Slashdot Mirror
Stan Lee Sues Marvel Comics
night_flyer writes "In a story that demonstrates the way the entertainment industry manipulates its artists, Marvel is claiming that the 400 Million dollar blockbuster movie Spiderman produced no profits, and they are trying to weasel out of their contract that gives Stan Lee 10% of the profits from his creations. Nuff Said!"
That's a load of crap. You pay a man an honest wage for an honest days work.
Seems like these things have been going on in the comic book industry from the beginning tho.
. Quit playing Monopoly with Bill. Switch to one of many non-Microsoft products today.
Surely the studio should cut its losses, and not make the proposed sequel then.
Shareholders should be complaining to the board as you read this.
Pop stars are getting ripped off, developers are getting ripped off, fishermen are getting ripped off, the fire department are getting ripped off, etc, etc, etc
Dont mean to sound despotic, but Stan, join the queue
After all, he didn't do anything important re: Spiderman. All he did was develop the idea in print, nurse it along for years, pour his sweat and blood into it, bring respectability to a substandard art, etc.
The studio did the hard part. They hired the lawyer to screw Stan! If that isn't worth the 10% I don't know what is.
Time's fun when you're having flies. - Kermit the Frog
If you liscence something for a peice of the action always, ALWAYS try and do it based on revenues. Yes, you'll have to settle for a lesser percentage BUT you it is much harder for them to screw you. Basically, you get paid based on a percentage of sales, not profits.
The problem is, it's easy for acountants to find creative ways of including more "expenses" to make it look as though there were no profits. If that happens, then you have to fight it out in court. Revenues are much mroe straight forward, and harder to fudge, so it's much harder to screw you on them.
The part that really gets me is this: ...the company is "in full compliance with, and current on all payments due under, terms of Mr. Lee's employment agreement."
As if Stan Lee were just some burger flipper, instead of the person who created the character that they made $400 millions dollars from.
I've had it up to here with people that seem to think that a corporate lunch every now and then with their buddies makes them "creative".
According to my Accounting lecturer (don't look at me like that - it's compulsive for my ComSci Masters course) this isn't that uncommon. He pointed us to this from the Guardian . . .
."
"Robert Carlyle, star of the internationally popular film The Full Monty, was puzzled because he had not received any of his share of the profits from the film. 'Surely a film that cost £5 million and has taken hundreds of millions must be showing some in profits?' he asked the film's distributers. 'No', they replied 'in Hollywood no film ever makes a profit. It's all in the overheads.'"
Remember kids, "tidal waves couldn't save the world from Californication . .
"If being a geek means being passionate about something, then I pity those who aren't geeks." - Pike65
the artist steve ditko should receive some credit and money too. Unfortunately, none of the press seems to care that he is a co creator.
"Do something man. Right now."
My understanding is that this is SOP for scriptwriters, for instance. No matter what the sales are, the net profit magically ends up being zero, so they never get any royalties.
Then here you go:
Spider-Man creator sues Marvel
NEW YORK, Nov. 12 -- The creative force behind Spider-Man, the Incredible Hulk and the X-Men filed a $10 million lawsuit Tuesday, charging his old comic book company is cheating him out of millions of dollars in movie profits. Stan Lee, who crafted a menagerie of superpowered heroes with very human flaws, now claims Marvel Entertainment Inc. has tried to shut him out of the "jackpot" success of this summer's "Spider-Man" movie.
LEE'S ATTORNEYS filed court papers in Manhattan federal court, claiming that Marvel signed a deal to give their client 10 percent of any profits from his characters used in films and television shows.
"Spider-Man" has been the year's biggest hit, grossing more than $400 million domestically -- but the 80-year-old Lee says he hasn't seen a penny.
"Despite reaping enormous benefits from Mr. Lee's creations, defendants have failed and refused to honor their commitments to him," the lawsuit charges.
Marvel has reported millions of dollars in earnings from the film but has told Lee the company has seen no "profits" as defined by their contract.
Lee hopes a judge will intervene and make sure he gets a percentage of profits from the Ben Affleck movie "Daredevil," based on another of his creations, scheduled for release in February.
He also seeks a share of profits from the upcoming movie "The Hulk," and the sequels to "X-Men" and "Spider-Man."
The lawsuit demands damages and a court order forcing Marvel to turn over Lee's share in any profits from movies about characters he created.
Marvel issued a statement saying Lee "continues to be well-compensated" for his contributions to the industry. It said the company is "in full compliance with, and current on all payments due under, terms of Mr. Lee's employment agreement."
"Spider-Man" stars Tobey Maguire as the teenage superhero, Willem Dafoe as the villainous Green Goblin and Kirsten Dunst as love interest Mary Jane Watson. A sequel is due out in 2004.
Huge Economic Success due to Spiderman, but Peter Parker can't benefit because:
* Check written in Spiderman's Name
* False agency
* Peter's sense of morality (and flashbacks of Uncle Ben) prevents him from accepting check.
* Etc etc.
Mod Karma -1: I sed bad wurds. If I cep my mouf shut, I wud be at riyses.
Maybe we should remove all copyrights on fictional written works for a while? The industry is creating a false sense for would-be-artists that they can make a good living doing what they excel at, but most of them don't get anywhere due to mismanagment and greed. So - copyrights have largely ceased to benefit those who create the works of art.
Why then should we feed the corporations with gullible, naive people out to change the world?
I also get increasinly mad at people who continuously get money because their granddad was a good writer. That somehow is very wrong - as in, all people should have equal opportunity and equal responsibility.
Copyrights on factual works is a bit of a different story. We have not understood the world sufficiently well to do something that drastical to the science community. However, patent reform is direly needed if our industry is going to start growing again - with real growth, not just growth based upon more effective court-room tactics.
Stop the brainwash
This sounds a lot like DC's dispute with Alan Moore over Watchmen. (Doesn't DC own Marvel now?). Basically, Alan Moore (one of comics writing gems) created a wonderful story that made DC millions. Posters, T-shirts, coffee mugs sold like hotcakes, and Alan Moore got zilch (even though he was entitled to royalties and such). DC said the Posters, et al were "advertising" and thus were not subject to the royalty clause, thus legally screwing Alan Moore. It was that event that caused Alan Moore (a UK citizen) to quit writing for US based comics altogether for a good long while (until the advent of some of the more independent labels who actually treat their artists right). I may have some details a bit fuzzy, but I believe that's the gist of the story. (There were apparently other factors that also led to his "retirement" from US comics, as well).
:P
A google search didn't come up with anything substantial, but I seem to recall an interview with him in Comic Shop News or the other big weekly comic paper, maybe I'm just smoking crack regarding this. Might be best to disregard this.
If you were me, you'd be good lookin'. - six string samurai
The Supreme Court of the US ruled more than ten years ago that the tradition of the US movie industry is well-known to cheat its stockholders and others by accounting tricks that reduce `profit' to zero -- at least on the books.
It's a little like Enron in reverse -- cooking the books to remove all traces of return.
It's quite legal and easy for them to do, and it has been the tradition in Hollywood since it began. And that's how the SC ruled in a case brought by a(n other) writer of one of the Predator series of Movies IIRC. In that case, like this one, Stan seems to have gotten percentage `points' (in Hollywood jargon) instead of real dollars.
The studios find it easy to do this, as they can charge whatever they like for stock footage (stuff they've already shot and used in other movies) since they are the true producers, whatever the credits might say. And all movies use stock footage somewhere. F'rexample, the fire scenes in Gone with the Wind have been used (and charged for at inflated prices) in hundreds of movies.
This and `distribution costs' allow them the room to reduce the booked profits on any and all projects to zero.
The Predator movie the Court ruled on was, at the time, the largest grossing (worldwide) movie in history. And it never made a profit.
Neither did Goodwill Hunting or Titanic.
OK, there's a little more info here.
Namely, that the source of the claim is not from any copyright or other rights as creator of the characters, but from a 1998 contract giving him royalties for the licensing of his creations, but not the actual comic book sales.
Looks like it's going to be a legal wrangle over whether movie profits can be considered to be royalties.
How can we afford to ever sleep
So sound again
--ebtg
Remember young Jedi..."percentage of the gross".
That's how Sir Alec Guiness, a man well used to the ins and outs of the film industry, managed to get his money. I believe Peter Cushing got the same deal, although I may be wrong in that. Percentage of the gross, not percentage of the profits.
Cheers,
Ian
My mate Al is going to kill me for slashdotting his site but:
This is one of the best articles I've read on this situation. It helps if you have some idea of the US Comics industry but Paul O'Brien is a good enough writer to make it all crystal clear. FWIW, Paul is a UK Lawyer.
http://www.ninthart.com/display.php?article=428
Sorry, should've held the parent post until I found the contract.
The pertinent clause is:
(ii) You also continue to have the benefit of a single full-time assistant. (f) In addition, you shall be paid participation equal to 10% of the profits derived during your life by Marvel (including subsidiaries and affiliates) from the profits of any live action or animation television or movie (including ancillary rights) productions utilizing Marvel characters. This participation is not to be derived from the fee charged by Marvel for the licensing of the product or of the characters for merchandise or otherwise. Marvel will compute, account and pay to you your participation due, if any, on account of said profits, for the annual period ending each March 31 during your life, on an annual basis within a reasonable time after the end of each such period.
Note that profits are explicitly mentioned.
How can we afford to ever sleep
So sound again
--ebtg
The "piracy" problem must be even worse than they're admitting....
/. If the government wants us to respect the law, it should set a better example.
That might have been the original idea, but get real people. If one were to look at the behavior of the top 100 corporations, does that rule hold true? As corporations weild more political power, they are becoming the equivalent of the ruling class. The only difference now is the rich get to hide behind some corporate name and not subject themself to public scrutiney. The more things change, the more they stay the same people.
I've been pretty amused in the past reading all of the comments (some on /. as well) that talked about how the film business "got it" (usually argued from the position of all the extra features and additional content DVDs come with), and how the RIAA, music biz, etal were "out of touch".
This just proves business is business, and the entertainment industry is - what a surprise - very adept at sugar coating their activties until, of course, the lawsuits start flying.
Business is business, and anyone sticking their head in the jaw of the corporate machine has gotta watch out for themselves. I'm sure Stan had attorneys looking after his interests so I don't know what happened there, but I do know that most companies will do anything they can to screw you should the need arise.
And yep; I've got a Masters in Finance so I know of what I speak. A few of our case studies at Uni directly factored in litigation as a "cost of doing business".
Good luck Stan! I've always enjoyed your work and genuinely wish you the best!
A message from our sponsor
I trade a lot with friends. I buy a movie, when I do, second hand from a second hand store (Hollywood doesn't get their cut that way.) I've given to causes that are willing to fight RIAA and MPAA.
So, what have YOU done? Obviously quite a few of you went to see Spider Man.
Necessity is the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves.
This is usually how rookie unproven writers get screwed, especially authors who have had succesful novels. This is unfortuantly very common in the movie industry. Established names usually never have a problem getting Gross Points instead of Net Points, they are real tight with Gross Points because there are only so many of them to go around (Gross Points also count as an expense driving down the pool available to Net Points). I don't get why Stan didn't have a better entertainment lawyer.
I mod down any one who says "I'm sure I will get modded down for this"
You pay a man an honest wage for an honest days work.
But... but, that's not the American way! The American way is all about pleasing the shareholders.
Um, no. That is the corporate way. The American way is an honest wage for an honest day's work. The fact that America let large corporations hijack its government and undermine its constitution during the anti-communist ferver of the cold war may mean America kneels beneath their jackbooted heels, but it does not mean that corporatism is the ideal to which the country aspires.
Quite the opposite, in fact, and a backlash to this sort of crap is brewing.
The Future of Human Evolution: Autonomy
That's why you NEVER agree to take a cut of the profits. You take a cut of the gross revenue. That way there can be no accounting games.
Remember, You are unique...just like everyone else.
This is the most common practice in the film industry. My family works in the film industry. The distribution companies never return "profits", as a few people have already noted, all of their costs for distribution are determines by themselves. They choose their own salaries, the cost of making the prints, the internal costs of advertising, etc... It's very common for filmmakers to get ripped off in this manner. It's happened to my father several times.
Stan lee is very lucky he has an avenue of complaint, as this happens with most every feature film. Hopefully this will be some kind of a wake-up call to filmmakers.
The article clearly mentions X2, the Hulk, and Daredevil, but no mention is made of the first X-Men film. Did Lee ever recieve his royalties from this? If so wouldn't this seem to be a precedent in his favor... it didn't do as well as Spider-Man, but it did do rather well nonetheless. If he didn't recieve his well-deserved 10% then why has he waited until now to file suit over it?
I thought so too, before last Tuesday. Now I'm not so sure, and I'm more than a bit scared. In particular, last Tuesday seems to be taken for a mandate for more Supply Side Economics (tax cuts) when our real problem is a demand-strapped economy.
If the economy were to *really* go into the toilet over this, Bush would go down in history as the second president to lead the nation into a Great Depression. But he would never miss a meal, or a host of other mundane worries. Chances are my family would learn about much of it, first hand.
The living have better things to do than to continue hating the dead.
Spiderman is one of the many movies that I actually went to a cinema to watch... why? because I respect Stan Lee, and I would rather let him have part of my ticket proceeds rather than pirate the movie off Kazaa or something.
But when shit like this happens, I wonder whether it was worth it. It's amazing how 400mil is not enough to be considered profitable. Last I checked the movie didn't cost a billion bucks to make (I don't think it even costs 500mil).
Thanks Sony... I'll repay you with my unlimited bandwidth.
Welley Corporation - SLM Scammers
Anyone remember the shameful treatment given Jack Kirby when he tried to reclaim his original art from Marvel when Stan was at the top? I do hope that Stan wins this, but find the irony just a little bit delicious - Lee has not been known for giving creators their due.
And where IS Ditko in all this? Is the mainstream press just too wimpy and gutless to brave one of his Ayn Rand-esque tirades and hair-splittingly precise reproach-a-thons?
Clearly Ditko was a major part of the creation of Spider-man.. I'm not clear what kind of rights he has in the character, if in fact Lee ever let him have any. Any help?
- There's a huge amount of visibility -- everyone saw the movie and knows it made shitloads of money.
- Lee is a revered and sympathetic personality -- nobody wants to see him get screwed over.
- In spite of this, due to the way the contract is worded Marvel is probably correct in their claim that they don't owe him a dime, in the strict legal sense.
End result, Lee loses his money but the public outcry is sufficient to push changes in contract law which provide new protections for artists.Okay, it might not happen this time around -- media conglomerates are hugely powerful and genuine public outcry is hard to come by and expensive to properly focus into action. But the sort of scenario I'm describing is one of the most plausible ways for change like this to be brought about -- goad the public into outrage with an example of a mediagenic victim being screwed by the bad guys. Look at history -- many important pieces of legislation are tied to individual events which raised an outcry out of proportion to their individual significance.
Yes, it's lame when someone gets screwed like this. But it happens all the time, so when it happens in a highly public way that's better for all of us because it contributes to potential reform.
My deviantArt site
Say you have a fleet of limos sitting around to drive executives/actors around. Ah, let's put that all on Spiderman... don't want to lose corporate profit by giving out higher royalties than you absolutely need to. Etc...
The incredibly stupid thing here is that Stan Lee has control over a rather large field of 'intellectual property' that said movie studios may want to draw on in the future, not to mention the sequel(s) of current films.
Imagine... Stan Lee's contract terms for Spiderman III: "5% of gross ticket sales and, oh yeah, %5 of gross ticket sales of Spiderman 1&2 you f%&#$!!!"
1. Stan Lee believes he has a contract with Marvel that entitles him to 10% of all profits from all tv shows and movies based on his creations.
2. Stan Lee has not been paid for the Spider-Man movie.
3. Stan Lee is suing Marvel.
Nothing in the article explains why Marvel has not paid Stan Lee. Perhaps Stan Lee misunderstood or misremembers his contract. Or maybe Marvel has no explanation whatsoever, and was just hoping that Stan Lee was too old and senile to remember the contract. Who knows? Clearly, more information is needed.
"The question of whether a computer can think is no more interesting than that of whether a submarine can swim" -EWD
Peering into my crystal ball...
StanLee: You owe me $40 million.
Marvel:Well, we calculated that 30 million copies of Spiderman were downloaded via peer-to-peer programs...
StanLee:..and..?
Marvel:
Trolling is a art,
This sort of thing happens a lot in the movie industry. Typically, profits are juggled like this in order to reduce taxes. That's why, if you ever make a royalty deal with a movie studio, make sure you're getting a percentage of the gross, not the net profits.
I don't speak for any group, but here is what I would do...
I would start to tax coorporations and individuals in similar manors so that the little guy, the driving force behind the economy, has more money to spend to keep the economy going. Right now coorporate tax law dictates that coorporations do not pay income tax, they pay a profit tax, in other words, no increase in net worth, no taxes. Even a small coorporate income tax would provide enough government revenue to reduce the tax burden on the american consumer, and stimulate the economy. This would also make it much more difficult for companies to dodge their financial obligations to the government (see what Marvel is doing to Stan).
"I'll have a Guinness, no wait, make that a Coors Light" -Grad student I work with, who shall remain anonymous...
Marvel has learnt from its past mistakes and no longer simply takes a step back from their film properties. They have a subdivision "Marvel Films", or something to that effect, which involves this guy being on the set to every single Marvel film property. From what has been released, Marvel gets a profit slice, not just a flat licensing fee.
Oh and by the way, Sony Pictures made the movie and it cost about 100 million to make. It took in 800 million at the box office worldwide thusfar and is the 7th highest grossing film of all time. It earnt an estimated 245 million in it's first week on video release. So out of this billion dollars, yeah, I'm sure Marvel only got "$12 million or so".
s200.org - visit it (me), love it (me).
I'm a little guy.
36K a year working tech support in Portland OR.
My last surviving parent died in early March. She had been running the family farm that'd been in the family since 1952.
Before G.W. Bush - Estate (Death) Tax would have left me with $12,250 from the Estate.
Since G. W. Bush - Estate (Death) Tax left me with the money to finish college and hopefully build a strawbale home in 2003.
So personally, I feel the President's tax cuts are helping that little guy.
DC is owned by Warner Brothers, and Marvel meanders on its own, failing (until recently) to really capitilize on all its licenses. Marvel's financial woes- bankruptcy and the like, were generated by over expansion and the 90s comic bubble.
As for Alan Moore, great stuff coming out now, but he came back for a spawn issue first, which meant he had to deal with McFarlane (we all know what he did to gaiman), and I'm ever so glad he didn't decide to quit with companies on our side of the continent all together.
...Guide to the Galaxy (original text game). I mean, how else can they claim to have "no-profit" and "profit" at the same time?
Tune in next week, when Spidey battles the Ravenous Bug-Bladder Beast of Thrall!
Ed Wedig
Graphic design services
docbrown.net
The point is that the 'media' can manipulate the public perception of their artists as much as they want. Public perception of artists is always on the bubble anyway -- they're dope-addled scofflaws, harlots or raging bolsheviks, or they're promoted to a larger-than-life hero status (if they have a new, big-budget movie about to be released).
I think Stan probably has a great argument, and its something I've suspected about the "zero profit" media industry all along -- there's either fishy accounting, gluttonous overhead costs (coke, whores, lear jets, mansions, parties, lawyers, hush money), or more likely, both -- using the former to justify the latter as expenses.
But Stan will likely get mixed in with all the "bad" Hollywood news and there will be little outcry for his cause as the mud slopped by the likes of Winona, Downey, et al will stain him, too, even though he doesn't deserve it.
To all you people babbling about films not making profits, and how Stan Lee should have negotiated for a percentage of the gross, let me make it simple:
1. Stan Lee's contract is with Marvel, and
2. Marvel licensed the intellectual property to the movie studio.
3. Marvel's lawyers knew enough to negotiate for gross points, therefore
4. Marvel made a profit, and
5. Stan Lee is therefore entitled by contract to 10% of Marvel's profits.
The contract dispute is not with the movie studios who, however evil, have done nothing particularly wrong by Lee. This is all about Marvel trying to redefine those profits.
Basically, the problem is that big movie accounting, much like big business accounting (a la Enron) has become the modern day "alchemy". With terms like gross points, net earnings, and loosely defined "profits", movie accounting provides millions of obfuscated legal terms to confuse the contractees such that no money gets paid.
The idea that a blockbuster movie like Spiderman made no profit seems ludicrous, but on paper, accountants paint a different picture. It sounds like Stan Lee signed a contract that would get him a percentage of the "adjusted gross". "Adjusted gross" is a movie mumbo-jumbo term that basically means "what's left over after everyone gets paid", which almost always comes out to be absolutely nothing.
Had Stan Lee been smart, and had the legal clout to pull it off, he should have tried for "gross points". "Gross points" are where the real money lives, and the types of contracts that grant gross points are usually reserved for the big name producers, big-wig movie execs, and A-list movie stars. Basically gross points are percentage points of the overall revenues that a movie brings in, before anything else happens to money - before expenses, before taxes, before the studios gets their checks.
My guess is that Marvel had a deal that would grant them something like half a gross point (which is actually a lot), and Stan Lee's contract was with Marvel (not the movie studio) which would give him a percentage of that cut deemed "profitable". The problem is that Marvel's own number crunchers probably account for every penny of that revenue granted by the movie studio, leaving nothing left for Mr. Lee, because there are no operating "profits".
It comes down to legal terminology in the actual contract, which is probably written to legally protect Marvel and the studios from the type of lawsuit that Stan Lee is seeking, and they will probably try to have the case dismissed based on legal precedent. (Hollywood sees this type of thing all the time) IANAL, but it seems like Mr. Lee's primary defense is that he was misled by the contract into thinking he would get a share of the actual *revenue*, not the *profits*.
-AAAWalrus
Put it in simple terms: the guy who created Spider-Man didn't get a penny from the movie. Joe Sixpack, on hearing that, is going to feel sympathy for Lee. We all know there was plenty of profit to go around, if it weren't for the fuzzy accounting -- Enron, anyone? Lee could be presented as a folk hero, and Marvel comes out of this sounding like Scrooge. Spider-Man is a cultural icon, and it's icons that move the masses into action, not abstract ideals like rights.
My deviantArt site
According to an economics textbook, in perfect competition, a company makes zero economic profit.
Economic profit is different than accounting profit.
Economic profit is accounting profit minus the opportunity cost of the next best thing the person/copmany could be doing. Companies do not report economic profit on their balance sheets. They report accounting profit. Accounting profit is what's at issue here.
If your textbook doesn't explain this, it's probably not a very good textbook.
The concept of economic profit is pretty interesting though. In this case, the movie studio is claiming to have made no accouting profit. This would make their economic profit negative, meaning that the company would have been better off doing something else with it's resources. This is obviously not the case, given the huge success of the movie.
What I imagine they'll do is just reinvest all their profit in the company. Since all the studio people people own stock in the company, they'll still make (theoretical) money because their stock value will rise.
There may still be a legal case here. At a whole company accouting scale they may be able to just reinvest the profit back in to the comapany, but if one looks at just a single picture, then you make be able to prove they made a profit. If they can't prove that all their "expenses" are tied to the picture, then they may not be able to figure them in when they calulated how much money the picture made.
Life is too short to proofread.
that the entertainment industry makes no profits from movies... If they did, they could afford to go to Washington and lobby for digital copy protection laws that would threaten our fair use rights...
Whew... What a relief!
The race isn't always to the swift... but that's the way to bet!
Wow, it's amazing how much shorter the article looks when it isn't in MSNBC's super-tiny-narrow-column format.
This Space Intentionally Left Blank