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!"

Comments

Aint that just a load

[ONOIML8]

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.

No Profits

[Mr_Dyqik]

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.

Re:No Profits

[coupland]

This is similar to the little pie chart you see on gas pumps claiming only 5% profit on gas sales. The problem is that profit is purely subjective since all expenses are subtracted from profit. Send the entire company on a 1-week vacation in Hawaii? It gets deducted from profits. Hire a hundred people to act as a permanent "think-tank"? Deducted. Free beer in the cafeteria? Deducted. You can burn hundred-dollar bills for warmth but still claim no profits. When a company cries poor due to low profits you need to take a closer look. Operating losses, declining sales, or decreased revenue are better indicators of corporate health. Pharmaceutical companies, oil companies, and now Marvel comics all cry poor in profits but are throwing buckets of money into a woodchipper 'cause they've run out of places to stack it...

Re:No Profits

[damien_kane]

Qouth Kevin Smith:

"Oh I disagree...
We had a contract, for likeness rights; remember?
As we are not only the character basis but obviously the artistic basis for your intellectual property, when said property was optioned to Miramax you were legally obligated to secure our permission to transfer the comic book to another medium.

Since you failed to do that, Banky, you find yourself in a very actionable position..."

In this case, all Stan is saying is: "Where's my mothefsckin' movie check?"

Re:No Profits

[GoRK]

Well, you may be right about quarterly reports from big companies and whatnot, but you're wrong about gasoline.

Generally, the establishment is lucky to make 5% net on the sale of gasoline, and that's before counting expenses for operating the pumps. Did you know that you play a flat tax of a *minimum* of 0.37 on each gallon no matter what the price is? It doesn't get any cheaper as prices go down, even though it should based on what the taxes are designed to pay for! Aside from that, it's illegal to inflate gasoline prices. I do not agree with the current taxation of gasoline, but I do agree with the price. Here's why:

Relative to the value of a dollar, gasoline is cheaper in the USA now than it has been anywhere in the world, *ever*. Granted, a couple years ago we got to see 76 cent gasoline in some places, but that was abnormilly low. Where is any company in the line from the investors on the drilling rig to the store selling you the gasoline supposed to take a $35 barrel of 50 gallons of oil and turn it into something they can make money with selling it for 38 cents/gallon (not including tax). Gasoline is already being practically given away as it is. People should stop complaining so much about it and rethink their decision to buy a new $45,000 car that gets less than half the gas mileage of the land yachts of the 70's.

Re:No Profits

[Malcontent]

"Relative to the value of a dollar, gasoline is cheaper in the USA now than it has been anywhere in the world, *ever*."

Well somehow I doubt the gasoline in the US is cheaper then in Quatar or Abu Dhabi.

Also remember that all the oil in the world actually belongs to us. We may let other countries sit on top of our oil reserves but we reserve the right to kill them anytime we want if they mess with our oil supply.

Re:No Profits

[Amazing Quantum Man]

Do a Google search on "Buchwald" "Coming to America" "Paramount"

for more on how movies don't make money.

Re:No Profits

[jgalun]

If no movies make profit, then how do studios make profit? Surely they must, or you'd hear about it on financial news etc.

Well, I totally agree that Spiderman obviously must have made a profit, or they wouldn't be making a sequel (and an X-Men sequel, and a Hulk movie, and a new Superman movie). However, in answer to your larger question - movie studios are actually not very profitable. I read an article about this a couple years back, and basically buying a movie studio is a horrible investment. The dynamics of the industry (movies costing so much to make, basically) mean that the studios themselves are not a good ROI. Yet people invest in them for one of two reasons:

1) The glamour. People aren't always rational economic actors, or at the very least, you have to take into account that people may seek more tha money. Yes, perhaps I could make 6% profit investing in bonds, but maybe I'd rather have 3% profit but hang out with movie stars/sleep with actresses all the time.

2) Media conglomerates believe that somehow, "synergy" will eventually make the movie studios pay off. Yes, this movie studio isn't a good investment as a standalone, but maybe if I tie my magazines, TV channels, pay per view channels, and retail stores together I can make it profitable.

Re:No Profits

[Dyolf Knip]

That's why an income tax is a nice idea in theory (tax the wealthy a higher percentage than the poor), but becomes utterly impossible to implement in real life. You have to know everything about everyone to keep it legit. I wouldn't mind higher sales taxes or even interstate commerce taxes as an IRS replacement. The uber-wealthy and big corps may be able to hide what they earn and lie about what they spend it on, but it would still get taxed anyway. Of course, then they'd just start doing under-the-table sales... sighhh...

And in other news

[youngerpants]

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

Why should Stan Lee get anything?

[JSC]

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.

Re:Why should Stan Lee get anything?

[jonr]

Yeah, he only drawed the thing. I mean, I could do that! Corporations have rights, too you know. Anybody can dabble wit pencils and paper, but it takes real work to create all those special effects...
J:

Re:Why should Stan Lee get anything?

[rovingeyes]

but it takes real work to create all those special effects...

The irony is that even those are done by artists.

This is why you never deal in profits

[Sycraft-fu]

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.

Re:This is why you never deal in profits

[ComaVN]

That should be:

- Make blockbuster movie
- ????
- No Profit!
- Profit!!!!

Hah!

[BJH]

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".

Not that unusual

[Pike65]

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 . . ."

Re:Not that unusual

[Temporal]

And according to my economics textbook, in perfect competition, no company ever makes a profit. After all, if one company was selling their goods at a price that brought them a profit, than some other company should be able to sell for less, and naturally everyone would buy from the cheaper company.

Well, of course that's all theory and it's hard to apply to practice, especially in the case of intellectual property (which, IMO, really needs a completely different economic system to support it, although I don't pretend to know the solution)... but that's the theory. And if you think about it long enough, it makes sense that no good company would ever actually have "profits", although I'm having trouble coming up with a good way to explain why...

I think the real question here is, first of all, how evil was it for them to even offer a percentage of profits to this guy when they knew full well that "profits" don't really exist, and second, how dumb was this guy to accept a deal based on profits rather than revenue?

Lesson to everyone: When negotiating with big companies, never accept a percentage of profits in return for anything. Always ask for revenue, or a set dollar amount.

Re:Not that unusual

[thomas.galvin]

And according to my economics textbook, in perfect competition, no company ever makes a profit. After all, if one company was selling their goods at a price that brought them a profit, than some other company should be able to sell for less, and naturally everyone would buy from the cheaper company.

You economics textbook is wrong. Theoretically, one company could always undercut the other, eventually selling everything at, or even below, cost, but this never happens unless a large company is dumping the market.

Basically, it goes like this: if you can sell a widget for $5.00, companies will be willing to produce 100 of them. If you can sell a widget for $10.00, companies will be willing to produce 1,000 of them. If you can sell a widget for $15.00, companies will be willing to produce 1,000,000. (Just example numbers). Now, if a widget sells for $5.00, comsumers will be willing to purchase 1,000,000 of them. If a widget sells for $10.00, comsumers will be willing to purchase 1,000 of them. If widgets sell for $15.00, consumers will be willing to buy 100 of them.

Because supply meets demand at $10.00, that is what the average market price for a widget will be. If you try to sell them for more, you are going to have left-over stock, and if you try to buy them for less, companies are not going to bother producing them.

In perfect competition, therefore, every company makes a profit, but not a profit so great that it hurts the consumer. Unfortunatly, perfect competition is, for the most part,a pipe dream. Fortunatly, the good people running state governments are trying to tax internet sales again, which, as we all know, will make the market much better for everyone.

Steve Ditko

[alexc]

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.

Film returns should be made public!

[krazyninja]

This is somewhat similar to the way Simon was trying to reclaim Captain America way back, as in this link. To avoid issues like this, all data relating to money accruals for all films should be public. If the MPAA can support RIAA for taking action against copyright violators, why cant it do this??

Re:Film returns should be made public!

[NewbieV]

Some public information from Marvel's 10-Q SEC filing in this PDF:

"7. SPIDER-MAN: THE MOVIE
During 1999, the Company entered into a license agreement with Sony Pictures Entertainment, Inc., ("Sony") providing for the licensing of the Spider-Man characters in exchange for a gross participation in the marketing of the Spider-Man: The Movie (which was commercially released on May 3, 2002) and related releases on DVD/VHS and likely other revenue sources (e.g., syndication sales, etc.), and established an equally owned joint venture for the merchandise licensing of the Spider-Man: The Movie characters.
Earnings associated with the Company's participation in the gross proceeds of the movie have been recognized as non-refundable advance royalty payments as received, which amounted to $10 million in 1999, and $2.5 million in the second quarter of 2002. During the quarter ended September 30, 2002, Sony reported Marvel's participation through such date at approximately $2.0 million in excess of advances previously received - which amount was subsequently collected from Sony. Prospectively, additional movie royalties will be recognized as revenue - as reported by Sony. Earnings associated with our merchandising joint venture (accounted for under the equity method of accounting) amounted to approximately $1.8 million during the three month period ended September 30, 2002, and $7.1 million during the nine months ended September 30, 2002, and represent the Company's share of merchandising royalties, net of expenses. The Company's share of the joint venture's earlier losses were $0.3 million in each of the years 2000 and 2001."

Millions in revenue, but no profits?

Re:/.ed already

[LordKronos]

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.

Typical Spidey Plotline

[LittleGuy]

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.

Remove copyrights on fictional works?

[Jeppe Salvesen]

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.

Reminiscent of Alan Moore and DC comic's Watchmen

[Rinikusu]

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).

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. :P

Movies NEVER make a profit....

[Anna Merikin]

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.

Source of the Claim

[theduck]

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.

Re:Alec Guiness??

[mccalli]

Didn't Sir alec guiness (may he rest in peace) request some percentage of the star wars profits, and recieve them?

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

Not about creator rights, it's about Contracts.

[CptLogic]

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

The Contract

[theduck]

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.

The Same Old Villain Strikes Again!

[Steve B]

Marvel is claiming that the 400 Million dollar blockbuster movie Spiderman produced no profits

The "piracy" problem must be even worse than they're admitting....

Business is business

[The Mutant]

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!

Here we go........again again again

[buss_error]

When are we going to stop giving money to RIAA and MPAA? I can tell you when I'm going to start boycotting them.... I've been at it for almost 2 years now. I haven't seen Spider Man, didn't buy the new CD from that band, didn't check out that Pay Per View move, or any thing like that. I buy my books from Baen, off of their webscription site, because the authors get double the money than from paperback sales.

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.

I completly agree

[Gekko]

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.

Um, No.

[FreeUser]

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.

Business 101

[saider]

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.

and a backlash to this sort of crap is brewing

[dpilot]

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.

Another reason to go P2P

[MoThugz]

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.

Stan reaps what Stan sows

[Anonymous Coward]

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?

Could be a good thing

[Myco]

Call me crazy, but this could potentially become a watershed event in entertainment contract law. Whether or not Stan Lee wins, this situation could be massaged into a public outcry for artists' rights. Think about it:

• 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.

Remember Forrest Gump?

[Mark Garrett]

Forrest Gump also never made any money, at least as far as the contract with the writer of the original story was concerned. The problem is that overhead can be allocated however a company wants to.

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%&#$!!!"

Re:Remember Forrest Gump?

[pfalstad]

yes, Forrest Gump lost money on paper. the screenwriter and the guy who wrote the novel both got screwed because they were supposed to get a percentage of the profits. More on that here, including details on how the accounting was rigged.

Blurb is wrong

[Galvatron]

As far as I read the article, Marvel may not be claiming the movie did not turn a profit. As I read it, the article states three facts:

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.

Visions...

[grub]

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: ..at $20 per DVD that would have been bought, we lost $600 million. So with the $400 million we earned on the movie release we have a net loss of $200 million. You owe us 10%, or $20 million.

Re:I'll bite

[firewort]

You propose taxing corporations and individuals in the same or similar manner.

That sounds great on the surface, except that it doesn't work that way in real life, because corporations don't pay taxes, as such- they pass them on to others. Who really pays taxes when they're levied on a corporation?

1. employees, in the form of lower wages.
2. customers, in the form of higher prices.
3. shareholders, in the form of lower investment value.

Now, I know you may not care about the last one, but when you tax a corporation, you're really punishing the very people you rely on to spur the economy.

Re:I'll bite

[Metrol]

I would start to tax coorporations and individuals in similar manors

A tax, any tax, removes currency from the economy and places it in the government, where some of it may come back into general use again. The state of the economy is not how rich the government is, but how rich the populace is.

so that the little guy, the driving force behind the economy, has more money to spend to keep the economy going.

The "little guy" does very little one way or the other in the economy, or in taxation now. Folks who would fit into this category aren't likely to invest cash into new businesses or technology. They definitely aren't going to actually hire someone.

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.

Are you under the impression that corporations don't pay taxes by the truckload?

Even a small coorporate income tax would provide enough government revenue to reduce the tax burden on the american consumer, and stimulate the economy.

Lost you on this point... You want to raise taxes on the folks that produce the goods that the consumer's are going to buy from? Umm, who do you think actually pays for that? The money that companies pay in taxes really does come from somewhere. You and me.

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).

A tax increase would have given Stan a better contract? You really lost me on that point. Care to work the logic that brought you to that conclusion please?

Re:I'll bite

[FatRatBastard]

Even simpler (well, not really simple considering you'd be fighting vested interests) would be trim the damn budget by the 30-50% the GAO estimates is wasted / lost / stolen by the gov't every year. Gov't bookkeeping makes Enron's look honest. The solution wasn't giving Enron more money, and the solution isn't to give the gov't more money either. Let them learn to live on what they've got.

Actually, Marvel didn't just "sell the rights"

[Komrade S.]

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".

Taxes and the Little Guy

[Wyatt Earp]

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.

Marvel's been playing too much Hitch-Hikers...

[docbrown42]

...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!

Marvel -- not the Movie Studio -- you fools

[GlobalEcho]

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.

Lost In The Noise: Movie studio accounting

[AAAWalrus]

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

I'm glad...

[Eric Damron]

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!