Class Handouts
Class Notes 2/23/98
Underlying Rights
Taken by Amy Baldwin,
Thanks Amy!
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Today's class was a discussion of UNDERLYING RIGHTS belonging to Originators of material that might be used as a basis for a new work. These are the rights that you need acquire or pay for in order to start a project Based on existing material.
Copyrights like bundle of rights stemming from the same property. The right to produce on stage, songs, movies, musicals, etc. You can License or purchase one or more of these rights from the original Artist or whomever owns them (such as an estate, music publisher).
For the stage, the playwright usually owns the work. In film, studios hire writers, lyricists, etc and they paid to "work for hire", so they have no claim to ownership (studio owns the copyright) Since new copyright law in 1976, copyrights exist for the life of the author plus 50 years. You must check the copyright status of all material involved before attempting to produce a show.
Shows can be based on various types of original material: novel, life story, movie, animation, cartoons, songs, paintings, poetry, or another play.
There are two types of rights for which royalties must be paid: Grand Rights and Small Rights. Grand rights must be acquired for songs that have been dramatized, or are used to dramatize a play using sets, choreography, or a through story. Small rights apply to general public performance, radio, concerts and the like. A concert hall will pay for a blanket license in the form of a yearly fee to ASCAP, BMI, and SESAC-(performing rights societies) representing authors and publishers of music. All Broadway houses hold blanket licenses for all music used for general small performance use during a year, then grand rights are licensed by producers for specific shows.
Titles are not covered by copyright, but can be protected under the laws of "Unfair competition" (Lanham Act), to protect public from thinking that a production is something that it is not.
As a producer must be careful not to defame anyone, intrusion into the privacy, or use of a deceased public persona without permission (right of publicity)
Who owns the underlying rights?
It can be the author, his or her estate, music publisher, movie studio. It is your responsibility to conduct a copyright search if there is any question. The law office of Dennis Angel is devoted to this specialty.
It is a good idea to take out Errors and Omissions insurance just in case you have missed something. An attorney can prepare this for you and it protects a producer and author against unknowing infringement on someone's rights including defamation. The authors must provide producer with warranties and representations, as proof that they are in fact owners of the property that you are either paying royalty fees for, or purchasing and indemnification if not.
Underlying Rights Agreements: You need:
1. Warranty and Representation must be provided to show that they have the right to grant you the rights to the property.
2. Perpetual and worldwide rights for the life of the copyright, the right to make changes, and a waiver of 'moral rights' (right to changes) outside of the U.S.
3. Enough time (usually 3 years) to create and produce the show, plus negotiable extensions.
4. Fees to the owner are usually paid in advance against royalties.
5. Royalties. Generally 2% of gross receipts each go to the bookwriter, lyricist, and composer, and .25%-1% to the underlying rights owner. (Usually 1 third the amount paid to the bookwriter) . All of this is negotiable depending upon the specific circumstances. GWBOR (gross weekly box office receipts) is the basis used to make the calculations.(subject to royalty pool- to be discussed next week)
6. Merger Clause. After a specified number of performances, usually 21, or a Broadway opening, each aspect of the work becomes merged into one entity under one copyright which can then be licensed for future subsidiary productions.
7. Developmental Productions. You need the rights to readings, out-of-town tryouts, workshops and any other steps to get you to the final production,
8. Subsidiary Rights. After the merger comes into effect the rights to future potential activities (movie, stock, amateur, TV, books) usually shared prorata with authors as GWBOR.
9.The underlying rights owner does not get any portion of music publishing rights including mechanical (LP, CD, etc), synchronization (film, TV) or small performance (cabaret, radio). These go entirely to the composer and lyricist.
10. Billing. Size, advertising, location of credits are all negotiable. Generally 50% of the size of the bookwriter, lyricist and composer.
11. The underlying rights owner gets houseseats (available for purchase).
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