In the film and television industry, royalty arrangements are particularly complex, governed by both individual contracts and collective bargaining agreements. These payments—often called “residuals” or “participations”—provide ongoing compensation to creative contributors when content is exploited beyond its initial use. In addition, Secondary Performance Payments (SPP), AI-generated replicas, and streaming platform buyouts, have become a cornerstone issue in recent guild negotiations, particularly following the 2023 SAG-AFTRA strike.
At Rodriques Law, PLLC, whether you’re renegotiating legacy contracts or drafting new deals, our AI, digital content, and metaverse lawyers ensure your rights are protected in a rapidly evolving marketplace.
SAG-AFTRA, Writers Guild of America (WGA), and Directors Guild of America (DGA) have established sophisticated residual payment systems through collective bargaining. For example, a television writer typically receives approximately 1.2% of the license fee when an episode reruns on network television, while SAG-AFTRA actors receive graduated residuals declining from 75% to 5% of their day rate for television reuse. These payments are typically administered through the guilds’ residual departments, which serve as collection and distribution intermediaries.
For prominent talent and producers, “points” participation can generate significant revenue beyond fixed compensation. These agreements typically allocate percentages of defined profit pools:
The definition of these profit pools is critical. For instance, we recently negotiated a modified adjusted gross definition that eliminated distributor fees from deductible expenses, increasing our executive producer client’s participation payments by approximately 28%.
Streaming platforms have dramatically altered traditional royalty models. Rather than the established residual formulas for broadcast television, streamers often implement buyout models or alternative compensation structures based on:
Our digital media attorneys leverage industry data and comparable deals to maximize these emerging revenue streams.
As generative AI and virtual production technologies become mainstream, film and television contracts must now address the use of digital doubles—computer-generated replicas of an actor’s likeness, voice, or performance. Key areas include:
Our goal in contract negotiation is to ensure clients are paid fairly, protected legally, and respected artistically in this evolving digital frontier.
Film and television properties generate significant merchandise licensing opportunities. Directors, producers, and key talent may negotiate separate participation in:
These secondary revenue streams often exceed primary media exploitation income for successful franchises. Our contracts emphasize clear accounting provisions and audit rights for these complex, multinational revenue streams.
Many territories maintain statutory remuneration rights that exist independently of contractual royalties. These include:
Our New York entertainment attorneys ensure clients receive their entitled share of these often-overlooked revenue sources by facilitating registration with foreign collection societies and monitoring compliance with territorial regulations.
Perhaps nowhere are robust audit provisions more essential than in film and television. Studio accounting practices are notoriously opaque, with high-grossing productions sometimes reporting no “net profits” despite substantial box office success. For example, an audit may identify numerous systematic accounting issues including:
Our firm can work with your auditor to search for and recover any previously unreported foreign television license fees that had been improperly allocated to a different property in the distributor’s catalog.
Our film and television royalty practice combines granular contract analysis with industry-specific accounting principles to ensure clients receive every dollar they’re entitled to under their agreements.
Whether you’re a screenwriter seeking unpaid residuals, a producer navigating backend points, or a showrunner negotiating a streaming deal, our film and television royalty attorneys are here to protect your interests.
At Rodriques Law, PLLC, we combine deep entertainment industry insight with rigorous contract and audit enforcement strategies to help clients uncover hidden revenue, clarify profit participation rights, and ensure long-term compensation.
Schedule a confidential consultation today.
