITCHFEST

Date: Saturday - June 21, 2008Time: 11 a.m. - 12:30 p.m.

Mark will be a speaker at the upcoming Great American Pitchfest.

Screenwriters need to protect themselves from the people they write about and producers they contract with. They also need to take care when collaborating with others.

This seminar explains how writers can avoid legal problems by properly securing rights, obtaining releases and not infringing the rights of others. Related topics include registering your work, submission releases, and annotating and clearing your script.

Topics include:

When you need to purchase the rights to a person's life story
What is in the public domain
Defenses to defamation and invasion of privacy
Title and Copyright searches
Reserving rights
Reversion and Turnaround clauses
Watering down warranties
E & O insurance
Story theft
Typical compensation and terms of studio contracts
Defenses and privileges to defamation and invasion of privacy
How to preserve the integrity of your screenplay and avoid costly lawsuits

The fifth annual Great American PitchFest will take place on June 20-22, 2008 at the Burbank Marriott Hotel & Convention Center, 2500 N. Hollywood Way, Burbank, CA 91505.

For additional information:

UCLA Self-Defense for Writers and Independent Filmmakers: Protecting Your Legal Rights JULY 12, 2008

Mark will present his annual legal defense seminar the weekend of July 12, 2008.

Filmmakers learn how to make shrewd business decisions and protect their interests in negotiations with production and distribution companies. Instruction covers how to anticipate problems before they arise and how to encourage other parties to live up to their contractual obligations through performance incentives, default penalties, and arbitration.

In the event of a dispute, learn what remedies are available to enforce your rights. Topics include creative accounting; customary terms of contracts; negotiating tactics and strategies; properly securing rights to your work; and how to avoid being sued for copyright infringement, defamation, or invasion of privacy. Attention is paid to how to protect oneself by modifying warranties, obtaining E&O coverage, using lab access letters to retain control of masters, and utilizing termination clauses.

The seminar includes an extensive handout with sample forms, contracts and a self-defense checklist.

Registration No. U2433, Additional info at:

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

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 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 or,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

Monday, March 24, 2008

KIRBY v. SEGA (2006)

A recent case has found that videogame developers can base game characters are real celebrities provided they are transformed sufficiently. Keirin Kirby was the lead singer of a retro-funk-dance musical group known as “Deee-Lite,” who had a diva-like artistic character reminiscent of the 1960’s. Sega of America, Inc. developed a videogame in 1999 called “Space Channel 5” set in outer space and featuring a character named “Ulala,” who shared many attributes of Kirby’s character. Kirby claimed Ulala was a direct appropriation of her character’s unique public identity, and she sued Sega under an invasion of privacy claim.

Some of Ulala's characteristics and computer-generated features resemble Kirby, and her name is a phonetic variant of “ooh la la”- a phrase associated with Kirby. However, aspects of each character’s costuming and style are different- Ulala dons a jetpack, blue headset, and the number five on her outfit as opposed to Kirby’s 60’s flair. Kirby conceded she has no singular identity; her appearance and visual style are “continually moving.”

Sega contended that the First Amendment is a complete bar to the invasion of privacy claim. A defendant may raise the First Amendment as an affirmative defense to an allegation of appropriation if the defendant's work “adds something new, with a further purpose or different character, altering the first with new expression, meaning, or message.” This is known as the “transformative test” and was applied here by the court. Based on the differences stated above, the court found that Ulala is “transformative” from Kirby’s likeness and constitutionally protected.

Thus, given the many dissimilarities between Ulala and Kirby, any public confusion arising from a mistaken assumption that Kirby endorsed the videogame is easily outweighed by the public interest in free artistic expression. Kirby v. Sega of America, Inc., 144 Cal. App. 4th 47 , 2006 Cal. App. LEXIS 1672 (Cal.Ct.App. 2006)

Entertainment Software Association v. Swanson (2008)

The 8th Circuit Court of Appeals affirmed the District Court’s ruling, striking down a part of the Minnesota Restricted Video Games Act. Provisions of the Act prohibited the sale of video games to minors if the games were rated “M” for mature or “AO” for adults only. The Entertainment Software Association challenged the constitutionality of the Act, while the State defended, citing numerous studies linking media violence and aggressive behavior.

The court followed Interactive Digital Software Ass’n v. St. Louis County, and held that violent video games are protected free speech. Thus, any restrictions were subject to strict scrutiny analysis; requiring the law to be necessary to serve a compelling state interest and narrowly tailored to achieve that end.

The State argued that safeguarding both the psychological well-being and the moral and ethical development of minors were compelling interests and the court agreed. However, an interest in safeguarding the psychological well-being of minors must be real and not merely abstract. In other words, the State must prove that the law will in fact protect minors in a direct and material way and present more than anecdote and supposition.

Here, the court found that the State could not prove that violent video games actually negatively affected the psyche of minors. Without indisputable proof of causation between the exposure to video game violence and subsequent psychological dysfunction, the State did not meet its burden to satisfy strict scrutiny and the law was struck down.

Entertainment Software Association v. Swanson

Upcoming Speaking Engagements

Mark will be moderating a panel on International Co-Productions held by the Producers Guild of America on March 26, 2008 at the DeMill Screening Room at 9336 W. Washington Blvd., Culver City. Non PGA members and students can attend by paying a fee. To attend or inquire RSVP by March 24, 2008 to
Please put your first and last name in the subject line of your “RSVP” email response.

Mark will be speaking at a film finance seminar titled “Getting Films Funded” held at the WGA theater on March 29, 2008.

On June 25, 2008, Mark will moderate a panel on Intellectual Property In Entertainment & Media" put on by the California State Bar Intellectual Property Section at the Beverly Hills Hotel. The panel will discuss clearance issues in documentary filmmaking.

Monday, March 03, 2008

Tolkein Trust Sues New Line Cinema Over “Lord of the Rings” Profits

The trust that manages the estate of J.R.R. Tolkein, the author of the massively popular trilogy, has not received any profits from New Line Cinema, the distributor of the three films which have grossed nearly $6 billion.

The suit claims that New Line has engaged in various “bookkeeping” practices in order to avoid paying the trust and other gross revenue participants, including director Peter Jackson.

According to the lawsuit, a series of 1969 agreements granted the underlying rights to the books to United Artists in exchange for 7.5% of the gross receipts of any films based on the works. New Line subsequently acquired the rights.

The suits asks for over $150 million in damages and other remedies for breach of contract.

Judge Reverses Decision In Regard To Restraining Website

Website Wikileaks: ( blows the whistle by exposing corporate and government wrongdoing. It focuses mainly on oppressive regimes in Asia, the former Soviet bloc, Sub-Saharan Africa and the Middle East. The site was completely shut down when Judge Jeffrey S. White ordered that the entire site be taken offline. The site allowed whistleblowers to disclose sensitive documents without them being traced back to their source. It has received more than 1.2 million documents from dissident communities and anonymous sources.

The judge completely reversed himself, however, after several organizations including the Electronic Frontier Foundation, The Reporters Committee for Freedom of the Press, The Associated Press and the ACLU filed briefs contending that such an order was an unlawful prior restraint.

The Feb. 15 order required the required domain name service provider stop all access to the Wikileaks site, disabling its Web address. A Swiss bank had asked the court to require the site to be taken down on the grounds that it had disclosed private banking records. The site was allowed to resume when the judge dissolved his previous order.

The media coalition's brief in the case can be found at:
State Bar Conference

Mark Litwak will be moderating a panel at a one-day conference entitled "Intellectual Property In Entertainment & Media" put on by the California Bar Intellectual Property Section on March 25th at the Beverly Hills Hotel.

Self Defense for Writers and Filmmakers Comes to New York April 26, 2008

Volunteer Lawyers for the Arts is sponsoring a one day seminar with Mark Litwak on Saturday, April 26, 2008: 10 am – 5 pm in Manhattan.

Writers and filmmakers need to understand their legal rights and how to defend themselves from those who may seek to exploit them. Production companies and distributors often know all the tricks of the trade, while writers and filmmakers know little about how to protect themselves.

This seminar explains how writers and filmmakers can prevent problems from arising by properly securing underlying rights, and by encouraging the other party to live up to agreements by adding performance incentives, default penalties and arbitration clauses. Participants learn what remedies are available to enforce their rights in the event of a dispute.

Related topics include creative approvals, typical compensation and terms of studio contracts, merchandising deals, and negotiating tactics and strategies. The seminar includes more than 100 pages of useful contracts, checklists, forms and materials.

Speaker: Mark Litwak is a veteran entertainment attorney with offices in Beverly Hills, California. His practice includes work in the areas of copyright, trademark, contract, multimedia law, intellectual property, and book publishing. Litwak also functions as a Producer's Rep, assisting filmmakers in the financing, marketing and distribution of their films. For more information about Mark Litwak, please see

Lawyers can receive Eight (8) New York CLE "Areas of Professional Practice" credits.

Artists and Full-Time Students: $100 if registering on or before Friday, March 28th; $125 after March 28th.

Attorneys (including 8 CLE credits): $275 if registering on or before Friday, March 28th; $375 after March 28th.
To register, please complete the registration form at:

Since 1969, Volunteer Lawyers for the Arts has been the leading provider of pro bono legal services, mediation services, educational programs and publications, and advocacy to the arts community in New York. The first arts-related legal aid organization, VLA is the model for similar organizations around the world. For more information about Volunteer Lawyers for the Arts, please see

Sunday, January 27, 2008

Red Hot Chili Peppers Sues Showtime for “Californication”

The rock band Red Hot Chili Peppers recently filed suit for disgorgement of all profits, unspecified damages, and a permanent injunction against Showtime Networks for use of the name of their 1999 Grammy-winning album “Californication” as the title of a television show.

The televisions show, “Californication,” stars David Duchovny as a troubled writer and father living in Los Angeles with a habit of sleeping with beautiful women. The show premiered in 2006. The show also features a character named “Dani California”—the title of a single released by the Chili Peppers in 2006.

The lawsuit, filed in Los Angeles County Superior Court, alleges a violation of federal trademark law because the album and single title are inherently distinctive and “widely recognized by consumers and those in the trade.” Furthermore, the use of the name is a “false designation of origin” and causes “a likelihood of confusion…in the minds of the public.”

Andre Agassi Wins Injunction Against Target

The US District Court of Nevada has agreed with Andre Agassi and has issued an injunction against Target to prevent the continued sale of sandals bearing Agassi’s name.

According to the complaint, Agassi had licensed Target to use his likeness, but had never authorized the company to use his name. Target had agreed to take the sandals with his name on them off the market, but one month later the sandals were still for sale in Nevada and online.

The court indicated that Target violated Agassi’s right of publicity and that Agassi was likely to succeed on the merits of the infringement claim. In a balance of hardship analysis, the court ruled that there would be no undue hardship to retail giant Target by taking the shoes off the market while the damage to Agassi’s reputation could not be remedied through any amount of monetary award.

Fields of Fuel Wins at Sundance

Congratulations to our client, Johnny O’Hara the writer of the Documentary Fields of Fuel which won the Audience Award at Sundance. A look at America's addiction to oil, the documentary is about a man with a plan and a Veggie Van, who is taking on big oil, big government, and big soy to find solutions in places few people have looked.

Diamond Dog Caper to Premiere at Santa Barbara Film Festival

Congratulations to our client filmmaker Mark Stouffer, whose new family film, Diamond Dog Caper, will premiere at the Santa Barbara International Film Festival on Saturday, February 2, 2008 at 10 AM at the Victoria Hall Theater at 33 West Victoria Street in Santa Barbara (between State and Chapala Streets).
The picture is about a thief and his two dim-witted accomplices who arrive in a small town with a dog they mistreat. An ingenious boy battles to protect the dog and keep it away from the thieves. Unaware the animal is carrying a fortune in stolen jewels, the boy defends himself and dog at his fort hidden deep in the woods. Fortunately, the fort has an array of clever booby traps and devices the boy has created to fend off the thieves. Fun for the whole family, Diamond Dog Caper will delight kids of all ages with its fast-paced action and comedy. A trailer can be viewed at
Diamond Dog Caper stars French Stewart (3rd Rock From the Sun, Home Alone IV), Brittany Curran (Suite Life of Zach & Cody), John Farley (Blonde and Blonder), Kevin Farley (Waterboy), Kelly Perine (One on One); Luke Benward (How to Eat Fried Worms), and Cameron Monaghan (Click; The Three Investigators and the Secret of Skeleton Island). Special effects were supervised by Lance Wilhoite (Pirates of the Carribbean).

Director/Producer Mark Stouffer (Wild America) is the winner of 2 Emmy Awards (including Outstanding Achievement in Directing), 9 Emmy Award Nominations, a Directors Guild of America - Best Director Nomination, and over 75 prestigious, international awards. Mark Stouffer's productions include 4 features, 18 network specials, and 120 episodes of series television.