Class Handouts
Securing Underlying Rights
I. DEFINITIONS:
1. "Property" is a stage play or musical, motion picture, television production (special or series), recital or musical composition to be based upon an "Underlying Work."
2. "Underlying Work" is another property such as a novel, biography, character (living or dead), historical event (whether or not generally known to the public) or any element therefrom (such as but not limited to a title, character name, story line, plot or subplot).
3. "Purchaser" is an author, producer, performer, director, theater owner, publisher or other acquirer of Underlying Rights.
4. "Underlying Owner" is an owner of Underlying Rights and may include another author, motion picture company, publisher, intermediate acquirer or the estate or assignees of any of the foregoing.
II. THE THRESHOLD QUESTION
Is it necessary or desirable for the Purchaser to acquire the Underlying Work?
Determine this by:
(1) One own's knowledge of literature, history, events and common sense.
(2) engaging services to furnish copyright and title searches,
(3) considering domestic and foreign copyrights, the law of unfair competition, rights of privacy and publicity, dangers of libel, slander and other defamation,
(4) determining whether the property will be based on public domain material, or is a permissive fair use, parody, and whether "droit moral" (moral rights of authors) may be violated. (5) investigating the prior history of the Underlying Work, e.g. prior adaptations, claims, litigations and its own "prior art" (especially public domain prior art that can be used instead of the Underlying Work).
A. If the answer to the Threshold Question is "Yes" or "probably", proceed to contact all the Underlying Owners of their agents or other representatives and negotiate a deal. Do not acquire Underlying Rights from fewer than all the Underlying Owners unless the Purchaser can get and is satisfied with a non-exclusive license or stage rights without motion picture or television rights.
B. If the answer is "No", it is wrong to contact anyone who might claim to be an Underlying Owner, lest the property be tainted with a claim of access or copying.
III. THE UNDERLYING CONTRACT
1. Adequate representations and warranties. Indemnities of the Underlying Owner against claims and liabilities.
2. Broad grant of perpetual worldwide rights -- use, adaptation, change, interpolation, waiver of droit moral, use of Underlying Authors' names, biographies and likenesses and characterizations.
3. Sufficient time to prepare and mount or release the property (i.e., a workable Production Date).
4. Merger of Property and the Underlying Work upon 21 paid public performances.
5. A fair advance, royalty and proportionate share, of proceeds from subsidiary (excluding music publishing) rights.
6. Inspection by Underlying Owner (or representatives) of books and records for a period of two years from rendition, following which statements not reasonably objected to shall be final.
7. Merger of all previous and contemporaneous understandings in this contract. No oral change or waiver. Applicable law. American Arbitration Association in New York City.
8. Do not allow rescission or reversion of rights to Underlying Owner for non-payment or other breaches or reasons (except failure to comply with the Production Date).
9. Do not grant Underlying Owner approvals of material, cost, directors, designers, etc. (i.e., Vanity" productions)
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