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Filmmaker Bill of Rights

Filmmaker Bill of Rights

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Published by Mark Litwak
How Filmmaker's can protect themselves
How Filmmaker's can protect themselves

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Published by: Mark Litwak on Jul 11, 2011
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07/11/2011

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Filmmaker Bill of Rights
By Mark Litwak 
A reputable distributor should be willing to accept terms that protect a filmmaker's interests.Many such provisions do not cost the distributor anything as long as the distributor lives up tothe terms of its contract. A provision for interest on late payments, for example, costs thedistributor nothing as long as payments are made on time. Such provisions are important becausethey encourage a distributor to live up to its commitments, and provide the filmmaker with aviable remedy in case the distributor defaults. Here is a list of some of the most critical ways for filmmakers to protect their interests.This list should not be considered exhaustive. There are other items a filmmaker may want toinclude such as clauses dealing with advances, guarantees and reservation of rights.
1.
NO CHANGES
: The film should not be edited, nor the title changed, without thefilmmaker's approval. Editing for censorship purposes, television broadcast and changesmade for a foreign release, such as translating the title, is permissible.
2.
MINIMUM ADVERTISING SPECIFIED
: The contract should specify in writing theminimum amount the distributor will spend on advertising and promotion of the film. Thedistributor should make a commitment to pay for the creation of a poster, one-sheet andtrailer if these items have not been created.
3.
EXPENSES LIMITED
: There should be a floor and a ceiling on expenses. Marketexpenses (the cost to attend film markets) should be limited to the first year of release andcapped per market. Promotional expenses should be limited to direct out-of-pocket costsspent to promote the film and should specifically exclude the distributor's generaloverhead and staff expenses.
4.
TERM
: The term should be a reasonable length, perhaps up to ten years, but not in perpetuity. The filmmaker should be able to regain rights to the film if the distributor gives up on it. Thus, it is best to have a short initial term, such as two years, and a seriesof automatic rollovers if the distributor returns a certain amount of revenue to thefilmmaker. If these performance milestones are not met, all rights would automaticallyrevert to the filmmaker.
5.
INDEMNITY
: Filmmaker should be indemnified (receive reimbursement) for any lossesincurred by filmmaker as a result of distributor's breach of the terms of the agreement,violation of third party rights, and for any changes or additions made to the film.
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6.
POSSESSION OF NEGATIVE
: Distributor should receive a lab access letter rather than possession of the original negative and other original elements. Distributor shouldnot be permitted to remove masters from the laboratory.
7.
ERRORS AND OMISSIONS (E&O) POLICY
: While it is generally the filmmaker'sresponsibility to purchase an E & O insurance policy, distributors are often willing toadvance the cost of this insurance and recoup the cost from gross revenues. In such anevent, the filmmaker should be added as an additional named insured on the policy.
8.
TERMINATION CLAUSE
: If the distributor defaults on its contractual obligations,filmmaker should have the right to terminate the contract, and regain rights to license thefilm in unsold territories as well as obtain money damages for the default. Filmmaker should give distributor fourteen days prior written notice of default before exercising theright to termination.
9.
RIGHT TO INSPECT BOOKS AND RECORDS
: Distributor should maintaincomplete books and records with regard to all sales and rental of the film. Filmmaker should receive quarterly (or monthly) producer statements with any payment duefilmmaker. Filmmaker should have the right to examine the books and records of distributor during reasonable business hours on ten days notice.
10.
LATE PAYMENTS/LIEN
: All monies due and payable to filmmaker should be held intrust by distributor for filmmaker. Filmmaker should be deemed to have a lien onfilmmaker's share of revenue. Distributor should pay filmmaker interest on any amounts past due.
11.
LIMITATION ON ACTION
: Filmmaker should have at least three years from receiptof any financial statement, or discovery of any accounting irregularity, whichever is later,to contest accounting errors and file a Demand for Arbitration.
12.
ASSIGNMENT
: It is best to prohibit assignment unless Filmmaker consents. If assignment is permitted, Distributor should not be relieved of its obligations under theoriginal contract.
13.
FILMMAKER DEFAULT
: Distributor should give Filmmaker fourteen days writtennotice of any alleged default by filmmaker, and an additional ten days to cure suchdefault, before taking any action to enforce its rights.
14.
WARRANTIES
: Filmmaker's warranties in regard to infringement of third party rightsshould be to the best of the filmmaker's knowledge and belief, not absolute.
15.
SCHEDULE OF MINIMUMS
: For distributors who license foreign rights (known asforeign distributors or foreign sales agents) there should be a schedule of minimum
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