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Now, if you’re wondering what Charlie Sheen has to do with Louisiana and its entertainment industry, just sit back, put an ice bag of crawfish on your head and follow along. This is a Louisiana story of how the state’s entertainment tax incentives affect our local economies and a strong argument of why anyone opposing them is, well, ‘not winning’ and a ‘troll.’ If you’re still living in that camp down by the bayou, and don’t have radio or television, or any modern form of outside communication, then suffice it to say, Charlie Sheen is a film and television actor. He was (and probably still is) the highest-paid television star on television. He had a TV show and now has a web show. Sort of like Conan O’Brien. He recently got into a hurricane-breeze of trouble when he embarked upon a bizarre adventure to prove to the TV world (and all territories in perpetuity; and throughout the universe; and all media known and unknown) he is a winner. The fallout is several hundred people have been put out of work, local Burbank, California businesses have seen a marked decrease in business, oh and lawsuits are going to fly just like the pigs did when the New Orleans Saints went to the Super Bowl. You see, when a crucial lead in a TV show just, well, walks off a show, it affects hundreds of people. The crew. The vendors who supply goods and services to the show (directly and indirectly). And, believe it or not, the viewing audiences. Oh, and those mean ole nasty TV studios. Take for instance the local eateries surrounding the Warner Bros. lot in Burbank. They have seen a drop-off in lunch time and dinner time crowds from the crew of Two and a Half Men, as well as the studio departments which work with the show. Local vendors who supply the lot and the show with filmmaking supplies, television goods and services, have lost the revenue streams of providing these valuable services. While these businesses certainly have other clients and customers, CBS’s top-rated sit-com Two and a Half Men provided a whole heck of a lot of gumbo for everyone. And now it’s gone because of one guy. Okay, if you want to argue CBS’s side, Warner Bros.’ side, the show producer’s side, Charlie’s side, his ‘two smokin’ hotties’ sides, then go right ahead. However, with regards to a multiplying-effect of business which Two and a Half Men provided, what ever side you argue, there has been a significant decrease in work and revenue with those involved. Just ask any of the crew members who worked on that show. Louisiana enacted in 2002 a tax incentive program with which to lure new business to the Pelican State. Though in the early stages there were crooks involved with some of the tax incentives given out, which made for sensational headlines, taken as a whole, Louisiana’s entertainment tax incentive programs have been a resounding success. This state is No. 3 behind California and New York (respectively) when it comes to television and film production revenue generation in the United States. It is my prediction, in the coming years, Louisiana will overtake New York. When a film or television production company comes to Louisiana to produce a project (or, many) they employ locals as well as interstate workers. No. Not those on the I-10. These workers have to eat. They have to have places to stay. They need to buy clothes. They need to buy goods and services from local businesses. And, yes, they need medical care after Mardi Gras. Rookies. Film and television workers in Louisiana spend their money where they need to support themselves. If you’ve looked around town, even in the smaller cities throughout the state, these crews spend their money on things they need and want. I haven’t even begun to discuss the expenditures the production companies make, yet. This multiplying-effect in turn, generates new opportunities for other businesses to take on more stock/inventory, hire some more employees when they can, and in turn, spend their new money on things they need and want. Another consequence of the entertainment tax incentives program is it attracts new businesses to support these production companies which come to town. A special digital video effects company. A local New Orleans production company. And, even a Hollywood cameraman friend of mine. He sold his house in Los Angeles and moved to New Orleans for the opportunities in the entertainment business. Sandra Bullock, Brad Pitt, Angelina Jolie and other actors didn’t have to buy houses and move their families to New Orleans. But they did. Maybe to get away from Chuck? I don’t know. So much like the Charlie Sheen Effect affected businesses in Burbank, so too does the entertainment business affect Louisiana. Yet, without all the nasty aftertaste. Or, what ever is in his Tiger’s Blood. If you want to argue Louisiana taxpayer money shouldn’t go to the greedy Hollywood types, yet rather go to the schools or [fill-in-the-blank-here-with-your-pet-project], then you’ll have a long bayou to drain because the entertainment industry is flourishing. It’s flourishing because we’ve worked through all the bad details in the laws to flush out a good solid program here. There are a lot of businesses in this state which welcome the added revenue streams. And if you’re still not convinced of the Charlie Sheen Effect, well then, you’re just not winning! Stanley B. Gill
One, of many, contractual mechanisms for a producer to option a work for possible future production into a movie or similar project is a ‘dollar option.’ Filmmakers shouldn’t take this method to mean they’re buying a script, for example, for exactly a dollar. And, writers shouldn’t take this method to mean they’re selling their script for a buck. The option generally is for the exclusive right to develop the property under certain conditions. The stories (i.e. industry folklore) I hear and read, always – 100 percent – had one thing in common. They had no written agreement timely & properly drafted, executed and completed. Case in point? A simple query I received by a screenwriter working with another screenwriter. This screenwriter had spent a year working collaboratively on a screenplay with another writer, in a foreign country. And now it was time to see if they could get it produced, optioned, sold, etc. The problem? No legal written agreement existed between them.
Could an attorney have helped them? Yes. Could they have cleared all the hurdles needed to have a solid agreement – for a buck? Yes. With that, I’ve always asked myself, “Self? Why do producers, et al. swim into these swamps?” I’ve come to the conclusion they never really wanted to bother doing the right thing. You decide what ‘right’ means to you. A ‘one dollar option’ not only requires a valid written agreement, yet also requires further agreements on what is to happen when the next step comes into play. For example, the option period has expired; what happens next? The producer lines-up financing to produce the script; what happens next? And, some people’s favorite, what happens when one of the parties dies? If you fail to negotiate and secure agreements on these and a vast myriad of other conditions, you really have nothing. You’ve wasted your time working on a project, even if you find a wealthy investor, you won’t be able to legally produce the project. If you fail to plan for business, business will plan for you. Waiting until after a relationship has developed, re-writes, writes, re-writes, etc. have been completed, to only then execute agreements will certainly kill your project. You just wasted time out of your life for nothing. Just ask Frank Konigsberg and Ann Rice. It’s all about “The Mummy.” Frank lost $50,000 on an option with Ann on her book. They never had any written agreements and Frank never exercised his options. (Konigsberg Int’l. v. Rice, 16 F.3d 355 (9th Cir. 1994). There wasn’t even a ‘one dollar option’ there. Tough lesson to learn. As indie production is taking a hard hit with regards to financing and distribution in today’s economy, indie producers are looking for ways to limit their cash outlays, while insuring they have solid agreements in place with ventures. As a producer, if you sit down with a writer (let’s surmise a non-WGA writer for this example) to workout a ‘one dollar option’ with an agreement to purchase if certain conditions come into play, and this same writer starts balking at your offer, you have to ask yourself, “Self? Why would I want to spend my business venture life working with them?” Case in point for me as an indie producer, a British writer contacted me in hopes of me producing their script. After reading the log line, I agreed to read the script with a properly executed release. And, I also told them (before we went further) what I expected. I expected, if I did like the script, I would option it for a dollar with an agreement to purchase at WGA minimum (plus other incentives), once principle photography commenced. Boy. I tell ya. I don’t think the hate eMail stopped for a month. Having been accused of trying to ‘steal’ this author’s work in the first reply eMail, I just said, “Thanks. I’ll pass.” I had not even read the script. Without a ‘housekeeping arrangement’ with a studio and a fat development-money bank account, how does an indie producer expect to option properties in concerted hopes of producing a movie? A TV show? The ‘one dollar option’ is just one of many methods by which to achieve this goal. From my professional experience, I’ve had great success in optioning books and screenplays for a dollar – a buck. And the writers (as am I) are banking on the hopes I can get these into production, distribution and make a profit. Huge, huge hurdles. Yes, I’ve had options lapse. I couldn’t get the project to work. I was out a buck. The writer had a hope of getting their script produced and now they were free to move on. While these projects never came to fruition, though we were disappointed, I have made great relationships with writers. They write. Scripts. Oh, and want me to option them. Relationship-building is lost in the fog. Don’t get lost. Are there agreements out there where ‘friends’ get together to write a script and want to produce it themselves, and not one piece of paper has been touched by ink to form an agreement? I bet dollars to doughnuts (Krispy Kreme, of course) there are hundreds made every day. I don’t get into those relationships. They’re just not worth the hassle. As a producer, you have to decided whether or not this ‘one dollar option’ is a route you want to go down. As a writer, you have to … well, you get my point. Are there people out there that’ll screw you over at the drop of a dime? Er, dollar? You betcha. However, when all is said and done, you need to have properly executed agreements in place. One of my favorite quotes comes from John Landis in his deposition during the “Coming To America” Art Buchwald case with Paramount Pictures (Buchwald v. Paramount Pictures Corp., 17 Media L. Rept. 1257 (Cal. Sup.Ct. L.A. County) Dec. 21, 1990). He said, “Every movie I ever made that made over $100 million, there were lawsuits.” I wished I had his problem. My other, is my own. Question: How do you know your friends in Hollywood? Answer: They stab you in the front, because everyone else is going to stab you in the back. DISCLAIMER: While I did go to law school, I’m not a lawyer. But I did watch a marathon of Boston Legal once. Join the conversation below and become a part of HollywoodSouth. Good luck to everyone! Stan Gill |    |
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The myth of selling one’s script for a dollar and same becoming the next blockbuster, only for the writer to be screwed, is prevalent in Hollywood with folklore abound. Don’t get confused. If you want to be a producer in this industry, my advice would be to educate yourself. Oh, and get competent legal support from an entertainment attorney.