Filmmaker Beware: Know How to Analyze Your Distributor Contract

Listen to Bob Seigel before signing any contracts. He covers what’s normally IN MOST contracts and SPEFICALLY what you should be looking for. If you would like to learn more about Carole Dean and From the Heart Productions please visit www.FromtheHeartProductions.com

Transcript

SPEAKER_05 0:01

Love So Radio.

SPEAKER_02 0:15

Hi and welcome to the Art of Film Funding. I'm your co-host, Claire Capan. Along with Carol Dean, author of the best-selling book, The Art of Film Funding, Carol is also the founder and president of From the Heart Productions and the host of this show. Robert Siegel has more than 20 years' experience in the counseling and representation of producers, writers, directors, distribution companies, and foreign sales agents concerning development, production, marketing, distribution, and exploitation of fiction and nonfiction film, television, publishing, and new media projects. His clients' projects have appeared theatrically and on networks, syndicated public, and cable television, and have earned Academy Award and Emmy nom nominations and awards and prizes at major film festivals. And Carol, I understand that Robert is a donor to your Dean Film Grant.

SPEAKER_03 1:23

Yes, Robert fully supports from the heart with a generous donation of his fees. And we thank you for joining us, Robert.

SPEAKER_04 1:30

Thank you. Glad to be here.

SPEAKER_03 1:32

Well, today I want us to cover what's in most contracts and what filmmakers specifically should be looking for. And then let's get into distribution contracts and discuss the pitfalls that filmmakers should be aware of. And so let's start, Robert, with what's m in most contracts and what you should immediately be looking for.

SPEAKER_04 1:54

Well, uh again, if if you're producing the film, you know, there you have to have certain agreements like basically cast and crew memos, releases, you know, those type you know, those type of things, uh as well as a chain of title, if it's there's a screenplayer involved, etcetera. And that's the whole the whole area of like production council work, you know, w which we you know we can discuss. Um but uh I know we were gonna talk about distribution and ironically for most um producers, um the distribution is something that comes, you know, later in in the in the in the process. It's very rarely unless you're you know, you're able to like pre-sell rights, which is really, really difficult because it has to have the level of talent or certain, you know, subject matter that that has a certain marketability. So f frequently it will be um you know, it's later in the p in the process, um such as, you know, when you have a r you know, a rough cut or or a fine cut or something like that. But regardless, it's the s the same issues are you know, we have to address. And as I said, it's basically getting everyone who works on the film or participates, there should be some type of agreement where everything they're doing is a work for hire owned by the production company or or the rights have been assigned, just in case it it doesn't clearly m constitute a work for hire. And of course the you know, the location agreements, material releases if you're using and of course um the you know, if you're using uh music, you know, composer agreement, if it's any, you know, pre-existing music or the compos you know, the composer is not doing it as a work for hire, then basically you know the they're granting the rights to use it in the motion picture, in promotion, advertising, along along those lines. Uh and obviously those are the things that have to be taken care of. So uh earlier in the process, you know, that can be early in the process, the better off. A lot of times it'll be um, you know, I'll I'll talk to people where they have a distribution deal and then we have to kind of reverse engineer it to the extent that we can. Um, you know, basically what agreements are there, and then you have to kind of play catch up, which is always difficult where everybody is flown to the four corners, you know, the earth. So, um you know, so uh the earlier the earlier the better. And you know, it's like I know people don't like going to the dentist or going to the lawyer, but you know, there's a reason for it. And uh you know. And I think I think I'm a little less painful than the dentist.

SPEAKER_03 4:32

Uh definitely. Well let's let's uh get very clear here. So in other words, every person who works on the film has to have a contract.

SPEAKER_04 4:44

Yeah, some type of contract. It may be a release, it may be a cast, maybe a deal memo, and but that yeah, that has to really they sh it should be papered as much as possible and you know, people don't realize like if you're using somebody's apartments, say, you know, not o not only you know you need to get permission, but the question is who do you from whom do you have to get the permission? I mean, is it is it really the r the tenant or is it really the landlord who actually owns the building? And basically the tenant will make a deal and the landlord will show up and say, Hey, you you have to make a deal with me, not with the tenant. So th those issues, you know, can come up as as well. So that's why it's kind of like part of you know, you're starting a business, regardless of whether it's a film or or anything like that. You just have to kind of think of it in those terms and I know the budgets may be very low, but these principles are the same whether you're doing a fifty thousand dollar film, a f five hundred thousand dollar film, or you know, to a five million dollar film. You know, but obviously there are more issues frequently when the numbers are higher, but it's the same principles.

SPEAKER_03 5:56

Yes. And in with documentaries, it's very important. Uh someone told me that uh when they sold their film to Discovery, that uh every that they went over the film and at every frame when somebody put their foot in the frame and was in the film, they had to have a release form for that person.

SPEAKER_04 6:17

Yes, uh very true. I mean whether it's it's uh National Geographic or Discovery or HBO, you know, basically all what happens is if they're not if they're not producing the film themselves and and they're and they're you know, they're uh trying to secure the r rights to your project, they're gonna have to rely on you as a producer or filmmaker to basically have done this work. And m you know, and and basically and that you have to kind of show that you have done those work because at the end of the day, all these company all these licensees are gonna want errors and omission insurance. They want an insurance that in case provided you've cleared everything that you you know, required to clear, um, that basically if somebody brings uh you know, a third party comes in with a claim that you have insurance that can address it the same way like oh if you get into a car accident, that type of thing, God forbid. So that's part and parcel of of it and in order to really get that type of insurance you have to work with an attorney and you have to basically clear, you know, basically get all the permissions and as I say, music is really, you know, somewhat problematical. I mean, yes, a composer you can make a deal, it's when you start wanting to use certain uh compositions and certain recordings and they have to you know, they have to be licensed. Sometimes you get a music supervisor who basically, you know, knows how to do the research and track it down and and I always tell people, you know, my job basically is I'll provide you with the agreement, I'll I'll review the agreement, you know, and help you negotiate it, but I'm not gonna chase down, you know, bids or offers of how much it's gonna cost because it's not a very productive way for my for me to use the time. You should have somebody who's really going to do all the follow-ups and all that. Um so that's um that's something uh to th to keep in mind.

SPEAKER_03 8:20

Okay. All right, so if if your filmmaker has um an attorney to start with, then the would the attorney give him most of these um contracts to use?

SPEAKER_04 8:33

Well, especially for a documentary, I mean usually there are releases and material r personal releases, material releases, and there's um you know, and then and then they'll there's location releases and again, you know, they're they're they're accessible, but you know, uh you know, people go onto the internet and they try to find everything and you have to remember that each everything is a little bit facts and circumstances. Everybody uh tailor the agreement somewhat. And it's not basically my providing contracts and forms. That's really what the work is. It's really giving advice and also you know, uh just not just advice, but also helping to kind of you know, gu guide through the process as much as I can. And that's really that's based on you know, knowledge and experience and that's really why I'm being you know, hopefully I'm being retained. So, you know, they and of course if you know, I can provide whatever that is, but that's only, you know, a component of it. Obviously in the fiction feature there's a lot more negotiation for like cast and so forth, unless everybody's most favored nations, everybody gets the same deal. But even then, you know, um people don't realize that when you don't have money to fight over because everyone's getting the same thing, you fight over other things such as you know, such as, you know, basically um uh d is a coach or first class, you know, if you're in SAG, you have to really it has to all be first class unless it's ultra it's ultra low and and then you know, basically as long as everybody gets the same treatment, I mean that's it to all sorts of things. So, um you know, that's part and parcel of the documentary is a little more streamlined, but you know, you it's the same. At the end of the day you still need your documentation just to get your errors in omission insurance and uh so that basically uh you know, the n the network or the licensee or the you know, a cable company or what or what have you, or the educational distributor, they're all gonna feel like a sense of relief that, you know, at least it's been covered. Uh because you you started you did the work that led to that.

SPEAKER_03 10:45

So that's Well, you do arrows and omissions uh work yourself, don't you? You review it.

SPEAKER_04 10:51

Well I'm not an insurance company, I'm not an underwriter, but what I do is and and this is really more for documentaries and less so for fiction. There'll be times where rights, you know, there'll be an issue about getting rights to certain, you know, certain materi pre-existing material, and if it's used in a certain manner, there is a defense to copyright infringement called fair use. And, you know, the idea is you you didn't get permission, but you think that because you follow a certain set of guidelines that you're using it not to enhance the production, but because it's a means to illustrate something that's being commented or critiqued upon or an example to be shown. I mean it it's it's very narrow and there is you know there are you know factors to consider. The you can basically and it's again it's a little less difficult less difficult for documentaries than it is for fiction, where everything basically it's hard to talk about commenting and critiquing in a fiction project. It'll happen, but it's less so. Um and so basically there'll be a series of of you know of uses and have you cle you know, basically if you're having been able to clear it and it fits certain parameters, it's fair use and there's an opinion and you explain why basically this defense of fair use, because you're commenting, critiquing, you're not taking too much, you're basically you know, uh you're not diluting the pr you know, the material that you're that you're using, you're using it for some quote transformative purpose. It isn't just to put it in because it it's great production value, there's a purpose for it that is you know, falls within the parameters of fair use. Like uh for you know, one project um which obviously you you know basically won won the grant was the brainwashing of my dad, which is really obviously about um uh the filmmaker Jensenko's father who was who you became a very, very arch conservative person and he used to watch a lot of TV and listen to a lot of right wing radio and you know, and uh and all watch Fox News. And we can't go to Fox, yes, or permission, because all it's it's gonna be sh we were showing how people are being, you know, you know, basically they're they're they're being m you know, their m their mentality is being manipulated possibly. Um and th or certain arguments are being used to draw you into the Fox News world. Yeah, the Fox friends and friends world for for whatever reason. And so we couldn't do that, so we have to find a reason why is it being used. It illustrates a certain concept or tactic that, you know, basically the conservative party frequently or right wing and and also left wing in certain cases uses for the purposes of you know, swaying people's opinion.

SPEAKER_05 13:49

Right.

SPEAKER_04 13:50

So so that's you know, that that was like, you know, basically one one example of of that and uh and then So you found something that was short enough and and concise enough and it fit the what you were saying and so it was acceptable as fair use. Correct. Yeah, because basically in the y uh I give the opinion to the underwriter of the insurance company, they have their attorneys and if there's any issues, you know, we'll address it. Usually, you know, so knock wood, uh usually no issues really come up. Uh and uh because it's been addressed in the fair use opinion.

SPEAKER_05 14:29

Uh-huh.

SPEAKER_04 14:31

So, you know, again, years ago, you know, the idea of fair use was like, oh, it's yeah, it's an i an edu educational concept more, you know, than actually being used, and then basically there were these guidelines from American University for documentaries about how they could be used and basically it i it would you know because you had a choice if you were a documentarian you either had to pay for it or you had to strip it out of the f of the out of the project. And here it is a little f uh flexibility because of these guidelines, these best practices.

SPEAKER_03 15:08

Right. Well this is very important that uh that you know all this. I think this is brilliant because uh so many times people get in big trouble over that. And that uh sometimes, you know, they they hear uh they think they're safe. I heard about one woman who had uh was ready to sell her documentary film and she found that um there was a song being played as a um ringtone on a telephone cell phone in and when she was filming and she had to go back and buy the rights to that music to get a release. And that cost her almost as much as it did to make the film.

SPEAKER_04 15:54

Well uh hopefully it wouldn't have yeah, I mean, uh I'll give you an example like Mad Hot Ballroom, there's a ringtone of Gonna Fly Now from Rocky, and and this and this is it's an important point because if the distributor had been, you know, some mom and pop small boutique company, you know, there could have been an argument that, you know, the the documentarian didn't insert gonna fly now into the film. It you know, in it in the documentary it was something that organically appeared and we couldn't strip it out or anything like that. However, when the deal was made for Manhop Ballroom, it w Paramount Pictures picked it up. You know, which is kind of like a a variation when we were talking about National Geographic and HBO. When you you uh you're dealing with these corporations, you know, they you know, they they want to make sure that everything has been kind of t you know, tied down as much as possible and they a decision had to be made uh that you know, basically to negotiate and get the license for it because it was really Paramount was gonna be the deep pocket, it wasn't gonna be the the documentarian. So Yeah, and yeah, actually there are projects like uh one project where we did have um a couple you know, a couple of fair use cases, but we went to like say Netflix and Netflix is like a studio and it became, you know, they had a question, we had to address it and if it couldn't be addressed we had to figure out about whether to deal with it or or um you know, take it out or whether or not we could have to go back and negotiate again. So the larger companies I mean all companies basically should be following the same path, but as I say, the deeper pockets tend to be a little bit more reluctant, you know, for obvious reasons.

SPEAKER_03 17:44

Absolutely. I understand that. Well, all right. And now see, Robert, uh you know, I consider myself at the hub of the wheel because I talk to filmmakers daily. They call me for advice and they know I'm available to talk to them, and particularly when they get in the tight spot, or they just need someone to talk to. And the m calls I get the most are saying I signed with the distributor, uh, there's three problems I hear the most. And so the first one um that that is that they call and say, Listen, I signed with this distributor, was so excited, but it's been one year and I don't have a penny coming in. And um, so I'm asking you if it's possible that when you are signing a distributor contract, if you put in a clause that says that if X dollars have not come in within one year, then this contract is null and void and all rights revert to the filmmaker. And then the filmmaker has a the has an opening to get rid of this p uh company if they so choose. Is that possible?

SPEAKER_04 18:56

It is possible that again a lot of times you'll hear like best practices put in this what is called a milestone or a performance clause if the distributor or the sales agent doesn't generate a certain amount of revenue, you know, or doesn't release you know, uh distribute doesn't it doesn't come into the marketplace within a certain period of time, but but usually amount of money, and then you have to figure out the amount and uh have to realize that this isn't in a vacuum, that basically um you've made a deal with a distributor or a sales agent, and I'll answer your question, but before you even get to that point, like even f whether you have one sales agent or distributor, or you have a s series of them, the same process occurs. I mean you have to pick the best deal and maybe there's only one and maybe it's better not to take any, but we'll get to that in a moment. That okay. Yeah, that um you know the idea is it's like, you know, buying a car, buying a house, where you uh you know, you go and you find out, you know, what w what the neighbors think of the area, which in this case is really um, you know, other you know, other filmmakers, producers, documentarians have dealt with you know, uh with them and you could check that obviously on the website, IMDB Pro, it's and you know, the idea and a lot of times, you know, the distributor or sales agent will give you the names and it's like, oh they're giving you the names and you know it's not gonna be a bad r review, you know, from the from the from the producer, but at least you have somebody who who l had a good experience with them and you know, you hopefully you can get more than one, you know, two, three. There's no magic number and you can, you know, call and d do a certain sense of due diligence, whether or not, you know, you get the number from the distributor or sales agent or you, you know, uh hunt around for it on your own on you know, on the web or what have you. And uh so you get a sense and again find out when, you know, uh maybe a company that this is their first year, so they really haven't gotten a accounting statement. So, you know, basically they're still kind of in the early stages of their relationship with their sales agent or distributor, so try to find people that have more than one year they've dealt with that distributor or a sales agent. And um and then, you know, obviously there's a negotiation of the distribution agreement, but uh to take your point about putting in a performance clause or a milestone um the idea, you know, being that if it doesn't generate a certain amount of money, you have to you have to realize the distributor's gonna say, Well, you know, w we we paid you in advance or a minimum guarantee, you know, that you know, you know, we pay you the advance, we don't want you to leave w without giving us a chance to basically uh try to make our money back if we can. So, um I mean so that's one factor if it if there is a an advance or a minimum guarantee, or basically we we paid for the cost of certain deliverables, you know, like we b paid for the E and O insurance or we paid for some type of, you know, you know, basically like closed caption, or we do or we did this or that. And and maybe it was on top of or instead of it being in advance or a minimum guarantee, we need to get back that money. So, you know, the more they've basically expended, the harder it is to leave, you know, free and clear. Unless they're saying, well, you gotta give us a certain amount of time to get our money back or, you know, you make a new deal and you get paid money, you gotta pay us so that we're not out of pocket as a you know, as a distributor or a sales agent. So you know you know, the idea would be yeah, uh what what every producer or documentarian wants is to have it free and clear, you know, if if they don't hit the hit their milestone. But sometimes, you know, it's not as as clear as that and at at the end of the day, it's whether, you know, if they say, well we don't give up m you know, b milestones or anything like that, the market is so volatile that we we'd only be guessing. So you have to decide whether or not you can live with one or without one and if you only have one deal, then you have to really look at the deal and say, you know, do I really want to take the deal and you know, sometimes I know it's so tempting to take the deal 'cause it's the bird in the hand, but your b your bird may be very old, you know uh and um you know b basically and uh so you so that's you know, so that you know that's you know, that's something to bear in bear in mind that uh um it's uh you know uh at least it's out there, I mean as I say it's not a science. You know, it and it's dealing with certain people and their relationships but you can have the best contract in the world. If you got some person who's gonna pay you, they're not gonna pay uh uh statements to you periodically, you got the best contract in the world. It's only as good as the people that are there.

SPEAKER_03 24:03

Oh oh is that true? I d I know. I've heard those stories. It's fascinating. Well let's look at for the moment uh not take any deal. You you mentioned that's a possibility too and now with Tug, I like Tug and I like gather dot TV, I think they're both wonderful places where you can distribute your film but you have to uh it's work. It's more work for you but you're in charge.

SPEAKER_04 24:30

It's an option that real years ago you really never had unless you know uh as a general rule but na basically you can s you know in a way you like you split your rights and you slice it and dice your rights to go to different companies that are very good for like education. Like I know Tug does education or I have a client has women make movies that they're doing it's going to be for educational purposes and not for consumer uh necessarily but y you can separate out the rights and of course the idea is it gonna be a you know is it gonna be a worldwide rights deal or is it just basically going to be the US or North America which is usually US and Canada and territories and then the rest of the world. Uh 'cause frequently when you get like a producer's rep, you know what they'll do is they'll make the deal for the domestic part of it, which we we include North America often unless there are s Canadian rights are handled separately. Or um and then there's the rest of the world. And a lot of times when you have a rep, rather they're not gonna go and make the deal for German TV. Some will but some a lot of them you know that's not what they do. You need a sales agent and not a producer's rep. You know, a sales agent handling all the foreign rights and they handle like T V and VOD and all of that. So it may just be you know the domestic including Canada we'll say for North America and it's going to also be the rest of the world and a lot of times the producer rep or you'll find a f a sales agent that will handle the rest of the world. And one of the reasons that this is good is that, you know, if it's all worldwide there's something called cross collateralization where you can take the money you earn like from foreign or domestic and and vice versa and use it to offset expenses that are incurred in foreign and or d or domestic. So basically unless you're getting like an advance or some sort of reasons to go with this po company on a worldwide basis you you should really try to parse out your rights accordingly.

SPEAKER_03 26:44

Yes, that makes a lot of sense because you these are very expensive things, your deliverables that you mentioned, your closed caption, your E and O, your packaging all of those are and filmmakers should know what an average cost is for each of those and I think that should be included in their contract with the distributor so they don't get zoned at the end with with h horrendous or bills that are twice what it should have been.

SPEAKER_04 27:12

Well again a lot of people don't realize that you know they they look at the contract and they're and they don't realize there's a s there's a section called delivery schedule that's attached to it and a lot of you know a lot of things were not thought of or weren't paid for or gonna have to or are required and that's why usually if when people put together their budgets, well one of the things that becomes really problematical is they don't put enough money into delivery. Yeah and you know that it's like oh yeah we made the movie and we're ready to take it to a festival and that's great. Well w you know if uh what happens if there's a you know interest, you know, and they're gonna give you a delivery schedule where you know if you don't provide all of this you know we don't start the deal, we don't pay the advance or the minimum guarantee or or we c or maybe we can't even make a deal.

SPEAKER_03 28:02

So and they should what should they have as a uh an average, what, fifteen thousand, twenty thousand?

SPEAKER_04 28:09

Well I mean in a way let what the let a m producer or documentarian or what have you, um what they should do is they should really find may is they find a sample agreement or f you know, or with something that's comparable and then you take and then you look at the delivery schedule will give you a rough idea. You know you know to to deal with that or you're dealing with a you know if you're dealing with a rep or you know often attorney you'll you'll get one, you know, 'cause again a lot of these delivery schedules are very similar and a lot of them well a lot of them they're all the bells and whistles because they're, you know, deep pocket distributors or sales agents. So um and now because of the internet and because of all you know the classes, you know, and seminars and webinars and all of that, you know, getting this information is become, you know, I won't say easier but less difficult, you know, in order to do that and there are a lot of resources, I mean just because of the internet and because it may not be on the internet but there'll be, you know, where you can get that information and like, you know, for documentaries of the international there's the International Documentary Association or, you know, the various like film independent IFT, there are a lot of organizations. You know, so there are a lot of resources that are out there that were not there, you know, maybe fi ten fifteen years ago or more. So that's and again there's a lot of there is a lot of community. You know, I mean oh I I mean that's why there are a lot of these organizations that uh you know you can basically uh you know you join and and you have the resources and you have members and other people, you know, like IFP and some others. Um as I say here on the West Coast it's really film independent but it's the same concept.

SPEAKER_03 30:03

Um to you know to do all that well okay Robert well let's go to the second thing that I hear a lot is um th I think that the first thing they should do is investigate the distributor. No matter how big they are when you find someone that says um I can't discuss that you know if you call someone and say would you give me a reference for the ABC distributor and they say oh sorry I can't discuss it then you must say did you sign a confidentially a confidentiality agreement and if they say yes I say don't use that distributor because you want to find filmmakers that say they're very happy and they'll give you a good review and when someone's had to sign an NDA they have had major problems, major complaints usually and uh and they had to settle things between them and the filmmaker was told that they cannot talk about it.

SPEAKER_04 31:07

Well yeah frequently this you know this kind of you know i the idea is that uh everything is very is confidential and uh i it can be a a problem but again if if this particular distributor sales agent it has a confidentiality provision in there, you know, it's like this is this it's not the first time this issue has come up probably so uh I think at the end at the end of the day um not everybody has the confidentiality provision and a lot of you know a lot of people you know this reminds me of those confidentiality agreements with Harvey Weinstein and all of that. You know, with the sexual harassment. I mean s same concept it's like you know the idea is well why'd you sign it? It's because we settled you we got money. And it's an interesting point that now that these confidentiality agreements and under these circumstances, I know it's off topic but i are not being uh uh signed or may not be enforced, you know, people are not going to be able to ask for money. You know, a lot of a lot of people under those circumstances as we're seeing don't basically lodge complaints and go and deal with the situation because of money. Uh it's really because they want to get the story out and that's the whole thing with me too and Time's up but I know it's kind of a off on a tangent but it's it's an interesting time to to deal with the situation and it's really pervasive not just in media but across the board.

SPEAKER_03 32:39

But at any rate um uh if they're you know again not everybody basically has the confidentiality provision and what you know so um that's that's something to you know to to consider um when you know well sometimes they get into so many problems the filmmakers run into so many problems with uh their distributor that in order to that they have to um either go uh get an uh uh ten fifteen thousand dollars and hire an attorney and go after the money and most of these filmmakers don't have that kind of money to go to to fight a distributor. So they settled for a small amount and that's when they signed the NDA so they can't talk about w what a terrible experience they had. But the the other thing I often see is that the distributor sometimes sells the film and doesn't tell the filmmaker. So the filmmaker has no idea they sold it but the distributor is playing with the money and doing whatever they want with it.

SPEAKER_04 33:46

So the next thing I wonder is there a way that they can you can say in your contracts that any sales should be reported with in thirty days well it could be it could be thirty days or it could be on a quarterly basis maybe because they have so many titles that to do thirty days for all of them would just it would be a kind of a drain on on on the you know on on the infrastructure or the backroom um registration. But you know hopefully it'll be quarterly and that's why it's important to have accounting statements and not just accounting statements but statements that have a a sufficient breakdown about by you know deal, by uh you know what rights, what amount, etcetera so that you you you do get a you know kind of you know a in the statement you get a bird's eye view of what what deals have been made during that period of time, the that accounting period and also a right to basically audit the books. And um you know so to examine.

SPEAKER_03 34:51

Terrific that would be exactly what you want.

SPEAKER_04 34:55

Yeah I mean uh very rarely um anyone who really objects to having their books examined on a reasonable basis and then we're saying like oh you can only make you know you know what w you asked for one examination per year or sometimes there there's a little statute of limitations in there saying if you don't bring a claim within say two years from when the statement was received by you, the clock shouldn't start till you got the statement um and the payment hopefully um if they're you know if you d are entitled to the payment. Um basically you have let's say two years or three years or five whatever or basically you're time barred because they don't want you after s five years to go back to year one.

SPEAKER_03 35:40

You know publicers should take advantage even if they do it themselves without a a CPA, even if they go look at the books to see exactly what went on because it's not that hard to do. And then if they see a problem they could take a an accountant in with them.

SPEAKER_04 35:59

See again it depends on who you're dealing with. You know you're dealing with you know a larger entity a more established entity frequently they'll say well you know we don't want you know we don't want your you know your your tax accountant your tax you know your bookkeeper looking at our books who has no idea of of how to look at books concerning motion pictures and television. So if you're gonna look for somebody look for somebody who has a certain amount of experience in that area for a certain amount of time and they're gonna say, you know, it's not going to be a fishing expedition. You have to have somebody who really kn knows what they're looking for. Even if they whether or not they find it. So sometimes they'll say you know having an account you know, basically an accountant ha with at least ten years experience. Um or sometimes it says oh it's one we have to approve and you know it's like well I mean that's you know, accountant's an accountant and if they have sufficient experience, you know, they have a you have a that type of situation. And I had a real wrinkle r and I want to say the company obviously where basically they made the the auditor sign a non disclosure agreement where unless there was a reason for the audit that the auditor would not disclose it to the producer. And I said I said, you know, peop people who pay for audits they'll get to see them have rocks in head. You know Yeah, so we said we'll we'll s we'll sign a an a confidentiality provision. We don't re reveal it, but you know you know, you you pay for the audit you get to see the results of the audit and we'll keep our mouth shut it was like oh that's our that's our standard wise no it's not you know so that that was a interesting wrinkle but they're they're good people.

SPEAKER_03 37:50

Uh they were willing to they were good people I'm glad to hear that. Well what let me go to this what are the things that you can do to prevent distributors from sitting on your film and not making any money for you.

SPEAKER_04 38:05

Well again what people don't realize being being either a bad distributor or sales agent or just you may be a good sales a agent or distributor but just somehow you don't have a handle on, you know, a a d producer or documentarian or what have you their their title and they they're not able to do it or to handle so many titles it's like, you know, it's just tonnage after a while. Um again the the idea is, yes, if you can get the performance and you know and set a reasonable you know standard and obviously allow for like you know, at least the first year because it you know it's gonna go to various markets like Cannes and m and META and so forth and pick you know, try to pick a number that's low but r maybe reasonable if something has to be negotiated. Um in order to to do that and and then realize if for some reason you know the st distributor sales agent doesn't hit the number, you know, the the way off very low, well I mean then what happens and under what conditions can you walk away from the deal. And that you know that has to you know be in the agreement is as well.

SPEAKER_03 39:17

I know people don't want to think of those terms but No no but they should be thinking of those terms. That's exactly what I I want them to be able to do is to be able to walk away. So putting a clause in there to get 'em out of it, walking away is the key when you've got to have that somewhere.

SPEAKER_04 39:34

Yeah or or basically you gotta be willing to walk away from the deal if you if you're not gonna have it. You know and and that's only something that's something only you that only the producer can really decide upon. You know, um you know what point do you just you know just you know walk away from the table and not you know not get involved. And I know y everyone's been working so hard on the producing the project and this is the whole next phase, getting it out into the marketplace. So yeah, I mean basically the again the idea is to be able to f know and spot the issues and try to address it and either you will address it with the distributor or sales agent or they're gonna say no and then you have to do make a calculated assessment about, you know, should I go with this particular party.

SPEAKER_03 40:22

Exactly that's the key thing. And don't be afraid to say no in today's world you have a lot of options and I think you need to know all those options before you even get in the room with the distributor because that would give you more power. Uh and you might have you might decide you want to keep educational or something like that and you should speak up in the very beginning of the negotiation and say this is what I want to do and see if they'll allow that.

SPEAKER_04 40:49

Well one thing that the you know one of the things to bear in mind is can can the distributor or the sales agent really exploit the rights? You know I I mean basically there are a lot of companies that are not going to do DVDs and I know I know it's like a d dying breed in many ways.

SPEAKER_03 41:07

Yes.

SPEAKER_04 41:07

But you know the idea is if you're not gonna handle the D V Ds can you know can can we have it, you know, we'll try to coordinate you know the timing and and and we're gonna talk about the issue of windows I guess in a moment uh and the whole idea of it and how w how wild invest it it's become. In fact we might as well handle it now. I mean the idea of the window is well it used to be was relatively straightforward. You'd have theatrical and then you'd have your pay per view and then you'd have your you'd have your pay cable, your HBOs and your show times, and then your basic like your USAs and TBS and um and you you know here and abroad and you work your way through it. But now it's gotten really it's all the various you know, these variations like you know uh used to be that um with the idea of DOD you know it's like oh we're gonna do theatrical first and then VOD because our distributor is not gonna you know uh is not gonna want to distribute the film in theaters if you get a theatrical release if it's if you can also see it, you know, basically day in date on cable. Um and you know in cer in certain cases they just won't do the deal and then there are other c distributors that are a little more enlightened and they look at it as, you know, the theatrical is really more for promotion you know uh for for VOD and other rights, the exploitation of the rights. So in fact frequently uh you know we'll get a situation, especially with a documentary, it's like you want a theatrical release we're not gonna give you an advance. I mean in an ideal world you'd be able to get both.

SPEAKER_03 42:55

Yes, but not not today, right.

SPEAKER_04 42:58

Yeah, you know basically um and then the question you have to look at it is does this distributor actually r theatrically release films? I know it used to be everybody did that. But now theatrical has become you know it it's kind of a lost leader at times. You know it's like it's a way of getting the word out about your project because if you don't how are you going to promote your project? You know and so you know so sometimes you have to go through that process and sometimes it means you know paying for the for the favor and four walling it or or basically having a limited you know theatrical release in in you know in major cities or a certain number of them. I mean this is all part and parcel and and whether or not you're the com a lot of companies you deal with, you know, uh d really do not do much theatrical unless it's like specialty limited uh theatrical um I'm not talking about you know a thousand or t two thousand theaters, I'm just talking about really just doing it in maybe a dozen or or two dozen theories and how it gets rolled out. So you have to kind of again talk to whoever had a theatrical release with this particular distributor, you know, maybe with comparable s subject matter. Like you wouldn't ask a documentarian for this for a fiction film, but again, regardless of the film, you you can listen to their experience.

SPEAKER_03 44:21

Yes, that's a very important thing. That's the first thing filmmakers should do. They have to get some references about the company before they even take these uh appointment and sit down and start talking. They have to know who they're dealing with. Well Robert, you've been so good to us. Thank you for your kindness. This is a lot of good information for filmmakers.

SPEAKER_04 44:41

I know. Event eventually, you know, you know, I know what people are always looking for, like kind of a checklist of of of uh of topics, you know, like term and territory and all that. I mean usually there are l there are a lot of materials that, you know, do address that and that's something I do discuss with clients. As I said, just the territory, whether it's worldwide or it's you know, or or you're dividing it up accordingly and then you know, do you you do you go to an educational distributor, do you should uh some of them are going to say, well, if we're gonna take the education, we want the consumer rights you know, the per the person who does that. And again, you know, I I just mentioned the word windows and I kinda started out on it, but again there people have to be very mindful of um of being able to respect holdbacks. Like I had a client who made a deal for Netflix and then didn't tell me. And and then we're gonna do a deal with um HBO and they said, Oh, you have Netflix, we're not interested. Well we'll we'll give you for a lower licensing fee. No, we're not interested. It's just they're competition.

SPEAKER_03 45:51

Netflix and HBO are so they should have gone to HBO first and they didn't do that, right? Yeah.

SPEAKER_04 45:56

So Oh Robert, you see everything Yeah, it's uh it it there are more markets and there are more revenue streams, which is a good thing, although I I always tell people we've kind of traded our D V D dollars for digital pennies.

SPEAKER_03 46:13

Digital pennies, so that is so true, right?

SPEAKER_04 46:15

And and you know the idea you know it's like well how do you do well? Well make projects for lower budgets or be able to see uh there's a marketplace for it you know and you spend enough money to justify it and that's why HAR is such a big genre because it's made on a budget and and it's not cash dependent and a lot of different things.

SPEAKER_03 46:37

So it's not cash dependent that's a that's true. All right Robert well tell us how people can find you your uh email and your telephone number please.

SPEAKER_04 46:47

Yeah well the um email is um R L S is Robert Lewis Siegel E-N-T-L-A-W at A O L dot com and R L S E N T L A W at A O L dot com and the phone number you know basically it's uh 21260501 21260501 and uh yeah have a website it's it's www dot again RLS and Laur dot com and periodically we we we we spruce it up when we can. Uh but uh but again basically uh email is is good and and and actually phones. It's amazing we we live in a whole generation where where people communicate and they never talk the email it's certainly a certain generation that says oh we don't use the phone anymore or we never used it at all. It's like excuse me, well I I roam the earth with the other dinosaurs.

SPEAKER_02 47:52

Uh oh we thank you so much Robert Yes? Yes and and if you wouldn't mind Robert one more time very slowly say your uh website address.

SPEAKER_04 48:06

Well the website is www dot r l s e n t l dot com. But again emails is probably a good thing because it's the R L S E N T L A W. It's at A O L dot com.

SPEAKER_03 48:21

As I said, I'm kind of a dinosaur Okay All right okay well you certainly have current information.

SPEAKER_02 48:29

Thank you so much for helping us great wonderful okay all right bye bye thank you and be well everyone thank you too bye all right now in its second edition Carol Dean's popular book The Art of Film Funding has 12 new chapters to cover all areas of film financing and how to avoid expensive pitfalls. Learn how to start with an idea and end with a trailer. How to make an ask for money create your story structure and your trailer legal advice fair use successful crowdfunding how to ask for music rights and what insurance you can't shoot without available on Amazon under Caroline and at FromTheheartproductions.com I want to remind our listeners that David Rakelin is a brilliant and talented award-winning musician who scores films and can compose music for a trio or for a full orchestra David is a very good friend to the independent filmmaker and comes highly recommended by From the Heart production. If you need music to help tell your story please contact him at davidrain.com that's david r-a-i-k-l-e-n dot com and Carol and I want to thank you for tuning in to the Art of Film Funding. Please visit our website at From the Heartproductions com. You can also find us on Facebook and Twitter. Good luck with your films everyone