Copyright Assignment to the Producer
The Sea (2013)
If a producer has acquired an option in relation to an existing work or has come up with an idea for a film himself but needs someone else to write the screenplay, he will commission a screenplay writer to write one or more draft screenplays. A screenplay agreement normally provides that the copyright is assigned to the producer though occasionally agents for writers will insist on turnaround provisions whereby if the film production does not proceed, the rights in the screenplay revert to the screenplay writer. Normally however in this context a producer will insist upon being reimbursed his development costs if the screenplay writer is to get the copyright back.
A screenplay agreement normally provides that the producer commissions a first draft of the screenplay with an option on the producer's part to go on and commission further drafts. The writer is normally paid a fee for each draft. There are minimum scales in the UK under the WGGB / PACT arrangements but these are high and also involve substantial further payments to buy out all rights if the film starts shooting and caution needs to be exercised in agreeing these scales. If the money available to pay for screenplay writing is modest, the writer can be compensated by being promised a substantial payment on principal photography including a payment based on a percentage of the budget eg 2.5% of the budget (all earlier payments being treated as on account of this).
Share in Profits
Sometimes writers also receive a share in profits, again 2.5% of producers share of 100% of net profits is not uncommon. The producer should, as far as possible in dealing with agents, ensure that any share of profits is a share of producers net profits rather than what are referred to as 100% of net profits as a share of 100% of net profits can include financiers' share of net profits. This can mean the producer is involved in the commitment to the writer of what may turn out to be a substantial share of the producers share of net profits when other talent participation is taken into account.
Written Agreement Essential
A common mistake is to believe that simply because a screenplay has been commissioned that the producer commissioning it owns the copyright. In the absence of a written agreement signed by the screenplay writer assigning the copyright to the producer, the copyright remains with the screenplay writer. If substantial development finance is devoted to a project and it looks as though it might go ahead, the producer is very exposed if the screenplay writer becomes aware of this and still holds on to the copyright in the script.
Standard Provisions for Option Agreement and Screenplay Agreements
Both Option Agreements and Screenplay Agreements need to address such issues as the moral rights of the author (the right to be identified as the author of a work and the right not to have the work subjected to derogatory treatment); rental and lending rights (the fees should be stated to include equitable remuneration in respect of these rights); the right to use the name and likeness of the author at the producer's discretion (not being obliged to use the screenplay in the film so as to prevent liability to the writer in damages under the heading of loss of opportunity to enhance a reputation). Provisions preventing the producer from using other writers and guaranteeing to make the writer the director should be avoided.