November 16, 2001
SONY DENIED INJUNCTION IN REGARD TO ZORRO
Sony was denied its request for an injunction to stop distribution of the syndicated television program “Queen of Swords.” Sony had alleged that the program infringed its copyright and trademark rights to Zorro. Sony had recently produced and distributed the feature film “The Mask of Zorro,” starring Antonio Banderas and Catherine Zeta-Jones.
Zorro is a fictional character originally created by pulp magazine writer Johnson McCulley. Movie rights were sold to Douglas Fairbanks Sr. who starred in a number of Zorro films including the silent film “The Mask of Zorro.” The copyrights to the original magazine story and the movie “The Mask of Zorro” have now expired.
Sony contended that the “Queen of Swords” TV program was similar to its “Mask of Zorro” film. The court disagreed, finding that the two were not similar in regard to the copyright protected aspects of Sony’s Zorro. The case illustrates how difficult it may be to prove infringement when another party creates material based on a public domain story or character. Sony Pictures Entertainment v. Fireworks Entertainment Group, 137 F. Supp. 2d 1177, 2001 U.S. Dist. LEXIS 4549 (C.D. Cal. 2001).
FLICKER MEDIA
Congratulations to our client Flicker Media (www.FlickerMedia.com) on its new internet advertising campaign for Hallmark. Flicker Media provides a new concept in Internet advertising: a targeted streaming ad-delivery system with on-line content and hyperlinks. The company has created ad campaigns for skateboarding magazine Beyond Extreme, as well as for Speedo, Diesel and a “Free Tibet” spot.
You can see the Hallmark Stories Flicker, "Memories" on:
www.scrapbook.com (home page)www.marthastewart.com (all channels except home page)www.iparentingstories.com (home page)Law Offices of Mark Litwak & Associates (www.marklitwak.com)
Friday, November 16, 2001
Monday, October 29, 2001
Upcoming Features on the Independent Film Channel (IFC)
October 29, 2001
Upcoming Features on the Independent Film Channel (IFC)
“The Poor & Hungry," an independent motion picture written and directed by our client Craig Brewer will be shown for the first time on the Independent Film Channel on November 21st. This wonderfully entertaining movie won the top prize for Best Digital Feature at the Hollywood Film Festival where it received rave reviews. It was shown at a number of other festivals and was released theatrically at the Malco Theater in Memphis, Tennessee where it has generated more than twice the receipts of competing films including "The Cell" and "Blood Simple."
"The Poor & Hungry" is a fictional story of a car thief in Memphis who falls in love with one of his victims - a young cellist. The picture features an incredible performance by actress Lindsey Roberts who is also one of our clients.
Also, showing next month on the IFC is “Mugshot” by our client by renowned photographer and illustrator Matt Mahurin. The film shared the top award at the Hampton's International Film Festival.
The Hollywood Reporter said: "Mahurin's feature debut highlights his signature camera work, which gives the effect of a quivering selective focus, granting this part thriller-part identity picture a formal intensity and authority rarely seen in otherwise economically beleaguered independent films." This visually stunning drama is the story of a white photographer whose life is taken over by one of his attackers after an amnesia-inducing mugging.
Upcoming Features on the Independent Film Channel (IFC)
“The Poor & Hungry," an independent motion picture written and directed by our client Craig Brewer will be shown for the first time on the Independent Film Channel on November 21st. This wonderfully entertaining movie won the top prize for Best Digital Feature at the Hollywood Film Festival where it received rave reviews. It was shown at a number of other festivals and was released theatrically at the Malco Theater in Memphis, Tennessee where it has generated more than twice the receipts of competing films including "The Cell" and "Blood Simple."
"The Poor & Hungry" is a fictional story of a car thief in Memphis who falls in love with one of his victims - a young cellist. The picture features an incredible performance by actress Lindsey Roberts who is also one of our clients.
Also, showing next month on the IFC is “Mugshot” by our client by renowned photographer and illustrator Matt Mahurin. The film shared the top award at the Hampton's International Film Festival.
The Hollywood Reporter said: "Mahurin's feature debut highlights his signature camera work, which gives the effect of a quivering selective focus, granting this part thriller-part identity picture a formal intensity and authority rarely seen in otherwise economically beleaguered independent films." This visually stunning drama is the story of a white photographer whose life is taken over by one of his attackers after an amnesia-inducing mugging.
Friday, September 07, 2001
Invitation to Special Screening
September 7, 2001
Invitation to Special Screening
Last year my client writer/director Craig Brewer completed his film “The Poor & Hungry” a story about a romance between a cello player and a car thief. The picture won the top prize for Best Digital Feature at the recent Hollywood Film Festival. It has received rave reviews and was in limited release at the Malco Theater in Memphis, Tennessee where it generated more than twice the receipts of such films as "The Cell" and "Blood Simple.” The film was also shown at the Austin Film Festival.
Most recently, the picture was shown at the Nashville Film Festival and won the Audience Choice, Independent Spirit and the Regal Cinema Best Feature Awards. The film has been licensed to the Independent Film Channel which will exhibit it nationwide next year.
You are invited to a special screening at the Director’s Guild sponsored by the Tennessee Film and Music Commission on September 13 at 7:00PM. The Director’s Guild is at 7920 Sunset Blvd. There is limited seating so please come early to assure yourself a seat.
Invitation to Special Screening
Last year my client writer/director Craig Brewer completed his film “The Poor & Hungry” a story about a romance between a cello player and a car thief. The picture won the top prize for Best Digital Feature at the recent Hollywood Film Festival. It has received rave reviews and was in limited release at the Malco Theater in Memphis, Tennessee where it generated more than twice the receipts of such films as "The Cell" and "Blood Simple.” The film was also shown at the Austin Film Festival.
Most recently, the picture was shown at the Nashville Film Festival and won the Audience Choice, Independent Spirit and the Regal Cinema Best Feature Awards. The film has been licensed to the Independent Film Channel which will exhibit it nationwide next year.
You are invited to a special screening at the Director’s Guild sponsored by the Tennessee Film and Music Commission on September 13 at 7:00PM. The Director’s Guild is at 7920 Sunset Blvd. There is limited seating so please come early to assure yourself a seat.
Wednesday, September 05, 2001
To End All Wars Premieres at Telluride Film Festival
September 5, 2001
To End All Wars Premieres at Telluride Film Festival
I have just returned from the Telluride Film Festival with my clients, Director David Cunningham and Producer Jack Hafer, where their compelling film “To End All Wars” was received by enthusiastic audiences. The film is based on an eyewitness account by author Ernest Gordon who was an Allied prisoner of war during WW II forced to build the “Railway of Death” for the Japanese. The picture stars Kiefer Sutherland and Robert Carlyle.
The film will be shown next at the Toronto Film Festival on September 14th (9:00 PM at the Uptown 1 theater) with special appearances by Kiefer Sutherland and Ernest Gordon, and again on September 15 (11:15 AM at the Varsity 4 & 5 theaters). There is also a press screening on September 13th at (9:30 AM). It will also be shown at the upcoming Mill Valley Film Festival on the evening of Oct. 6th. This is a film you do not want to miss. Additional info on the film can be found at www.toendallwars.com. Congratulations David and Jack.
To End All Wars Premieres at Telluride Film Festival
I have just returned from the Telluride Film Festival with my clients, Director David Cunningham and Producer Jack Hafer, where their compelling film “To End All Wars” was received by enthusiastic audiences. The film is based on an eyewitness account by author Ernest Gordon who was an Allied prisoner of war during WW II forced to build the “Railway of Death” for the Japanese. The picture stars Kiefer Sutherland and Robert Carlyle.
The film will be shown next at the Toronto Film Festival on September 14th (9:00 PM at the Uptown 1 theater) with special appearances by Kiefer Sutherland and Ernest Gordon, and again on September 15 (11:15 AM at the Varsity 4 & 5 theaters). There is also a press screening on September 13th at (9:30 AM). It will also be shown at the upcoming Mill Valley Film Festival on the evening of Oct. 6th. This is a film you do not want to miss. Additional info on the film can be found at www.toendallwars.com. Congratulations David and Jack.
Tuesday, August 21, 2001
NOT EVEN TOP DIRECTORS ARE IMMUNE TO ACCOUNTING DISPUTES
August 21, 2001
NOT EVEN TOP DIRECTORS ARE IMMUNE TO ACCOUNTING DISPUTES
Independent filmmakers often complain about creative accounting and the failure of distributors to pay them all that they are due. Veteran producers and directors frequently avoid such disputes because they have lawyers and agents to protect their interests, and because they have enough clout to insist on a better definition of profits, and can sometimes even secure a piece of the gross. But even top directors may encounter problems.
According to the Associated Press, Emmy-winning director James Burrows (“Cheers,” “Will & Grace”) is suing Warner Bros. Television for more than $5 million, contending that WB did not pay him his share of profits from the highly rated TV show “Friends.”
Burrows’ complaint alleges that WB promised him five percent of the net profits from “Friends'' and other compensation. According to Burrows, WB told the director that they planned on deducting payments to third parties from Burrows’ share of profits even though there was no explicit provision for such deductions in his agreement.WB declined comment.
NOT EVEN TOP DIRECTORS ARE IMMUNE TO ACCOUNTING DISPUTES
Independent filmmakers often complain about creative accounting and the failure of distributors to pay them all that they are due. Veteran producers and directors frequently avoid such disputes because they have lawyers and agents to protect their interests, and because they have enough clout to insist on a better definition of profits, and can sometimes even secure a piece of the gross. But even top directors may encounter problems.
According to the Associated Press, Emmy-winning director James Burrows (“Cheers,” “Will & Grace”) is suing Warner Bros. Television for more than $5 million, contending that WB did not pay him his share of profits from the highly rated TV show “Friends.”
Burrows’ complaint alleges that WB promised him five percent of the net profits from “Friends'' and other compensation. According to Burrows, WB told the director that they planned on deducting payments to third parties from Burrows’ share of profits even though there was no explicit provision for such deductions in his agreement.WB declined comment.
Wednesday, July 25, 2001
HOLLYWOOD FILM FESTIVAL & CONFERENCE
July 25, 2001
HOLLYWOOD FILM FESTIVAL & CONFERENCE
Congratulations to our clients Charles Acosta and Dov Kelemer whose films were invited to screen at the upcoming Hollywood Film Festival.
Producer Charles Acosta’s PENDULUM will screen in the Studio Theater on the Paramount lot on August 4 at 7:00 PM. This picture is a terrific thriller starring Rachel Hunter and James Russo.
Dov Kelemer’s WON’T ANYBODY LISTEN is a documentary that chronicles the lives of a struggling rock band and the brutal realities of the record industry. It screens at the Raleigh Studios, Chaplin Theater at 7:00 PM on August 4.
I am moderating a panel on financing film on August 2 from 10:00 AM to11:45 at the Hollywood Roosevelt Hotel. I am also participating as a speaker on the topic of Documentary Filmmaking for the New Millennium. This panel is also at the Hollywood Roosevelt hotel and will be on August 3rd from 3:00 PM to 4:30 PM.
The Hollywood Film Festival and Conference runs from August 2-6. Additional information can be found at http://hollywoodfestival.com.
HOLLYWOOD FILM FESTIVAL & CONFERENCE
Congratulations to our clients Charles Acosta and Dov Kelemer whose films were invited to screen at the upcoming Hollywood Film Festival.
Producer Charles Acosta’s PENDULUM will screen in the Studio Theater on the Paramount lot on August 4 at 7:00 PM. This picture is a terrific thriller starring Rachel Hunter and James Russo.
Dov Kelemer’s WON’T ANYBODY LISTEN is a documentary that chronicles the lives of a struggling rock band and the brutal realities of the record industry. It screens at the Raleigh Studios, Chaplin Theater at 7:00 PM on August 4.
I am moderating a panel on financing film on August 2 from 10:00 AM to11:45 at the Hollywood Roosevelt Hotel. I am also participating as a speaker on the topic of Documentary Filmmaking for the New Millennium. This panel is also at the Hollywood Roosevelt hotel and will be on August 3rd from 3:00 PM to 4:30 PM.
The Hollywood Film Festival and Conference runs from August 2-6. Additional information can be found at http://hollywoodfestival.com.
Monday, June 04, 2001
Dept. of Commerce Issues Report on Runaway Production
June 4, 2001
Dept. of Commerce Issues Report on Runaway Production
Last year Congress asked the U.S. Dept. of Commerce to study the impact of runaway productions on the U.S. film industry. The report has now been completed and it findings are no big surprise: the number of films shot abroad for economic reasons increased dramatically from 100 films in 1990 to 285 films in 1998, an increase of 185% over eight years.
The report states that there are many reasons that American films are increasingly produced abroad including incentive programs offered by foreign governments. An entire 15 page chapter is devoted to the incentive programs offered by leading destination countries. The reports contains a useful two-page chart detailing the 30 programs offered in Canada.
The report is titled “The Migration of U.S. Film and Television Production: Impact of Runaways on Workers and Small Business in the U.S. Film Industry,U.S. Dept. of Commerce,” and is available at http://www.ita.doc.gov/media/filmreport.htm
Congratulations to Our Clients
With the threat of possible WGA and SAG strikes, many of our filmmaking clients have been rushing to get into production before possible strikes could take place. Congratulations to producer Harvey Kahn who began production of “Pressure.” The feature is a thriller starring Kerr Smith (Dawson’s Creek) and Angela Featherstone, and is directed by our client Richard Gale (“The Proposal”) and written by our clients Gale and Craig Brewer.
Writer/Director Daniel McCarthy has began production on the feature film “Irish Eyes Are Crying” a drama starring Daniel Baldwin. The shoot takes place in New Brunswick, Canada, and is produced by McCarthy and Julian Valdes.Congratulations also to Dennis Fallon who begins production June 4th on “Silence” starring Christine Swanson and Vincent Spano. The shoot takes place in Kansas City, Missouri and is directed by Tom Whit
Dept. of Commerce Issues Report on Runaway Production
Last year Congress asked the U.S. Dept. of Commerce to study the impact of runaway productions on the U.S. film industry. The report has now been completed and it findings are no big surprise: the number of films shot abroad for economic reasons increased dramatically from 100 films in 1990 to 285 films in 1998, an increase of 185% over eight years.
The report states that there are many reasons that American films are increasingly produced abroad including incentive programs offered by foreign governments. An entire 15 page chapter is devoted to the incentive programs offered by leading destination countries. The reports contains a useful two-page chart detailing the 30 programs offered in Canada.
The report is titled “The Migration of U.S. Film and Television Production: Impact of Runaways on Workers and Small Business in the U.S. Film Industry,U.S. Dept. of Commerce,” and is available at http://www.ita.doc.gov/media/filmreport.htm
Congratulations to Our Clients
With the threat of possible WGA and SAG strikes, many of our filmmaking clients have been rushing to get into production before possible strikes could take place. Congratulations to producer Harvey Kahn who began production of “Pressure.” The feature is a thriller starring Kerr Smith (Dawson’s Creek) and Angela Featherstone, and is directed by our client Richard Gale (“The Proposal”) and written by our clients Gale and Craig Brewer.
Writer/Director Daniel McCarthy has began production on the feature film “Irish Eyes Are Crying” a drama starring Daniel Baldwin. The shoot takes place in New Brunswick, Canada, and is produced by McCarthy and Julian Valdes.Congratulations also to Dennis Fallon who begins production June 4th on “Silence” starring Christine Swanson and Vincent Spano. The shoot takes place in Kansas City, Missouri and is directed by Tom Whit
Thursday, March 29, 2001
SELF DEFENSE FOR SCREENWRITERS
March 29, 2001
NEW ARTICLE: SELF DEFENSE FOR SCREENWRITERS
As an entertainment attorney I am often called upon to assist writers who have gotten themselves into trouble because they don’t understand how their work infringes the rights of others. A writer who learns the fine points of the law through trial and error is receiving an expensive education. I have written an article that was recently published by Screentalk Magazine (www.screentalk.org) and is now posted on my website.
TROUBLE FROM PEOPLE PORTRAYED IN YOUR WORK
I. FICTIONAL CHARACTERS
If your script or film contains fictional characters -- characters from your imagination -- you generally do not need to obtain any permissions or releases. However, if there is a chance that the public could mistake your imaginary characters for real people, you could be liable if you have thereby infringed their rights.
You can protect yourself by making sure your fictional characters cannot be mistaken for real people. Give characters unusual names that no living individual would have. Check the phone book to see if any people with your character’s name reside at the location portrayed in your story. If there is a person in that community with the same name or a similar one, consider changing the locale or setting the story in a fictional locale. Add a disclaimer at the beginning of the film stating that any resemblance to persons living or dead is purely coincidental.
To read the rest of the article go to: www.marklitwak.com
NEW ARTICLE: SELF DEFENSE FOR SCREENWRITERS
As an entertainment attorney I am often called upon to assist writers who have gotten themselves into trouble because they don’t understand how their work infringes the rights of others. A writer who learns the fine points of the law through trial and error is receiving an expensive education. I have written an article that was recently published by Screentalk Magazine (www.screentalk.org) and is now posted on my website.
TROUBLE FROM PEOPLE PORTRAYED IN YOUR WORK
I. FICTIONAL CHARACTERS
If your script or film contains fictional characters -- characters from your imagination -- you generally do not need to obtain any permissions or releases. However, if there is a chance that the public could mistake your imaginary characters for real people, you could be liable if you have thereby infringed their rights.
You can protect yourself by making sure your fictional characters cannot be mistaken for real people. Give characters unusual names that no living individual would have. Check the phone book to see if any people with your character’s name reside at the location portrayed in your story. If there is a person in that community with the same name or a similar one, consider changing the locale or setting the story in a fictional locale. Add a disclaimer at the beginning of the film stating that any resemblance to persons living or dead is purely coincidental.
To read the rest of the article go to: www.marklitwak.com
Monday, January 08, 2001
TIGER WOODS LOSES TRADEMARK AND RIGHT OF PUBLICITY ACTION AGAINST ARTIST WHO CREATED LIMITED EDITION POSTER DEPICTING HIM
January 8, 2001
TIGER WOODS LOSES TRADEMARK AND RIGHT OF PUBLICITY ACTION AGAINST ARTIST WHO CREATED LIMITED EDITION POSTER DEPICTING HIM
Rick Rush, a sports artist, created a print featuring renowned golfer Tiger Woods. Woods licensing agent, ETW Corp., brought suit to stop distribution of this print.
The court found that ETW had failed to show that it had any trademark rights to the image of Tiger Woods since his image was not used as a mark. While a specific image or photo of a person can function as a trademark if it is consistently used to identify a source of product, this does not mean that any of a variety of different images of a person will each be given protection as a trademark. The court also dismissed the action for violation of right of publicity under Ohio law stating that the artist’s expression was constitutionally protected under the First Amendment.
CHANGES IN EMPLOYMENT OF MINORS
Minor and their parents planning a career in show biz should be aware of some recent changes in California law. As of Jan. 1, 2000, money must be set aside in a blocked account for all children working in the entertainment industry. This includes musicians, actors and those working in non-union productions. In the past this requirement only applied to court-approved contracts. SAG's website contains useful information including the SAG/AFTRA Young Performers Handbook (http://www.sag.org/youngpersons.html). Parents can have their questions answered by calling the SAG Child Actor Hotline.
TIGER WOODS LOSES TRADEMARK AND RIGHT OF PUBLICITY ACTION AGAINST ARTIST WHO CREATED LIMITED EDITION POSTER DEPICTING HIM
Rick Rush, a sports artist, created a print featuring renowned golfer Tiger Woods. Woods licensing agent, ETW Corp., brought suit to stop distribution of this print.
The court found that ETW had failed to show that it had any trademark rights to the image of Tiger Woods since his image was not used as a mark. While a specific image or photo of a person can function as a trademark if it is consistently used to identify a source of product, this does not mean that any of a variety of different images of a person will each be given protection as a trademark. The court also dismissed the action for violation of right of publicity under Ohio law stating that the artist’s expression was constitutionally protected under the First Amendment.
CHANGES IN EMPLOYMENT OF MINORS
Minor and their parents planning a career in show biz should be aware of some recent changes in California law. As of Jan. 1, 2000, money must be set aside in a blocked account for all children working in the entertainment industry. This includes musicians, actors and those working in non-union productions. In the past this requirement only applied to court-approved contracts. SAG's website contains useful information including the SAG/AFTRA Young Performers Handbook (http://www.sag.org/youngpersons.html). Parents can have their questions answered by calling the SAG Child Actor Hotline.
Sunday, April 16, 2000
New California Law Seeks to Protect Minors and Extend Rights of Publicity
Spring 2000
NEW CALIFORNIA LAWS SEEK TO PROTECT MINORS AND EXTEND RIGHTS OF PUBLICITY
California Governor Gray Davis has recently signed several pieces of legislation affecting the entertainment industry. Entertainment employers are now required to pay 15 percent of a minor's personal-services earnings into a trust account. Minors can take control of trust account monies when they turn 18. The Celebrity Image Protection Act increases the right of publicity enforceable by a celebrity's heir from 50 years after death to 70 years after death.
HOW TO THINK LIKE AN INVESTOR
The most recent edition of MovieMaker magazine contains an article I have written titled "How to Attract Capital to Your Movie by Thinking Like an Investor." The piece explains how financiers evaluate projects and decide which ones to back. It includes a checklist I developed for movie investors. The article has been posted on my website: www.marklitwak.com
INTERNET DISTRIBUTION - THE PROMISE AND THE PITFALLS
Here is an excerpt from an article I have written on Internet Distribution of motion pictures. A more extensive version will be appear in the next issue of MovieMaker Magazine. After publication the article will be posted on my website.
With the rapid development of web sites designed to distribute motion pictures directly to consumers, many producers are being asked to grant "Internet" rights to their films. The grant of such rights raises a number of new and interesting issues.
The distribution agreement needs to define "Internet" rights. Is the distributor selling cassettes via the Internet? If so, the right is in the nature of a home video right--the Internet is just being used to market cassettes. But will the grant to an Italian company permit it to sell videocassettes to a buyer who logs onto the Internet from France?
Another "Internet" right is the right to distribute a motion picture via streaming media. Here the distributor is actually transmitting the motion picture over the Internet. This has been called "Netcasting." In the next few years new technologies will enable an increasing number of computer users to watch movies over the Internet with viewing quality comparable to television. Thus, movies can be distributed directly to the end user, bypassing such traditional intermediaries as the broadcast networks, home video retailers, and cable operators.
The economic viability of Internet distribution is unproven at this time. Keep in mind that traditional distributors perform an important marketing function that an Internet distributor may not be able to replace. While Internet distribution is of questionable profitability, there is no doubt that the distribution of your film over the Internet can jeopardize agreements with traditional distributors. If HBO is willing to license your film, how do you think the cable channel will react when you try to reserve the right to simultaneously distribute your movie over the Internet?
For the aforementioned reasons, it is prudent for producers to hold onto their Internet rights until the dust settles. If a distributor insists on obtaining Internet rights, or if you want to be a trailblazer, consider the following:
EXCLUSIVITY: Will the grant of rights be on an exclusive or nonexclusive basis? At this time it is not clear which Internet sites will prosper and which ones will crash and burn. If you grant exclusive rights to a company that goes out of business, your Internet rights may be tied up in bankruptcy proceedings.
TERRITORY: Territory becomes an almost meaningless term when applied to Internet distribution. Anyone with a computer anywhere in the world can log onto the Internet and download data from computer servers wherever they are located. Even if you attempt to restrict distribution, how can you or the distributor prevent distribution outside the territory?
ROYALTIES: No standard has been established as to how to divide revenue from Internet distribution. A popular model for Internet companies is to give information away for free, and generate revenue from the sale of advertising and ancillary services. If your movie is being given away for free, and the Internet distributor retains all revenue from advertising, how do you benefit?
The deals that have been concluded to date are all over the spectrum. Broadcast.com licensed 50 Trimark titles as part of a broader pact in which Broadcast.com acquired a $4 million dollar stake in Trimark. Sightsound.com acquired a limited 30 day pay-per-view Internet window to Artisan Entertainment's Pi in a straight licensing deal. MovieFlix.com offers about 150 features acquired from indie distributors. The company pays a one time license fee. The site is advertiser supported and sells movie memorabilia.
GRANT OF RIGHTS: Do you have the authority to grant Internet rights? Do your contracts to obtain the script, music and stock footage grant you the right to distribute the work over the Internet? Note that many contracts don't explicitly grant "Internet" rights because when the contracts were drafted no one was thinking in terms of the Internet as a distribution media.
If, after reviewing the above issues, you are inclined to license Internet rights, consider the following: many distributors seeking Internet rights have never distributed anything over the Internet. Such companies may be warehousing your rights in the hope that they will become valuable some day. That day may not be soon. Artisan Entertainment's Netcast of Pi attracted an on-line audience of only 100.
NEW CALIFORNIA LAWS SEEK TO PROTECT MINORS AND EXTEND RIGHTS OF PUBLICITY
California Governor Gray Davis has recently signed several pieces of legislation affecting the entertainment industry. Entertainment employers are now required to pay 15 percent of a minor's personal-services earnings into a trust account. Minors can take control of trust account monies when they turn 18. The Celebrity Image Protection Act increases the right of publicity enforceable by a celebrity's heir from 50 years after death to 70 years after death.
HOW TO THINK LIKE AN INVESTOR
The most recent edition of MovieMaker magazine contains an article I have written titled "How to Attract Capital to Your Movie by Thinking Like an Investor." The piece explains how financiers evaluate projects and decide which ones to back. It includes a checklist I developed for movie investors. The article has been posted on my website: www.marklitwak.com
INTERNET DISTRIBUTION - THE PROMISE AND THE PITFALLS
Here is an excerpt from an article I have written on Internet Distribution of motion pictures. A more extensive version will be appear in the next issue of MovieMaker Magazine. After publication the article will be posted on my website.
With the rapid development of web sites designed to distribute motion pictures directly to consumers, many producers are being asked to grant "Internet" rights to their films. The grant of such rights raises a number of new and interesting issues.
The distribution agreement needs to define "Internet" rights. Is the distributor selling cassettes via the Internet? If so, the right is in the nature of a home video right--the Internet is just being used to market cassettes. But will the grant to an Italian company permit it to sell videocassettes to a buyer who logs onto the Internet from France?
Another "Internet" right is the right to distribute a motion picture via streaming media. Here the distributor is actually transmitting the motion picture over the Internet. This has been called "Netcasting." In the next few years new technologies will enable an increasing number of computer users to watch movies over the Internet with viewing quality comparable to television. Thus, movies can be distributed directly to the end user, bypassing such traditional intermediaries as the broadcast networks, home video retailers, and cable operators.
The economic viability of Internet distribution is unproven at this time. Keep in mind that traditional distributors perform an important marketing function that an Internet distributor may not be able to replace. While Internet distribution is of questionable profitability, there is no doubt that the distribution of your film over the Internet can jeopardize agreements with traditional distributors. If HBO is willing to license your film, how do you think the cable channel will react when you try to reserve the right to simultaneously distribute your movie over the Internet?
For the aforementioned reasons, it is prudent for producers to hold onto their Internet rights until the dust settles. If a distributor insists on obtaining Internet rights, or if you want to be a trailblazer, consider the following:
EXCLUSIVITY: Will the grant of rights be on an exclusive or nonexclusive basis? At this time it is not clear which Internet sites will prosper and which ones will crash and burn. If you grant exclusive rights to a company that goes out of business, your Internet rights may be tied up in bankruptcy proceedings.
TERRITORY: Territory becomes an almost meaningless term when applied to Internet distribution. Anyone with a computer anywhere in the world can log onto the Internet and download data from computer servers wherever they are located. Even if you attempt to restrict distribution, how can you or the distributor prevent distribution outside the territory?
ROYALTIES: No standard has been established as to how to divide revenue from Internet distribution. A popular model for Internet companies is to give information away for free, and generate revenue from the sale of advertising and ancillary services. If your movie is being given away for free, and the Internet distributor retains all revenue from advertising, how do you benefit?
The deals that have been concluded to date are all over the spectrum. Broadcast.com licensed 50 Trimark titles as part of a broader pact in which Broadcast.com acquired a $4 million dollar stake in Trimark. Sightsound.com acquired a limited 30 day pay-per-view Internet window to Artisan Entertainment's Pi in a straight licensing deal. MovieFlix.com offers about 150 features acquired from indie distributors. The company pays a one time license fee. The site is advertiser supported and sells movie memorabilia.
GRANT OF RIGHTS: Do you have the authority to grant Internet rights? Do your contracts to obtain the script, music and stock footage grant you the right to distribute the work over the Internet? Note that many contracts don't explicitly grant "Internet" rights because when the contracts were drafted no one was thinking in terms of the Internet as a distribution media.
If, after reviewing the above issues, you are inclined to license Internet rights, consider the following: many distributors seeking Internet rights have never distributed anything over the Internet. Such companies may be warehousing your rights in the hope that they will become valuable some day. That day may not be soon. Artisan Entertainment's Netcast of Pi attracted an on-line audience of only 100.
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