Entertainment Legal Issues Which Can Arise in the Development of a Film or TV Project

Issues That Can Arise During the Development of a Film or Television Project

With multiple parties often involved in the creative process of a project, whether it’s a concept a producer has conceived, the script, ideas for a pitch, the music, obtaining development money, or a development deal, there can be issues of ownership, copyright issues, and a tendency to give away far too many important pieces of the pie which can leave the creator or creators of a work with little left but crumbs for themselves when all is filmed and done.

Before a filmmaker make promises they can’t keep or finds themselves in a situation in which they and a collaborator have each have agreed to an equal split and can no longer agree on anything, it’s essential to draft an agreement with the help of an experienced California entertainment lawyer.

When a collaborator starts to grumble about what’s in it for them, it can already be too late. The time to get experienced legal advice and consider discussing the framework of a producer’s working relationship is when they decide to collaborate with anyone else on their project.

It’s when a creator or producer begins to work with others on their project, share ideas with their best friends, or talk to others in the entertainment industry before putting their ideas to writing and have them copyrighted, that projects can be stolen. It’s possible after a submission has been made by a talent agency or by a network or studio after a reputable and experienced entertainment law firm has submitted a project to them but that’s less likely. Thefts of good ideas and concepts probably occur more frequently when a creative person shares their ideas with someone they’re closely involved with in the early stages or creation of the concept for their film or television project.

It’s also at the start of a collaboration when an individual creator or producer has the most leverage to strike a deal with others. The collaborator wants to work with them. It’s at that early stage they should get a contract signed, not when the collaborator has added to the value of the project and obtains leverage over the initial creator. Once a collaborator begins to add to the creative process, it’s too late. Once production starts, it’s impossibly late. Anyone who collaborates with others in the creation of a project has rights to a share in the copyrights eventually obtained for the work involved.

To reinforce how key it is to have contractual arrangements put to writing, before any distribution agreement can be obtained from a distributor, an E&O insurance legal opinion will be requested by the insurer to confirm the proper legal contracts have been signed with every participant in the creation and development of the project. A distributor must ensure that the production company is the sole owner of the project. Unless a producer’s rights are tied down in writing, that legal opinion will state there are issues which should concern the distributor. And distributors don’t want to hear that type of legal advice.

Copyright Mistakes When A Producer Attempts To Protect A Project in Development

Making the mistake of filing a copyright form in which a person makes the statement that a work is a derivative work when it isn’t, can affect a lawyer’s analysis of whether the production company is the sole owner of the project with the right to distribute a film, or whether further licenses or agreements must first be obtained by the production company.

When it comes to filing copyrights and trademarks, the creator of a work or the producer of a project needs to entrust the job to their own entertainment lawyer and to no one else. Allowing anyone else in the process to file the copyright for the producer and owner of the project can result in years of expensive litigation when rights are asserted by others in the creative process or when copyright applications are filed incorrectly.

Copyright assignments must also be utilized and drafted carefully to avoid loopholes that can result in litigation after a film is released. They should also be signed by anyone in the creative process to ensure that the producer is the sole owner of the project.

If a screenplay is written by more than one writer, or a writer co-writes it with the producer, an agreement must be drafted to state how the co-writers will share the screenplay rights.

Film music licensing is a complicated process. The cost of licensing music for a film will depend on the popularity of the songs, and where the music is used in the film, for example during the credits, can make the music much more expensive to license. To “clear” the music, an entertainment attorney experienced in film music licensing should be retained for what can be a lengthy and expensive process.

Work-for-hire agreements today are not as simple to draft or apply in as many situations as they were in decades past. A poorly drafted work-for-hire agreement or one which doesn’t fit the fact situation of the employee’s obligations to be at the disposal of the producer can result in the “work-for-hire employee” being determined to be an actual employee, for whom taxes should have been paid as well as overtime and paid for missed lunch breaks and rest breaks.

Film and Television Development Agreements

Among the types of agreements which need to be drafted and signed during the development stage of a film or television series production include agreements for the purchase of rights to another’s work, e.g a book option or screenplay option, a life story agreement, an agreement to hire a writer to write, rewrite or polish a script, work-for-hire agreements, collaboration agreements, and co-production agreements.

Business Entity Formation During the Development Stage

Producers need to form a business entity for their production projects in order to protect themselves from liability, but they should not try to save money by using a service that prepares thousands of corporations monthly all from a template which they use like a cookie cutter to mass produce the same cookies for everyone.

Although a producer can operate as a sole proprietorship, there is no protection for the sole proprietor other than what insurance coverage they may be able to purchase with all of the exclusions contained in the insurance policy.

General partnerships still expose a producer to liability and while limited partnerships are better if structured appropriately, they are still not favored. Corporations can be used, however, the most favored form of entity by film producers today are LLCs.

However, even an LLC’s protection can be illusionary if the directors of the corporation or the members of the LLC fail to comply with the formalities required of them. There are less formalities with operating an LLC, however co-mingling personal and entity assets is one of the biggest issues looked at by attorneys seeking to pierce the corporate veil and attach liability to the owners and managers of the LLC.

One approach to filmmaking is to create one entity to hold a basket of all of the producer’s eggs or in this case, the producer’s projects as the producer begins to mold these early stage concepts into viable possible projects for production. Some initial acquisitions might even be entered into for some of these projects such as book oroptions.

Then, only when one project is ready to be hatched and taken to the next stage for financing, the project and the producer’s rights to it are conveyed to a separate LLC. In that way, as the project gets underway, the producer’s other projects remain separate and protected in the group project warming entity.

The LLC for the project being funded on the other hand signs all of the other agreements, hires actors, a cast, a directors and obtains commitments from A-list actors. The newly formed LLC thus owns and licenses the project, and becomes responsible to the investors. Distributors wishing to ensure that all the rights to the project are secure, will look to the individual production LLC’s paperwork and not delve into the LLC simply warming other projects before they’re hatched.

At all cost, despite filmmaking being a collaborative industry, filmmakers should avoid entering into joint ventures or any other agreements of that type which would allow one partner the ability to stymie the other from making decisions and bringing the project to completion. Like a marriage or even a law corporation, breakups happen frequently, people pass away, get tired of the rat race, go on vacation, sometimes permanently, or get into trouble with drugs or alcohol.

Protecting The Producer’s Project and Rights

When it comes time for a distributor to look at a filmmaker’s rights to the work about to be filmed (if contacted that early) or when it’s ready for distribution, the distributor’s attorneys will want to look at the producer’s rights to the script, any underlying books or prior scripts, rights of collaborators, music rights (licensing), location agreements, and more.

A filmmaker must have parental consent to use child actors in a film, negotiate actor and director agreements, obtain agreements with all of the over the line crew, talent release forms, materials release forms, location release forms, group releases, extra releases, crew deal memos, and much more. While the failure to have all of one’s ducks in a row may not be a deal breaker, if the missing ducks cannot be signed, the project may sink into the mud where other dead projects reside.

Once a producer makes the decision to spend the time and money to create a work or develop a film or television project, it’s essential to retain an experienced entertainment law firm at the earliest possible date to protect the producer’s rights from the very start and all the way through production, distribution and theatrical release or broadcast on networks or on streaming services.

Every contract is important. Not just the early agreements a producer makes with collaborators or the production contracts, but the contracts with sales agents and distributors, with A-list actors, and with investors are equally important. Filmmaking is a learning process, but some lessons can be avoided with the right entertainment attorney on your side.

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ABOUT THE AUTHOR: The Law Offices of R. Sebastian Gibson
Entertainment Lawyer Sebastian Gibson has over 40 years combined experience in California and London. He has been named a 2019 Top Lawyer for the 9th year in a row by Palm Springs Life Magazine and has been called “Brilliant” and “A Legend.” With law degrees both in California and in Great Britain, Sebastian Gibson is rated as a “Superb” lawyer, their highest rating, by Avvo. He has written for the Los Angeles and San Francisco Daily Journal newspapers and is a published author with offices in Palm Springs/Palm Desert and Newport Beach. Sebastian Gibson is the right choice for all your entertainment film and television productions, projects in development and film and TV agreements for productions in the U.S., the UK and around the world as well as the international entertainment law firm to turn to for entertainment events, music performances, world tours, songwriting, publishing, modeling, fashion, athlete representation, and other creative aspects of the entertainment industry.

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Disclaimer: Every effort has been made to ensure the accuracy of this publication at the time it was written. It is not intended to provide legal advice or suggest a guaranteed outcome as individual situations will differ and the law may have changed since publication. Readers considering legal action should consult with an experienced lawyer to understand current laws and.how they may affect a case. For specific technical or legal advice on the information provided and related topics, please contact the author.