LEGAL TIPS for FILMMAKERS – Don’t Do a Deal Without Them

Legal Tips for Filmmakers

By The Film Collaborative Legal Counsel Cherie Y. Song, Esq.

 2257 Regulations

§ 2257 of Title 18 of the U.S. Code, the enforcement guidelines for the Child Protection and Obscenity Enforcement Act of 1988, requires producers of visual depictions of actualsexually explicit conduct to maintain records to ensure that actors in such depictions are not minors and to label materials containing such depictions with the location of the records.  In 2006, Section 2257A broadened the record-keeping and labeling requirements of 2257 to visual depictions of simulated sexually explicit conduct.  Failure to comply with either is a criminal offense.

What does this mean for the indie filmmaker?  Practically speaking, if your film contains at least one simulated sex scene, regardless of genre, and the film’s original production commenced after March 18, 2009, then you may be subject to the record keeping requirements of Section 2257A unless you’ve timely filed what’s called a “safe harbor” exemption letter with the U.S. Attorney General certifying, among other things, that in the regular course of business, you collect and maintain IDs of all performers and give the statutory basis for eligibility for the safe harbor.

Because distributors, as “secondary producers,” may be required to maintain records that identify the filmmaker for any depiction and that verify the filmmaker checked the legal age of performers prior to the date of original production, a growing number of them are requiring such safe harbor letters from filmmakers to minimize their liability.  Obtaining a safe harbor letter may be a condition to close the deal, so make sure you look into this in advance.

Terminate and Revert.

You’re sick and tired of waiting for him to live up to his promise, and you remind him and remind him a second time, and he still forgets.  You’ve had it and want out.  Where do you go from here?  In the context of a distribution deal, you want your contract to contain a clearly written default/termination provision that allows you an “out” if the distributor fails to do something material, say pay you overages or send you statements.  Make sure your rights automatically revert to you upon termination (but subject to any pre-sold territories).  In addition, make sure you have an “out” if the distributor files for bankruptcy or assigns the contract to an unaffiliated third party who may not necessarily be able to live up to the promises the distributor made.  Then you can take your film and try to monetize it in any unsold territories, which may be difficult, but it’s better than the alternative, which is to be stuck in a bad relationship.

Terms Should Be Defined.

It’s not uncommon – in fact, it’s the norm – that distribution contracts contain undefined terms, or better yet, terms whose definitions are to be given meanings “in accordance with industry standards.”  Some filmmakers prefer the IFTA definitions because they are believed to be on their faces more “fair” than the definitions contained in some distributors’ contracts.  Read the definitions carefully, and make sure you’re not inadvertently giving your rights away.  For example, if you want to stream your film on your website(s) or social networking pages, make sure the definition of “Digital Rights” in your contract excludes this right.  You may want to consider putting in a reservation clause as follows:  “Notwithstanding anything to the contrary contained herein, Licensor shall retain the right to [list reserved rights].”  In all cases, you should have a qualified distribution attorney review the contract to make sure it reflects the deal you made.

Please also refer to TFC’s Digital Distribution Tips in regard to definitions of digital rights. Technology of delivery is not the only factor that should be considered in defining and categorizing rights. One must consider payment methods and potential modes of receiving content.

Payment Triggers.

If you’re getting a minimum guarantee (usually paid out in installments), your contract should contain clearly defined triggering events for payment(s) and a time period within which such payment(s) should be made.  If distributor fails to pay the full MG within a certain time period following complete delivery, you should have the right to terminate the agreement, get any materials in distributor’s possession returned to you and all rights granted to the distributor should revert to you so you can take your film elsewhere.

Disclaimer:  This article contains information of a general nature that is not intended to be legal advice and should not be considered or relied on as legal advice.  Any reader of this article who has legal matters involving information addressed in this article should consult with an experienced entertainment attorney.  This article does not create an attorney-client relationship with any reader of this article.  Cherie can be reached at CherieSong@me.com

 

Orly Ravid October 24th, 2011

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