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Insight + analysis on indie film legal issues

Three reasons your independent film or television project needs a clean chain of title.

Where is the title to a film or television project? If your first thought was something like in an animated opening sequence starting off with James Bond turning abruptly to camera with raised .25 Beretta, in a continuous opening shot of “The Player” heading across a studio lot, or in disturbing typography like Se7en, you’re thinking of the wrong titles. This kind of title is critically important, of course. But unlike the title in your film’s chain of title, it’s unlikely to stop your project from ever being seen.

That’s because chain of title in the film industry refers to the ownership of intellectual property rights, life rights, and other rights involved in a cinematic project. The “chain” is a series of documents that link current ownership of those rights to their original owners. One link might be rights of publicity that belong to the subject of a life story. Another might be copyright in a screenplay or the literary fiction, short story, or comic on which it is based.

All of those rights must be established as owned by the production company behind the media project. This means written proof in the form of an agreement, license, or assignment transferring or granting the rights to the filmmaker for use in the specific project being made. Broken links in the chain are spaces where there is no documentation. Their result is uncertainty over ownership, which creates a risk that one who can prove ownership will assert the rights. Typically, this means a lawsuit.

Chain of title and liability protection

If you are sued for infringing someone else’s intellectual property rights, right of publicity, or other rights, costs can be severe. A copyright owner, for example, “is entitled to recover the actual damages suffered by him or her as a result of the infringement, and any profits of the infringer that are attributable to the infringement and are not taken into account in computing the actual damages.” 17 U.S.C. § 504(b). If he or she cannot prove actual damages (say because your film was never distributed as a result of its broken chain of title), statutory damages “in a sum of not less than $750 or more than $30,000 as the court considers just” may be awarded to the owner. And “the court in its discretion may increase the award of statutory damages to a sum of not more than $150,000” if it finds that infringement was willful. 17 U.S.C. §§ 504(b)-(c)(2).

Chain of title and media distribution

Because a lawsuit carries the risks of monetary damages, prevention of distribution, or even destruction of all copies of a film making unauthorized use of certain rights owned by someone else, errors and omissions insurers and distributors will not cover or acquire the film. That’s another major reason to make sure your chain of title is clean from the beginning of development.

Chain of title and film finance

But a clean chain can affect your film even sooner by severely limiting your ability to finance it. Just look at a program like Panavision®’s New Filmmaker Equipment Grant and Post Production Grant. It provides for camera rental packages and post-production services such as VFX pulls for up to 50 shots and up to 12 hours of final color correction. But you’ll need to sign an agreement warranting that you “have the exclusive, unconditional legal right and authority to submit” your project for consideration as well as “the legal right to film and distribute the Project.” If your chain of title is broken in any way, then you cannot truthfully make that statement.

You can be sure that when you seek some other form of film finance you will again be asked for the state of your chain of title. As an indie producer, you must be able to answer immediately that it is clean and provide the documentation to back it up. It is vastly easier and more economical to work with experienced production legal counsel on creating your chain of title during the process of creating your script. By continuing to do so though development and production, your financing options will expand, and your film or television project will be ready for distribution.

Original image of Hollywood sign by Ahmet Yalçınkaya.

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