Lawyer fees

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  • Lawyer fees

    Saw this post in another thread and had some questions that I thought might be of more general interest:

    Originally posted by Ronaldinho View Post
    But the reality is that when you have somebody interested in buying your material, you will contract will an experienced entertainment attorney who will work for 5% of your fee. He will know what is appropriate to ask for, and will negotiate the specifics of your deal for you.
    I've always wondered why 5% has become the industry standard, because it sounds a bit steep for what I think is a one-time service?

    Does the 5% fee also obligate the lawyer to represent the writer if there's some future problem with the contract?

    Does the 5% also apply to the writer's residuals, or just to their initial payments?

    Are there good entertainment attorneys who charge per hour instead of as a percentage?

  • #2
    Re: Lawyer fees

    I think the trade off here with the 5% versus hourly rate is that an entertainment attorney will perform work on your behalf without charging you for it. That could be anything from going over agreements and making phone calls to helping find representation to negotiating all your deal points. If an entertainment attorney charged for everything they did like a regular attorney, you'd probably be broke.

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    • #3
      Re: Lawyer fees

      It doesn't apply to residuals. It only applies to the fees in the contract the lawyer negotiates. (This is true of agent and manager commissions, as well). It doesn't apply to anything that's already determined by the minimum basic agreement.

      Early in your career, this is hugely advantageous to you. e.g., let's say you do a guild scale option deal with a rewrite, which will earn you around $45k. Hourly you definitely eat all that up, especially if the lawyer is negotiating the deal. The lawyer's only getting $2,250.

      But it's worth it for him or her, because they also get a chunk of the purchase price - so down the road if the option gets picked up for $250k, the lawyer gets a nice $12.5k bonus for doing no more work.

      It does seem like lawyers, compared to agents, get a ton of money for relatively little work. I mean, for an entertainment lawyer, there's a paycheck every time the telephone rings. On the other hand, I'm aware of a lot more in the way of absurdly rich agents than I am absurdly rich lawyers, so the economics must be working out in some sort of reasonable way in the end.

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      • #4
        Re: Lawyer fees

        there are plenty of lawyers who will work hourly for you, but in the beginning, when a lot of these deals are just lower options or possibilities that only "could" lead to more substantial $, it can be good value to get the work done like this.

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        • #5
          Re: Lawyer fees

          All this info is very helpful-- thanks to everyone who replied!

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          • #6
            Re: Lawyer fees

            I'm not sure it's a one-time service because they go over those contracts multiple times after negotiating with the company back and forth.

            Wording is extremely important and so it takes time to go over each iteration. Negotiations and paperwork can sometimes go on for months before it's finalized.

            Everyone I know working steadily in the industry say the 5% is well worth it (the ones with good lawyers anyways).

            I think Scott Meyers talks about how one word in his contract changed whether they got money on sequels for K-9 or something like that -- imagine how much money he could have gotten had that been thought about and changed.
            Quack.

            Writer on a cable drama.

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            • #7
              Re: Lawyer fees

              Originally posted by Zodraz View Post
              Saw this post in another thread and had some questions that I thought might be of more general interest:



              I've always wondered why 5% has become the industry standard, because it sounds a bit steep for what I think is a one-time service?

              Does the 5% fee also obligate the lawyer to represent the writer if there's some future problem with the contract?

              Does the 5% also apply to the writer's residuals, or just to their initial payments?

              Are there good entertainment attorneys who charge per hour instead of as a percentage?
              Also, keep in mind that not every deal which you negotiate will close. The 5% contingency arrangement is actually a good hedge for a writer--do you really want a 500.00 an hour attorney working a deal for you and spending 5-6 hours on a deal that doesn't close and then you are on the hook for a couple grand with no deal to show for it?

              They are taking a risk on you by working on the 5%, so though it may seem a bit high, bear in mind that the hourly costs could be untenable for you.

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              • #8
                Re: Lawyer fees

                And a good lawyer will be well worth that... a good lawyer will make money for you that an agent or manager will not. They will remove crap from the contract and negotiate perqs for you: I have performance bumps for home video so if they sell X number of DVD/BluRays I get a bonus. Little things like that can make you money.

                My favorite lawyer story is from novelist David Morrell who wrote FIRST BLOOD and his lawyer got him a piece of toys and other merchandise. Because Rambo dies in the end, and it's a freakin' violent novel, the idea of "toys" never entered anyone's mind... except that lawyer. How much did Morrell make on Rambo action figures? (etc)

                Bill
                Free Script Tips:
                http://www.scriptsecrets.net

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                • #9
                  Re: Lawyer fees

                  On my last two options, I paid about $2000 in hourly lawyer fees.

                  The minimum I would've made had the options gone through was $50,000. 5% of $50,000 is $2500. So I would've "saved" $500.

                  Instead I only made $1500 from the options. So I "lost" $500.

                  It's important to note, at the time of those options I was a complete noob. I was not given the choice of hourly vs. percentage, at least with the lawyers i talked to. I think with complete nobodies, lawyers opt for the hourly rate because the chances are slim you will be paid. Unless of course you've actually got a purchase agreement.

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                  • #10
                    Re: Lawyer fees

                    In the news recently, BP is taking it in the shorts because of wording in a Gulf oil spill agreement that it signed - after who knows how many in-house and outside counsel reviewed it. Taking it so bad that even the judge seemed to chuckle because of how the terms in that agreement are now playing out. And by "taking it in the shorts" I mean billions in extra payments to plaintiffs.

                    And so, while even (as there) lawyers do make mistakes, it's generally much worse if you don't have a lawyer at all.

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                    • #11
                      Re: Lawyer fees

                      The other thing is that Hollywood seems to have a culture where the lawyers deliberately set out to screw you over.

                      I've had a contract where we specifically negotiated that there was no cap on our percentage payment where, when the contract showed up, there was a very low cap on that payment. I guess they were hoping we wouldn't notice.

                      I've heard about a case where in the last draft of the contract, the studio lawyer turned a mandatory step into an optional step - just slipping in a couple of words. When they then decided not to exercise that now-optional step, the writer was out six figures. You think a lawyer who catches that is worth 5%?

                      This sucks, and I'm under the impression that there are lots of places where contacts aren't approached like this, where the purpose of the contract is to clarify issues and avoid conflict. However, in Hollywood, that's not the case.

                      In Hollywood, studio lawyers set out to knife you in the back.

                      Needless to say, you get a good lawyer, you read the contracts carefully yourself, and you ask questions about anything that smells funny before you sign.

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                      • #12
                        Re: Lawyer fees

                        After a long hiatus, I'm going to jump in here. Three months of negotiations between my attorney and the production company's attorney over a TV deal based on a book of mine, which translated into many, many hours of work for him, including summer weekends, and I ended up only paying 5% of the final contract's bottom line.

                        And, considering the amount of work my lawyer put into getting the contract to work for me, I consider it a pittance well spent.
                        Last edited by Jake Schuster; 07-14-2015, 04:50 AM.

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                        • #13
                          Re: Lawyer fees

                          I find it's best not to think about it too much. It will only make your head explode.

                          After all, entertainment agents get 10% while NFL agents get 3%, NBA agents get 4% and real estate agents get 3%.

                          Welcome to California.

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                          • #14
                            Re: Lawyer fees

                            Originally posted by juunit View Post
                            I find it's best not to think about it too much. It will only make your head explode.

                            After all, entertainment agents get 10% while NFL agents get 3%, NBA agents get 4% and real estate agents get 3%.

                            Welcome to California.
                            I mean, yeah. They all have "agent" in their title, so they all have to be doing the same amount of work.

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                            • #15
                              Re: Lawyer fees

                              Thanks again to everyone who replied-- this has really been an informative thread.

                              Hopefully one day soon I'll be able to make use of all this great advice!

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