Film

CDAS Named a Top Tier Firm, Nationally, for Entertainment Law and Trademark Law in U.S. News – Best Lawyers® “Best Law Firms in America 2020,” and achieved High Rankings in Copyright and Media Law

CDAS achieved a Tier 1 ranking nationally for Entertainment Law – Motion Pictures & Television as well as Trademark Law. The firm was also ranked nationally in Tier 2 for Copyright Law. Within New York City, CDAS was ranked in Tier 1 for Entertainment Law – Motion Pictures & Television, Copyright Law and Trademark Law, and in Tier 3 for Media Law.

These competitive rankings are based on extensive client and peer review, focused on practice group expertise, responsiveness, understanding of business needs, cost-effectiveness, and other important parameters. Inclusion in “Best Law Firms” is considered a significant achievement.

The Entertainment Industry in 2020: Four Legal and Business Issues For Consideration

By Simon Pulman and Briana Hill

1. AB5 Brings Uncertainty: The new California Assembly Bill 5 (AB5) became effective on January 1, 2020. Originally created to codify the California Supreme Court’s decision in Dynamex Operations West, Inc. v. Superior Court of Los Angeles (2018) 4 Cal.5th 903 (Dynamex), and to address the increase of misclassification of workers as independent contractors, the drafting of AB5 is so broad that it greatly expands the definition of “employee” in a way that potentially reclassifies most independent contractors as employees. This has huge potential repercussions for many companies doing business in California, including those in the entertainment industry (which has traditionally been extremely reliant on independent contractors), as companies may now need to provide full employment benefits to individuals previously characterized as independent contractors.

While there are certain statutory exemptions, the exemptions do not cover traditional entertainment job categories.  There is currently very little guidance as to how the law will be interpreted and enforced, and how it will interact with guild rules. It is incumbent on all studios, producers, networks, and other entertainment companies to watch developments closely, and to consult with knowledgeable counsel when in doubt.

2. Continued Evolution in Streaming: The rise of streaming platforms has dominated the film and episodic programming business over the past few years. 2020 is poised to bring the most significant year of change yet, as new platforms such as HBO Max, Quibi and Peacock will join the recently launched Apple TV+ and Disney+, and incumbents such as Netflix, Hulu, and Amazon. Each of these platforms is targeting a slightly different position in the marketplace, and the economics for content producers vary on a platform-by-platform basis based on the rights and territories that each discrete platform is presently seeking to acquire.

From a deal-making perspective, it is possible that the increased competition will put pressure on platforms to offer greater transparency into the performance of their content and potentially more meaningful participation for creators in the upside of successful series and movies. Additionally, it will be interesting to see if Netflix blinks with respect to its (to date) steadfast insistence on dropping all series on an all-at-once “binge” model, given the plaudits and positive buzz that Disney+ has received for releasing episodes of The Mandolorian on a weekly basis. Finally, Quibi is a truly interesting new entrant that is planning some fascinating creative experiments with short form and interactive content, in addition to providing producers with a business model that is arguably more favorable than some of its competitors.

3. Exclusivity Reigns in Podcasting: 2019 was a year of huge growth and continued maturation for the podcast industry. Mainstream coverage of the industry expanded significantly, many major celebrity names launched podcasts for the first time, and a number of big media conglomerates entered the space or materially increased investments in their podcast divisions. The maturing of the podcast industry has had notable effects on the business side of this burgeoning medium. Participants at all levels in the value chain have started to stake a claim to ownership of, or participation in, podcast rights and revenues. Moreover, the deal-making has become much more sophisticated. Prior to 2019, the dominant podcast distribution model was very simple – make your podcast available on as many ad-supported platforms as possible, and split revenues between stakeholders (usually the creator and the production company or network) (often in a straight 50/50 configuration). This began to change during 2019 as certain companies grew and engaged more experienced representation, and entrants such as Spotify and Luminary started to lock down exclusive rights to content.

Expect the podcast content arms race to heat up in 2020, as high-profile shows and creators commit exclusively to platforms in exchange for sizeable minimum guarantees. However, platforms that offer podcasts in combination with music (such as Spotify, Apple, iHeart, and Pandora) would appear to be best positioned in the market versus pureplay podcast subscription outlets because of their existing subscriber bases and the value proposition of bundling music with podcast (and, indeed, expect 2020 to be the year of the “music podcast”).

4. Gaming Grows: As Netflix Chairman and CEO Reed Hastings famously opined, Netflix is primarily competing with Fortnite rather than with other SVOD platforms. Expect 2020 to be a huge year for gaming, with the release of several big titles (such as Cyberpunk 2077 and The Last of Us 2) being followed by the impending launch of much-anticipated new consoles Playstation 5 and Xbox Series X in the fall.

The continued growth of gaming will fuel a corresponding growth in esports and “game-adjacent content culture” – the creation, consumption and interactive fan participation in content around the culture of videogames, via platforms such as Twitch, Mixer, YouTube and Instagram. All of the next-generation gaming platforms will include built in recording and streaming capabilities allowing gamers to easily create media and engage with other users. While this arguably implicates copyright issues for rightsholders, many of the game companies have taken a permissive stance regarding streaming (and other activities, such as creating derivative works), believing it to be helpful to their business – although distributors must also be cognizant of other issues such as right of publicity.

Additionally, as discussed in a previous blog, expect a flurry of announcements during 2020 and beyond with respect to entertainment extensions of videogame properties – most notably film and TV adaptations, but also podcasts and graphic novels. A significant portion of these will probably involve the original game developers and/or publishers in a meaningful way, as rightsholders understand the importance of maintaining a strong and consistent brand across platforms.

Other sectors of the entertainment business should ignore gaming at their peril. For more, we recommend reading “7 Reasons Why Video Gaming Will Take Over” by Matthew Ball.

Demystifying WGA Television Residuals

Under the Writers Guild of America Theatrical and Television Basic Agreement (the “Basic Agreement”), credited writers for television motion pictures, including episodic programs, are entitled to receive compensation for the reuse of their work, also known as residuals. Television residuals were first negotiated by the Writers Guild of American (the “WGA”) in 1953, under the theory that a rerun of an existing program reduces employment for new products. Consequently, residuals are payable for the reuse of a writer’s material, as opposed to the original exhibition. Though initially limited to programs made-for-television and to five rerun payments, residuals expanded over the years not only to include home video, pay television, cable, new media, and others, but also to payments in perpetuity.

Whether or not a television writer is entitled to receive residuals is ultimately governed by the WGA’s credit determination. Per the Basic Agreement, if the guild accords a “Written by” credit to a writer, such individual is entitled to receive one hundred percent (100%) of available residuals, while a writer that is accorded a “Teleplay by” credit can claim seventy-five percent (75%) of available residuals; if the guild accords only a “Story by” credit to a writer, he or she is entitled to receive twenty-five percent (25%) of available residuals[1]. Furthermore, for an episodic series, if a writer were entitled to Separation of Rights[2] and “Created by” credit on the series, such writer would be entitled to a residual on the creator sequel payment minimum payable for each episode of the series produced beyond the pilot. Continue reading

Examine How the #MeToo and #TimesUp Movements are Impacting Entertainment Contracts

As the #MeToo and #TimesUp movements and their effects continue to unfurl, Hollywood is utilizing legal mechanisms via entertainment contracts to implement and supplement the changing norms, from “morals provisions” to “inclusion riders.”

What are commonly referred to as “morals provisions” have a long history in the entertainment industry, but in recent years, have been more commonly found in endorsement and advertising deals than in television and film agreements. Studios and production companies that had stopped using such provisions have started putting in place plans to reimplement them, while those that had been using them all along are revising them to conform to the new landscape.  Even distributors who never used morals provisions are starting to include them in their contracts, lest one of their projects ends up with some unexpected negative baggage.  Regardless, all of these industry players are looking for ways to tailor their contractual language to better address the valid business concerns related to fallout from the #MeToo movement.  Although talent attorneys are generally not pleased at the resurgence of these provisions, it appears unlikely at this time that the provisions will go away entirely; indeed, in some cases talent representatives think that there should be reciprocal provisions benefitting talent if there is another Weinstein-like situation with a studio or distributor. Continue reading

The de Havilland v. FX Networks, LLC Appeal: Round 2 Goes to FX

On Monday a California appeals court handed down a decision in the closely watched case of de Havilland v. FX Networks, LLC et al., triggering a collective sigh of relief from studios, networks, and other content producers. The court’s decision reaffirms two widely recognized principles: (1) that the First Amendment’s protection of creative works is not limited by the mere fact that a work generates income, and (2) that an individual cannot censor the way in which she is depicted in a creative work merely because she does not like that depiction.

These principles, as applied to the entertainment industry, have been challenged in recent years with a wave of cases such as de Havilland.  For instance, a case in New York, Porco v. Lifetime Entertainment Services, LLC, was allowed to proceed after an appellate court held that the newsworthiness exception to New York’s statutory right of publicity did not apply to a docudrama that substantially fictionalized the life story of a real person.  The court stated that such a work was “mainly a product of the imagination” and thus “nothing more than [an] attempt[] to trade on the persona of the plaintiff.” Continue reading

Notable TV and Digital Deals from Q3-4 2017

The last few months have seen a number of high-profile deals in episodic programming, spurred in part by the entry of a number of significant new players in the marketplace. Here are a few particularly noteworthy entries:

Jennifer Aniston, Reese Witherspoon Morning Show Drama Lands at Apple With Two-Season Order

Apple is anticipated to become a major purchaser of entertainment content, and it made a splash with its first show announcement – a two-season order for a show starring and executive produced by Jennifer Aniston and Reese Witherspoon, set inside the cutthroat world of morning television.

Lin-Manuel Miranda’s ‘Kingkiller Chronicle’ Series Set At Showtime

Everyone is looking for the next “Game of Thrones and “The Kingkiller Chronicles,” in development at Showtime and based on Patrick Rothfuss’s acclaimed fantasy series, may be it. “Hamilton” creator Lin-Manuel Miranda is attached to executive produce, and will contribute music to the series – a key development as music is an important component of Rothfuss’s books. Continue reading

Writers Engaged in “Additional Capacities” – Article 14 Basics

WGA writers, particularly as they advance in their careers, often end up engaged in both their capacity as writers as well as in an additional non-writing capacity, such as executive producers.  Article 14 of the WGA Minimum Basic Agreement (MBA) is therefore an important provision to understand for both writers and anyone engaging them; it states that if a writer is engaged in such an additional capacity, but also provides writing services, those services are still covered by MBA and that writer is still entitled to at least a certain level of minimum compensation for writing services.  Without Article 14 of the MBA, it would be difficult to determine what portion of a WGA writer’s time is spent writing, versus (for example) producing, and thus difficult to determine the writer’s minimum compensation.  Article 14 was one of sections of the MBA that was updated as part of the May 2, 2017 three-year revision of the MBA, discussed here. Continue reading

Inside Counsel’s Five-Part Series, “Where Former Entertainment GCs Go Next”, Provides Firm Profile of CDAS

Inside Counsel’s Senior Editor & Community Manager, Rich Steeves, published a five-part series titled “Where Former Entertainment GCs Go Next” last week, which was prominently featured on the Inside Counsel website.

The series, which discussed the so called “third act” for successful general counsel, provided a comprehensive profile of CDAS and the services the firm provides to clients, while also discussing the appeal the firm has had for former GCs in their transition to a new environment.

CDAS Partners Aileen Atkins, Frederick Bimbler, Douglas Jacobs, Eleanor Lackman, Marc Simon and Stephen Sheppard were interviewed for the series. You can find a link to each part of the series below.

PART 1: http://www.insidecounsel.com/2015/04/27/third-act-where-former-entertainment-gcs-go-next-p
PART 2: http://www.insidecounsel.com/2015/04/28/third-act-where-former-entertainment-gcs-go-next-p
PART 3: http://www.insidecounsel.com/2015/04/29/third-act-where-former-entertainment-gcs-go-next-p
PART 4: http://www.insidecounsel.com/2015/04/30/third-act-where-former-entertainment-gcs-go-next-p
PART 5: http://www.insidecounsel.com/2015/05/01/third-act-where-former-entertainment-gcs-go-next-p

Stolen Screenplay Ideas: A Look at Recent Cases

It’s a tale almost as old as Hollywood itself. A new movie comes out and garners some attention and commercial success and, before the first profit participation checks have been mailed (and even if the movie never turns a profit), a lawsuit has been filed alleging that some element of the movie was stolen from an earlier work – and often an earlier work that has never seen the light of day commercially. Continue reading

Re-Creation of Scenes from Pornographic Film for Biopic Not a Violation of Copyright Laws

New York Court Tosses Copyright and Trademark Claims at Pleading Stage

In Arrow Productions, Ltd. v. The Weinstein Company LLC, et al., No. 13 Civ. 05448, 2014 WL 4211350 (S.D.N.Y. Aug. 25, 2014), Judge Griesa undertook the judicial task of determining whether Defendants’ unauthorized recreation of scenes from Arrow’s copyrighted film constitutes fair use by viewing “all that is necessary” to make such determination – scenes from the pornographic film descriptively titled Deep Throat, and the film that allegedly copied them, Lovelace.  All in a day’s work.

Arrow is the copyright owner of the well-known pornographic film Deep Throat (1972) starring a young Linda Lovelace.  Deep Throat is about a woman’s journey to achieving sexual satisfaction, and is replete with sexual scenes and nudity.  Defendants’ film, Lovelace (2013), is a biographical account of Linda Lovelace.  Lovelace documents how Linda Lovelace’s formative years in the pornography business, including her experience filming Deep Throat, and her emotionally abusive marriage to Chuck Traynor led her to become an outspoken critic of pornography later in life.  Lovelace does not contain any pornographic scenes or nudity. Continue reading

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