Los Angeles, CA (Law Firm Newswire) October 28, 2011 - Napoleon Pictures, the production company that created “Napoleon Dynamite”, says Fox Searchlight owes it $10 million because of alleged unpaid royalties, breach of contract, and negligent misrepresentation. Litigation like this is ever present in Hollywood, and affects not only production companies, but many players in the business. Motion picture contracts are known to be very complex, and yet many deals are struck casually over the phone or over lunch.
“It is of the utmost importance to have legal representation when a contract is being reviewed and agreed to, no matter how experienced your production company is,” said Los Angeles entertainment attorney Anthony Spotora, of Spotora & Associates, P.C. “Spending the extra time up front is beneficial when it comes to enforcement of the agreement years down the road.”
“Napoleon Dynamite” grossed an estimated $45 million in theatres and remains popular as a home rental. In the term sheet, Searchlight said it would pay 31.66 percent on home video net royalties. Napoleon Pictures says that its audit shows they have only been paid 9.66 percent and that Searchlight is taking improper deductions. The producers say they were given many choices for distributors when it marketed the film at the Sundance Film Festival, and ultimately chose Fox Searchlight because of its high up-front fee and potential home video payout. But their confidence has been eroded after it allegedly found that Searchlight had underreported TV license fees, did not disclose electronic sell-through revenue, and other unexplained charges and costs.
“This case will be interesting to see unfold as it takes careful analysis of studio cash flows and accounting practices to recover the money,” said Spotora.
The Law Offices of Spotora & Associates has a wealth of experience in the film and TV industry. They can help an individual or corporate client analyze accounting practices, contracts, and royalty concerns. Their Los Angeles entertainment litigation attorneys are known for their hands-on approach and personalized attention. To learn more, visit http://www.spotoralaw.com/.
Law Offices of Spotora & Associates, P.C.
1801 Century Park East, 24th Floor
Los Angeles, California 90067-2302
Call: (310) 556.9641