Buy Movie Rights

A Complete Guide to Buying Movie Rights

Film rights are sold either by the author or the author’s agent. There are two ways to buy film rights or a literary work. The article explains how to buy movie rights outright or with the more common option deal.

Buying film rights with option trading

Follow the instructions of a media and entertainment attorney.

Media and entertainment attorneys specialize in the legal needs of the entertainment industry. They also know about film rights. As they are well versed in this process, they are extremely important to those who want to buy the film rights to a film and not experience a catastrophe in the process.

Prepare a sale with an option contract.

This is the preferred method as the buyer doesn’t pay as much upfront. The initial investment is usually only 10 percent of the agreed total purchase price. For you, the option means that you, as a potential buyer, have to pay the author a certain amount of money in order to have the option to purchase the film rights. This contract is for a specific period of time, during which you can organize everything to produce the film. When you’re ready, you can exercise your option to purchase the rights. If the option trade is not accepted, the author retains the payment received and any further monies paid by the buyer and still retains the film rights and the ability to sell them elsewhere.

Set an option deadline for trading.

This timeframe may vary and include initial period extensions, which often require additional payments to the author each time you make use of an extension.

Determine the amount of option payments.

There is an initial payment, usually a percentage of the total purchase price, and the amount you pay for each extension included in the agreement. Depending on the agreement, these payments may or may not count toward the total purchase price. If you want to complete the purchase, it is possible that you cannot deduct the amount already paid from the total sale price. Instead of a fixed purchase price, the agreement can include a percentage of the film’s budget. The minimum and maximum usually fall in amounts between 2.5 to 5 percent.

Include a post-compensation clause in the contract.

The author may want a share of the film’s earnings. This percentage is usually very small and can be negotiated in advance.

Determine the amount for any rights you pay the author for subsequent productions, such as sequels, prequels, or even TV series based on the original work, or the first film adaptation of the work.

For example, an amount has to be paid if certain characters are marketed, etc. TV rights may differ from cinema rights.

Let the exclusive rights be written into the contract.

Make sure that every detail – who is allowed to use what, when and who owns what – is defined down to the last detail. If the author retains certain rights, this must also be stated in the contract.

Sign the option agreement together with the author and pay the agreed option price.

A lawyer must be present when you sign. After signing the agreement, the writer pays the option price.

Buy the complete film rights

Find out exactly who the author of the book is.

You can do that online, e.g. B. in the USA in the US Copyright Database. Authors can register there for their work to be on the safe side. Be careful. After all, you don’t want to buy the rights from someone who isn’t the author of the work. The US Database goes back to 1978. You may also need to use an author research service. But that can get expensive.

Find out who owns the film rights.

You should contact the author’s agent, or the author directly if they don’t have an agent, to see if the author has previously sold the rights, or if an options trade currently exists. Once the literary work is published, you should read the publishing agreement to make sure the publisher is not claiming film rights. Obtain a waiver from the publisher to ensure rights are available. If the publisher doesn’t own it, find out if the author owns the rights.

Find a media and entertainment attorney.

Media and entertainment attorneys specialize in the legal needs of the entertainment industry. They also know about film rights. As they are well versed in this process, they are extremely important to those who want to buy the film rights to a film and not experience a catastrophe in the process.

Negotiate the purchase of the film rights with the author’s agent.

Even if you can deal directly with the author if there is no agent, or you think you can get a better deal by avoiding the agent, it is generally recommended to work with the agent as the author does not always have the legal side knows to sell these rights. If you buy full rights, you have complete control over what happens to the rights. Exceptions will be agreed in writing with the author, such as the right to reuse the characters in book series, reserving certain publishing rights such as for stage or radio, or the right to allow certain changes to the original work in the adaptation.

Agree on a total purchase price and all terms of the sale in writing.

The terms of sale may state that buyer and author reserve certain rights. The buyer may agree to rights to incorporate the literary work into a larger film or otherwise distribute it, such as home videos, series, or rewriting rights, advertising, and promotional rights, or the right to modify portions of the original work if adapted for a film is adjusted.

Pay the author the agreed amount.

Pay the author the agreed amount and make sure both you and the author sign the agreement drafted to sell the film rights.

Final Words

If you’re buying film rights, you should make sure that you have no obligation to actually make a film out of the literary work, so that the author can’t force you to do so. However, authors can include an opt-out clause stating that the film rights expire if the literary work is not filmed within a certain time, so they can try to sell the rights elsewhere. Best-selling authors often require you to buy the film rights outright rather than an option deal.

 

About the Author

Lillie Byrd

Lillie Byrd is a saving expert for CouponKirin. He has been a newspaper reporter and editor, authored a personal finance book in 2012. She previously was a reporter at Digital Journal, covering consumer products, society, and other business topics. She also has a certificate in finance from Boston University.