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Hollywood Accounting — How Harry Potter Loses Money
An anonymous reader writes "Techdirt has the details on how it was possible for the last Harry Potter movie to lose $167 million while taking in nearly $1 billion in revenue. If you ever wanted to see 'Hollywood Accounting' in action, take a look. The article also notes two recent court decisions that may raise questions about Hollywood's ability to continue with these kinds of tricks. For example, the producers of 'Who Wants To Be A Millionaire' now have to pay $270 million for its attempt to get around paying a partner through similar tricks."
Peter Jackson had to sue New Line Cinema to get paid for LotR. New Line claimed they lost money on the trilogy.
Anyone who loves or hates any language, platform, or manufacturer, doesn't know what they're talking about.
The producers of Forrest Gump used the same math to claim a loss on that one too.
It's the people below the poverty line who don't work and aren't productive enough that are to blame for Hollywood's plight. Not the rich accountants and brilliant producers that carefully select only the most qualifying of movies. It is obviously getting to the point where our culturual heritage -- the heritage of Americans -- in film needs to be conserved by the government. Which is why movies like Harry Potter should be able to apply for and be granted a government bailout when they finish in the red. It's obvious that the economy has hit them hard and they need a little help. With the file sharers and ripoff dupes in the world taking away their copyright, this is the only way we can help them out until a solid and sane prosecution framework like ACTA is approved for the whole world.
My thoughts and prayers are with Hollywood and the families of everyone involved with such quality original films.
Roger Corman had some problems like that with studios back in the 1970s, and he won, too. Read his "How I Made A Hundred Movies in Hollywood and Never Lost a Dime".
Don't most major league sports teams do this as well? And major corporations in a bid to avoid taxes? And most (US) individuals in a bid to pay less in taxes? I'm not saying it's right or wrong only that it just is and is practically universal.
This is a very old trick, and I can't understand why people still fall for it.
Winston Groom had to learn the hard way when his deal involved a percentage of the net profits from Forrest Gump. Unfortunately for Winston, Hollywood accounting always makes sure there isn't any net profits.
This is why the big actors and producers always ask for a percentage of the gross revenue.
These comments are my own and do not necessarily reflect the views or opinions of my employer or colleagues...
Stop wasting millions in special effects, stop wasting millions for known actors. Get good actors, a good script and non-crappy decors and you can make money.
Get out of your California bubble once in a while. See how the rest of the world lives. You are disconnected from reality. Take a vacation from your little fairytale world. Travel outside of the USA and change your mind once in a while.
".....and not pay our actors, writers, staff their share of the profit-sharing contract, but if you are dishonest and download a DVD, then you'll get the equivalent of a life sentence in fines! Seems perfectly fair to us." - Motion Picture Association of America (MPAA) aka megacorp tyrants
"I disapprove of what you say, but I will defend to the death your right to say it." - historian Evelyn Beatrice Hall
I absolutely adore the world of film, but holy fuck do I hate Hollywood.
Living With a Nerd
You know, if they can make such a wildly successful film as Harry Potter appear to lose money, then suddenly all of the MPAA's statistics about piracy make sense!
Taxation is legalized theft, no more, no less.
This magical accounting is why more and more bankable stars are demanding x% of the gross instead if just wanting part of the profits.
I judt got a nre Kinesis keybiartf so please excusr ant egregiou typos.
also part of the lost sales they claim from movie pirating making them look exaggerated. Oh look me lost millions because of pirates.
by TheSpoom (715771) Uncaring Linux user here. I have nothing to add to this but please continue. *munches popcorn*
Seems like if they loose money distributing these films the normal way, then piracy saves them money on distribution costs, and might actually make the films profitable!
Obviously Hollywood needs a government bail out. First the pirates were cutting into sales, and with all these extremely successful movies that have lost millions, Congress must do something fast!
It's like the Boston strangler became an accountant.
Kudos if you know why that's relevant.
Seems that Hollywood has a property that should be hugely successful. They are using the investments that other people made to make it so.
It seems that the producers are deliberately trying to not make money from these investments. I'm pretty certain that if any other business executive decided to run a business in such a way as to minimise shareholder value, they would be in serious legal trouble.
Maybe the pirates aren't the real enemy there...
The document shown probably concerns net calculations for a deal with a writer. A Deadline comment said:
These are VERY high loads, but they are TYPICAL loads for writers, who very rarely receive "cash break" or "studio breakeven" type deals. To repeat, nothing has changed under the sun: the "net" deal articulated above is fairly standard for writers. Typically writers are compensated up-front with a kicker if a film is absurdly profitable. Writers rarely, if ever, get gross or "studio breakeven" or "cash breakeven" -- i.e., a share of the revenue from the first dollar of revenue, or a share of the profits from the first dollar of profits. When the studio cut the deal above with the writer, I can't imagine they told the writer: "Once we breakeven, you get paid! We all win!" They probably said to his agent/lawyer: "We'll give you the standard "net" kicker", which is exactly what he got.
I.e. the writer got paid on a fixed basis regardless of movie performance, with the "net kicker" that no one really expects to see (except maybe on "Avatar").
Note the document has nothing to do with taxes. That is a very different story.
Disney are just the current rights holder of Who Wants To Be A Millionaire?, which was not invented in America. Celador originally owned the rights to it (and it ran first on British television).
So it's not a mere 'partner' who is being bilked. The deal to buy the production company included a revenue split for Celador, and Disney has been caught trying to pretend it doesn't have to pay.
Canna get to your urrrrrrrrl
So, um, someone wanna post a mirror/text?
Karma: Non-Heinous
The probably forgotten, but at the time well known comedian art buchwald had to sue hollywood for his royalties,wich were not % of gross, but % of net, and as i remember it, it was the same story - accounting that turned huge profits into losss
The CEO of the company I worked for used this trick once. He was trying to get all the executives to take a temporary pay cut for one month. In order to do this he mentioned that he took no salary for the last 3 months. While this was technically true, the more overarching truth was more sinister. He had in fact shielded himself and his income from any downturn in the business by setting up a second corporation where he was the only owner, employee etc. This was a marketing company. Now the first company only got leads from Direct Mail. Guess what the second company did? Direct Mail Marketinig. So while he took no salary from the first company, he continued to get paid very well from the second company for something the first could not live without.
So this means I should pirate more movies, since my pirating isn't hurting their wallet as much as they claimed it was yes?
When pirating, you never took into consideration whether or not it would hurt anyone's wallet except your own, so continue pirating at your regular rate. If you ever get caught (unlikely) you can tell them falzer on Slashdot said it was OK.
http://www.guardian.co.uk/film/2010/jul/08/harry-potter-order-of-the-phoenix
Oh, right. I'm taking money out of the hands of the starving artists. You know, the ones who aren't getting any money because their points were off the net and golly gee, the movie didn't make any money.
I love Disney strip-mining the world's fairy tales for ideas and then suing people for intellectual property infringements.
Fuck all the fucking fuckers.
Kwisatz Haderach
Sell the spice to CHOAM
This Mahdi took Shaddam's Throne
You'd think that the IRS would be interested in loss of revenue from corporate profits, or at least the State of California. With all the stuff they go after these days, this seems ripe for "transparency"
Tax avoidance through expense maximization and income minimization is one thing; there are rules and if you break them you get penalized, up to an including prison.
In this case, though, the rules (GAAP) are much more flexible and in some cases they can write their own rules (contract language, business procedures) and the punishment at worst might be a fraud conviction but generally the punishment is getting sued and that has a high barrier to success, let alone initiation.
It also helps that the "product" of much of Hollywood doesn't have the kind of supply-and-product chain that manufacturing or other industry has. It has a lot of soft costs and a lot of human costs that can silently and flexibly siphon money from successful projects (consulting fees, personal services (AKA "hookers and blow"), promotional costs, legal fees).
HAHAHA Techdirty is now being dirty, they REMOVED the news. Google follows by not offering the cached page, EVEN THO IT EXISTS!
Check the article HERE: http://webcache.googleusercontent.com/search?q=cache:8V1pgRKUcLsJ:www.techdirt.com/articles/20100708/02510310122.shtml
In the movie industry, gross profits is customarily defined as the profits remaining after production and distribution expenses are subtracted from revenues.
The more you know.
The Kruger Dunning explains most post on
And it's pretty much standard too - just invest as much as you can in your future projects and you won't have to pay taxes or anything on it. I used to work at a company (.com startup) that did the same thing. Every year they invested a rough $2 million (net profit) in the development team (4 people) - eventually the development team became their own company so they just shifted funds back and forth (here you go 2 mil. to build this application, here you go 2 mil. for rent) - the developers kept the same desks, computers etc. I believe they off-shored a healthy profit as well.
Custom electronics and digital signage for your business: www.evcircuits.com
Accountants are there to minimize profit that is shown externally. External profits are always bad. They require taxes and other payouts to external entities. Just as an example because they have the highest gross profits I know about, MS earned about 14 million the latest quarter, of which 11 million was gross profit. About two million of that was spent on research and 4 million on admin expenses and marketing. This is about 33% of gross profits on marketing and admin. As a percent of gross profit this is not excessive, but as percent of revenue it is highly excessive. Other companies might spend 10-20% of revenue. It is arguable that MS maximizes admin expenses to minimize profit. They put perks in minimize taxes and make them look less profitable. They do the same with research money that leads nowhere, i.e. the kin.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
Years ago I read an interview with one of the cast members of the original Star Trek. He said that the most creative writers were the finance guys who claimed that in 30 years of reruns that Star Trek has never made a profit. (I think the interview was in the early 90's) Unfortunately I do not recall who that was.
No, unless you have no ethics or morals.
In other words, it is still wrong and if you do it you are exactly like those weasels you claim to hate and whom you steal from.
There is no "-1 offended" or "-1 you don't agree with me" mod options for a reason.
When pirating, you never took into consideration whether or not it would hurt anyone's wallet except your own
when I pirate, I do consider other peoples wallets. Since it in no way impacts them,I'll continue to do so for the reasons I do.
To an external observer it seems, Hollywood has declared cheating the universal principle: actors cheat their wives, wives cheat gravity with upper body parts, businesspartners cheat each other and everyone cheats with his/her taxes....
I only noticed, nobody managed to cheat death yet, but think they will some day :-).
CU, Martin
Always ask for a percentage of revenue. It is much harder to lie about revenue than about profit.
A slashdotter who didn't build his own computer is like a Jedi who didn't build his own lightsaber.
So let's say you get a contract that specifies you get paid gross percentage. You get 1% of revenues, not profits. Hard to fudge that, right? Well they make it tricky and do some shuffling so that they then sell the movie to one of their sibling companies. Company X produced the movie, they sell the rights to Company Y for a low amount of money. You are paid your cut of the sale, but it is small. Company Y then pays you nothing because the contract was with Company X, even though they are all under the same conglomerate.
Hollywood is very good at this kind of shit and just keeps doing it. There is never any real effort to stop them because they buy off politicians. California is thoroughly bought and paid for, and they donate plenty to congress.
Why do you think congress is so happy to push their anti-piracy agenda? After all, there are plenty of other companies that make WAY more than all of Hollywood combined for the US. Well, because Hollywood bribes really, really well, that's why.
Really, anyone who works with Hollywood should never ask for percentages, but always do a "pay or play" up front, meaning you get a certain amount of money for the work, and you get it no matter if they decide to use what you do or not.
Is techdirt.com slashdotted so hard that they lost all their database content? I only get "No stories found." even on the main page...
CAPTCHA: "durable". Well, maybe not ;)
NPR's Planet Money covered this before too. Gone in 60 Seconds grossed $240 million at the box office, but somehow "lost" $212 million. Their accounting is about as realistic as their movies.
http://www.npr.org/blogs/money/2010/05/the_friday_podcast_angelina_sh.html
Are actors getting screwed out of money by these companies? When these stories come up it seems like it's always writers, directors or the original owners of the property who get screwed. I'm guessing actors and film crews either know how to work the system or they've got unions protecting them. And I'm guessing big name actors hold some influence over the studios, given their ability to draw in viewers, so it's in their best interested not to screw with them.
Either way, I'm guessing there are so many people dying to get into the business that for anyone who's principled and prudent there are 10 suckers waiting in line right behind them. I'm also certain that Hollywood has enough lobbyists and close ties with some politicians to ensure that they can get away with quite a lot of things.
It seems if you make an agreement, to perform services or provide material in exchange for the profit.. You and the production company expect there to be profits, and you expect those profits to be preserved so you can be paid, or you do not have a deal.
If you do not have a deal, then the distributor's actions are copyright infringement. And maybe if they ignore their obligations implicit or otherwise, the contract could be thrown out by the court.
And the company you contracted with has a responsibility to take reasonable efforts to maximize the profits.
If you are a company taking reasonable efforts to make sure there is a profit, it is not reasonable for you to pay a large fee for a service, without making sure the agreements and business relationships you conduct will likely allow you to have a profit buying that service.
It is also not reasonable to pay a distributor a large fee for a service, when there is a much lesser market rate for that service, or that service is excessive and not likely to produce a profit.
Close. Really, you should pirate more movies because why? cause fuck 'em, that's why.
Doesn't the company that now got a deal higher than market value have to pay taxes on the income? I'm sure there's some tricks they use, they sure as hell aren't paying more taxes than they need to.
http://www.npr.org/blogs/money/2010/05/the_friday_podcast_angelina_sh.html
The banks are trying to set up a futures market for movies, so that you could buy into the new $MOVIE sequel. Naturally, Hollywood is vehemently opposed to this. If these movies became publicly traded you'd better believe there would have to be some transparency, and that's what Hollywood fears.
That's why they get sued. That's why they don't like pirates. If there wouldn't be pirates, nobody ever would notice who is stealing in first place.
Films are usually produced via a special vehicle, a company created specifically for the purpose of that movie.
The studio parent company still owns the producer-subsidiary, so they have lots of options. For example pay over a massive interest rate on the financing provided, a "management fee" to move the profits. That's just the expense side, it's even easier to simply licence the product to the parent company at their chosen rate, so all the profit margin is shifted to the studio. This approach will also reduce payments due to people paying a % of gross.
Beautifully, you can still get the tax hit at the producer company by declaring the transactions at arms-length (market) value rather than what was actually paid over, and yes the tax is deducted from net profit. So the tax man gets something approaching the real figures (well, no doubt there is other tax-avoidance) but that's not what the contracts are based on. Or rather, that's not what people seem to keep basing their contracts on even though they really should know better. Seriously, Peter Jackson either doesn't bother with lawyers and accountants or they're ludicrously incompetent not to see this coming. I'm not saying he deserves to get ripped off or anything, but there is a reason it's called due diligence.
Never sign up to a % of net profits unless you control the company. Directorship plus majority voting power is what you want - particularly check any variations to voting rights in respect of issuing more shares, varying voting rights and appointing/removing directors.
Sure, if the contract is very well worded to ensure fiddles are excluded from the calculation it can work, but then you're just giving yourself the hassle of making sure. To be fair the courts can "see through" the transactions and base awards using fair value, but you're at the mercy of obtaining proof and court agreeing to essentially reinterpret contract. Courts are big fans of the freedom to contract.
On this kind of scale, if you really must go with profit-share contracts, at a minimum you should be ensuring contracts give complete right of access to an auditor of your appointment. This guy you employ from the beginning, not after the fact, ideally teamed up with other profit-participants to share costs.
But just go for % of gross takings based on fair-value or "to ultimate consumers" instead. It will still take some working-out but is much easier to do and prove than using net profit. This of course means the project is much riskier for the studio since you get paid regardless of whether a real profit is made. It would be much fairer for everyone if pay was calculated as a share of fair profits. But studios have proven they can't be trusted and aint karma a bitch.
We always knew the twisted ways of hollywood to get tax breaks...this is just another way also of promoting that piracy really hurts the industry, sort of like stopping james cameron from getting his 5th bentley and such...
http://www.youtube.com/watch?v=NbtqW62Ty0s#t=8m40s
Always ask for a piece of the gross, not the net; the net is fantasy!
(funnily enough Freakazoid was produced by WB!)
It should be noted that these dodges do not avoid any income taxes as the profits are simply shifted to the studio. It also should be noted that the studios have been doing this since before WWII. Anyone who accepts a "share of the profits" deal is at best ill-advised.
Warning: this article may contain humor, sarcasm, parody, and perhaps even irony. Read at your own risk.
While I think the studios are so greedy that we need to make up a new word for greed, as it doesn't really cut it anymore, I do have to point out from the Harry Potter article...
I don't see where they got the $938 million number from, it appears to be from a later press release, or some such, as the numbers from the Total Defined Gross on the balance sheet only seem to indicate $612.6 million cumulative revenue. It's entirely possible that an additional $325.8 million in gross revenue could have put the film into the black, as long the additional expenses didn't exceed around $309.8 million.
The article seems somewhat disingenuous at best.
Most of it comes from the problem that studio and some other cost can be determined long after the film has been out.
You used the sound stage then if you movie makes millions then the sound stage charges extra $ for you bill.
Hint: always as for percentage of the Gross revenue.
Guy: It was a producer, wasn't it?
Forrest Gump: A producer?
Guy: That signed you up and fucked you.
Forrest Gump: Oh, yes sir. Fucked me right in the buttocks. They said it was a million dollar contract, but the studio must keep that money 'cause I still haven't seen a nickel of that million dollars.
It's one of those in-jokes that will cause you to blend ennui with joy at the thought of your existence at this particular moment in time...
I don't think this is Hollywood accounting so much as pretty common accounting. Business setup "independant" corporations all the time to executie projects. Its a stupid practice you really should not be able to market services to a subsidiary that you have whole ownership of and book it as transaction between entities; it really should just be sub accounts.
Repeal the 17th Amendment TODAY! Also Please Read http://www.gnu.org/philosophy/right-to-read.html
Creative--yet fraudulent--financial or tax accounting are federal crimes punishable by jail time (ala Enron, Bernie Madoff, Michael Milken, Kenneth Lay, Jim Bakker, John Gotti, Al Capone). I don't understand why Hollywood gets a free pass, particularly when the corporate shell games are so obvious.
Camping on quad since 1996.
Hollywood has been getting away with this crap for so long that it's seen as normal. When any other big business does even a small fraction of this sort of creative accounting, they get jumped on by every lawmaker and regulator who can dream up a way to punish them. Yet Hollywood somehow is an exception and the response is always along the lines of "Well it's Hollywood everyone should expect this." With the Hollywood accounting, much of what goes on seems to be well beyond contract disputes, moving on to straight up fraud.
This exemption from accounting fraud that Hollywood enjoys needs to end.
I hear it's going to break even any time now.
Once a thief, always a thief. Remember that Hollywood itself was created to escape Thomas Edison's patent enforcers. In California the land was cheap (at that time), the sun was usually shining (free lighting), and they were a very long way away from the east coast and Edison.
Win, win, win!
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Just read any pro-DRM argument - they really, really want to give content creators the money they deserve!
"Playah...."
Copyright infringement is illegal, but it may or may not be wrong. If he pirates a movie that he would never buy, or like a lot of people pirate it then buy it when he sees he's not getting ripped off buying it, what he's doing is still illegal, but it isn't wrong.
Adultery is legal in Illinois, but it's wrong. Smoking pot is illegal, but it isn't wrong. Don't confuse legal and illegal with right and wrong. There are a lot of legal ways to steal, but they're still wrong.
Free Martian Whores!
WTF JMS? You never seemed like the kind of guy to take this lying down. Heck, you nuked San Diego just because once upon a time there you'd gotten so embarrassed and tongue-tied in your Creative Writing class at SDSU that the lovely E.C. had to finally rescue you. Where's that fight-back spirit now? When does Hollywood get their own nuke?
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
I'm not sure I understand how anyone ever ends up getting screwed by this? I mean, if this is known accounting practice, wouldn't every agent and lawyer in L.A. be saavy to this nonsense and work up contracts in such a way that they guarantee that they get paid?
What I really wonder, though, is does all this creative accounting deprive state/feds of tax revenue? I'd be rather upset if I, as a working person, have to pay my share of taxes, but rich movie studios could use creative accounting to report fraudulent losses and get out of paying their fair share.
After all the other oil companies see the racking over the coals that BP is going to get - YOU BETTER BET that they'll start doing this exact same thing with their risky drilling platforms. Start a seperate company which you 'buy' the oil from in exchange for the amount of money needed for their bare operating costs. Then, if the thing blows up or leaks, you leave the little shell company to pay it all and you walk away with the profits. I'm honestly shocked they aren't doing this now.
The world is literally full of dishonest scum sucking pigs, and the two places with the highest concentration of them are L.A. and Washington DC.
That brings me to an interesting point, / . is just "the ramblings of socially-inept, technology-literate news-mongers".
And, who made you the arbiter of right and wrong? Why do you believe that because you do not like the law, you have a right to break the law?
If you do not like the law, work to change the law. Breaking the law is almost always wrong. By doing so, you are saying that you are above the rest of society and the law.
There is no "-1 offended" or "-1 you don't agree with me" mod options for a reason.
I'm surprised the government has never gotten involved in this. If some of these movies are truly profitiable in the $100 million plus range, thats a lot of of corporate income tax to be taken by the government.
Bring back the old version of slashdot.
"Gross profit" != "Gross box-office revenue."
Loosely speaking, Gross profit = Sales revenue minus Cost-of-goods-sold.
Net Profit = (Revenue + all-other-income) minus (COGS + all-other-expenses)
But that's only for the company you have a contract with, nothing to do with box-office. Call them Shonky Films. Shonky is a subsidiary of Film Embezzlement Corp. FEC will set up an "advertising" subsidiary, a "production" subsidiary, "distribution", "merchandise", etc. You don't have a contract with any of these.
The "advertising" subsidiary might contract out the actual promotion to an actual marketing company, but it will charge Shonky Films orders of magnitude more. Likewise, Shonky will sell merchandising rights to the "merchandising" subsidiary for vastly less than it's worth. The "merchandising" sub will sign the actual individual deals with toy makers, fast-food giants, etc, for the true commercial value.
And so on. The net effect is that Shonky Films' revenue is artificially lowered, its costs are artificially raised. The actual profits from the films are shifted to subsidiaries owned by FEC, being shared between FEC's shareholders and cocaine blowjobs for the execs.
First people said, "Make sure you get a written contract or they won't pay you!" Later, "Make sure you get a % of the profits!" Then they said, "Make sure you get a % of the profits AND merchandising!" Finally they said, "Make sure that's GROSS profit!" And you still don't fucking get paid.
(Sigh. I know there's a lame Niemöller rip-off lurking in there somewhere. Just don't.)
So now what can people do? They're being cheated on gross profit. I see two options, 1. make sure your contract has a pass-it-on clause. You get % gross profits from Shonky Films plus from every single contractor it signs with, and every single contractor they sign with, and so on...
Or 2. Have a buy-back clause. You have the right to buy the film (and-all-rights-and-privileges-thereof-free-of-all-encumbrances) for 5 times the "gross" figure they use to calculate your percentage-of-gross...
$62,000 was 7.5 of the Gross????
That means the trilogy only took in $826,000?
...so the family-trust would be able to buy the trilogy outright for $4m.
Science is all about firing a drunk pig out of a cannon just to see what happens.
With all of these near-billion dollar ventures showing a bogus loss, isn't Uncle Sam losing out on tax revenue?
I seem to recall that Sam gets pretty ticked off when he doesn't get paid. They put Capone away for tax evasion, you know. They didn't mind the murders as much.
Weaselmancer
rediculous.
This is not a "trick". That word describes something that plays upon you gullibility or lack of attention, like a shortchange con. This is a complicated money management technique that you need a forensic accountant to sort out.
Yeah, you can demand a percentage of the gross instead of the net. Not everybody's in a position to do that.
Every time Slashdot has a story about a confidence trick, there's a lot of smug bullshit decrying the people who fell for it. The implication being that the poster is too smart to be conned. Hey, guess what? People who are full of their own brilliance are the softest marks of all.
One trick that I heard about a long time ago that was supposedly used in "Hollywood Accounting" involved renting equipment you already owned to yourself for an inflated rate and then also claiming depreciation of the same gear.
End result, they had a huge, but fictional, expense.
so who were the Harry Potter producers trying to cheat out of their fair dues?
http://entertainment.timesonline.co.uk/tol/arts_and_entertainment/film/article6024677.ece
The article has its own rebuttal against nazi types:
"As a proud Jew, I want America to know about our accomplishment. Yes, we control Hollywood. Without us, you'd be flipping between "The 700 Club" and "Davey and Goliath" on TV all day."
Jewish people may hold a lot of high positions but that's largely because a lot of them are pretty darn smart. Hell, the number of Jews running studios is just a confirmation that the USA is a meritocracy.
See: Civil disobedience*
*That only applies to publicly breaking the law. You have to be loud about it or you are just hiding from the law. If you are going to infringe on copyright, it's not not civil disobedience unless you are speaking out against copyright law (ex. joining the Pirate Party). If you are smoking pot, it's not civil disobedience unless you are lobbying for new drug laws (or a member of a group that does so).
Why don't they call it Jewish accounting? It's not as if the practice is particular to Hollywood or the film industry in general.
Oh wait, I know why they don't... *runs and hides*
As long as some holding company up the chain is making profits wouldn't the Tax kick in at that level ? So, it seems that the only 'benefit' is to avoid paying people who were to get % of gross/net/etc. Isn't that a clear fraud ? With the huge tort cases in the US for every small thing, how come this hasn't gotten fixed yet through some judgments etc ?
David Prowse, the actor who famously played Darth Vader in the original Star Wars trilogy has just posted on his site that he's been banned from the big Lucas Film Star Wars Celebration V (C5) in Orlando. It's possible this stems from complaints he made to Slashfilm last year that he isn't getting any residual checks because, according to LucasFilms, the films "never made a profit."
If so, this is criminal. The guy's 76-years-old. He has massive arthritis problems. He's had hip and knee replacement surgery and can't move one of his arms. His main source of income is that he was one of the actors in the most successful movie franchise in history. Emporer Lucas, send the guy a couple checks or, at least, let him do some photo-ops.
http://geektwins.blogspot.com/2010/06/darth-vader-actor-banned-from-star-wars.html
Jewish people may hold a lot of high positions but that's largely because a lot of them are pretty darn smart.
Yes. After all they are the master race. Wait what...
The obvious solution is to convert to Judaism.
It's all because of piracy. If you look at line 54(b) of the Warners statement, it clearly says "Losses due to piracy by Jammie Thomas --- 212,000,637.15". With terrible theft like that going on, it's no wonder studios make no profit and can't pay contributors anything.
There's $12m of "Guild, Union, and Residual Payments" which is $12m more than Pirate Bay ever paid any artist.
This has been going on in the music biz for many years: The record company would claim a huge production and distribution cost on the artist's music, and the artist would wind up owing them money, which they could only pay off by making the next album... (repeat)
Your incredibly touching story about the plight of Hollywood has made me cry. God bless you and God bless the MPAA.