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A mere seven weeks before Steven
Spielberg's Amistad was to make its 1997 debut, a lawsuit
threatened to sink the movie's release. Barbara Chase-Riboud, author of
the novel Echo of Lions, brought the suit, alleging that
Dreamworks, Inc. had copied original "scenes, characters and
plot devices" in Amistad from her novel.
Chase-Riboud sought $10 million
and a preliminary injunction against the film's opening. Although a
judge ruled in Dreamworks' favor regarding the injunction, allowing
Amistad to open as scheduled, the studio quickly reached a monetary
settlement with Chase-Riboud for an undisclosed amount.
Are small, independent film
producers also vulnerable to lawsuits such as this? The answer is
"definitely." In today's litigious world, the act of producing a film
puts you face to face with numerous legal perils, such as copyright and
trademark infringement, libel (or product disparagement), invasion of
privacy and misappropriation of an idea (or plagiarism). Any of these
can play havoc with almost any producer's limited financial resources.
Even worse: you don't have to do
anything wrong to be sued!
For example, when the 1994
documentary Hoop Dreams gained unexpected success, one of the
characters in the film sued the producer, alleging he had never given
him the authority to film him. In fact, the producer had been extremely
diligent about gaining permissions and had a signed contract with the
person granting such authority. The producer's defense costs were
minimal because, luckily, the person quickly backed off. But that isn't
always the case. Sometimes claimants look to drag out litigation, hoping
to force a favorable settlement or to gain publicity for a cause—at the
producer's expense, of course. To better understand the legal exposures
facing film producers, let's take a look at the typical film production
process and the potential liability traps along the way.
Story Line
The producer's story is either
original or it is obtained from someone else. If the story is not
completely original, the producer needs to get a written release to use
the story or risk a copyright infringement lawsuit. (More about releases
later.) From outward appearances, and without knowing all the details of
the case or settlement, it looks as if Dreamworks may have taken someone
else's story for Amistad and wound up paying a steep price,
both financially and with their reputation. But even the producer who
tells a story that he or she believes to be completely original runs the
risk of a potential copyright infringement suit. For example, the
producer who films a story about the life of a black horse could have a
copyright problem if elements of the story resemble any in Black
Beauty.
Film Footage
The producer determines whether
the film footage will be completely original or contain clips. The
process for using film clips is the same as for using someone else's
story line—you need to obtain the necessary releases. Don't ever assume
that any film clip is in the public domain and that no release is
necessary, as you could be mistaken. Some clips are indeed in the public
domain, but it's best to do a search and to make no assumptions.
Performers
The producer must receive
permission to be filmed from anyone who appears in the film. (The
exception is when filming takes place in a public setting and
unrecognizable people appear in the background.) Failure to have a
written agreement can result in an invasion of privacy lawsuit.
Permission is especially important
in the case of children. If you want to have a child in your film, you
need to get a parent's permission to film that child.
Several years ago, a producer
filmed a documentary on mental illness that showed patients in a mental
hospital. The film was shown in colleges as part of a course, and one
student saw her mother in the mental hospital. She sued for emotional
distress. Fortunately, the producer did what he was supposed to do by
getting permission from hospital administrators to film the patients.
The question was whether the patients should have also given their
consent. A judge decided in favor of the producer, ruling that the
patients were not mentally fit to give consent. The case is a good
example of a producer doing the proper due diligence, yet still being
vulnerable to a lawsuit.
The same goes for products and
trademarks that appear in the film. For example, a scene may depict a
Coca-Cola can, so you want to make sure you have Coca-Cola's signed
permission to show it. Generally, if a product or trademark appears in a
favorable or neutral light, you will have no trouble getting permission
from the manufacturer or trademark owner to film it. If the product
appears in a negative light, however, you may be sued for product
disparagement (or libel) unless you have written permission to film it
in that way.
Music Here a producer has two
potential exposures: the composer and the performer. A common mistake by
independent moviemakers is to assume that it's alright to use music
that's in the public domain, such as Beethoven's Ninth Symphony.
What is often overlooked is who recorded it. So not only do you have to
secure the rights to a musical piece, but you also have to get
permission from the group or recording artist that made the recording.
Of course, if you compose your own
original music, you're safer. But even here you have to consider who's
recording the piece. Does this person know the recording is for a film,
and do you have the artist's written permission? Another potential
problem is if the original music sounds like someone else's composition,
you could be hit with a copyright or plagiarism lawsuit.
One source of protection is to use
the services of a musicologist. That's a professional who listens to
original music and identifies—and helps people avoid—potential copyright
issues.
Title/Distribution
Technically, a title can't be
copyrighted unless it's a series such as The Hobbit or
Tarzan. But using an existing title or one that resembles another
title can create confusion among films, and that can lead to other types
of lawsuits, such as infringement. For example, in a recent publishing
case, the titleholder for Gone with the Wind sued the author and
publisher of the derivative book The Wind Done Gone. The suit
was unsuccessful, but expensive to defend.
A title search can help avoid
confusing titles and can be done inexpensively. There are two levels of
search: title search and title opinion. A title search tells you all the
times that a name, or any combination of the name, is used. With a title
opinion, the title search firm conducts a title search and also renders
an opinion on whether it's okay to use the name. From a liability
standpoint, a title opinion offers better protection than a simple title
search. Even a completed film may yet contain errors. Distribution has
the effect of magnifying errors. That's why it's advisable to have an
expert review the finished product before distribution begins. An
experienced media attorney can perform this function.
The Number One Risk:
Defending Yourself
As noted, film producers face a
number of potential liability risks. But the most common risk—and often
the largest—is the cost of a legal defense should a lawsuit occur.
A claimant can allege that he or
she was harmed even when a producer hasn't done anything wrong. The
claimant may want money and believe that the producer has "deep pockets"
(perhaps in the form of insurance). Or the claimant may be seeking
publicity and a soapbox on which to stand and make a point. Or the
claimant may sense that the producer can be induced to pay in order to
avoid negative publicity. The claimant may have no intention of taking a
case all the way to court, and hope to force a settlement. Most cases
are, in fact, either dismissed or settled before they get to court. It
doesn't cost much money to bring a lawsuit, with or without merit, but
the cost of mounting a defense can be enormous. In the event of a false
accusation, you have little choice but to prove your innocence. The
burden of proof may be on the accuser, but the defense will often be
forced to submit to a lot of discovery, i.e. pay to produce mountains of
semi-relevant documents.
I've mentioned some of the ways
film producers can reduce their chances of being sued and ward off
potentially catastrophic financial losses. What follows is a more
detailed look at these and other important "loss control" measures; ways
of mitigating the risks:
Releases
The importance of getting releases
can't be overstated, and all releases should be in writing. The release
document itself is fairly standard. But having a signed release in hand
isn't enough; you also need to make sure that the person signing the
release has the proper authority to do so.
It is critical to understand that
a verbal release has no value, especially in a legal proceeding. A
handshake agreement—even one made with the best of intentions—offers no
proof of rights, so that any contested case will become a "he said-she
said" scene in a courtroom, with a dubious outcome for the producer.
As further protection, the written
release should include a warranty and indemnification section, which
shields the producer in the event that any warranties are breached—that
is, the person granting the release doesn't actually own the rights
being released.
Subcontractors
Using subcontractors to provide
content or services for the film, such as footage, special effects,
graphics or music, also carries risks. Be sure you know who they are,
their procedures and their reputation. It's a good idea to make sure
that they do just as good a job as you do in obtaining releases.
Media Attorney
Probably the most valuable part of
an effective loss control program is having an experienced media
attorney. The attorney should establish procedures for making sure that
all necessary releases are obtained, check the authority of people
signing releases, evaluate subcontractors and review the finished
product for potential liability exposures. In short, your media attorney
should be involved throughout the entire moviemaking process.
Film Review
An expert review of the final
film, by a media attorney and/or experienced media liability insurance
professional, can help to prevent potential problems from ever arising.
For example, a documentary about four American nuns who were murdered in
El Salvador repeatedly showed footage of the bodies being removed from
crude graves. Worried that the nuns' parents, who also appeared in the
film, would suffer emotional distress and possibly sue, the producer was
asked to obtain releases from the parents, granting permission to show
the emotional graveside footage. The producer readily agreed, and all
the parents signed releases with no problems. It is better to be
overcautious than regretful later.
Another example: a documentary
film about gay people started out with credits rolling, and at a
distance down the street two women were walking toward the camera. As
they approached the camera and walked past, they became quite
recognizable. The two women may have been unknowns who just happened to
be filmed on the street, but the insinuation was that they were gay, and
they probably weren't. The producer was advised to either obtain
releases from the women or re-shoot the titles. Since the producer
didn't know who the women were, and the footage was inconsequential to
the film, he redid the titles without the women, eliminating a potential
exposure.
Insurance
It's impossible to distribute a
film without insurance, since distributors require it, so insurance is
critical from that standpoint. But before you think of insurance as a
mere commodity and purchase the first policy you see, consider the
ramifications of buying something that offers less than adequate
protection. If you are like most film producers, your personal assets
are definitely limited, and you can't afford to lose them defending a
lawsuit or in a settlement because your insurance left critical gaps in
coverage.
The important considerations in
purchasing insurance, therefore, are covering the most important
exposures, the dollar amount of coverage, the insurance company and
broker and value (the coverage received for the amount of premium paid).
Comprehensive coverage for the
unique exposures faced by film producers is unlikely to be found in an
off-the-shelf general liability policy that has been modified. So look
for a policy that is specifically written to cover multimedia liability
exposures. A true multimedia liability policy will explicitly spell out
broad coverage for a producer's most critical exposures. It will address
distribution in all forms (TV, radio, DVD, etc.) and merchandising. It
will cover defense costs, offer the option of covering these costs
inside or outside the policy limits and allow you to select your own
defense counsel. A good policy will not have a "settlement hammer
clause." In other words, the insurer cannot agree to a settlement
without your permission—nor will it exclude coverage for internal
copyright disputes, such as when an employee or freelance writer
prepares material for you and then claims ownership of the material.
Finally, it will offer coverage for as long as your rights are granted,
otherwise known as lifetime coverage.
For anyone who asks how much
insurance is enough, the pat answer is: "You'll need one dollar more
than the largest lawsuit you'll ever have." That gets a chuckle and
doesn't solve their problem, but it opens the door for a proper
discussion. What is the nature of the film? What are the potential
exposures? How wide is its distribution? Has a media attorney been
involved throughout the filming process? As a general guide, most cable
companies require coverage of $1 million per occurrence and $3 million
in total (or "aggregate"). That is likely enough coverage for most
films, but not for a major film.
Usually with insurance, you get
what you pay for. Purchasing a policy on the cheap probably means
coverage is dangerously limited or contains critical gaps—gaps that you
may not discover until you file a claim with the insurance company and
learn that it won't pay. Getting value for your premium dollars is a far
more effective purchase strategy since, in the long run, it can save you
money. Finding value means examining coverage, of course, but it also
means selecting the right insurer and broker.
Selecting an insurance company or
insurance broker may not sound like much fun, but it doesn't have to be
difficult. Consider the financial strength of the insurer—will they be
around long enough to pay a claim?—as well as the reputations of the
insurer and the broker. You certainly want an insurer that has a good
reputation for handling claims, and you want a broker that responds
quickly to your requests. Perhaps most importantly, you want them to
have expertise in multimedia liability and be able to offer important
value-added services such as an expert liability review of the final
film product. You want to obtain a policy through a broker who
specializes in handling multimedia liability coverage and handles dozens
of film producer customers and claims every year. The expertise offered
by an insurance specialist who knows the film industry could save you a
blockbuster claim, a major headache and a lot of money. MM
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