Legal Limbo: The Intersection of Law and Storytelling by Business of Art + Design

LEGAL AL

LIMBO T H E I N T E R S E C T I O N O F L A W & S T O RY T E L L I N G

BY E M I LY F R I T Z

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LEGAL LIMBO: WHEN A LAW IS NOT CLEAR ON A SPECIFIC ISSUE. Vocabulary.com, 2020

TA B L E O F C O N T E N T S

08 20 28 38 48

ENTERTAINMENT L AW IND U ST RY OV E RV IE W ROL E OF T H E E NT E RTA INME NT AT TOR N E Y IND U ST RY IMPAC T

INTELLECTUAL PROPERT Y IND U ST RY OV E RV IE W IP’S ROL E IN F IL M & T V IP’S ROL E IN MA RK E T ING & BRA ND IN G

FILM & TELEVISION IND U ST RY OV E RV IE W F IL M F INA NCING D IST RIBU T ION

TRENDS & TAKEAWAYS E ME RG ING T E CH NOLOGY WA R ON CONT E NT RISE OF ST RE A MING

“

THERE’S NO SUCH THING AS APPENDIX F U L L INT E RV IE W S RE F E RE NCE S

ENTERTAINMENT LAW. THERE’S JUST LAW WITH ENTERTAINMENT CLIENTS. Jeff Schneider, National Geographic TV

INTERVIEW PANEL

EXECUTIVE SUMMARY

When you think about entertainment law, or more

Truth is, as the entertainment industry rapidly evolves

specifically, what an entertainment attorney does all

and expands into all forms of media, so do legal

day, what comes to mind? Probably the boring stuff

systems and teams - and they play a monumental

- drafting contracts, negotiating on behalf of their

role in creative departments. This book aims to

client (usually some famous actor, right?), or maybe

educate artists, designers, and anyone aspiring to

even suing a big, Hollywood film studio. Intrigued,

make waves in the entertainment industry, on the

I set out to understand the world of entertainment

legal practices that will impact them in a myriad of

law, with a focus on the role of the entertainment

ways throughout their careers. Through exclusive

attorney and their contribution to creative projects

interviews with entertainment attorneys and studio

in the entertainment industry. Almost immediately,

executives at media powerhouses like Warner Bros,

I found the public understanding of entertainment

National Geographic, Dreamworks Animation and

law to be very black and white - with little to no grey

more, this book includes unique insight into the

area. Entertainment law is either viewed as a lousy

legal dynamics of various sectors within Hollywood’s

desk job, or as Hollywood attorney Jeff B. Cohen

multibillion dollar industry, including Film and

writes, “In my fantasy, it involved dry martini’s Cuban

Television, Intellectual Property, Consumer Products,

cigars, fancy cars, and movie premiers.”

and Emerging Trends and Innovations.

DOUG CHERRY

SHAWN DENNIS

SVP, Business & Legal Affairs

IP & Tech Lawyer

Former President, Marketing

SVP, Finance

Warner Bros. Home Video

Shumaker, Loop & Kendrick LLP

DreamWorks Animation

HBO Original Programming

JEFF SCHNEIDER

DANA LIRA

EVP, Business & Operations National Geographic TV

RAY LANDES

RESEARCH QUESTIONS

RESEARCH QUESTION #1

RESEARCH QUESTION #2

HOW DOES ENTERTAINMENT LAW SUPPORT AND INTERACT WITH STUDIO DEPARTMENTS?

HOW DOES ENTERTAINMENT LAW ADAPT TO CHANGING INDUSTRY TRENDS AND ENVIRONMENTS?

E N T E R TA I N M E N T L AW

C H A P T E R 01

ENTERTAINMENT

LAW

FEATURED INTERVIEW

DANA LIRA SVP, BUSINESS & LEGAL AFFAIRS

WARNER BROS. HOME VIDEO

“

As Senior Vice President of Business and Legal Affairs for Warner Bros.’ Home Entertainment department, Lira manages legal clearances for all enhanced content and virtual reality experiences created by the home entertainment division, along with legal review of the marketing and promotion of the studio’s movies, TV shows and video games in physical and digital formats on a worldwide basis. She also handles all legal matters for the studio’s Australia and New Zealand home entertainment divisions. Lira also leads the Distribution, Direct-to-consumer, Games, and Emerging Markets for the Corporate Visual Development and Home Entertainment department.

E N T E R TA I N M E N T L AW

INDUSTRY OVERVIEW

LITIGATION Resolving disputes by filing or answering a complaint through the public court system.

AREAS OF ENTERTAINMENT LAW

Want to hear something that probably comes with no shock value? The U.S. media and entertainment industry is the largest in the world. At $720 billion, it represents a third of the global M&E industry, and includes films, television programs and commercials,

CONTRACT LAW Branch of civil law that deals with interpretation and enforcement of contracts between two or more parties.

streaming content, music, broadcast, radio (that includes podcasts, for you Gen Z’s) book publishing, video games, consumer products, and ancillary services and products.

COMPLIANCE LAW Conforming to a rule, such as a specification, policy, standard or law.

According to PwC’s 2018-2023 Entertainment & Media Outlook, the U.S. industry is expected to reach more than a whopping $825 billion by 2023. So what does that mean for the legal teams behind every flashy Hollywood project? It means they’ve got a big job.

AGREEMENTS An understanding between private parties creating mutual obligations enforceable by law.

FILM

MULTIMEDIA

MUSIC

INTERNET

PUBLISHING

TV & RADIO

THEATER

VISUAL ARTS

But before you can understand the role entertainment attorney’s play, let’s cover the many types of practices.

LABOR & EMPLOYMENT The area of law that governs the employer-employee relationship.

E N T E R TA I N M E N T L AW

While the media and entertainment industry is extremely broad in scope, there are several major players that dominant the industry. Whether they’re a household name corporation that’s been around for what seems like forever, or relatively new (new as in making major waves within the past five to ten years), each of these powerhouse media conglomerates owns and operates the majority of the media we consume everyday. Disclaimer: The chart only outlines the industry’s major players, most of which are parent companies to what feels like hundreds of smaller corporations

$300 B

“

Global revenue in the entertainment industry will reach 1.7 trillion Euro in 2020.

ANNUAL REVENUE (BILLIONS)

THE MAJOR PLAYERS

$260.2B

$250 B

$200 B

$181.2B

$150 B $108.9B

$100 B $69.57B

$50 B $12.84B

$20.15B

$33.5B

$33.97B

$44.83B

StartUs Insights, 2019

(Disney - I’m looking at you.)

MEDIA AND ENTERTAINMENT COMPANIES

E N T E R TA I N M E N T L AW E N T E R TA I N M E N T L AW

E N T E R TA I N M E N T L AW

“

My youngest child, who’s now 14, one day said, “What do you do at work?”

THE ROLE OF THE ENTERTAINMENT AT TORNEY

and I had to think of a way to explain to him what I did and I couldn’t figure

Want to hear something that probably comes with

With thousands of employees and numerous projects

out a way that a 9 year old would understand so I said,

no shock value? The U.S. media and entertainment

happening all at once? While independent attorneys

industry is the largest in the world. At $720 billion,

working for a firm normally have singular clients and

it represents a third of the global M&E industry, and

maybe a few businesses on their roster, in-house

includes films, television programs and commercials,

legal teams operate solely to empower studios and

streaming content, music, broadcast, radio (that includes

their creative projects. Although, it’s not all glitz and

podcasts, for you Gen Z’s) book publishing, video

glamour. According to Beth Bruns, a senior legal editor

games, consumer products, and ancillary services and

on Practical Law’s Intellectual Property & Technology

products. Deals handled by entertainment attorneys

team, “They (entertainment attorneys) enjoy helping

could include anything from licensing agreements to

creators, financiers and distributors bring their projects

sponsorship deals or appearance releases. In these

to life and to an audience. Although entertainment

situations, entertainment attorneys are responsible

lawyers may attend film premieres and entertainment

for ensuring that their clients understand what they

awards shows, the day-to-day work is not nearly as

are signing and for protecting their clients’ interests.

glamorous. Nonetheless, many attorneys love being

However, what does the attorney-client relationship

an essential part of a creative or meaningful project.”

BASICALLY, I TELL PEOPLE WHAT TO DO AND THEY DO IT.

look like when the client is a studio? Jeff Schneider, President of Business Affairs & Operations, National Geographic TV

E N T E R TA I N M E N T L AW

LITIGATION VS TRANSACTIONAL PRACTICE

THE NIT TY GRIT TY

The first thing to know about entertainment law is the

To summarize, transactional attorneys rarely see

Unlike constitutional or criminal law, entertainment

Intellectual property

difference between the two largest sectors of practice:

the inside of a courtroom. From contracts for large,

law isn’t specific to any particular practice. Because

Film and TV financing, development and distribution

litigation vs transactional. Writing for the American Bar

corporate mergers to negotiating the terms on

of the wide range of projects constantly being

Theatrical stage production and financing

Association, Transactional Attorney Jeff B. Cohen says,

closing documents to purchase intellectual property

developed in the M&E industry, it is naturally

“

- research, drafting, negotiating and advising - are

broad in its size and scope, encompassing

transactional attorney’s areas of expertise. Meanwhile,

everything from protecting intellectual property

litigation attorneys are those who seek to resolve

to influencing your favorite movie’s title. In short,

I negotiate deals and structure transactions.

disputes in court - from the contract that was (allegedly)

entertainment law is as varied as the entertainment

Video content distribution and licensing

I fight people with my brain for money.

breached to the amusement park that was (allegedly)

industry itself. However, writing for the American

Intellectual property protection and enforcement

The litigators play in a whole different ball

negligent in operating a roller coaster. Given the

Bar Association, Kirk T. Schroder argues, “Despite

Talent agreements

game. I fight for money. They fight for blood.

natural intersection between legal and creative within

the lack of a universally accepted definition of

Endorsement deals

the entertainment industry, this book focuses primarily

what entertainment lawyers do, a legal practice

on transactional law.

in this industry is distinct from other areas of law.”

Entertainment litigation can run the gambit from breach of contract suits, intellectual

Schroder goes on to note that practice areas for

property claims, labor law, criminal defense,

an entertainment attorney may include any or all

and the list goes on. Some attorneys are

of the following:

Branded entertainment Advertising and marketing Film and television animation agreements

Mergers, acquisitions, joint ventures, and strategic alliances Collective bargaining negotiations/agreements Employment agency license applications Talent management

ambidextrous and can do both litigation and transactional, but that is usually more the exception than the rule. Attorney Jeff B. Cohen, Transactional Attorney

E N T E R TA I N M E N T L AW

THE CLIENT

IN HOUSE VS. FIRM

AN EVOLVING INDUSTRY

Whether they work for studios or individual clients,

There is also a distinction between “in-house” lawyers

The size and scope of the entertainment industry, and the

entertainment attorneys can count on their clients

that work at a studio versus being a lawyer at a firm.

type of content produced, is evolving at a faster speed than

changing over time. Actors, musicians and other

In-house counsel have one client—the company

ever before, and it’s vital that entertainment attorneys stay

talent may expand into other industries by founding

they work for. That company may be a studio, music

up-to-date on legal developments that affect the industry.

“

charities, launching their own brands, or starting other

label, production company, video-game developer,

These changes can be anything, whether it’s a new law

solid character ideas, we would bring in the lawyers

businesses. Singers may transition to acting and actors

talent agency, talent management company, or an

against advertising practices on “sensitive groups” like

before even speaking with creative.” From a legal

to singing, or clients may move between television,

entertainment labor union such as SAG-AFTRA or The

children, or even what directors can and can’t do on set. One

perspective, nothing can be created or developed

film, and live performances. According to Bruns, many

Writer’s Guild of America. In-house counsel are often

major industry player is the rapid increase, and what some

before a studio knows what content they’re

entertainment attorneys narrow their focus to a specific

further divided into “business affairs” attorneys and

would even call the oversaturation, of streaming services. I

allowed to make in the first place. It’s up to legal

sector of the industry, and she notes that “each sector

“legal affairs” attorneys.

mean, let’s be real, if someone would’ve told me five years

teams to inform and advise studios and creative

ago I wouldn’t have cable throughout college, I would’ve

teams on what content they own, what can be done

laughed in disbelief. Yet here we are in 2020, with a streaming

with that content, and other guidelines relating to

platform from virtually every major media enterprise: Netflix,

characters, story, setting, etc. For example, Disney

Hulu, Disney+, HBO max, NBC’s Peacock, Apple TV, Amazon

isn’t allowed to create a new movie and have one

Video - I could go on and on. With so many options ready

of the characters attend Hogwarts.

has its own industry norms.” If the majority of a lawyer’s clients work in the film industry, for example, it is easier to specialize in film than to diversify.

Business affairs attorneys have the glamorous gig of negotiating deals while legal affairs attorneys are stuck doing real legal stuff (corporate filings, cease and desists, chain-of-title documentation, etc.). Lawyers working at a firm usually represent multiple clients at any given time. Transactional entertainment law can be a smallish division of a large firm or a stand-alone firm with anywhere from three to thirty lawyers. According to Cohen, “given the intimate nature of transactional entertainment law and the limited number of clients who warrant use of a top legal eagle, smaller firms can

When we were at the very beginning stage of launching a new show, before we even had a plot or

at the click of a button, the war on content begins. Okay, so where do attorneys come into the picture? My interview with

Shawn Dennis, DreamWorks Animation

Shawn Dennis, former president of marketing and branding at Dreamworks Animation, and the woman who spearheaded the launch of DreamWorks TV, shed some light on integrating legal into the creative process. She says,

and do wield a great deal of power in the industry.”

INTELLECTUAL PROPERTY

FEATURED INTERVIEW

DOUG CHERRY CHAP TER 02

INTELLECTUAL

PROPERTY

IP & TECH LAWYER

SHUMAKER, LOOP & KENDRICK LLP

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Board Certified in Intellectual Property Law, Cherry is known for taking complex principles and making them understandable for his clients. His areas of concentration include intellectual property (patent, copyright, trademark, trade secret, publicity rights and unfair competition) consulting, acquisition, licensing and litigation, as well as technology, cybersecurity and data breach law. He represents corporations, municipalities, non-profits, start-ups and entrepreneurs in a variety of industries, including technology, healthcare, law enforcement, and manufacturing. He also has extensive litigation and mediation experience involving high profile, corporate technology cases, patent, trademark, copyright, and trade secret litigation. He is a founding member of Shumakerâ&#x20AC;&#x2122;s Data Breach Team. His background in computer consulting, fluency in many programming languages, and my computer skills, including database and network management, expert systems, simulation design, and various software packages, enable him to effectively and efficiently assist his clients.

INTELLECTUAL PROPERTY

FEATURED INTERVIEW

SHAWN DENNIS FORMER PRESIDENT, MARKETING & BRANDING

INTELLECTUAL PROPERTY What would you assume is the primary product that comes

DREAMWORKS

out of the entertainment industry? Movies? TV shows?

“

The answer might surprise you: Intellectual Property. In today’s modern world, where the evolving dynamics of technology and innovation are brought to the forefront of

Dennis is an active Board Member across 6 private companies and national non-profits.

the entertainment industry, the issues of content security

She delivers 30+ years experience as company President, CMO and Strategic Business

and intellectual property (IP) are becoming gradually

Leader spearheading strategies, steering enterprise-wide initiatives, and directing

more significant. IP refers to creations of the mind, such

product innovations for such iconic brands as DreamWorks Animation, Mattel’s

as inventions; literary and artistic works; designs; and

American Girl, Dell Computers, the NFL, MasterCard, and Universal Studios. Now

symbols, names and images used in commerce. According

focused on value-added board work and advising innovative start up companies such

to the World Intellectual Property Organization (WIPO),

as GoldieBlox, Slumberkins and Toca to help them disrupt consumer experiences and

“Intellectual property, when efficiently used, is an important

build global fans. Her background includes successful experience defining business

tool in creating an image for your business in the minds of

priorities, championing corporate mission, and creating synergies between brand

your current and potential customers and in positioning

assets to build customer relationships and loyalty. She has pioneered explosive retail

your business in the market.” IP rights, combined with other

growth, the launch of new business units and integration of content and storytelling

marketing tools, are crucial for:

Differentiating your products and services and making them easily recognizable

Promoting your products or services and creating a loyal clientele

Diversifying your market strategy to various target groups

Marketing your products or services in foreign countries

to build customer engagement.

INTELLECTUAL PROPERTY

TYPES OF INTELLECTUAL PROPERTY

IP IN MARKETING & FRANCHISE DEVELOPMENT

PATENTS

TRADEMARKS

TRADE SECRETS

Protects creators

A grant of

A symbol, word,

Consist of secret

RIGHT OF PRIVACY

RIGHT OF PUBLICITY

GEOGRAPHICAL INDICATIONS

or owners of rights

property rights

or words legally

information

Prevent you

Protects the

A sign used on

Intellectual property rights play a crucial role in the

Because the Wizarding World is a protected IP, no one in

marketing and brand development of all kinds of

the world has the right to use pieces of it’s content without

companies, regardless of industry, but especially the

permission of the copyright holder who, in this case, is J.K

entertainment industry. But how are franchise’s assets

Rowling. During our interview, Shawn Dennis painted a

and content protected? Copyright law. Copyright law

clearer picture into IP’s effects on creative departments as

is the driving influence of how franchises are built and

she explained the role of copyright and when legal steps in

marketed to the world. One key aspect of copyright law

to help. “An example would be when I was at DreamWorks™,

is that of derivative works. Let’s use J.K. Rowling and the

we thought we owned the “Where’s Waldo?” brand. We

Wizarding World franchise as an example. The copyright

had plans to do “Where’s Waldo” television, additional

holder (Rowling) controls who may create a work based on

books and consumer products. But within those rights, the

their original creation. This control is critical to authors and

“Where’s Waldo” creator had approval on everything. A

screenwriters, whose works can be adapted to several other

studio like DreamWorks™ is not used to that. They’re used

revenue-generating media—films and sequels, television

to having everything sit with them. Our legal team could

series and movies, toys, games, T-shirts, and other products,

help us understand what was bought, and help exploit all the ways the IP can be used. You know, Star Wars™ and

by preventing

to an invention.

registered or

and can include

from intruding on,

image and name

products that have

but it’s also essential to the development and growth of a

others from using

Types of US

established as

a formula, pattern,

exposing private

of a person.

a specific geographical

their works without

patents - Utility,

representing

compilation,

facts about, or

origin and possess

brand or franchise. Since the series took off in the early

Marvel™ for example didn’t start at Disney. Disney acquired

their permission.

Plant & Design.

a company or

program, device,

falsely portraying

qualities or a

2000’s, Rowling has allowed Warner Bros. Entertainment to

those properties, so now Disney lawyers are a huge part of

product.

method, technique

someone.

reputation that is

roll out the films, and Universal Studios to bring the series to

what they can and cannot do.”

due to that origin.

life through the Wizarding World of Harry Potter.

or process.

E N T E R TA I N M E N T L AW INTELLECTUAL PROPERTY

E N T E R TA I N M E N T L AW

“YOU FUTURE PROOF

YOUR IP BY KNOWING WHAT IT STANDS FOR. Shawn Dennis, Former President of Marketing & Branding, DreamWorks Animation

IP’S ROLE IN FILM & TELEVISION So where does IP fit into the journey from script to screen?

public display, performance, and the creation of derivative

The answer is everywhere. Writing for WIPO, Cathy Jewell

works.” Basically, it lets creators claim and protect their

says, “[Intellectual property rights] help producers attract

work. Whether you’re an independent artist or working

the funds needed to get a film project off the ground;

for a major media corporation, someone has a great idea

enable directors, screenwriters and actors, as well as

for a product or service, there will always be people who

the many artists and technicians who work behind the

will want to duplicate that success and sell those ideas

scenes, to earn a living; and spur the technological

as their own. Copyrights, trademarks and patents can be

innovations that push the boundaries of creativity and

used to prevent competitors or anyone else from using

make the seemingly impossible, possible.” Among the

your ideas for their own profit without your consent.

many types of IP’s, copyright is considered the “lifeblood

IP protection applies to individuals and businesses of

of movies,” and is arguably the most influential factor in

all sizes; even huge corporations have had their ideas

the creation of movies and tv shows everywhere. Writing

infringed upon and have made multi-million dollar

a piece on the major role IP plays within the film and

lawsuits. Besides providing the ability to claim their work,

television sector, producer and lawyer Mandi Hart says,

“Movies are a first-love in America and around the world,

is especially important and relevant to the film industry.

and their production is made possible by the existence

Without copyright, producers would have no distribution

of intellectual property rights. Copyright secures to

rights to sell in the first place, and without distribution

creators certain exclusive rights in their original works of

deals, many producers wouldn’t be able to secure the

authorship, including rights of reproduction, distribution,

funding necessary to make their movies.

FILM & TELEVISION

CHAPTER 03

& FILM

FEATURED INTERVIEW

JEFF SCHNEIDER EVP, BUSINESS & OPERATIONS

NATIONAL GEOGRAPHIC TV

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Schneider is an entertainment media legal, business affairs and operational management generalist with a great deal of experience advising television and digital content executives, as well as managing business affairs and/or legal departments. His specialties include television and digital production; content acquisition and distribution; entertainment finance; corporate operations; publishing; consumer products and licensing; copyright and trademark. Adept at working with creative executives, producers, corporate strategists and other high-level decision makers as well as managing executive and non-executive personnel at all levels.

FILM & TELEVISION

FEATURED INTERVIEW

RAY LANDES SVP, FINANCE

HBO ORIGINAL PROGRAMMING

“

Landes is the Senior Vice President of Finance overseeing all Financial Strategy,

FILM & TV OVERVIEW

THE CLIENT

When most of us imagine the entertainment industry,

FIRM

the first thing that comes to mind is movies. The film

industry

comprises

the

technological

and

commercial institutions of filmmaking, film production

1. Producers, directors, screenwriters, actors and other talent 2. Production companies and distributors 3. Emerging creative digital and media companies

companies, film studios, cinematography, animation, film production, screenwriting, pre-production, post production, film festivals, distribution and actors, film directors and other film crew personnel. Hollywood is the world’s oldest national film industry, and remains

Long Term Planning, Corporate Accounting, and Production Finance for the

the largest in terms of box office gross revenue. One

Original Programming division at HBO. Specializing in Corporate Finance, SEC

way to measure the success of the industry at any given

Reporting, Strategic Planning, Production Finance and M&A. Previously, Landes

time is by measuring box office revenue.

IN-HOUSE 1. The studio / network 2. Studio various departments

was Chief Financial Officer for Casual Entertainment label within Electronic Arts. Specializing in video games for the packaged goods, D2C, and mobile business.

In 2019, the global box office revenue hit a record $42.5

Number one market share with focus on casual gamers with revenues reaching

billion despite a 4% dip since 2018. “Given the level of

$1B by 2010. Prior to EA, he was CFO/COO for Home Entertainment division

competition from a plethora of options across multiple

for New Line Cinema focusing on finance, accounting, and supply chain. Hands on cross functional responsibilities for maximizing profits by collaborating with sales, marketing, and publishing groups. Landes’ specialties include Strategic Planning, Budgeting, M&A, Accounting, Financial Reporting, Treasury and Audit. Additionally I hold the operating responsibilities for Production Finance.

platforms on an incalculable number of devices, it should be actually heartening to the industry that 2019 delivered the second-best annual box office revenue in history,” says Paul Dergarabedian of Comscore. “But clearly movies have to seem fresh and original to draw today’s audiences, who have a massive level of choice for their entertainment diet.”

FILM & TELEVISION

WHERE LEGAL FITS IN Unlike constitutional or criminal law, entertainment

Film financing - Investments, Production Loans and Taxing

law isn’t specific to any particular practice. Because

Service Deals, Acquisition and Agreements

of the wide range of projects constantly being

Private Print and Advertising Investors Agreements

developed in the M&E industry, it is naturally broad in its size and scope, encompassing everything from protecting intellectual property to influencing your favorite movie’s title. In short,

Crowdfunding Campaigns Submission of Idea Agreement Nondisclosure Agreements

entertainment law is as varied as the entertainment

Independent Contractor Agreement

industry itself. However, writing for the American

Talent Services Agreement

Bar Association, Kirk T. Schroder argues, “Despite

Insurance - Errors and Omissions (E&O)

the lack of a universally accepted definition of

Guild Signatory Agreements

what entertainment lawyers do, a legal practice in this industry is distinct from other areas of law.” Schroder goes on to note that practice areas for an entertainment attorney may include any or all of the following:

Advertising and Marketing Production Risk Management Formation of Production Companies Chain of Title Review, Title Report and Script Clearance Distribution Agreements

“

PRODUCTION FINANCE IS ALWAYS IN SERVICE OF BUSINESS AFFAIRS, LEGAL AFFAIRS AND CREATIVE. Ray Landes, HBO

FILM & TELEVISION

“FILM DISTRIBUTION; The commercial process that makes a feature film available to the general public, and it usually also includes determining a marketing strategy.

THE DISTRIBUTION PROCESS IN FILM & TV Film distribution is one of the leading categories that

These agreements, almost always in the form of a contract,

entertainment attorneys work across. With the rise

define an agreement between the owner of distribution

of streaming services and new distribution channels,

rights in a film or video (usually the producer), and a

the splitting up of rights in the works among multiple

company engaged in the business of marketing such

distributors, distribution contracts are constantly changing

works to users and purchasers (usually a distributor). An

and evolving. In an article titled “Domestic Distribution

experienced film, TV and media attorney brings more to

Guide, Part 1,” Mark Litwak sheds some light on the

the representation of a producer than just knowledge of

distribution process before the rise of streaming services,

the law. They have knowledge of the business aspects

“The term “distributor” is so broad that it encompasses

of the industry, as well as the value of the distribution

many different types of companies. The major studios such

rights of their clients’ works. They have relationships with

as Paramount and Sony would typically distribute pictures

people in the industry that may impact the negotiations,

directly to theaters, license them to television channels like

and they know the standards, customs and special terms

Showtime, and manufacture their own packaged media

of distribution contracts, including, for example, which

(i.e. DVDs) for sale to mass merchants and video rental

provisions of the contract need to be changed and which

outlets.” However, because distribution channels have

do not. Entertainment attorneys also work to secure

evolved and expanded across more platforms than ever,

ancillary rights, basically finding the movie somewhere

distribution agreements are one of the primary documents

to live following it’s theatrical release. Ancillary rights and

an entertainment attorney would review or advise their

revenue are typically negotiated in the initial deal between

client on, and they come in many shapes and sizes.

the distributor and filmmaker.

FILM & TELEVISION

INTELLECTUAL PROPERTY

PRODUCTION AGREEMENT

NEGATIVE PICK-UP

PRE-SALE

RENT-A-SYSTEM

LICENSE

SALES AGENT

OUTPUT AGREEMENT

CO-PRODUCTION

A distribution company hires a production

A distribution company agrees to pay a fixed

limited

company

the

price upon delivery of the film. Because the

particular

directly

distribution company does not advance the

finance production of, and to distribute, the

for

A producer licenses certain film rights to a

In common usage, a license refers to any

A sales agent acts as the film owner’s agent for

Commits a licensee to acquire particular rights

These types of arrangements resemble either

prior

distribution company, typically a studio, for

limited grant of rights to a film, with the

a commission. There is no grant of rights from

to a specified number of films produced in the

a partnership (when there is a sharing of

before

a limited term, but the distribution company

owner retaining other rights to the film. Thus,

the owner to the sales agent. However, if the

future by a production company. In effect, an

profits and losses) or a separate ownership

cost of production, the production company

commencement of production, of the film.

is not required to pay an advance to the

licenses encompass a broad array of grants

sales agent is exclusive and has the authority

output agreement is a pre-sale agreement

(where there is no sharing of profits and

film. The grant of distribution rights to the

must obtain a loan to finance production,

Most pre-sales involve a foreign distributor

producer to either finance production or

of rights, ranging all the way from a one-day

to enter into licenses for and on behalf of

for a number of unspecified films. The output

losses). However, the term “co-production” has

distribution company is always of all rights in

and the lender will almost always require a

committing to pay a fixed dollar amount upon

take delivery of the film. In exchange for the

pay-per-view television license to a grant of all

the owner, then the sales agent resembles a

agreement governs the overall arrangement,

mutated over time to refer to any agreement

perpetuity throughout the world, making the

completion guarantee to ensure delivery of

delivery of a film in exchange for specified

absence of fixed payments by the distribution

worldwide rights for a term of 25 years.

licensee. The sales agent is usually entitled to

and a separate license is entered into each

between two or more film companies relating

distribution company the owner of the film.

the film to the distribution company in order

rights in a given country for a limited term.

company, the distribution company agrees to

a relatively low distribution fee.

film once the film is designated.

to the production and ownership of a film.

distribution

produce company

film, and

agrees

to trigger payment.

distribution country

completion, and

agreement

entered often

into

even

a very low distribution fee, and the remaining revenues are remitted to the producer.

T R E N D S & TA K E AWAY S

CHANGING THE GAME Thereâ&#x20AC;&#x2122;s no denying the media and entertainment industry

CHAPTER 04

TRENDS &

TAKEAWAYS

is supported and empowered by the rapid evolution of technology, and emerging leaders include trends within Virtual Reality, Augmented Reality, 5G, and even Holograms. Each of these trends are changing the way brands communicate and, in their own way, each have a major impact on the future of the industry. Despite tech being a consistent trend over the past few years, the transformation technology has within the entertainment industry is really only in its early stages. Companies within the entertainment space will definitely face challenges moving forward, yet the opportunities to

â&#x20AC;&#x153;

Global revenue in the entertainment industry will reach 1.7 trillion Euro in 2020. StartUs Insights, 2019

innovate and evolve are endless. Now more than ever, legal teams but be ready and equipped to face this transformational landscape through projects that position their companies on top.

T R E N D S & TA K E AWAY S

VIRTUAL REALITY

“

According to a recent study by the Consumer Technology

My theory on virtual reality is that VR in the home

Association, VR growth rates either declined or were sluggish

is never going to be where the business goes. I think

in the years since, but 2020 is predicted to see double-digit

it’s a location based experience and that’s where the money is

growth for the first time in four years. The New York Times

to be made. In the home, first of all, you have to invest in a lot of

VR app is a great example of modern use of VR. According

equipment, you know the headset, a high powered computer

to the New York Times, the VR experiences combine the

to make the VR experience worthwhile and be really robust,

power of immersion with compelling first-person narratives

and I just don’t think that’s something most people are going

and storytelling to allow users to explore a range of scientific,

to want to do. You do the experience once and it’s done. So I

cultural and global themes. During my interview with Dana

think the idea of going to a location and doing it with a group

Lira, head of Business Affairs at Warner Bros. and the studio’s

of friends and making it a real entertainment experience

VR initiatives, she made an interesting observation on the

whether it’s in a theme park or a movie theater, that’s going to

influence of VR amongst consumers moving forward, saying,

be how it’s successful. Dana Lira, Warner Bros.

T R E N D S & TA K E AWAY S

WAR ON CONTENT

A 2019 article by EY, a multinational professional services

This is truer today than ever before. When I asked Ray

firm, analyzed the most significant growth opportunities

Landes, Chief of Finance for HBO original programming,

media and entertainment companies today, saying,

on what industry trends are affecting legal teams today

“The rapid proliferation of video distribution platforms

more than ever, he said, “Oh that’s easy. The content

and a corresponding uplift in engagement metrics,

war. There’s more demand than ever before, and

subscription fees, advertising revenue — or a combination

studio’s simply cannot keep up. Everyone is desperate

— has created an intense competitive landscape for

for content, and picking up shows they wouldn’t have

developing and acquiring the best content.”

settled on five years ago.”

“

There’s more demand than ever before, and studios cannot keep up. Ray Landes, HBO

T R E N D S & TA K E AWAY S

THE RISE OF

STREAMING SERVICES Right now, cable TV networks find themselves at the mercy

Though Quibi’s initial launch didn’t perform as well as

of a market that has their eyes on one thing - streaming

expected, with none of the series making much of an impact

services. Media powerhouses like Walt Disney Company and

with ratings of 47%, 67% and 71% on Rotten Tomatoes. For

WarnerMedia are all withholding their content for exclusive

TV, where RT is on a bit of a curve, those are relatively poor

streaming, and cable networks that relied on content

scores (almost every featured TV show on the site’s page

from conglomerates are scrambling. “Video continues to

is above an 80%). Regardless of whether or not a global

comprise over two-thirds of the total revenue for subscription

pandemic in which everyone is stuck at home was the right

streaming services (music accounts for just under a third) and

time to launch such a service, Quibi is the first of many

are predicted to keep increasing at a strong pace for 2020, up

emerging platforms that will disrupt traditional streaming

24% to $21.9 billion.” New platforms like Quibi, a short-form

and content consumption.

platform designed specially for mobile phones with content

“

spanning scripted series, documentaries and reality TV, are each helping to shape the future of media consumption.

What we’re seeing now is so much competition with Netflix and Hulu and Amazon and all the studios. Ray Landes, HBO

T R E N D S & TA K E AWAY S

THE END OF AN ERA

SO WHERE DO LEGAL TEAMS GO FROM HERE?

Not only has the digital transformation brought many changes to the entertainment industry, but evolving production

and

distribution

models,

consumer

expectations and general content consumption are each transforming the work that legal teams do on a daily basis. Never before has it been more important to understand the monumental shifts happening

â&#x20AC;&#x153;

At the end of the day, the point of legal teams is to help an entertainment company be able

in this new era, and inform creative teams on the

to unlock and ensure that the

possibilities of what they can do. Not only is it vital to

company is prepared to maximise

be up to date on current trends and evolutions, but a deep understanding of the creative process is vital. As industry evolution pose immense opportunities, it is vital for entertainment companies, in-house attorneys,

all the places story makes money. Shawn Dennis, DreamWorks Animation

artists, designers, and other creatives to act now, seize these opportunities, and excel through cuttingedge technologies, partnerships, and projects to gain a lasting competitive advantage, and ensure their companies and clients arenâ&#x20AC;&#x2122;t ever left in legal limbo.

APPENDIX

FULL APPENDIX &

INTERVIEWS

50 58

FULL INTERVIEWS 50

DANA LIRA

DOUG CHERRY

SHAWN DENNIS

JEFF SCHNEIDER

RAY L ANDES

WORKS CITED 58

ENTERTAINMENT L AW

INTELLEC TUAL PROPERT Y

FILM & TELEVISION

TRENDS & TAKEAWAYS

DANA LIRA SVP, BUSINESS & LEGAL AFFAIRS

TOPICS COVERED: WARNER BROS. HOME VIDEO

“

Business & Legal Affairs at Warner Bros Day-to-Day of an Entertainment Attorney Leading VR at Warner Bros

ACCESS THE FULL INTERVIEW HERE:

E M ILY F R IT Z .M E /T H E S IS

The Streaming War Working on the Wizarding World™ Brand Getting Comfortable With Risk Legal’s Role In Global Campaigns Evolution of Home Entertainment

DOUG CHERRY

TOPICS COVERED:

“

Intellectual Property Data Privacy Marketing & Branding

IP & TECH LAWYER

SHUMAKER, LOOP & KENDRICK LLP

“

Board Certified in Intellectual Property Law, Cherry is known for taking complex

ACCESS THE FULL INTERVIEW HERE:

EMI LY FR ITZ.ME/ T H ES I S

principles and making them understandable for his clients. His areas of concentration include intellectual property (patent, copyright, trademark, trade secret, publicity rights and unfair competition) consulting, acquisition, licensing and litigation, as well as technology, cybersecurity and data breach law. He represents corporations, municipalities, non-profits, start-ups

Positioning Your Brand

and entrepreneurs in a variety of industries, including technology, healthcare,

Intersection of IP & Entertainment Law

mediation experience involving high profile, corporate technology cases,

Representing Creative Companies Representing Independent Artists Trademarks, Patents & Copyright

law enforcement, and manufacturing. He also has extensive litigation and patent, trademark, copyright, and trade secret litigation. He is a founding member of Shumaker’s Data Breach Team. His background in computer consulting, fluency in many programming languages, and my computer skills, including database and network management, expert systems, simulation design, and various software packages, enable him to effectively and efficiently assist his clients.

SHAWN DENNIS

TOPICS COVERED:

FORMER PRESIDENT, MARKETING & BRANDING DREAMWORKS ANIMATION

“

ACCESS THE FULL INTERVIEW HERE:

Business Leader spearheading strategies, steering enterprise-wide initiatives, and

Licensing & Consumer Products

directing product innovations for such iconic brands as DreamWorks Animation,

Legal’s Role in the Creative Process

E M ILY F R IT Z.M E / T H E S IS

profits. She delivers 30+ years experience as company President, CMO and Strategic

Mattel’s American Girl, Dell Computers, the NFL, MasterCard, and Universal Studios. Now focused on value-added board work and advising innovative start up

The Streaming War

companies such as GoldieBlox, Slumberkins and Toca to help them disrupt consumer

Upcoming Trends and Challenges

experiences and build global fans. Her background includes successful experience defining business priorities, championing corporate mission, and creating synergies between brand assets to build customer relationships and loyalty. She has pioneered explosive retail growth, the launch of new business units and integration of content and storytelling to build customer engagement.

“

Strategy Behind DreamWorks TV

Dennis is an active Board Member across 6 private companies and national non-

Changes in Traditional Distribution Brands Disrupting Entertainment Space Why Google Should Be Scared

TOPICS COVERED:

â&#x20AC;&#x153;

Experience at National Geographic TV Business Affairs vs. Legal Affairs Legal Impact on Film & TV Qualities of a Good Entertainment Attorney Relationship Between Legal & Creative Evolution of Distribution Models The Streaming War

FEATURED INTERVIEW

JEFF SCHNEIDER EVP, BUSINESS & OPERATIONS

ACCESS THE FULL INTERVIEW HERE:

EMI LY FR ITZ.ME/ T H ES I S

â&#x20AC;&#x153;

Why Netflix Is In Real Trouble

4 10

Cohen, John B. “Entertainment Law 101,” American Bar Association, 2019. Watson, Amy. “Value of the global entertainment and media market 2011-2023,” Statista.com, 2020. “Media and Entertainment Spotlight,” www.selectusa.com, 2020. “Entertainment Law: What Is It and Why It’s Important,” halt.org, 2019.

13 15

“Annual Revenue Per Media and Entertainment Company 2019” Statista, 2020. “The Unique Role of the Entertainment Lawyer,” USCGould School of Law, 2020. Bruns, Beth. “10 Things To Know About Entertainment Law,” Above the Law, 2017. “An Introduction to Entertainment Law,” www.USCGould.edu, 2020.

WORKS

CITED

Cohen, Jeff B. “Entertainment Law 101,” American Bar Association, 2019. Barnes, Harrison. “Pros and Cons: In-House vs. Law Firm Practice,” www.lawcrossing.com, 2020.

“Entertainment Law: Intellectual Property,” law.jrank.org, accessed 2020. “What is Intellectual Property?” WIPO, 2020. Why is Intellectual Property Crucial for Marketing the Products or Services of Your SME?” WIPO, 2020.

Jewell, Cathy. “From Script to Screen: What Role for Intellectual Property?” World Intellectual Property Organization, 2020. “Definition of Patent,” Merriam-Webster Dictionary, 2020. Carver, Barbara. “New Patent to Transform Entertainment Industry,” PR Newswire, Jan 2020. “Definition of Trademark,” UK Dictionary, 2020. “Trade Secret Policy,” United States Patent and Trademark Office, 2020. Intellectual Property Organization, 2020. “Overview of Intellectual Property Laws,” Stanford University Libraries, 2020. “Geographical Indications,” WIPO, 2020.

Entertainment Law: Intellectual Property,” law.jrank.org, accessed 2020. Intellectual Property Organization, 2020.

Jewell, Cathy. “From Script to Screen: What Role for Intellectual Property?” World Intellectual Property Organization, 2020. Hart, Mandi. “From Star Wars to La La Land: How Intellectual Property Fuels Films,” CIPI, 2017. J.Labate, Robert. Pomerantz, Daniel. Saper, Dahlia. “Legal Issues in Film Production,” PDF, 2006.

“Film Industry,” wikipedia.com, 2020. Bruns, Beth. “10 Things To Know About Entertainment Law,” Above the Law, 2017. McClintock, Pamela. “2019 Global Box Office Revenue Hit Record $42.5B Despite 4 Percent Dip in U.S,” Billboard, 2020.

The Filmmaker’s Ultimate Guide to Video & Film Distribution,” studiobinder.com, 2018. Freedman, Robert. “Distribution Contracts,” documentary.org, 2020.

“8 Key Consumer Tech Trends for Entertainment,” Consumer Technology Association, PDF, Sept. 2019. “Teaching With NYT Virtual Reality Across Subjects,” The New York Times, 2019.

“8 Key Consumer Tech Trends for Entertainment,” Consumer Technology Association, PDF, Sept. 2019.

Harrison, John. “Ten opportunities and threats for media and entertainment companies,” EY, 2019. 59