April 7, 2004
In this newsletter:
MARK'S NEWEST BOOK, "RISKY BUSINESS," ABOUT TO BE PUBLISHED
"Risky Business" is the comprehensive nuts-and-bolts guide to setting up an independent production project. Starting with the basic organization of the company and the preparation of production, collaboration, and screenplay agreements, it covers in detail everything from raising money via loans, presales, and investors through finding, contracting with, and policing the finished project's distributors. We will receive copies from the publisher any day now. The book is not yet in bookstores. To order visit the bookstore on Mark's website: www.marklitwak.com/store.
The complete table of contents is below:
PREFACE FILMMAKER SELF DEFENSE CHECKLIST ORGANIZING YOUR COMPANY Choice of Business Entity Sole Proprietorship General Partnership Limited Partnership Corporation Limited Liability Company (LLC)
COLLABORATIONS AND CO-PRODUCTIONS International Co-Productions Production Incentives FINANCING
INDEPENDENT FILMS Loans Contract: Promissory Note Contract: Promissory Note with Guarantee Borrowing Against Pre-sale Agreements Investor Financing Registration and Exemptions 504 Offering 505 Offering 506 Offering Intrastate Offering Exemption Accredited Investor Exemption California Limited Offering Exemption Anti-Fraud Provisions Distributor Supplied Financing Finders
ATTRACTING INVESTORS Checklist for Film Investors
TACTICS AND STRATEGY IN ARRANGING DISTRIBUTION 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 Investigate the Distributor
THE DISTRIBUTION AGREEMENT Principle Terms of a Distribution Agreement Territory Media Term Distribution Fee Distribution and Marketing Expenses Advances and Guarantees Consultation Rights Warranties and Representations Accounting Arbitration Insurance Termination Assignment Allocation of Package Revenue Security Interest Governing Law Territorial Minimums Access to Master Materials Return of Materials Delivery
WHEN A DISTRIBUTOR DEFAULTS Selecting a Distributor Creative Accounting Conducting an Audit How Revenue is Divided Creative Accounting Pitfalls Accounting Terms Defensive Tactics A Filmmaker’s Bill of Rights
LOOKING FORWARD APPENDIX - DISTRIBUTION Delivery Checklist Certificate of Origin Statement of Prior Distribution Statement of Distribution Restrictions and Obligations Major Deal Points: Acquisition/Distribution Agreement Copyright Security Agreement
GLOSSARY OF TERMS
The book also includes the following template contracts:
CONTRACTS Co-Production Agreement Distributor Sales Agency Agreement Finder Agreement International Distribution License Agreement Lab Access Letter International Distribution Agreement (Filmmaker-friendly version) International Distribution License Agreement
Wednesday, April 07, 2004
Thursday, April 01, 2004
TIMES SQUARE BUILDING AND BILLBOARD OWNERS GET A SECOND SHOT AT SONY
April 1, 2004
In this newsletter:
TIMES SQUARE BUILDING AND BILLBOARD OWNERS GET A SECOND SHOT AT SONY
The owners of buildings and billboards in Times Square filed claims against Sony Pictures for altering the way the building and billboards appeared in real life at the time the movie was filmed. In “Spider Man,” images of the buildings and billboards were digitally altered.
Owners of the buildings and billboards claim that in the movie scenes of Times Square, Sony digitally inserted other companies’ ads and signs in order to “generate revenue.” Sony, on the other hand, argues that the reason they changed the appearance of Times Square is in order to create a more “artistically satisfying [in] appearance.” The real appearance of Times Square was too “advertising-encrusted” for the movie.
Sony scanned the images of the Times Square buildings and billboards with a laser light beam, and then digitally created new images for the movie. Owners of the buildings and billboards claim that under New York state law, this digital alteration violated their trademark and trade dress rights and amounted to “trespass.” They also filed federal law claims against Sony.
Both federal and state law claims of the Times Square’s owners were dismissed by federal District Judge Richard Owen. Times Square’s owners appealed and the federal appellate court affirmed the dismissal of federal causes of action. However, in a Summary Order marked “May Not be Cited as Precedential Authority,” the appellate court has vacated Judge Owen’s dismissal of the owners’ state law claims “with prejudice” and remanded the state law claims with instructions that they be dismissed “without prejudice.” For the owners, dismissal “without prejudice” means that they may file their claims in state court, if they decide to do so.
In its decision, the Court of Appeals concluded that the owners’ state law claims should not be dismissed because their allegations of trespass were “an unsettled question of state law.” The case was dismissed before Sony could show that its digital alterations had “artistic relevance” to the movie and were therefore protected under the First Amendment. Sherwood 48 Associates v. Sony Corp., 76 Fed.Appx. 389, 2003 U.S.App.LEXIS 20106 (2nd Cir. 2003).
CLARIFICATION
In my last newsletter, I discussed the arbitration award won by my client, Florida Film Investment Company against RGH/Lions Share. Mention was made of a license between RGH/Lions Share to a home video label, Singa Home Entertainment, which is also managed by Eric Louzil a principal of RGH/Lions Share. Singa, in turn, attempted to license the film to Pathfinder Pictures, which is not a company affiliated or connected in any way with RGH/Lions Share, Singa or Eric Louzil. I want to make it clear to my readers that Pathfinder was not a party to the arbitration proceeding, and was not accused of any wrongdoing in this matter at all.
In this newsletter:
TIMES SQUARE BUILDING AND BILLBOARD OWNERS GET A SECOND SHOT AT SONY
The owners of buildings and billboards in Times Square filed claims against Sony Pictures for altering the way the building and billboards appeared in real life at the time the movie was filmed. In “Spider Man,” images of the buildings and billboards were digitally altered.
Owners of the buildings and billboards claim that in the movie scenes of Times Square, Sony digitally inserted other companies’ ads and signs in order to “generate revenue.” Sony, on the other hand, argues that the reason they changed the appearance of Times Square is in order to create a more “artistically satisfying [in] appearance.” The real appearance of Times Square was too “advertising-encrusted” for the movie.
Sony scanned the images of the Times Square buildings and billboards with a laser light beam, and then digitally created new images for the movie. Owners of the buildings and billboards claim that under New York state law, this digital alteration violated their trademark and trade dress rights and amounted to “trespass.” They also filed federal law claims against Sony.
Both federal and state law claims of the Times Square’s owners were dismissed by federal District Judge Richard Owen. Times Square’s owners appealed and the federal appellate court affirmed the dismissal of federal causes of action. However, in a Summary Order marked “May Not be Cited as Precedential Authority,” the appellate court has vacated Judge Owen’s dismissal of the owners’ state law claims “with prejudice” and remanded the state law claims with instructions that they be dismissed “without prejudice.” For the owners, dismissal “without prejudice” means that they may file their claims in state court, if they decide to do so.
In its decision, the Court of Appeals concluded that the owners’ state law claims should not be dismissed because their allegations of trespass were “an unsettled question of state law.” The case was dismissed before Sony could show that its digital alterations had “artistic relevance” to the movie and were therefore protected under the First Amendment. Sherwood 48 Associates v. Sony Corp., 76 Fed.Appx. 389, 2003 U.S.App.LEXIS 20106 (2nd Cir. 2003).
CLARIFICATION
In my last newsletter, I discussed the arbitration award won by my client, Florida Film Investment Company against RGH/Lions Share. Mention was made of a license between RGH/Lions Share to a home video label, Singa Home Entertainment, which is also managed by Eric Louzil a principal of RGH/Lions Share. Singa, in turn, attempted to license the film to Pathfinder Pictures, which is not a company affiliated or connected in any way with RGH/Lions Share, Singa or Eric Louzil. I want to make it clear to my readers that Pathfinder was not a party to the arbitration proceeding, and was not accused of any wrongdoing in this matter at all.
Wednesday, March 31, 2004
RGH/LIONS SHARE ARBITRATION AWARD
March 31, 2004
In this newsletter:
RGH/LIONS SHARE ARBITRATION AWARD
In a recent newsletter, I mentioned an arbitration award I obtained against RGH/Lions Share on behalf of our client, the Florida Film Investment Company. Mr. Eric Louzil, who manages RGH/Lions Share as well as Echelon Entertainment and Singa Home Entertainment, has objected, complaining that I did not describe the arbitrator’s award accurately and as a result his reputation has been tarnished.
Mr. Louzil objects to my statement that the arbitrator found that his company had failed to provide "accurate" accountings. Indeed, the exact words the arbitrator used were that RGH/Lions Share had failed to provide “complete and timely accountings.” The arbitrator also noted that RGH/Lions Share failed to provide backup of its expenses. I am not sure how an incomplete and late accounting could possibly be accurate, but let’s set the record straight.
Mr. Louzil claims that it is not fair to say that his company had engaged in numerous incidents of wrongdoing. The arbitrator specifically found that RGH/Lions Share failed to provide complete and timely accountings, reported questionable expenses, refused to acknowledge my client’s cancellation of the distribution agreement, failed to return materials, entered into an invalid agreement with Singa Home Entertainment that appeared to be a sham transaction, and tortiously interfered with my client’s attempt to enter into a home video distribution deal with another distributor. Sounds like multiple acts of wrongdoing to me.
Another objection concerns my statement that RGH/Lions Share attempted to sell DVD rights to Pathfinder Pictures (which is not a company managed by Mr. Louzil). Apparently, the agreement was between another of Mr. Louzil’s companies, Singa Home Entertainment, and Pathfinder. So it appears that RGH/Lions Share contracted with my client, and then assigned the home video rights to Singa, which in turn attempted to license the rights to Pathfinder. So Mr. Louzil may be technically correct that the agreement was with Singa, not RGH/Lions Share. Of course, we should also mention that the arbitrator specifically found that RGH/Lions Share agreement with Singa was invalid, and had “all the appearances of a sham transaction between related entities serving simply to dilute the proceeds from the distribution and the potential revenues.”
Mr. Louzil is upset that I wrote that “damages” were awarded in the amount of $75,000. In fact, the award was for $50,000 in damages, $25,052.52 in reimbursement of attorney fees, costs and arbitration expenses, for a total award against RGH/Lions Share of $75,052.52. I am not sure, from the perspective of Mr. Louzil’s reputation, how this makes any difference but perhaps he thinks that people will think more highly of his company if a portion of the award is for reimbursement of attorney fees and costs rather than damages.
It appears that Mr. Louzil is not aware that in defamation actions, truth is an absolute defense and a defendant is not required to prove the literal truth of an allegedly defamatory statement in every detail, so long as the imputation is substantially true so as to justify the gist or sting of the statement. Southwell v. Mallery, Stern & Warford 194 Cal. App. 3d 140, 239 Cal. Rptr. 371 (2nd Dist., 1987).
In order make sure that our readers are precisely and accurately informed, we are publishing this correction. Because we don’t want to quibble over words chosen to describe the award, here is a verbatim copy of the arbitrator’s award:
AFMA INTERNATIONAL ARBITRATION TRIBUNAL
In the matter of the Arbitration between AFMA Arbitration No. 03?62
FLORIDA FILM INVESTMENT COMPANY and RGH/LIONS SHARE PICTURES STATEMENT OF DECISION AND AWARD OF ARBITRATOR T
his matter was heard on February 2, 2004, and argued and submitted for decision on February 9, 2004. Roy G. Rifkin, Esq. was duly appointed as Arbitrator pursuant to the parties’ agreement to arbitrate contained in the agreement dated as of March 2, 2000, and the AFMA Rules for International Arbitration effective September 19, 2002 (“Rules”).
Mark Litwak, Esq. appeared as counsel for Claimant Florida Film Investment Company (“Florida Film”), and Eric Louzil appeared on behalf of Respondent RGH/Lions Share Pictures (“RGH”).
The Arbitrator, having considered the evidence and arguments submitted, makes the following Findings of Fact and Conclusions of Law and Award:
FINDINGS OF FACT
1 . Claimant is the producer of a motion picture entitled Oliver Twisted (the “Picture”).
2. Respondent is in the business of motion picture distribution.
3. The parties entered into an agreement (the “Agreement”) dated as of March 2, 2002, for the worldwide distribution of the picture by Respondent.
4. The Agreement provides, inter alia, for: (a) Written approval by Claimant of any sub?distribution agreements (paragraph 3(e)); (b) The allocation of gross receipts (paragraph 14); (c) Recoupable expenses (paragraph 15); (d) Rendering of accountings by Respondent to Claimant (paragraph 21); (e) Claimant’s right to cancel the Agreement based on failure to generate $100,000 net proceeds to Claimant in the first year of the Agreement (paragraph 17) (“performance clause”); (f) Arbitration of disputes (paragraph 24); and (g) Attorney’s fees and expenses to the prevailing party (paragraph 25).
5. Respondent reported to Claimant total gross receipts in the amount of $8,232.89 from the distribution of the Picture.
6. Respondent reported to Claimant expenses in the amount of $36,460.11 in connection with the distribution of the Picture.
7. Claimant canceled the Agreement pursuant to the performance clause by letter dated February 22, 2003.
8. As of February 22, 2003, Claimant demanded from Respondent the return of all materials in connection with the Picture. Respondent did not return any materials.
9. By agreement dated as of January 15, 2003, Respondent purported to license domestic home video rights to the Picture to Singa Home Entertainment (“Singa”). Singa is affiliated with Respondent. Claimant was not aware of and did not consent to the distribution agreement between Respondent and Singa.
10. In or about April 2003 Claimant had an agreement to license the Picture for domestic home video (including DVD) to BCI Eclipse. The transaction was aborted due to the assertion by Respondent and/or Singa that it had the rights to the Picture.
CONCLUSIONS OF LAW
1. Respondent was in violation of the terms of the Agreement by its failure to provide complete and timely accountings of its distribution activities. Respondent never provided the backup which Claimant requested regarding reported expenses. Furthermore, many of the reported expenses are questionable, including, but not limited to, $2,000 for advertising, $4,000 for M&E tracks, $4,000 for poster, and $500 each for legal/handling fee in connection with various territories. However, even assuming the invalidity of many of the expense items reported, Claimant has not established that it was damaged by any of these breaches. For example, no evidence was offered challenging the market expenses reported by Respondent, under paragraph 15(i) of the Agreement, in the amount of $10,000; and the evidence does not support a finding that Respondent received gross receipts in excess of the $8,232.89 reported. Accordingly, even if all of the questionable distribution expenses were to be disallowed, Claimant still would not be entitled to any producer’s revenues under the terms of the Agreement.
2. Claimant was entitled to cancel the Agreement under the terms of the performance clause because the Picture did not generate $100,000 in producer’s revenues the first year. Such cancellation was effective as of February 22, 2003. Respondent’s refusal to acknowledge the cancellation and return the materials was unwarranted. Respondent’s assertion of prior breach by Claimant in connection with Claimant’s limited attempt to market DVDs of the Picture is not compelling as Respondent had knowledge of and impliedly consented to such activity; and, in any case, there is no evidence of such activity having any detrimental commercial effect on Respondent’s distribution activities. However, Claimant offered no evidence establishing that Respondent’s failure to recognize the cancellation of the Agreement and failure to return the materials proximately caused any damage to Claimant. See Postal Instant Press v. Sealy, 43 Cal.App.4th 1704 (1996). Accordingly, while Claimant is entitled to the return of the materials, it is not entitled to any monetary damages in connection with this claim.
3. Respondent’s distribution agreement with Singa is invalid. It was entered into without the consent of Claimant as required by the Agreement; it exceeded the allowable term of years; and it has all the appearances of a sham transaction between related entities serving simply to dilute the proceeds from the distribution and the potential revenues.
4. Respondent tortiously interfered with Claimant’s domestic home video distribution deal with BCI Eclipse. Respondent had no legitimate basis to deny Claimant’s cancellation of the Agreement nor to rely upon Respondent’s distribution agreement with Singa. Accordingly, Respondent had no reasonable basis to assert to BCI Eclipse its own rights to the Picture as of April 2003. Although the evidence of actual damage based on Claimant’s loss of the distribution deal with BCI Eclipse is somewhat sketchy, there is support for a finding that, had Respondent not interfered with the deal, revenues from the home video distribution of the Picture to the producer would approximate $50,000 (see Exhibits 16 and 25).
AWARD
1. The Agreement dated as of March 2, 2000 is terminated effective as of February 22, 2003. Respondent RGH/Lions Share Pictures retains no rights in the motion picture Oliver Twisted, and Claimant Florida Film Investment Company is free to deal with the Picture as it sees fit in all territories.
2. Respondent RGH/Lions Share Pictures is permanently enjoined from advertising, selling, distributing, manufacturing, or shipping the motion picture Oliver Twisted in any media or any territories whatsoever.
3. Respondent RGH/Lions Share Pictures is ordered to deliver immediately to Claimant Florida Film Investment Company at the office of its counsel, Mark Litwak, Esq. any and all materials in its possession, custody, or control relating to the motion picture Oliver Twisted including, but not limited to, masters, submasters, negatives, videotapes, video disks, stills, cue sheets, boxes, posters, photographs, artwork, advertising material, access letters, and distribution agreements.
4. Respondent RGH/Lions Share Pictures shall pay to Claimant Florida Film Investment Company the following: (a) damages in the amount of $50,000.00; (b) attorney’s fees in the amount of $22,702.52; (c) costs in the amount of $850.00; and (d) reimbursement for one?half of the compensation and expenses of the Arbitrator in the amount of $1,500.00; for a total monetary award in the amount of $75,052.52.
DATED: February 12, 2004
In this newsletter:
RGH/LIONS SHARE ARBITRATION AWARD
In a recent newsletter, I mentioned an arbitration award I obtained against RGH/Lions Share on behalf of our client, the Florida Film Investment Company. Mr. Eric Louzil, who manages RGH/Lions Share as well as Echelon Entertainment and Singa Home Entertainment, has objected, complaining that I did not describe the arbitrator’s award accurately and as a result his reputation has been tarnished.
Mr. Louzil objects to my statement that the arbitrator found that his company had failed to provide "accurate" accountings. Indeed, the exact words the arbitrator used were that RGH/Lions Share had failed to provide “complete and timely accountings.” The arbitrator also noted that RGH/Lions Share failed to provide backup of its expenses. I am not sure how an incomplete and late accounting could possibly be accurate, but let’s set the record straight.
Mr. Louzil claims that it is not fair to say that his company had engaged in numerous incidents of wrongdoing. The arbitrator specifically found that RGH/Lions Share failed to provide complete and timely accountings, reported questionable expenses, refused to acknowledge my client’s cancellation of the distribution agreement, failed to return materials, entered into an invalid agreement with Singa Home Entertainment that appeared to be a sham transaction, and tortiously interfered with my client’s attempt to enter into a home video distribution deal with another distributor. Sounds like multiple acts of wrongdoing to me.
Another objection concerns my statement that RGH/Lions Share attempted to sell DVD rights to Pathfinder Pictures (which is not a company managed by Mr. Louzil). Apparently, the agreement was between another of Mr. Louzil’s companies, Singa Home Entertainment, and Pathfinder. So it appears that RGH/Lions Share contracted with my client, and then assigned the home video rights to Singa, which in turn attempted to license the rights to Pathfinder. So Mr. Louzil may be technically correct that the agreement was with Singa, not RGH/Lions Share. Of course, we should also mention that the arbitrator specifically found that RGH/Lions Share agreement with Singa was invalid, and had “all the appearances of a sham transaction between related entities serving simply to dilute the proceeds from the distribution and the potential revenues.”
Mr. Louzil is upset that I wrote that “damages” were awarded in the amount of $75,000. In fact, the award was for $50,000 in damages, $25,052.52 in reimbursement of attorney fees, costs and arbitration expenses, for a total award against RGH/Lions Share of $75,052.52. I am not sure, from the perspective of Mr. Louzil’s reputation, how this makes any difference but perhaps he thinks that people will think more highly of his company if a portion of the award is for reimbursement of attorney fees and costs rather than damages.
It appears that Mr. Louzil is not aware that in defamation actions, truth is an absolute defense and a defendant is not required to prove the literal truth of an allegedly defamatory statement in every detail, so long as the imputation is substantially true so as to justify the gist or sting of the statement. Southwell v. Mallery, Stern & Warford 194 Cal. App. 3d 140, 239 Cal. Rptr. 371 (2nd Dist., 1987).
In order make sure that our readers are precisely and accurately informed, we are publishing this correction. Because we don’t want to quibble over words chosen to describe the award, here is a verbatim copy of the arbitrator’s award:
AFMA INTERNATIONAL ARBITRATION TRIBUNAL
In the matter of the Arbitration between AFMA Arbitration No. 03?62
FLORIDA FILM INVESTMENT COMPANY and RGH/LIONS SHARE PICTURES STATEMENT OF DECISION AND AWARD OF ARBITRATOR T
his matter was heard on February 2, 2004, and argued and submitted for decision on February 9, 2004. Roy G. Rifkin, Esq. was duly appointed as Arbitrator pursuant to the parties’ agreement to arbitrate contained in the agreement dated as of March 2, 2000, and the AFMA Rules for International Arbitration effective September 19, 2002 (“Rules”).
Mark Litwak, Esq. appeared as counsel for Claimant Florida Film Investment Company (“Florida Film”), and Eric Louzil appeared on behalf of Respondent RGH/Lions Share Pictures (“RGH”).
The Arbitrator, having considered the evidence and arguments submitted, makes the following Findings of Fact and Conclusions of Law and Award:
FINDINGS OF FACT
1 . Claimant is the producer of a motion picture entitled Oliver Twisted (the “Picture”).
2. Respondent is in the business of motion picture distribution.
3. The parties entered into an agreement (the “Agreement”) dated as of March 2, 2002, for the worldwide distribution of the picture by Respondent.
4. The Agreement provides, inter alia, for: (a) Written approval by Claimant of any sub?distribution agreements (paragraph 3(e)); (b) The allocation of gross receipts (paragraph 14); (c) Recoupable expenses (paragraph 15); (d) Rendering of accountings by Respondent to Claimant (paragraph 21); (e) Claimant’s right to cancel the Agreement based on failure to generate $100,000 net proceeds to Claimant in the first year of the Agreement (paragraph 17) (“performance clause”); (f) Arbitration of disputes (paragraph 24); and (g) Attorney’s fees and expenses to the prevailing party (paragraph 25).
5. Respondent reported to Claimant total gross receipts in the amount of $8,232.89 from the distribution of the Picture.
6. Respondent reported to Claimant expenses in the amount of $36,460.11 in connection with the distribution of the Picture.
7. Claimant canceled the Agreement pursuant to the performance clause by letter dated February 22, 2003.
8. As of February 22, 2003, Claimant demanded from Respondent the return of all materials in connection with the Picture. Respondent did not return any materials.
9. By agreement dated as of January 15, 2003, Respondent purported to license domestic home video rights to the Picture to Singa Home Entertainment (“Singa”). Singa is affiliated with Respondent. Claimant was not aware of and did not consent to the distribution agreement between Respondent and Singa.
10. In or about April 2003 Claimant had an agreement to license the Picture for domestic home video (including DVD) to BCI Eclipse. The transaction was aborted due to the assertion by Respondent and/or Singa that it had the rights to the Picture.
CONCLUSIONS OF LAW
1. Respondent was in violation of the terms of the Agreement by its failure to provide complete and timely accountings of its distribution activities. Respondent never provided the backup which Claimant requested regarding reported expenses. Furthermore, many of the reported expenses are questionable, including, but not limited to, $2,000 for advertising, $4,000 for M&E tracks, $4,000 for poster, and $500 each for legal/handling fee in connection with various territories. However, even assuming the invalidity of many of the expense items reported, Claimant has not established that it was damaged by any of these breaches. For example, no evidence was offered challenging the market expenses reported by Respondent, under paragraph 15(i) of the Agreement, in the amount of $10,000; and the evidence does not support a finding that Respondent received gross receipts in excess of the $8,232.89 reported. Accordingly, even if all of the questionable distribution expenses were to be disallowed, Claimant still would not be entitled to any producer’s revenues under the terms of the Agreement.
2. Claimant was entitled to cancel the Agreement under the terms of the performance clause because the Picture did not generate $100,000 in producer’s revenues the first year. Such cancellation was effective as of February 22, 2003. Respondent’s refusal to acknowledge the cancellation and return the materials was unwarranted. Respondent’s assertion of prior breach by Claimant in connection with Claimant’s limited attempt to market DVDs of the Picture is not compelling as Respondent had knowledge of and impliedly consented to such activity; and, in any case, there is no evidence of such activity having any detrimental commercial effect on Respondent’s distribution activities. However, Claimant offered no evidence establishing that Respondent’s failure to recognize the cancellation of the Agreement and failure to return the materials proximately caused any damage to Claimant. See Postal Instant Press v. Sealy, 43 Cal.App.4th 1704 (1996). Accordingly, while Claimant is entitled to the return of the materials, it is not entitled to any monetary damages in connection with this claim.
3. Respondent’s distribution agreement with Singa is invalid. It was entered into without the consent of Claimant as required by the Agreement; it exceeded the allowable term of years; and it has all the appearances of a sham transaction between related entities serving simply to dilute the proceeds from the distribution and the potential revenues.
4. Respondent tortiously interfered with Claimant’s domestic home video distribution deal with BCI Eclipse. Respondent had no legitimate basis to deny Claimant’s cancellation of the Agreement nor to rely upon Respondent’s distribution agreement with Singa. Accordingly, Respondent had no reasonable basis to assert to BCI Eclipse its own rights to the Picture as of April 2003. Although the evidence of actual damage based on Claimant’s loss of the distribution deal with BCI Eclipse is somewhat sketchy, there is support for a finding that, had Respondent not interfered with the deal, revenues from the home video distribution of the Picture to the producer would approximate $50,000 (see Exhibits 16 and 25).
AWARD
1. The Agreement dated as of March 2, 2000 is terminated effective as of February 22, 2003. Respondent RGH/Lions Share Pictures retains no rights in the motion picture Oliver Twisted, and Claimant Florida Film Investment Company is free to deal with the Picture as it sees fit in all territories.
2. Respondent RGH/Lions Share Pictures is permanently enjoined from advertising, selling, distributing, manufacturing, or shipping the motion picture Oliver Twisted in any media or any territories whatsoever.
3. Respondent RGH/Lions Share Pictures is ordered to deliver immediately to Claimant Florida Film Investment Company at the office of its counsel, Mark Litwak, Esq. any and all materials in its possession, custody, or control relating to the motion picture Oliver Twisted including, but not limited to, masters, submasters, negatives, videotapes, video disks, stills, cue sheets, boxes, posters, photographs, artwork, advertising material, access letters, and distribution agreements.
4. Respondent RGH/Lions Share Pictures shall pay to Claimant Florida Film Investment Company the following: (a) damages in the amount of $50,000.00; (b) attorney’s fees in the amount of $22,702.52; (c) costs in the amount of $850.00; and (d) reimbursement for one?half of the compensation and expenses of the Arbitrator in the amount of $1,500.00; for a total monetary award in the amount of $75,052.52.
DATED: February 12, 2004
Thursday, February 26, 2004
RGH/LIONS SHARE LIABLE FOR WRONGDOING, CLAIMANT AWARDED $75,000
February 26, 2004
In this newsletter:
RGH/LIONS SHARE LIABLE FOR WRONGDOING, CLAIMANT AWARDED $75,000
In an AFMA arbitration proceeding, RGH/Lions Share Pictures was found liable for multiple counts of wrongdoing. RGH/Lions Share failed to provide accurate and timely accountings, wrongfully refused to accept cancellation of its distribution agreement for the motion picture “Oliver Twisted,” and tortuously interfered with the producer’s attempt to re-license the picture to a new distributor. The arbitrator also found that RGH/Lions Share, a company controlled by Eric Louzil, wrongfully attempted to enter into a license agreement with Singa Home Entertainment, another company controlled by Eric Louzil. The arbitrator found that the Singa distribution agreement was invalid, and awarded Claimant $75,000 in damages.
Mark Litwak, attorney for Claimant Florida Film Investment Company, stated, “we are very pleased that the arbitrator agreed with all our claims against RGH/Lion’s Share, and dismissed all of RGH/Lions Share’s purported defenses.” Litwak added, “The sworn testimony of Eric Louzil during the proceedings was incredibly shocking, as he admitted that his producer reports were full of errors and improper deductions, and that he had freely transferred assets among his affiliated companies, including Singa Home Entertainment, Echelon Entertainment, and Newmark/Echelon, as well as transferred assets offshore.”
According to Gersh Morningstar, CEO of the Florida Film Investment Company, RGH/Lions Share attempted to continue licensing its film, “Oliver Twisted,” even after RGH/Lions Share’s rights were terminated. After Morningstar gave formal notice that the distribution agreement was terminated to Eric Louzil, the President of RGH/Lions Share, in February 2003 , RGH/Lions Share concluded deals for which revenue had never been reported to the producer. Louzil and his company also continued to market “Oliver Twisted,” months after the termination.
Morningstar states that RGH/Lions Share attempted to sell DVD rights for “Oliver Twisted” to Pathfinder Pictures, which in turn advertised on their website that they would be releasing a DVD on Oct. 28, 2003. When attorney Litwak contacted Pathfinder in June at Morningstar’s behest, the company disclosed that RGH/Lions Share had entered into a contract with them in April 2003; more than a month and a half after the agreement with RGH/Lions Share was canceled. Pathfinder, embarrassed by this revelation, had to withdraw the picture from its slate.
BRANDON COLE WINS PANASONIC FILMMAKERS’ GRANT
Congratulations to our client, Brandon Cole! Cole was awarded a Panasonic Digital Filmmakers’ Grant based on the merits of his film “Bristol Boys.” “Bristol Boys” is a coming-of-age crime-comedy about the rise and fall of a trio of suburban drug dealers and is based on a true story.
“SCREEN DOOR JESUS” TO SCREEN IN L.A.
Congratulations to our clients, producers Sam Adelman and David Stuart, and writer/director Kirk Davis, whose film, “Screen Door Jesus” won the 2003 Hamptons International Film Festival (Best Feature, Best Cinematography, Best Score), 2003 Deep Ellum Film Festival (Best Texas Film), 2003 New York International Film & Video Festival (Best Drama), and 2003 St. Louis International Film Festival (Best Emerging Talent, Eugene Williams).
The film tells the story of that summer in Bethlehem, TX (pop. 2,378) when people thought they saw none other than the images of Jesus on Mother Harper’s screen door.
At 8PM on March 5, “Screen Door Jesus” will roll on Screen 1 at Laemmle’s Fairfax 3 Cinemas, 7907 Beverly Blvd, Los Angeles, CA 90025.
Tickets are available online and at the box office. Purchase tickets online: ticketweb.com/user/?region=socal&query=detail&event=493919
In this newsletter:
RGH/LIONS SHARE LIABLE FOR WRONGDOING, CLAIMANT AWARDED $75,000
In an AFMA arbitration proceeding, RGH/Lions Share Pictures was found liable for multiple counts of wrongdoing. RGH/Lions Share failed to provide accurate and timely accountings, wrongfully refused to accept cancellation of its distribution agreement for the motion picture “Oliver Twisted,” and tortuously interfered with the producer’s attempt to re-license the picture to a new distributor. The arbitrator also found that RGH/Lions Share, a company controlled by Eric Louzil, wrongfully attempted to enter into a license agreement with Singa Home Entertainment, another company controlled by Eric Louzil. The arbitrator found that the Singa distribution agreement was invalid, and awarded Claimant $75,000 in damages.
Mark Litwak, attorney for Claimant Florida Film Investment Company, stated, “we are very pleased that the arbitrator agreed with all our claims against RGH/Lion’s Share, and dismissed all of RGH/Lions Share’s purported defenses.” Litwak added, “The sworn testimony of Eric Louzil during the proceedings was incredibly shocking, as he admitted that his producer reports were full of errors and improper deductions, and that he had freely transferred assets among his affiliated companies, including Singa Home Entertainment, Echelon Entertainment, and Newmark/Echelon, as well as transferred assets offshore.”
According to Gersh Morningstar, CEO of the Florida Film Investment Company, RGH/Lions Share attempted to continue licensing its film, “Oliver Twisted,” even after RGH/Lions Share’s rights were terminated. After Morningstar gave formal notice that the distribution agreement was terminated to Eric Louzil, the President of RGH/Lions Share, in February 2003 , RGH/Lions Share concluded deals for which revenue had never been reported to the producer. Louzil and his company also continued to market “Oliver Twisted,” months after the termination.
Morningstar states that RGH/Lions Share attempted to sell DVD rights for “Oliver Twisted” to Pathfinder Pictures, which in turn advertised on their website that they would be releasing a DVD on Oct. 28, 2003. When attorney Litwak contacted Pathfinder in June at Morningstar’s behest, the company disclosed that RGH/Lions Share had entered into a contract with them in April 2003; more than a month and a half after the agreement with RGH/Lions Share was canceled. Pathfinder, embarrassed by this revelation, had to withdraw the picture from its slate.
BRANDON COLE WINS PANASONIC FILMMAKERS’ GRANT
Congratulations to our client, Brandon Cole! Cole was awarded a Panasonic Digital Filmmakers’ Grant based on the merits of his film “Bristol Boys.” “Bristol Boys” is a coming-of-age crime-comedy about the rise and fall of a trio of suburban drug dealers and is based on a true story.
“SCREEN DOOR JESUS” TO SCREEN IN L.A.
Congratulations to our clients, producers Sam Adelman and David Stuart, and writer/director Kirk Davis, whose film, “Screen Door Jesus” won the 2003 Hamptons International Film Festival (Best Feature, Best Cinematography, Best Score), 2003 Deep Ellum Film Festival (Best Texas Film), 2003 New York International Film & Video Festival (Best Drama), and 2003 St. Louis International Film Festival (Best Emerging Talent, Eugene Williams).
The film tells the story of that summer in Bethlehem, TX (pop. 2,378) when people thought they saw none other than the images of Jesus on Mother Harper’s screen door.
At 8PM on March 5, “Screen Door Jesus” will roll on Screen 1 at Laemmle’s Fairfax 3 Cinemas, 7907 Beverly Blvd, Los Angeles, CA 90025.
Tickets are available online and at the box office. Purchase tickets online: ticketweb.com/user/?region=socal&query=detail&event=493919
Monday, February 02, 2004
Unauthorized Movie Recording Gets Tougher Punishment in California
February 2, 2004
In this newsletter:
Congratulations to “Mango Kiss”
Client Sascha Rice’s film “Mango Kiss” has been bestowed a bevy of praise and awards in recent weeks. The film won the gold award at the Park City Film Festival, was the Opening Night Film at Seattle’s Sex on Screen Film Festival and Park City Film Music Festival, and is slated to be the closing night film for the Durango Film Festival, which will be held March 6-14, 2004.
Congratulations Sascha!
Unauthorized Movie Recording Gets Tougher Punishment in California
This new California law is designed to stop illegal recording of movies. It was necessary to enact this new law because it’s become increasingly easy to record movies in theaters illegally. With the shrinking size of video and digital recorders, anyone can smuggle them into theaters without being noticed.
California has already had a law that made it a misdemeanor to refuse to stop operating a recording device in a movie theater “upon the request of the theaterowner.” However, the legislature had to take tougher measures in order to protect the movie industry and curb piracy. The new statute supplements the existing law by adding a section to the California Penal Code, Section 653z. This section makes it a “public offense” to operate a recording device in a movie theater while a movie is being shown. Unless the person recording the movie has a written authorization from the movie theater’s owner, the act is punishable by imprisonment for as long as one year in county jail and a fine of as much as $2,500.
This tougher law will make it more difficult and risky for anyone to record movies illegally and will help decrease movie piracy.
Mark in Moviemaker, FFT, Will Speak at Miami Film Festival Feb. 7 Mark’s article, “Soft Money in Hard Times,” has been published in the current issue of Moviemaker magazine. Moviemaker can be found online at www.moviemaker.com.
Mark was also mentioned as one of “The Top 25 Indie Players” in Film Festival Today. FFT was distributed during the Sundance Film Festival and can be found online at www.filmfestivaltoday.com.
On Feb. 7, Mark will deliver his “Self-defense for Writers and Filmmakers” seminar at the Miami Film Festival. He’ll cover typical compensation and terms of studio contracts, merchandising deals, creative approvals, and negotiating tactics and strategies. To register, call 305.237.1696. Visit the Miami International Film Festival website at www.miamifilmfestival.com/.
In this newsletter:
Congratulations to “Mango Kiss”
Client Sascha Rice’s film “Mango Kiss” has been bestowed a bevy of praise and awards in recent weeks. The film won the gold award at the Park City Film Festival, was the Opening Night Film at Seattle’s Sex on Screen Film Festival and Park City Film Music Festival, and is slated to be the closing night film for the Durango Film Festival, which will be held March 6-14, 2004.
Congratulations Sascha!
Unauthorized Movie Recording Gets Tougher Punishment in California
This new California law is designed to stop illegal recording of movies. It was necessary to enact this new law because it’s become increasingly easy to record movies in theaters illegally. With the shrinking size of video and digital recorders, anyone can smuggle them into theaters without being noticed.
California has already had a law that made it a misdemeanor to refuse to stop operating a recording device in a movie theater “upon the request of the theaterowner.” However, the legislature had to take tougher measures in order to protect the movie industry and curb piracy. The new statute supplements the existing law by adding a section to the California Penal Code, Section 653z. This section makes it a “public offense” to operate a recording device in a movie theater while a movie is being shown. Unless the person recording the movie has a written authorization from the movie theater’s owner, the act is punishable by imprisonment for as long as one year in county jail and a fine of as much as $2,500.
This tougher law will make it more difficult and risky for anyone to record movies illegally and will help decrease movie piracy.
Mark in Moviemaker, FFT, Will Speak at Miami Film Festival Feb. 7 Mark’s article, “Soft Money in Hard Times,” has been published in the current issue of Moviemaker magazine. Moviemaker can be found online at www.moviemaker.com.
Mark was also mentioned as one of “The Top 25 Indie Players” in Film Festival Today. FFT was distributed during the Sundance Film Festival and can be found online at www.filmfestivaltoday.com.
On Feb. 7, Mark will deliver his “Self-defense for Writers and Filmmakers” seminar at the Miami Film Festival. He’ll cover typical compensation and terms of studio contracts, merchandising deals, creative approvals, and negotiating tactics and strategies. To register, call 305.237.1696. Visit the Miami International Film Festival website at www.miamifilmfestival.com/.
Friday, November 21, 2003
USE OF ELVIS FOOTAGE IN FILM BIOGRAPHY IS NOT FAIR USE
November 21, 2003
In this newsletter:
THE BIG EMPTY OPENS TONIGHT IN L.A.
Congratulations to our client, Echo Lake Productions. Their film, “THE BIG EMPTY,” starring Jon Favreau, Joey Lauren Adams, Rachael Lee Cooke, Kelsey Grammer, and Daryl Hannah opens this Friday, Nov. 21, at the Laemmle Sunset Five (8000 Sunset Boulevard, corner of Sunset and Crescent Heights) in Los Angeles. Producer Doug Mankoff will conduct an informal Q&A at the Wolfgang Puck Café next to the theater on Sunday evening. The film is also screening at the Century Orleans in Las Vegas, and AMC River Park Square 20 in Spokane, WA. Watch the trailer or read about the production by connecting to www.thebigempty.com . Advance tickets are available at www.moviefone.com or www.laemmle.com .
FIRESIDE FILMS LLC
Congratulations to our client, Fireside Films, LLC and director Brad Keller. Their film, “A Killer Within,” began principal photography in Dallas this week. The production stars C. Thomas Howell, Sean Young, Ben Browder, Dedee Pfeiffer and Giancarlo Esposito.
USE OF ELVIS FOOTAGE IN FILM BIOGRAPHY IS NOT FAIR USE
The King has won its appeal. Elvis Presley Enterprises won affirmation from the U.S. Court of Appeals for its preliminary injunction against Passport Entertainment, which prevented Passport from selling a multi-disc documentary about Elvis Presley entitled, “The Definitive Elvis.”
Elvis Presley Enterprises received its original injunction on the basis of copyright infringement. “The Definitive Elvis” incorporated unlicensed clips of copyrighted music, photographs, movies, and television appearances.
Passport Entertainment, which produces celebrity video biographies for the home video market, sought a review of the lower court’s decision, claiming the court abused its discretion and that Passport could, among other things, present a plausible fair use defense.
The doctrine of fair use requires the courts to consider four factors: the purposes and character of the use, including whether the use is of a commercial nature or is for nonprofit educational purposes; the nature of the copyrighted work; the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and the effect of the use upon the potential market for and value of the copyrighted work.
In an analysis of the lower court’s decision, Circuit Judge Richard Tallman of the U.S. Court of Appeals determined that the lower court had not made any errors, legal or otherwise, in its factual findings. However, the judge left the door open for a rehearing, writing that the Appeals Court “might view this case as closer than the district court saw it.”
In a dissenting opinion, Circuit Judge John T. Noonan wrote that the district court had both misstated critical facts and governing law, and that the appeals court should, in fact, reverse the grant of preliminary injunction.
Detailing the errors in the district court’s findings, Judge Noonan further commented on the district court’s failure to conduct an analysis of the public interest in the subject of the documentary and the public injury that would be caused by what is essentially a suppression of speech.
In this newsletter:
THE BIG EMPTY OPENS TONIGHT IN L.A.
Congratulations to our client, Echo Lake Productions. Their film, “THE BIG EMPTY,” starring Jon Favreau, Joey Lauren Adams, Rachael Lee Cooke, Kelsey Grammer, and Daryl Hannah opens this Friday, Nov. 21, at the Laemmle Sunset Five (8000 Sunset Boulevard, corner of Sunset and Crescent Heights) in Los Angeles. Producer Doug Mankoff will conduct an informal Q&A at the Wolfgang Puck Café next to the theater on Sunday evening. The film is also screening at the Century Orleans in Las Vegas, and AMC River Park Square 20 in Spokane, WA. Watch the trailer or read about the production by connecting to www.thebigempty.com . Advance tickets are available at www.moviefone.com or www.laemmle.com .
FIRESIDE FILMS LLC
Congratulations to our client, Fireside Films, LLC and director Brad Keller. Their film, “A Killer Within,” began principal photography in Dallas this week. The production stars C. Thomas Howell, Sean Young, Ben Browder, Dedee Pfeiffer and Giancarlo Esposito.
USE OF ELVIS FOOTAGE IN FILM BIOGRAPHY IS NOT FAIR USE
The King has won its appeal. Elvis Presley Enterprises won affirmation from the U.S. Court of Appeals for its preliminary injunction against Passport Entertainment, which prevented Passport from selling a multi-disc documentary about Elvis Presley entitled, “The Definitive Elvis.”
Elvis Presley Enterprises received its original injunction on the basis of copyright infringement. “The Definitive Elvis” incorporated unlicensed clips of copyrighted music, photographs, movies, and television appearances.
Passport Entertainment, which produces celebrity video biographies for the home video market, sought a review of the lower court’s decision, claiming the court abused its discretion and that Passport could, among other things, present a plausible fair use defense.
The doctrine of fair use requires the courts to consider four factors: the purposes and character of the use, including whether the use is of a commercial nature or is for nonprofit educational purposes; the nature of the copyrighted work; the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and the effect of the use upon the potential market for and value of the copyrighted work.
In an analysis of the lower court’s decision, Circuit Judge Richard Tallman of the U.S. Court of Appeals determined that the lower court had not made any errors, legal or otherwise, in its factual findings. However, the judge left the door open for a rehearing, writing that the Appeals Court “might view this case as closer than the district court saw it.”
In a dissenting opinion, Circuit Judge John T. Noonan wrote that the district court had both misstated critical facts and governing law, and that the appeals court should, in fact, reverse the grant of preliminary injunction.
Detailing the errors in the district court’s findings, Judge Noonan further commented on the district court’s failure to conduct an analysis of the public interest in the subject of the documentary and the public injury that would be caused by what is essentially a suppression of speech.
Tuesday, November 04, 2003
NEW YORK VOLUNTEER LAWYERS FOR THE ARTS
November 4, 2003
In this newsletter:
NEW YORK VOLUNTEER LAWYERS FOR THE ARTS
On Nov. 8 at the Lower Manhattan Cultural Council, Mark will conduct a comprehensive seminar that explores how independent films are financed and distributed. During this Volunteer Lawyers for the Arts seminar, Mark will review include financing via pre?sales, debt and limited partnerships, negotiating tactics, typical contract terms, cross?collateralization and creative accounting. He will address how producers and filmmakers can protect themselves by watering down warranties, getting added to the E&O policy, using lab access letters to retain possession of the negative, utilizing termination and arbitration clauses. The seminar includes a handout with a distribution contract, articles, a self?defense checklist and other materials. Other topics include criteria for selecting a distributor; what is negotiable and what is not; compliance with state and federal laws when seeking investors; retaining an attorney or producer’s rep; confirming arbitration awards in Superior Court; and, enforcing judgments. To register, please call Jonathan Tominar, VLA Office Administrator, at 212-319-ARTS (2787) ext. 10, or email vla@vlany.org.
In this newsletter:
NEW YORK VOLUNTEER LAWYERS FOR THE ARTS
On Nov. 8 at the Lower Manhattan Cultural Council, Mark will conduct a comprehensive seminar that explores how independent films are financed and distributed. During this Volunteer Lawyers for the Arts seminar, Mark will review include financing via pre?sales, debt and limited partnerships, negotiating tactics, typical contract terms, cross?collateralization and creative accounting. He will address how producers and filmmakers can protect themselves by watering down warranties, getting added to the E&O policy, using lab access letters to retain possession of the negative, utilizing termination and arbitration clauses. The seminar includes a handout with a distribution contract, articles, a self?defense checklist and other materials. Other topics include criteria for selecting a distributor; what is negotiable and what is not; compliance with state and federal laws when seeking investors; retaining an attorney or producer’s rep; confirming arbitration awards in Superior Court; and, enforcing judgments. To register, please call Jonathan Tominar, VLA Office Administrator, at 212-319-ARTS (2787) ext. 10, or email vla@vlany.org.
Tuesday, October 07, 2003
CALIFORNIA SUPREME COURT DECLARES COMICS PROTECTED BY FIRST AMENDMENT
October 7, 2003
In this newsletter:
UPCOMING LECTURES: HAMPTONS FILM FESTIVAL
On Oct. 23 at 1PM, Mark will be participating in a panel discussion at the Hamptons Film Festival. He and other industry professionals will discuss the differences between traditional and alternative financing models, domestic tax incentives, European tax incentives, and financing options for digital vs. celluloid filmmaking. To order tickets for the panel, entitled “Foregoing the Frustrations of Film Financing,” visit www.ticketweb.com/user/?region=ny&query=detail&event=463058 The official Hamptons Film Festival site is http://www.hamptonsfilmfest.org/2003/
NEW YORK VOLUNTEER LAWYERS FOR THE ARTS
On Nov. 8 at the Lower Manhattan Cultural Council, Mark will conduct a comprehensive seminar that explores how independent films are financed and distributed. During this Volunteer Lawyers for the Arts seminar, Mark will review include financing via pre-sales, debt and limited partnerships, negotiating tactics, typical contract terms, cross-collaterization and creative accounting. He will address how producers and filmmakers can protect themselves by watering down warranties, getting added to the E & O policy, using lab access letters to retain possession of the negative, utilizing termination and arbitration clauses. The seminar includes a handout with a distribution contract, articles, a self-defense checklist and other materials. Other topics include criteria for selecting a distributor; what is negotiable and what is not; compliance with state and federal laws when seeking investors; retaining an attorney or producer’s rep; confirming arbitration awards in Superior Court; and, enforcing judgments. To register, please call Jonathan Tominar, VLA Office Administrator, at 212-319-ARTS (2787) ext. 10.
CALIFORNIA SUPREME COURT DECLARES COMICS PROTECTED BY FIRST AMENDMENT
By Chrys Wu, Paralegal to Mark Litwak
In an opinion hailed as preserving First Amendment rights, the California Supreme Court has reversed and remanded a case pitting celebrities’ right of publicity against the First Amendment. DC Comics created a series of stories featuring the characters “Johnny and Edgar Autumn.” These characters were portrayed as vulgar, distasteful villains. Real-life musicians Johnny and Edgar Winter sued DC Comics alleging, among other causes of action, that DC Comics had misappropriated their names and likenesses in a series of comic books featuring characters named “Johnny and Edgar Autumn.” The California high court agreed to review the case, applying a balancing test the court established in the case Comedy III Productions, Inc. v. Gary Saderup, Inc. (2001) 25 Cal.4th 387, 396. In creating the balancing test, the court wrote that while celebrities had a right to protect the economic value of their names and likenesses, the right of publicity “does not confer a shield to ward off caricature, parody and satire. Rather, prominence invites creative comment.” Therefore, First Amendment protections could apply to some uses of celebrity likeness. The court applied its test to determine if DC Comics had appropriated the Winter brothers’ likenesses merely for economic gain, which the First Amendment does not protect; or if the publisher had significantly transformed the likenesses into a creative product, which the First Amendment does protect. The court found that while the characters portrayed in the comic book were “less-than-subtle evocations” of the Winter brothers, they were just cartoon characters in a larger, expressive story. Ultimately, the court wrote, DC Comics had created and sold, and buyers bought, comic books featuring “fanciful, creative characters, not pictures of the Winter brothers.” The comics books are therefore protected by the First Amendment. The case has been reversed and remanded to the Court of Appeal. Winter v. DC Comics, 30 Cal.4th 881, 134 Cal.Rptr.2d 634, 69 P.3d 473, 2003 Cal.LEXIS 3492 (Cal. 2003)
In this newsletter:
UPCOMING LECTURES: HAMPTONS FILM FESTIVAL
On Oct. 23 at 1PM, Mark will be participating in a panel discussion at the Hamptons Film Festival. He and other industry professionals will discuss the differences between traditional and alternative financing models, domestic tax incentives, European tax incentives, and financing options for digital vs. celluloid filmmaking. To order tickets for the panel, entitled “Foregoing the Frustrations of Film Financing,” visit www.ticketweb.com/user/?region=ny&query=detail&event=463058 The official Hamptons Film Festival site is http://www.hamptonsfilmfest.org/2003/
NEW YORK VOLUNTEER LAWYERS FOR THE ARTS
On Nov. 8 at the Lower Manhattan Cultural Council, Mark will conduct a comprehensive seminar that explores how independent films are financed and distributed. During this Volunteer Lawyers for the Arts seminar, Mark will review include financing via pre-sales, debt and limited partnerships, negotiating tactics, typical contract terms, cross-collaterization and creative accounting. He will address how producers and filmmakers can protect themselves by watering down warranties, getting added to the E & O policy, using lab access letters to retain possession of the negative, utilizing termination and arbitration clauses. The seminar includes a handout with a distribution contract, articles, a self-defense checklist and other materials. Other topics include criteria for selecting a distributor; what is negotiable and what is not; compliance with state and federal laws when seeking investors; retaining an attorney or producer’s rep; confirming arbitration awards in Superior Court; and, enforcing judgments. To register, please call Jonathan Tominar, VLA Office Administrator, at 212-319-ARTS (2787) ext. 10.
CALIFORNIA SUPREME COURT DECLARES COMICS PROTECTED BY FIRST AMENDMENT
By Chrys Wu, Paralegal to Mark Litwak
In an opinion hailed as preserving First Amendment rights, the California Supreme Court has reversed and remanded a case pitting celebrities’ right of publicity against the First Amendment. DC Comics created a series of stories featuring the characters “Johnny and Edgar Autumn.” These characters were portrayed as vulgar, distasteful villains. Real-life musicians Johnny and Edgar Winter sued DC Comics alleging, among other causes of action, that DC Comics had misappropriated their names and likenesses in a series of comic books featuring characters named “Johnny and Edgar Autumn.” The California high court agreed to review the case, applying a balancing test the court established in the case Comedy III Productions, Inc. v. Gary Saderup, Inc. (2001) 25 Cal.4th 387, 396. In creating the balancing test, the court wrote that while celebrities had a right to protect the economic value of their names and likenesses, the right of publicity “does not confer a shield to ward off caricature, parody and satire. Rather, prominence invites creative comment.” Therefore, First Amendment protections could apply to some uses of celebrity likeness. The court applied its test to determine if DC Comics had appropriated the Winter brothers’ likenesses merely for economic gain, which the First Amendment does not protect; or if the publisher had significantly transformed the likenesses into a creative product, which the First Amendment does protect. The court found that while the characters portrayed in the comic book were “less-than-subtle evocations” of the Winter brothers, they were just cartoon characters in a larger, expressive story. Ultimately, the court wrote, DC Comics had created and sold, and buyers bought, comic books featuring “fanciful, creative characters, not pictures of the Winter brothers.” The comics books are therefore protected by the First Amendment. The case has been reversed and remanded to the Court of Appeal. Winter v. DC Comics, 30 Cal.4th 881, 134 Cal.Rptr.2d 634, 69 P.3d 473, 2003 Cal.LEXIS 3492 (Cal. 2003)
Wednesday, September 03, 2003
WRITERS’ CLAIM AGAINST AARON SORKIN DISMISSED
September 3, 2003
WRITERS’ CLAIM AGAINST AARON SORKIN DISMISSED
by Chrys Wu, paralegal to Mark Litwak
Writers Kyle Morris and William Richert lost their case before a New York federal court. They wrote a treatment and script called “The President Elopes,” which Castle Rock Entertainment agreed to co-produce. Castle Rock bought the property after they greenlighted Aaron Sorkin’s script, “The American President.”
“The American President” went on to make a solid showing at the box office. “The President Elopes” was never produced. Morris and Richert thought the two projects were substantially similar and asked a WGA arbitration panel to determine if they should receive shared writing credit for “The American President.” The WGA arbitrators determined Sorkin deserved sole writing credit.
Morris and Richert then sued in New York’s federal court, alleging Castle Rock had purchased their property to essentially block its production while filming Sorkin’s project. The writers also claimed breach of contract against Castle Rock for failure to pay additional compensation for “The American President”; copyright infringement by Castle Rock, Sorkin, and Warner Bros., for “The West Wing,” which Sorkin writes; and accused Sorkin and others of conspiracy to defraud the WGA arbitration panel.
A federal district judge has dismissed the case without trial, stating first that the writers were never entitled to make a copyright claim since they had written “The President Elopes” under a work-for-hire agreement and had thereby signed away their copyright. Further, as Castle Rock then properly purchased the copyright to the material, Castle Rock was the rightful copyright holder.
The attorney for Morris and Richert argued that the copyright should revert to the writers as it was “unconscionable” for Castle Rock to own the rights simply to take the script out of production. The judge disagreed, both because “American President” and “President Elopes” had only “superficial similarities” and because the termination clause in Morris and Richert’s contract stipulated that Castle Rock would retain the copyright in the event of termination.
The judge ruled that the breach of contract claim also failed, since the original Castle Rock contract stated additional compensation was only due if the writers were entitled to shared writing credit, which the WGA arbitration panel ruled they should not receive.
As for conspiracy to defraud the WGA panel, the judge determined this was a meritless claim.
Morris v. Castle Rock Entertainment, Inc., 246 F.Supp.2d 290, 2003 U.S.Dist.LEXIS 2420 (S.D.N.Y. 2003)
Mark litwak TO Teach at UCLA and in Seattle This MonthOn Saturday, September 6, Mark Litwak will be teaching “Financing Independent Features and Negotiating a Distribution Agreement” at UCLA. Mark will discuss how financing can be obtained through pre-sales, debt, and limited partnerships. He will also review negotiating tactics, typical contract terms, cross-collaterization, and creative accounting. Handouts include a distribution contract, articles, a self-defense checklist, and other materials. To register, visit http://www.uclaextension.edu, click on the “Quick Enroll” tab and type in “N9506U” in the box that says “Reg #.”
On September 12 and 13, Mark Litwak will be in Seattle on a speaking tour to lecture and answer questions for screenwriters and filmmakers.
Washington Lawyers for the ArtsAt 11:45 a.m. on September 12, Mark will be speaking at the City Centre Building, 1420 Fifth Ave., 4th Floor Conference Room in Seattle. He’ll be discussing "Copyright Law for Literary Artists & Filmmakers: Practical Tips for Protecting Artistic Works." The brown bag lunch seminar is organized by Washington Lawyers for the Arts; MCLE credit may be available. For more information, email director@wa-artlaw.org with your name, postal address, email address and phone number, call (206) 328-7053, or visit the website: http://www.wa-artlaw.org/lecture.html#brownbag9.
Northwest Screenwriters GuildFrom 7 p.m. to 9 p.m. on September 12, Mark will be conducting an informal discussion on "Protecting Your Work from Theft and Prevent Legal Pitfalls" at the Mercer Island Community Center (MICC). The event is hosted by the Northwest Screenwriters Guild. No advance registration is required. Call (206) 842-7995 for more information or visit the NWSG website: http://www.nwsg.org.
The Indie Film GroupOn September 13, Mark will conduct a one-day workshop on "Self-Defense for the Writer & Filmmaker." Mark will describe common abuses and how to prevent them. He’ll also review how to secure underlying rights to a story and the remedies available should you find your project in trouble. This workshop is organized by The Indie Film Group and Circle Rock Productions. For more information or to register online go to http://www.indiefilmgroup.com or call toll free: 1-866-484-3434.
WRITERS’ CLAIM AGAINST AARON SORKIN DISMISSED
by Chrys Wu, paralegal to Mark Litwak
Writers Kyle Morris and William Richert lost their case before a New York federal court. They wrote a treatment and script called “The President Elopes,” which Castle Rock Entertainment agreed to co-produce. Castle Rock bought the property after they greenlighted Aaron Sorkin’s script, “The American President.”
“The American President” went on to make a solid showing at the box office. “The President Elopes” was never produced. Morris and Richert thought the two projects were substantially similar and asked a WGA arbitration panel to determine if they should receive shared writing credit for “The American President.” The WGA arbitrators determined Sorkin deserved sole writing credit.
Morris and Richert then sued in New York’s federal court, alleging Castle Rock had purchased their property to essentially block its production while filming Sorkin’s project. The writers also claimed breach of contract against Castle Rock for failure to pay additional compensation for “The American President”; copyright infringement by Castle Rock, Sorkin, and Warner Bros., for “The West Wing,” which Sorkin writes; and accused Sorkin and others of conspiracy to defraud the WGA arbitration panel.
A federal district judge has dismissed the case without trial, stating first that the writers were never entitled to make a copyright claim since they had written “The President Elopes” under a work-for-hire agreement and had thereby signed away their copyright. Further, as Castle Rock then properly purchased the copyright to the material, Castle Rock was the rightful copyright holder.
The attorney for Morris and Richert argued that the copyright should revert to the writers as it was “unconscionable” for Castle Rock to own the rights simply to take the script out of production. The judge disagreed, both because “American President” and “President Elopes” had only “superficial similarities” and because the termination clause in Morris and Richert’s contract stipulated that Castle Rock would retain the copyright in the event of termination.
The judge ruled that the breach of contract claim also failed, since the original Castle Rock contract stated additional compensation was only due if the writers were entitled to shared writing credit, which the WGA arbitration panel ruled they should not receive.
As for conspiracy to defraud the WGA panel, the judge determined this was a meritless claim.
Morris v. Castle Rock Entertainment, Inc., 246 F.Supp.2d 290, 2003 U.S.Dist.LEXIS 2420 (S.D.N.Y. 2003)
Mark litwak TO Teach at UCLA and in Seattle This MonthOn Saturday, September 6, Mark Litwak will be teaching “Financing Independent Features and Negotiating a Distribution Agreement” at UCLA. Mark will discuss how financing can be obtained through pre-sales, debt, and limited partnerships. He will also review negotiating tactics, typical contract terms, cross-collaterization, and creative accounting. Handouts include a distribution contract, articles, a self-defense checklist, and other materials. To register, visit http://www.uclaextension.edu, click on the “Quick Enroll” tab and type in “N9506U” in the box that says “Reg #.”
On September 12 and 13, Mark Litwak will be in Seattle on a speaking tour to lecture and answer questions for screenwriters and filmmakers.
Washington Lawyers for the ArtsAt 11:45 a.m. on September 12, Mark will be speaking at the City Centre Building, 1420 Fifth Ave., 4th Floor Conference Room in Seattle. He’ll be discussing "Copyright Law for Literary Artists & Filmmakers: Practical Tips for Protecting Artistic Works." The brown bag lunch seminar is organized by Washington Lawyers for the Arts; MCLE credit may be available. For more information, email director@wa-artlaw.org with your name, postal address, email address and phone number, call (206) 328-7053, or visit the website: http://www.wa-artlaw.org/lecture.html#brownbag9.
Northwest Screenwriters GuildFrom 7 p.m. to 9 p.m. on September 12, Mark will be conducting an informal discussion on "Protecting Your Work from Theft and Prevent Legal Pitfalls" at the Mercer Island Community Center (MICC). The event is hosted by the Northwest Screenwriters Guild. No advance registration is required. Call (206) 842-7995 for more information or visit the NWSG website: http://www.nwsg.org.
The Indie Film GroupOn September 13, Mark will conduct a one-day workshop on "Self-Defense for the Writer & Filmmaker." Mark will describe common abuses and how to prevent them. He’ll also review how to secure underlying rights to a story and the remedies available should you find your project in trouble. This workshop is organized by The Indie Film Group and Circle Rock Productions. For more information or to register online go to http://www.indiefilmgroup.com or call toll free: 1-866-484-3434.
Sunday, July 27, 2003
In this newsletter:
kiss-and-tell eliminates rights of publicity and privacy.
22-year old Diana Lynn Daly was caught on tape smooching with a member of Texas rockers Flickerstick, a group featured on VH1's "Bands on the Run" reality show.
Daly had no problem with that. In fact, she herself publicly disclosed the kiss. However, she and the band's drummer were in a bathroom stall, and video of her locking lips was broadcast on the show and still images of same were used in a national advertising campaign.
Embarrassed, Daly sued Viacom, Inc., VH1's parent company, for misappropriation of her right of publicity, invasion of privacy, fraud, and infliction of emotional distress, among other causes of action.
The California District Court judge didn't buy it. Judge Maxine Chesney found that the show is an "expressive work," and as such is protected by the First Amendment. Therefore, Daly could not claim misappropriation of her likeness in the program or in advertisements.
Furthermore, since Daly had publicly disclosed the kiss, she could no longer claim a right of privacy. Ruling that the publicly disclosed act could not be made private again "merely by virtue of the location in which such activity occurs," the judge struck down the privacy claim.
Daly's other claims also failed.
Daly v. Viacom, Inc., 238 F.Supp.2d 1118 (N.D.Cal. 2002)
LAST CALL FOR Hollywood Finance and Distribution symposium, JULY 19–20
On July 19 and 20, I am chairing an event that provides independent filmmakers with the opportunity to learn about finance and distribution opportunities.
The two-day event will cover such topics as international co-productions, subsidies, and production incentives; distribution channels; how soon is too soon to promote or market a film; and the future of film financing. In addition, filmmakers will have the chance to discuss their projects with agents, studio execs and distributors in 30-minute round tables.
Speakers include Rob Aft, Independent Consultant; Jeff Andrick, XL.Ent Media Group; Barry Barnholtz, Barnholtz Entertainment; Craig Baumgarten, MAC Releasing; Craig Bernstein, ICM; Paul Colichman, Regent Entertainment; Michael Dalling, Rogers and Cowan; Joseph Dickstein, Mainline Releasing; Bruce Eisen, Cinema Now; Udy Epstein, Seventh Art Releasing; Erik Feig, Summit Entertainment; Gary Garfinkel, Showtime Networks, Inc.; Marina Grasic, IFG; Judith Jecmen, MGM; Chris Libby, mPRm; Steve Lustgarten, Leo Home Video; Doug Mankoff, Echo Lake Productions; John Manulis, Visionbox Pictures; Sandra J. Ruch, IDA; Morris Ruskin, Shoreline Entertainment; Tony Safford, Fox Searchlight; Art Stribley, Lew Horwitz Organization; and Jared Underwood, Comerica.
The full schedule of events and details can be found at http://www.hollywoodawards.com/conference/market.html
Mark litwak to Speak AT VSDA in Las Vegas
On July 29, Mark will speak about "The Business Side of Filmmaking" during the Video Software Dealers Association Home Entertainment convention held at the Venetian Hotel, Las Vegas.
VSDA has partnered with organizers of the Had To Be Made Film Festival to bring independent filmmakers, distributors and retailers together to promote independent film to the public. This year's Filmmaker Program brings together the nation's leading video retailers, distributors and acquisition professionals to share their ideas and comments. The program is geared to provide networking, learning and sales opportunities.
kiss-and-tell eliminates rights of publicity and privacy.
22-year old Diana Lynn Daly was caught on tape smooching with a member of Texas rockers Flickerstick, a group featured on VH1's "Bands on the Run" reality show.
Daly had no problem with that. In fact, she herself publicly disclosed the kiss. However, she and the band's drummer were in a bathroom stall, and video of her locking lips was broadcast on the show and still images of same were used in a national advertising campaign.
Embarrassed, Daly sued Viacom, Inc., VH1's parent company, for misappropriation of her right of publicity, invasion of privacy, fraud, and infliction of emotional distress, among other causes of action.
The California District Court judge didn't buy it. Judge Maxine Chesney found that the show is an "expressive work," and as such is protected by the First Amendment. Therefore, Daly could not claim misappropriation of her likeness in the program or in advertisements.
Furthermore, since Daly had publicly disclosed the kiss, she could no longer claim a right of privacy. Ruling that the publicly disclosed act could not be made private again "merely by virtue of the location in which such activity occurs," the judge struck down the privacy claim.
Daly's other claims also failed.
Daly v. Viacom, Inc., 238 F.Supp.2d 1118 (N.D.Cal. 2002)
LAST CALL FOR Hollywood Finance and Distribution symposium, JULY 19–20
On July 19 and 20, I am chairing an event that provides independent filmmakers with the opportunity to learn about finance and distribution opportunities.
The two-day event will cover such topics as international co-productions, subsidies, and production incentives; distribution channels; how soon is too soon to promote or market a film; and the future of film financing. In addition, filmmakers will have the chance to discuss their projects with agents, studio execs and distributors in 30-minute round tables.
Speakers include Rob Aft, Independent Consultant; Jeff Andrick, XL.Ent Media Group; Barry Barnholtz, Barnholtz Entertainment; Craig Baumgarten, MAC Releasing; Craig Bernstein, ICM; Paul Colichman, Regent Entertainment; Michael Dalling, Rogers and Cowan; Joseph Dickstein, Mainline Releasing; Bruce Eisen, Cinema Now; Udy Epstein, Seventh Art Releasing; Erik Feig, Summit Entertainment; Gary Garfinkel, Showtime Networks, Inc.; Marina Grasic, IFG; Judith Jecmen, MGM; Chris Libby, mPRm; Steve Lustgarten, Leo Home Video; Doug Mankoff, Echo Lake Productions; John Manulis, Visionbox Pictures; Sandra J. Ruch, IDA; Morris Ruskin, Shoreline Entertainment; Tony Safford, Fox Searchlight; Art Stribley, Lew Horwitz Organization; and Jared Underwood, Comerica.
The full schedule of events and details can be found at http://www.hollywoodawards.com/conference/market.html
Mark litwak to Speak AT VSDA in Las Vegas
On July 29, Mark will speak about "The Business Side of Filmmaking" during the Video Software Dealers Association Home Entertainment convention held at the Venetian Hotel, Las Vegas.
VSDA has partnered with organizers of the Had To Be Made Film Festival to bring independent filmmakers, distributors and retailers together to promote independent film to the public. This year's Filmmaker Program brings together the nation's leading video retailers, distributors and acquisition professionals to share their ideas and comments. The program is geared to provide networking, learning and sales opportunities.
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