The Independent Filmmaker's Law and Business Guide: Financing, Shooting, and Distributing Independent and Digital Films

The Independent Filmmaker's Law and Business Guide: Financing, Shooting, and Distributing Independent and Digital Films

by Jon M. Garon

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The Independent Filmmaker's Law and Business Guide: Financing, Shooting, and Distributing Independent and Digital Films by Jon M. Garon

Today’s explosion of independent and digital filmmaking demands a brass-tacks guide to the business and legal aspects of the process. What fundraising options are available to a filmmaker? When should a filmmaker establish a corporation or limited liability company? How do screenwriters protect their work? What are a director’s legal obligations to the producer, cast, and crew--and what are their obligations in return? And why must the filmmaker pay special attention to products and artwork that might appear in the background of a shot?

This indispensable resource addresses the legal, financial, and organizational questions that an independent or guerrilla filmmaker must face, and the problems that will doom a project if left unanswered. It demystifies issues such as founding a film company, obtaining financing, preparing a budget, securing locations, shooting, granting screen credits, and distributing, exhibiting, and marketing a film.

Newly updated and expanded, this second edition explores concepts such as executing a digital distribution strategy through the use of YouTube and “webisodes,” the importance of international distribution, and legal issues particular to documentaries. Six handy appendixes provide sample contracts, copyright circulars, Documentary Filmmakers’ Statement of Best Practices in Fair Use, studio contact information, and more.

Product Details

ISBN-13: 9781556528330
Publisher: Chicago Review Press, Incorporated
Publication date: 06/01/2009
Edition description: Second edition
Pages: 464
Sales rank: 796,009
Product dimensions: 6.00(w) x 8.90(h) x 1.00(d)

About the Author

Jon M. Garon is a law professor at Hamline University School of Law who specializes in entertainment law, intellectual property, and business law.

Read an Excerpt

The Independent Filmmaker's Law and Business Guide

Financing, Shooting, and Distributing Independent and Digital Films

By Jon M. Garon

Chicago Review Press Incorporated

Copyright © 2009 Jon M. Garon
All rights reserved.
ISBN: 978-1-56976-397-1


Preparing to Make a Film

* * *

Only one thing separates great films from the thousands of finished films that go undistributed each year: great storytelling. A powerful story featuring engaging characters, dramatic tension, and a well-crafted plot helps make a successful movie. What went on behind the camera or in the cutting room rarely influences the audience's experience watching the film. Most viewers will never know whether the filmmaker was delighted with the completed film or devastated that his first choice of cast rejected the script. The audience pays the same price for the theater seat and popcorn whether the film's budget was $100,000 or $100 million.

But at each stage in the filmmaking process, business and financial decisions will affect the story being told. Without the business structure, casts will not be paid, locations will not be available, and the film cannot be exhibited. The filmmaker's job is to manage the tremendous amount of time, funds, talent, and energy expended off screen to assure the best possible result onscreen. During the feverish pace of principal photography, he has little opportunity for reflection. Effective preparation and thoughtful contingency planning made in advance of the filming can save a movie from ruin. The more thoroughly he has prepared every step in the filmmaking process, the better chance he has of creating a finished film that captures his vision.

A. Who Is the Filmmaker?

Filmmaking is a communal process. The filmmaker becomes parent, artistic mentor, instructor, boss, and police officer to the small army that join together to bring the filmmaker's vision to the screen. Although each project requires a strong writer, producer, and director to shape the process, each one has a very different set of responsibilities and priorities, so there is a constant tension among the three. Ultimately, the filmmaker will dictate how those tensions are resolved, and bring together the creative and business aspects of the film. He stands at the center of every production, serving as its spine and brain.

It is important that the filmmaker on the team be recognized early. Productions vary, but generally the filmmaker will be the producer or director, or occasionally the writer. Typically a single individual holds the role, but a collaborative team may share the duties.

1. Independent vs. Guerrilla Filmmaking

Guerrilla filmmaking is a special subspecies of independent filmmaking. The guerrilla filmmaker is generally a storyteller with a vision. Sources for guerrilla films come from the stage, from life experience, or from literature that transfixes the filmmaker and makes the production his reason for being. Spike Lee, producer/director/writer/actor of Bamboozled and Do the Right Thing, Jim Jarmusch, producer/director/writer of Night on Earth, and John Sayles, writer/director of Eight Men Out and Matewan, are a few of the more prominent guerrilla artists, but many established filmmakers, including Michael Apted, Joel and Ethan Coen, Keenan Ivory Wayans, David Zucker, and Jerry Abrams, created their first films as guerrilla filmmakers.

The essence of the guerrilla filmmaker is twofold. First, the filmmaker must need, desire, and crave to bring his movie — not any movie, his movie — to the screen. Second, the filmmaker must have this craving despite the fact that no money, social network, business connections, studio interest, or external support exists to make this possible.

Another way to describe the guerrilla filmmaker is to characterize him like any other filmmaker — only more so. The guerrilla filmmaker is an entrepreneur with the desire to make a film rather than start a business. Like the typical entrepreneur, the guerrilla filmmaker is an extreme risk taker. By contrast, the traditional independent filmmaker described in this book is a more cautious businessperson, typically more willing to make reasonable compromises to make a film. Both the traditional independent filmmaker and the guerrilla filmmaker will use loans to make their films, but only the guerrilla would be willing to mortgage his house — or the houses of friends and family. This book will outline the path for the independent filmmaker, but wherever possible it will also note those few guide-posts available for the guerrilla filmmaker as he cuts his own trail.

2. Independent vs. Studio Filmmaking

Independent filmmaking, whether traditional or guerrilla, is different from a studio production because, unlike with many commercial films, an independent film dictates the package. Producers of studio films often describe their preproduction development as "creating a package." They create lineups of stars, bestsellers, merchandizing tie-ins, audience demographics, locations, directors, and writers that, if executed properly, will inevitably result in blockbusters.

Independent and guerrilla filmmakers, on the other hand, focus on a personal vision instead of working to accommodate stars, investors, prior contractual commitments, or audience response cards. Unlike carefully packaged studio films, movies by smart independent filmmakers tend to be highly opportunistic, using available locations, actors, situations, or other organic elements that can enhance or even redirect the story. As a result, many of the steps in the independent filmmaking process are different than with studio productions. Still, when everything works, the resulting films are the best the industry can create.

Given the tremendous consolidation in the entertainment industry, independent moviemaking has become increasingly difficult to define. Technically, an independent feature is any film not made at one of the major studios — Sony (home to Columbia Pictures, MGM, and United Artists), Warner Bros., Universal, Disney, Paramount, or Fox. This would include such films as Rambo (produced and distributed by Lionsgate), Trumbo (distributed by Samuel Goldwyn Films), Juno (produced by Mandate Pictures), and many others.

For a 10-year period beginning in 1996, independent films were considered a very profitable market. All the major studios acquired independent production companies or developed their own indie houses, creating a group of production entities that were small and somewhat autonomous, but still within the influence of the studio system. Recently, the market has turned quite bearish for independent films, and a number of these companies have been closed.

For the first-time filmmaker, the largest practical difference between studio and independent filmmaking is the amount of authority and control she retains over the artistic and budgetary decisions that make up the film. With an independent film, the filmmaker possesses substantial autonomy in these decisions — usually accompanied by significant financial risk. If the film has studio distribution, each major decision is usually subject to approval by the studio, and such approvals generally transform the project from an independent film into studio product.

3. The Filmmaker's Team

Filmmaking is an intensely collaborative, communal process. While there are exceptional guerrilla filmmakers who can successfully walk around with a handheld camera, capture content, edit it themselves, and compose their own score to accompany their film, most films require a large company of specialists to successfully complete. Composed initially of a director, writer, and producer, the production team should quickly grow to include members of the business and artistic teams. In the beginning, the prospective team members may simply be consulted for their availability and interest in the project. But once a decision to go forward with a film is made, there is often limited opportunity to deal with logistical concerns before principal photography must begin. If the filmmaker lines up his team in advance, he can ensure that the launch of the film company will go much more smoothly and that the team behind the film will have had the time needed to build a common vision.

The artistic team includes the location manager, the director of photography, and designers for sets, costumes, and lighting. Collaboration between the director and this group of professionals will help clarify the vision of the film and establish the look and feel of the project. The artistic team should also include the principal actors. The leading actors will champion their characters, and the filmmaker will need them to display their enthusiasm for the script during the struggles for financing and distribution. An independent film with committed actors is far more likely to succeed than one with a cast that treats it like just another job.

The business team should include the line producer, the law firm, accountants, and key investors. Inexperienced filmmakers often wait too long to seek the assistance of lawyers and accountants. Since many of the critical decisions regarding financing, production, and distribution are made quite early in development, filmmakers should not try to avoid the costs of experienced legal and financial counsel. Mistakes in structuring the financing can close down a production or lead to criminal violations of securities laws.

Filmmakers should also consider their lead investors to be part of the filmmaking process. For projects that require more funding than is available from a family member or a credit card, the investors' opinions on the business structure and financing strategy will be critical to success. Moreover, few investors are willing to tie up their funds unless they know the funding will be completed, so first investors are harder to lure into a project than later investors. But film investors are generally willing to invest because of their interest in the project. Allowing them to contribute to the business strategy can help solidify their support and encourage them to help raise the necessary additional funds.

B. Selecting the Scale

By choosing to make an independent film, the filmmaker has already begun to make the first critical decision regarding the film: determining the scale of the production. The scale determines the size of the cast and crew and how much they are paid, the cost of the locations, the nature of the equipment to be used, the extent of any special effects, and the length of the shoot. These aspects of a production need not be proportional to each other, but they usually are.

It is commonly assumed that the subject matter dictates scale, but this is a misconception. A two-person love story can be told in exotic locales with expensive panoramic shots, requiring a budget of well over $150 million. A story about Alexander the Great or Napoleon can distill the conflict into a personal tragedy that can be shot for less than $1 million.

The scale of the production will dictate every subsequent choice. It shapes the vision of the filmmaker. For example, Francis Ford Coppola recalls his original concept for Apocalypse Now: he hoped to sneak his independent production company into Vietnam to shoot the film surreptitiously against the backdrop of the actual "police action." Instead, the movie was shot in the Philippines after Coppola had become a Hollywood success. The production became a bloated Hollywood extravaganza that required well over a year of principal photography. The scale of the movie had changed in the filmmaker's mind, reshaping every decision regarding the production.

Independent filmmakers often back into the scale of their projects based on the financial resources available. If they choose to avoid unions, they will have a lower budget but may face unanticipated costs caused by a relatively inexperienced talent and crew. If they choose to acquire the film rights to a particular novel, short story, or comic book, the rights holders may require them to adopt a higher budget and a higher-profile cast as a condition of selling the rights. In each case, the key decision sets the scale against which all other budgetary decisions will be made.

Another choice that can set the scale of an independent film is the decision to shoot on 35mm stock. Not long ago, the choice to shoot on 16mm stock or use a digital camera guaranteed a lower-quality print and potentially limited distribution options but saved money on film stock, equipment rentals, and lighting costs. Today a range of digital camera systems is available that equals the range of quality available with 35mm film cameras. The prices of these systems keep dropping while the quality continues to improve, making the format much less of a defining choice than it once was.

Setting the overall scale of the film production may not be a conscious choice, but the individual decisions that determine scale are usually carefully considered. Most filmmakers have definite opinions about budget, film stock, and Screen Actors Guild member actors. Together, these preferences set the scale of the production. Being aware of them and the scale they imply will help the filmmaker prepare for the many choices that will flow from this first step in the filmmaking process.

C. Planning

A filmmaker may be compared to a military general, commanding armies of cast and crew. If the plan of engagement has not been carefully developed, if contingencies have not been incorporated into the plan, the campaign will falter in the field. Once in the heat of battle, the opportunity for careful planning has been lost. Effective generals and artistic filmmakers are great at improvising because both have planned ahead and are able to incorporate any necessary changes into their overall strategy.

Well before principal photography begins, the filmmaker should have reviewed all the delivery obligations for the project to assure that the script meets all artistic and legal needs, the right shots are taken, the correct releases are signed, the funds will be disbursed, locations are available despite any vagaries of the weather, materials for marketing are created, the postproduction process is ready, and the strategy to distribute or sell to a distributor is fully thought out.

1. Planning for Distribution

Good planning dictates that the filmmaker consider the realities he will eventually face when the time comes to exhibit and distribute his film. At a minimum, distribution requirements dictate the running length of the film and the level of adult content. Very few theatrical distributors will accept a film that is too long or cannot receive an MPAA rating of R or lower. Some countries impose censorship standards on films, requiring the filmmaker to edit the film accordingly for that country. The filmmaker should plan to shoot alternate versions of potentially problematic scenes, so the story can be edited easily to address issues of alcohol, nudity, profanity, or other subjects likely to trigger censorial cutting.

The economics of independent film are highly volatile. The independent and documentary boom of recent years has now given way to a glut of films and a dearth of financing. U.S. theatrical distribution reflects an ever-shrinking portion of motion picture revenue, but remains critical to the potential success in other media. DVD/Blu-ray sales and rentals, cable, broadcast, and Internet distribution, and international distribution have all become larger segments of the revenue stream. More importantly, the Internet has made access to entertainment nearly limitless and the ability of a particular film to reach the audience much more difficult. So from the start of the planning process, the filmmaker should be formulating a strategy to engage the audience with his film.

The audience engagement strategy should build upon the filmmaker's existing audience base, if any. It should include Web sites, e-mail lists, RSS feeds, and social networks based on the film's content, cast, location, or other significant attributes. Budget and staffing decisions should take these elements into account.

2. Planning for the Filmmaker's Future

Good planning requires the filmmaker to be vigilant regarding the goal of the production. For some filmmakers, the goal may be to launch a film company. For others, the goal is simply to gain experience and increase their employability in the entertainment industry. An actor-turned- filmmaker may want to prove that she has the artistic range to play a role, the vision to shape her own content, and the clout to have the film distributed nationally. Another filmmaker may have a passion to tell his own story, and once that film or documentary is distributed, he may not make another film. Still another may make films as artistic expressions with little regard for the audience. Each of these examples reflects a very different reason to make an independent film. Each will require different choices during the process.

For the filmmaker hoping to launch a business, the development of ongoing relations with investors and vendors becomes a significant part of the planning. Such a filmmaker may wish to convince investors to prepare for investing in a few movies before making money, with protections that all investments will be repaid if the money ever does pour in. Such a filmmaker should plan a whole slate of projects and learn to always have one project in preproduction, one in production, and a third in distribution. Such a professional filmmaker will approach the business with a bit more distance than the filmmaker who has only one film.


Excerpted from The Independent Filmmaker's Law and Business Guide by Jon M. Garon. Copyright © 2009 Jon M. Garon. Excerpted by permission of Chicago Review Press Incorporated.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

Table of Contents


About This Book,
A Chronology: From Idea to Academy Awards,
1. Preparing to Make a Film,
2. The Film Company,
3. Duties of the Film Company,
4. The Property of the Film Company: The Film Concept,
5. Contracts,
6. Financing the Film Project,
7. Budgeting,
8. The Investors' Package,
9. Assembling the Production Team,
10. The Key Members of the Independent Film Company,
11. Equipment and Locations,
12. Shooting the Film,
13. Special Considerations for Documentaries and Films Based on True Life Stories,
14. Music,
15. Postproduction,
16. Special Considerations for the No-Budget Production,
PART 3 Selling the Movie: Distribution and Marketing,
17. Theatrical Distribution,
18. Nontheatrical Commercial Distribution,
19. Self-Distribution and Self-Promotion,
PART 4 Appendixes,
A. Form at for the Feature Screenplay,
B. Library of Congress Copyright Circulars,
C. Sample Agreements,
D. WGA Writing Credit Definitions,
E. Best Practice Guide for Fair Use in Documentaries,
F. Resource Listings,
Selected Bibliography,
About the Author,

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