Entertainment & Media Law Signal : Canadian Entertainment Lawyers for Licensing, Intellectual Property & New Media Matters

Reports about Warren Beatty's recent court victory in respect of the film and television rights to the Dick Tracy property offer a chance to reflect on the wording of reversion clauses.  Grants or transfers of rights in entertainment properties are sometimes subject to a reversion clause which obliges the grantee to exploit the rights within a certain period of time or else the rights "revert" to the grantor. 

In Beatty's case, though details are somewhat sparse, it appears that when he obtained the rights to the Dick Tracy property, his continued enjoyment of the rights was subject to a reversion clause: if Tracy failed to produce a new Tracy-based film or TV project by a certain deadline, the rights would revert to Tribune Co. (the owner of the underlying rights in the franchise).  Beatty had produced the 1990 movie Dick Tracy, but Tribune evidently was interested in producing a new TV series.  The most comprehensive coverage of the dispute between Beatty and Tribune is offered by Phil Rosenthal writing at the Chicago Tribune's Tower Ticker blog:

Beatty, who acquired rights to the character from Tribune Co.'s Tribune Media Services in 1985 and made the 1990 movie “Dick Tracy” starring himself and Madonna, filed suit in Los Angeles federal court in 2008 after Tribune Co.'s Tribune Media Services said those rights had reverted back to it. ...

Tribune Co. argued that Beatty was required to produce another Tracy television or movie project to retain the rights before a use-it-or-lose-it deadline TMS had established two years earlier. Beatty countered that, after his request to extend the rights to 2013 was denied, he had begun work on a "Tracy" special before the deadline.

Turner Classic Movies subsequently scheduled a half-hour movie chat between film critic Leonard Maltin and Tracy (as played by Beatty) discussing various portrayals of the comic detective for July 2009, but it's the special didn't run on the cable channel.

Judge Dean D. Pregerson of the Central District of California decided in Beatty's favour: Beatty's commencement of work on the half-hour movie was sufficient to meet the condition he had to satisfy in order to retain the rights.  In short (although this is necessarily speculative without having the benefit of the contractual language or the court's reasons), it would appear that Beatty abided by the terms of the reversion clause, though interpreted strictly: the reversion clause obliged him to commence production on some kind of film/TV project within a certain time frame in order to retain the rights - he did so, and so retains the rights.  Tribune's argument was presumably something along the lines of "to meet the condition, it couldn't just be a perfunctory production - it was supposed to be a real production - something with a big budget, something with stars, something that was intended to be theatrically released or broadcast on a major network or pay/subscription channel - not some rinky-dink 30 minute special which never even got aired".

The court was inclined to prefer Beatty's approach:

"(Tribune Co.) may be frustrated that (Beatty) has not used his rights to Dick Tracy for more profitable ends," Judge Pregerson wrote in his ruling, noting he saw nothing in the contract between the two requiring such a project to make money.

The upshot for practitioners?  Reversion clauses should be drafted with precision: if the grantor of rights intends that only a "real" production will qualify to vest rights in the grantee, then the clause should expressly state a minimum budget amount that is required to be actually spent by a particular date - or require broadcast on particular outlets or theatrical release in a minimum number of theatres by a particular date or require that distribution/license agreement(s) worth a particular dollar amount (paid as a minimum guarantee) be entered into by a specific date.  Other specific provisions can be envisioned, but the primary point to bear in mind is that contractual language needs to be as detailed as possible in order to ensure that performance by the parties can be measured against an express, identifiable standard.

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Over the last couple of weeks a number of articles have come to my attention which, in different measures, I thought provided some great background information on how the business facets of the film and television industries work and what types of arguments can be made for and against the types of copyright reform which many think are necessary to facilitate the continued survival of the entertainment industries in light of digital technology:

• The Economist wrote about Hollywood's disc problem: video nasty, highlighting how innovative business models and delivery systems have undercut the gargantuan DVD/Blu-ray cash behemoth
• in a longer, much more detailed piece, The Economist looked at Hollywood and home entertainment: unkind rewind, a brilliant little explanation of the economics of the film/TV industries and how the increasingly rapid closing of different "windows" of exploitation (eg theatrical, pay-per-view, home video) is impacting different elements of the distribution chain (how unhappy do you think theatre owners are that movies will soon be available for home consumption in as little as eight weeks from their initial theatrical release?)
• with a hat tip to Lon Sobel, Peter Yu's Digital Copyright and Confuzzling Rhetoric offers an enjoyable read on the various arguments being advanced by many parties in the ongoing struggles for copyright reform - he covers four arguments in favour of stronger protection and enforcement, four arguments against it, and offers five strategies for making more convincing the arguments of the entertainment industries

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UPDATED BELOW

The Ontario Superior Court of Justice recently confirmed, in emphatic an unambiguous terms, that Ontario law does not recognize a common law tort of "invasion of privacy".  In Jones v. Tsige, 2011 ONSC 1475, Whitaker J. framed the question began his judgment as follows:

The central issue in this case is whether there is a tort for invasion of privacy.

He concluded as follows:

I conclude that there is no tort of invasion of privacy in Ontario.

That conclusion was made with reference to the Ontario Court of Appeal's decision in Euteneier v. Lee, 2005 CanLII 33024 (ON C.A.) wherein one of the justices noted that the appellant had "properly conceded in oral argument before this court that there is no “free standing” right to dignity or privacy under the Charter or at common law".

As Whitaker J. noted, there are four statutes which apply in Ontario which speak to the protection of an individual's privacy:  Personal Information Protection and Electronic Documents Act; Personal Health Information Protection Act, 2004;  Freedom of Information and Protection of Privacy Act; and Municipal Freedom of Information and Protection of Privacy Act.  Outside the ambit of those pieces of legislation, there is no protection of privacy in Ontario (or at least none which would be encompassed within a tort of "invasion of privacy".  As the judge also noted, other provinces already have in place various statutory regimes which provide more protection for privacy rights than is afforded by the four statutes mentioned above.

What is the relevance of the Jones v Tsige court's conclusion for entertainment and media lawyers?  The ambiguous concept of "privacy rights" is often engaged (or at least brought up) as a concern when dealing with documentaries, news reports, "reality" TV - really any sort of printed or audio-visual content which involves some kind of depiction of an actual person.  Further confirmation that there is no "invasion of privacy" tort in Ontario means that the universe of potential claims is that much narrower - when we advise our clients about "privacy" concerns raised by their activities we have a finite set of sources to assess from which such a claim could arise.  (I canvassed some of the issues could arise from the Personal Information Protection and Electronic Documents Act (more commonly referred to as PIPEDA) in this earlier post: PIPEDA and Filming/Photographing Individuals for Film and TV Projects.)

UPDATE (April 17, 2011): David Vaver has stridently argued that the decision of the court in Jones v Tsige is incorrect, and that other Ontario courts have seen fit to award remedies for invasion of privacy: Jones v. Tsige: Snooping and Privacy in Ontario.

UPDATE II (January 19, 2012): The Ontario Court of Appeal decision in the case has reversed and confirmed that an invasion of privacy tort (or "intrusion upon seclusion") does exist - see here for coverage.

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The good folks at the Lawyers Weekly published an op-ed piece of mine last week (in their March 21, 2011 issue) - the full text of the article can be accessed here, and the opening paragraphs are below:

An arcane CRTC decision in February on “usage-based billing” among Internet service providers prompted an explosion of public anger. When the federal government voiced almost immediate concessions to the rage, at least one conclusion became inescapable: the copyright wars are not going to end any time soon.

Two assumptions underlie the struggle among content creators, distributors and users to re-orient the hoary copyright regime to better account for the realities of digital technology. First, that someone will eventually figure out a mechanism to easily and transparently facilitate payments for authorized online uses; second, that people who access content online will prove willing to pay in accordance with that mechanism. The public and government reaction to “usage-based billing” indicates those assumptions may not be tenable, at least not in a way that ensures the survival of the entertainment industries in their current forms.

Copyrighted entertainment products — songs, movies, TV shows, books — comprise many of the materials shuttling through the digital connections of the Internet. Traditionally, copyright ensured that access to entertainment products required, somewhere along the line, payment. That prospect of payment helped ensure that products were created and distributed on a commercial level. As the Internet has enabled widespread dissemination without multiple intermediaries between creator and consumer, and has made unauthorized consumption of content easier, the critical payment element in the creation and distribution calculus has been eroded. How do the entertainment industries recover that lost revenue?

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Bill C-32 (The Copyright Modernization Act) died with the prorogation of the 40th Canadian Parliament on March 26, 2011.  My own views on the bill were (and remain) largely irrelevant, but I will be discussing what would have changed had the bill been passed into law (and what the lack of passage means for practitioners) at the Law Society of Upper Canada's 2011 Entertainment & Media Law Symposium, along with my co-panelists Erin Finlay and Giuseppina D'Agostino.  In light of the death of Bill C-32, this, final, commentary round-up offers for consideration some selected materials which have made their way into my RSS feeds over the last few weeks:

• Giuseppina D'Agostino: There is no two without three - Bill C-32 is dead
• Leslie Chong: Techies, Artists and Collective Societies Weigh in on Bill C-32
• Ivy Tsui: Musicians and Radio Broadcasters Speak Up on Bill C-32
• Daryl-lynn Carson, writing in the National Post, canvassed a number of lawyers for their thoughts on the bill: Copyright reform close but no cigar

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The twelve-year old me would be incredibly disappointed that my practice does not consist solely of cases which involve the intersection of comic books and copyright law.  A few recent items of worthy of note:

• Evil Twin Comics have published the Comic Book Comics series, which tells "the inspiring, infuriating, and utterly insane story of the American comic book industry" - including a recounting, in the words of Eriq Gardner at THR, Esq., "such disputes as whether the Captain Marvel character was an infringement on the Superman character, the legendary legal battle over the control of Howard the Duck, the legal mystery surrounding the creation of Josie and the Pussycats, and Jack Kirby's battles with Marvel over stolen artwork"
• on a topic related to my post and short article from last year (Copyright and the King), Vincent James Scipior has written "Spider-Man and His Amazing Friends: Trapped in the Tangled Web of the Termination Provisions" (forthcoming in the Wisconsin Law Review, but available now for download from SSRN) - Scipior's article talks about copyright termination claims under US law and concludes, as I did with respect to the reversionary interest clause in Canada's own Copyright Act, that such claims/interests "deprive companies of all certainty in their copyright ownership" (hat tip: Media Law Prof Blog)
• Betty Boop wasn't a comic book character (she was a cartoon character), but that's close enough for our purposes - the US Ninth Circuit Court of Appeals recently decided that the family of the creator of the Boop character could not claim either copyright or trade-mark rights in the character; the decision is noteworthy because the court was emphatic that it would not allow a rights owner to assert a successful trade-mark claim where the effect of such successful claim would be to, in effect, make an end-run around copyright law and result in a virtually perpetual assertion of rights
• Joshua L. Simmons wrote an interesting rumination on "Catwoman or the Kingpin: Potential Reasons Comic Book Publishers Do Not Enforce Their Copyrights Against Comic Book Infringer" (33 Columbia Journal of Law & the Arts 267 (2010) - available for download from SSRN here)

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Nellie Andreeva, writing at Deadline | Hollywood, offers a detailed account of how Canadian cities are losing out on pilot productions this year, in part because of increasingly lucrative tax credit incentives available in US states: PILOT SEASON LOCATIONS: New York Production Booming, Canada Loses Ground.  As Andreeva notes,

Part of the reason for more TV studio executives to consider keeping drama pilot production in the U.S. is that the current currency exchange rate makes production in Canada less appealing than in years past. But also key are tax incentives offered in the states. On a standard hourlong pilot budget of $3 million, 10%-25% in tax rebates represents a nice saving. For instance, two of the three CW pilots shooting in the U.S., Hart of Dixie and Cooper & Stone, are being produced in states with tax incentives, North Carolina and Illinois. The locations also happen to fit the settings of the shows, which producers always wish for but only get when economics allow.

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A recent Canadian Radio-Television Telecommunications Commission (CRTC) decision finding that MTV Canada's broadcast of the show Bully Beatdown did not violate the Canadian Association of Broadcasters’ Violence Code offers a good opportunity to review the relationship between the Canadian Broadcast Standards Council (CBSC) and the CRTC - a useful reminder as we await the outcome of the CBSC's review of its earlier decision on the radio airing of the Dire Straits' song Money for Nothing (see here and here for earlier Signal coverage of the matter; also worth reading is the CBSC release entitled Some Important Clarifications about the CBSC’s Dire Straits Decision, which is not just informative, but fascinating reading from a public relations standpoint).

 Some background on the Bully Beatdown decision.  In April 2009 the CBSC received a complaint about MTV's broadcast of the show - this file contains the original complaint, the response from MTV and some subsequent correspondence from both sides.  The complaint asserted that the broadcast of the show, in which a victim of bullying is afforded the opportunity to see his or her bully engage in mixed martial arts combat with a professional MMA fighter (there's a monetary component to the show which is, frankly, entirely besides the point), violated the Canadian Association of Broadcasters’ Violence Code.

In April 2010, the CBSC released its decision in the matter (CBSC Decision 08/09-1667), in which it concluded that the broadcast of the show did not violate the CAB Violence Code:

In the end, although sympathetic to the complainant’s concerns about the best societal solution to the bullying problem, the Panel finds no breach of any of the foregoing standards as a result of the type, timing, or advisory choices regarding the violent content of the challenged episode of Bully Beatdown.

The complainant requested that the CRTC review the CBSC's decision (an explanation of the relationship between the CBSC and the CRTC as it relates to CBSC decisions can be found here).  The complainant wanted the CRTC to review the decision particularly with respect to the fact that the CBSC did not find that there was a violation of Section 3.1.1 of the CAB Violence Code - the so-called "watershed" provision which requires that programming containing scenes of violence intended for adult audiences be aired only after 9pm.

In March 2011, the CRTC released its decision in the matter (

).  The CRTC confirmed the CBSC's decision that the broadcast of Bully Beatdown did not violate the CAB Violence Code, and in particular, that the scenes of violence contained in the program "were not of such an explicit or graphic nature as to necessitate relegation of the broadcast of the program to post-watershed hours".

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A slew of interesting materials have recently been posted relating to developments in the United States law relating to the "right of publicity" (for Canadians, the closest analogue would be the rights protected by the tort known as "appropriation of personality" - for some Canadian-specific academic treatment of the topic, see the resources listed in this earlier Signal post):

• Aaron Moss's When It Comes to the Right of Publicity, Yes Doubt, looks at some recent California cases revolving around the use of celebrity images, particularly in the context of videogames
• Mark Litwak provides a short but information-packed post discussing theJimi Hendrix Right of Publicity Suit - meaning the recent decision of the US District Court for the Western District of Washington in Experience Hendrix, LLC vs Hendrixlicensing.com, Ltd., a case which examined the post-mortem treatment of publicity rights, particularly where there are conflicting state laws which might be applied
• Mark A. Fischer and Franklin H. Levy have written a lengthy discussion on Privacy Rights and Celebrities: Truth, Fiction and Biopics, examining the right of publicity as modulated by free expression concerns in the context of "biopics" or "docudramas" - with a focus on the recent movie The Social Network

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Selected materials for consideration about Bill C-32 (The Copyright Modernization Act):

• James Gannon posted slides from a recent presentation on TPMs / DRM and Bill C-32
• Robert Karrass queried whether Bill C-32 constitutes  A Lifeline for a Dying Industry?
•  Kyle Lavender offers link-rich Review of Selected Bill C-32 Position Papers
• Ken Anderson provided some Reflections on the Grammys: Glee, Bieber and the Mash-up Provision of Bill C-32
• Barry Sookman, in a detailed and thoughtful post, explores the extent to which Bill C-32's enablement remedy targets secondary copyright infringement

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Heenan Blaikie has published a Summary of Canadian Financial Incentives for the Production of Animation, Digital Media and Interactive Content - a concise (and good-looking!) guide to everything from the federal SREDTIP, to Ontario's OIDMTC, to Quebec's PMTTC and all points in between them.  We like to think of the Summary as the sister guide to our Producing in Canada handbook; between them they provide a comprehensive overview of Canadian government incentives for the production of projects in virtually all visual media.

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In the inimitable Law Law Land style (no, seriously, not capable of being imitated... I've tried), Brian Berman explores, from the perspective of California law, various issues about engaging actors who are minors: Hailee Steinfeld Owns Hollywood…But Who Owns Hailee Steinfeld?

Contracting with minors often exposes one of the larger gaps between Canadian and US entertainment law practice: US producers and lawyers are sometimes startled to learn that, at least in the Province of Ontario, no statute exists which creates a pre-determined process to have a court affirm that a contract entered into with a minor is enforceable (British Columbia, by contrast, does have such a statutory procedure in place).  I canvassed the differences in the law and practice in California, New York, British Columbia and Ontario in my article "A Minor Conundrum: Contracting with Minors in Canada for Film and Television Producers", originally published in 29 Hastings Comm. & Ent. L.J. 45 (2006-2007), and a copy of which is available here.

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