Stan Lee Sues Marvel Comics 680
night_flyer writes "In a story that demonstrates the way the entertainment industry manipulates its artists, Marvel is claiming that the 400 Million dollar blockbuster movie Spiderman produced no profits, and they are trying to weasel out of their contract that gives Stan Lee 10% of the profits from his creations. Nuff Said!"
Not that unusual (Score:4, Interesting)
"Robert Carlyle, star of the internationally popular film The Full Monty, was puzzled because he had not received any of his share of the profits from the film. 'Surely a film that cost £5 million and has taken hundreds of millions must be showing some in profits?' he asked the film's distributers. 'No', they replied 'in Hollywood no film ever makes a profit. It's all in the overheads.'"
Remember kids, "tidal waves couldn't save the world from Californication . .
I wonder how "profits" is determined. (Score:2, Interesting)
Boycott? (Score:2, Interesting)
Reminiscent of Alan Moore and DC comic's Watchmen (Score:5, Interesting)
A google search didn't come up with anything substantial, but I seem to recall an interview with him in Comic Shop News or the other big weekly comic paper, maybe I'm just smoking crack regarding this. Might be best to disregard this.
Movies NEVER make a profit.... (Score:5, Interesting)
It's a little like Enron in reverse -- cooking the books to remove all traces of return.
It's quite legal and easy for them to do, and it has been the tradition in Hollywood since it began. And that's how the SC ruled in a case brought by a(n other) writer of one of the Predator series of Movies IIRC. In that case, like this one, Stan seems to have gotten percentage `points' (in Hollywood jargon) instead of real dollars.
The studios find it easy to do this, as they can charge whatever they like for stock footage (stuff they've already shot and used in other movies) since they are the true producers, whatever the credits might say. And all movies use stock footage somewhere. F'rexample, the fire scenes in Gone with the Wind have been used (and charged for at inflated prices) in hundreds of movies.
This and `distribution costs' allow them the room to reduce the booked profits on any and all projects to zero.
The Predator movie the Court ruled on was, at the time, the largest grossing (worldwide) movie in history. And it never made a profit.
Neither did Goodwill Hunting or Titanic.
Re:No Profits (Score:5, Interesting)
I completly agree (Score:5, Interesting)
Re:Not that unusual (Score:4, Interesting)
Well, of course that's all theory and it's hard to apply to practice, especially in the case of intellectual property (which, IMO, really needs a completely different economic system to support it, although I don't pretend to know the solution)... but that's the theory. And if you think about it long enough, it makes sense that no good company would ever actually have "profits", although I'm having trouble coming up with a good way to explain why...
I think the real question here is, first of all, how evil was it for them to even offer a percentage of profits to this guy when they knew full well that "profits" don't really exist, and second, how dumb was this guy to accept a deal based on profits rather than revenue?
Lesson to everyone: When negotiating with big companies, never accept a percentage of profits in return for anything. Always ask for revenue, or a set dollar amount.
Re:Movies NEVER make a profit.... (Score:2, Interesting)
and a backlash to this sort of crap is brewing (Score:4, Interesting)
If the economy were to *really* go into the toilet over this, Bush would go down in history as the second president to lead the nation into a Great Depression. But he would never miss a meal, or a host of other mundane worries. Chances are my family would learn about much of it, first hand.
Re:I completly agree (Score:3, Interesting)
It may be Urban Legend but I have heard it said that the Star Wars films haave yet to show a profit -- on paper, at least.
Re:No Profits (Score:3, Interesting)
It's a little more complex than that. It's the same reason you wouldn't reasonably claim that a band made $15 million in profits because their $20 cd sold a million copies and cost $5 million to make. Columbia/Tristar or whoever the fuck made the movie bought the movie rights from Marvel Entertainment for $12 million or so.
So, even if that were mostly profit, they would owe Mr. Lee a cool million, or exactly what they've paid him every year since he signed his contract.
Stan reaps what Stan sows (Score:4, Interesting)
And where IS Ditko in all this? Is the mainstream press just too wimpy and gutless to brave one of his Ayn Rand-esque tirades and hair-splittingly precise reproach-a-thons?
Clearly Ditko was a major part of the creation of Spider-man.. I'm not clear what kind of rights he has in the character, if in fact Lee ever let him have any. Any help?
Re:Aint that just a load (Score:5, Interesting)
You also generally get a lawyer, accountant, and agent to look over any multi-million dollar contracts before signing. Especially for an established artist who must certainly have those resources at his disposal.
More than likely, folks like the actors, director, producers and the like took their cash off the gross revenue. Profits coming in get translated back to further marketing, associated products, and all kinds of other expenses to increase the gross. The higher the gross revenue, the more cash for the folks collecting on it. There is zero incentive for the studio, Marvel, or any of these folks to focus on a column labeled "profit" for the sake of Stan.
I really do feel for the guy, but it has limits. The focus on gross has been around for decades, and won't be going away any time soon. Stan himself should have known better! He's been in this game for a while now.
Rule of Thumb (Score:3, Interesting)
Re:Steve Ditko (Score:3, Interesting)
You can hear all about it in the excellent Stan Lee's Mutants, Monsters, and Marvels [amazon.com], hosted by the always great K. Smith. It comes highly recommended.
Please look into the facts before ranting (Score:1, Interesting)
The movie cost about $120 million to make and about $100 million in marketing. Marvel is paid a small percentage of Sony's take. Marvel did not take in $400 million dollars. More like $20-30 million. And then they have their expenses.
Stan Lee screwed Steve Ditko and other writers/artists over the years when he ran Marvel.
Here is the actual employment agreement: http://www.sec.gov/Archives/edgar/data/933730/000
Fool me once... won't get fooled again... (Score:2, Interesting)
If it was me, I'd say "You've already voided the contract with the first violation, I'm gonna take my rights and sell them to somebody else. Idiots."
These guys sound like three year olds, stealing candy a week before Christmas. You'd figure they'd be able to see the big picture and realize that they risk huge future returns by so blatently stealing. Hell, give him 1%, 2% and he'd probably wouldn't have noticed. Jesus, be professional about it.
Actually, Marvel didn't just "sell the rights" (Score:5, Interesting)
Marvel has learnt from its past mistakes and no longer simply takes a step back from their film properties. They have a subdivision "Marvel Films", or something to that effect, which involves this guy [imdb.com] being on the set to every single Marvel film property. From what has been released, Marvel gets a profit slice, not just a flat licensing fee.
Oh and by the way, Sony Pictures made the movie and it cost about 100 million to make. It took in 800 million [imdb.com] at the box office worldwide thusfar and is the 7th highest grossing film of all time. It earnt an estimated 245 million [hollywoodreporter.com] in it's first week on video release. So out of this billion dollars, yeah, I'm sure Marvel only got "$12 million or so".
Re:GIGO in business (Score:1, Interesting)
Simple. During the 80s and 90s, stock options were thrown at top executives (Funny thing about stock options, they don't count as an expense since their value is difficult to account for).
Anyway, Executive sees pile of stock options and wants to make as much as they can off them. As a result, business leaders often make decisions that are disasterous in the long term, but profitable in the short.
The idea of stock options is to put managers in the same boat as shareholders. Too bad it seems to have taken the opposite effect as it encourages bad business decisions that encourage short term stock valuations (Hence Enron, etc...).
Taxes and the Little Guy (Score:5, Interesting)
36K a year working tech support in Portland OR.
My last surviving parent died in early March. She had been running the family farm that'd been in the family since 1952.
Before G.W. Bush - Estate (Death) Tax would have left me with $12,250 from the Estate.
Since G. W. Bush - Estate (Death) Tax left me with the money to finish college and hopefully build a strawbale home in 2003.
So personally, I feel the President's tax cuts are helping that little guy.
Re:No Profits (Score:3, Interesting)
The incentive for companies then is to use up all income immediately as "marketing" (or other) expenses... new luxury cars to drive around the execs, flights to europe for a week to "promote" the movie, including the marketing VP's family so they won't miss him/her, etc...
Better to have something left over for the "company" than to give a piece to the government... I swear if there wasn't so much corporate welfare, exploitation, and "good buddy" politics, I wouldn't have to give 40% of my paycheck to taxes...
Re:Taxes and the Little Guy (Score:2, Interesting)
I'm sorry, I'm not a Troll, but Jesus Christ the Feds throw money down a black hole.
Welfare. The handing out money for doing nothing leads to a Hell for the people on Welfare.
I've seen it, I spent 21 years on the Cheyenne River Indian Reservation. I saw alot of talented and smart kids go nowhere and do nothing because it's easier to sit home with a 40 of Busch Lite and wait for the money from the Feds show up.
I saw the Federal Government give the Tribe 1.7 million dollars to build a 3,500 square foot one story brick building to replace a building that worked fine. Then 4 years later, they got 2.6 million to put another 2,000 sq feet to the building they got 1.7 for.
I've seen the Federal Government pay the Tribe three times for the land flooded from the Oahe Dam project. The latest one was 336 million, not one cent of which has left the Tribal Offices and not one cent has been spent on anything for the Tribe or the people.
Welfare needs to go away, the Reservation system needs to be phased out.
It's better for the people.
Citzens before corporations, damnit! (Score:3, Interesting)
Sadly, corporations in the US pay most of their taxes on "profit", which is defined, roughly, as "gross income minus expenses".
Here's the kicker (for me at least): A corporation can write off its salary/wage expenditures as part of those expenses (which I've been told by knowledgable business people is the largest operating expense to any corporation, or "Time is money").
Since salary and wages represent remuneration to employees for their skills and the time spent applying them on the corporation's behalf (that is to say, while the employee is working for the corporation), it is fair to say that corporations are allowed to claim the labor (which consists of skills, knowledge, expertise and time) of their employees as an expense. Thus, an employee's labor has a cost associated with it from the corporation's perspective (and the IRS' for that matter), and so has monetary value (which is deducted from gross income). The end result is that corporations can deduct 100% of that value from their gross income to derive profit.
Now, remove the corporation from the equation: If I do the exact same work for the exact same money as when I was working for a corporation, what is the cost of my labor? If I do the exact same work for myself for one half the amount that I was paid by a former employer, what is the cost of my labor?
Zero,zilch, nada. I am not allowed to claim my labor as an expense *to myself*, despite the fact that, were I working for a corporation, it would be an expense *to them*.
Huh?
Or, to phrase it succinctly - my labor has no value as an expense unless I work for a corporation, since I cannot claim it as an operating expense to myself. Or, even better: The time that that labor represents has no value unless I work for a corporation, and then it somehow magically gains value to the corporation for purposes of determining its profit.
This, in my opinion, is the most egregious example of the federal government's (and state governments', for that matter) abuse of its citizens in preference to corporate interests - the term "wage slave" comes to mind in the most literal sense.
And believe me, I know whereof I speak - I am self-employed, and see this in action each time I pay income taxes. Even were I to start a corporation with myself as the sole employee, I, personally, could never evade the fact that a corporation, ANY corporation, as a legal fiction, has privileges with regards to income taxes that I as a citizen will never realize.
So, to wrap up this off-topic rant (with apologies for wandering off the subject): All things being equal, my labor is 100% profit to me under the current tax system in the US whether I perform it for myself or for a corporation, and so I pay enormous amounts of income taxes on it, but it is a 100% expense to any corporation for whom I work, and they pay no income tax on it at all.
There isn't any other way to look at it, as far as I can tell. Somewhere along the way, that portion of my life spent working lost its value to the federal government (and, to a lesser extent, the state government as well), and any monetary recompense for it is "profit" to be taxed. The common denominator for me is this: My time.
Corporations get to write it off, I do not. All I want as a citizen of the US is to have the same tax priveleges as a legal fiction and to be treated with at least equal consideration by my governments - is that too much to ask?
And, for an interesting view on the limited applicability of federal income taxes from a different perspective, I encourage all of you to check out: http://www.taxableincome.net/
dj
Lee should have paid attention to Art Buchwald (Score:2, Interesting)
Re:Why should Stan Lee get anything? (Score:3, Interesting)
Steve! Come out! The Randites are winning! You can talk to us now!
Re:No Profits (Score:5, Interesting)
Well, I totally agree that Spiderman obviously must have made a profit, or they wouldn't be making a sequel (and an X-Men sequel, and a Hulk movie, and a new Superman movie). However, in answer to your larger question - movie studios are actually not very profitable. I read an article about this a couple years back, and basically buying a movie studio is a horrible investment. The dynamics of the industry (movies costing so much to make, basically) mean that the studios themselves are not a good ROI. Yet people invest in them for one of two reasons:
1) The glamour. People aren't always rational economic actors, or at the very least, you have to take into account that people may seek more tha money. Yes, perhaps I could make 6% profit investing in bonds, but maybe I'd rather have 3% profit but hang out with movie stars/sleep with actresses all the time.
2) Media conglomerates believe that somehow, "synergy" will eventually make the movie studios pay off. Yes, this movie studio isn't a good investment as a standalone, but maybe if I tie my magazines, TV channels, pay per view channels, and retail stores together I can make it profitable.
Re:Actually, Marvel didn't just "sell the rights" (Score:3, Interesting)
It has nothing to do with who paid for what. Disney takes stuff that has been around forever and remakes it, and then tries to make sure that their stuff never becomes available to anyone else to remake... ever. Disney deserves to get fucked because of the way they have been fucking the public over for decades. Marvel has done no such thing. Perhaps you can see why people don't feel the hostility towards Marvel that they do towards Disney?
Re:I'll bite (Score:3, Interesting)
It most certainly is. Government requires an income to perform it's basic services, which are provided through taxation. I never meant to suggest that taxes are removed entirely, especially for businesses.
As your post alludes to, there is a sweet spot where the load put on the economy by taxation also allows for maximum growth in the private sector. Real growth is what truly drives how much tax revenue the government is able to collect. If tax rates are too high, growth suffers, and subsequently the revenues the government collects actually drops.
One of the policies that we saw under the Clinton administration that made sense was the brakes that were applied to keep growth down a bit. This was certainly on Greenspan's advice, but Clinton to his credit took it. Greenspan saw the very real possibility of a rapid rise followed by a massive fall.
To keep growth in check, two approaches were taken. Both interest and tax rates were held high, which puts a drag on the economy.
Now that growth has slowed down, the Fed has dropped rates over the last few years to take the drag off. Taxes need to follow suit to get more cash flowing into the economy.
The especially clever bit to all of this is that neither interest or tax rate changes have an immediate impact. There's at least a 6 month delay before results are felt.
Essentially, nothing in your post disagrees with what I was attempting to address, or my views on policies concerning the economy. There are times when the brakes need applied, and there are times such as this when they need to be taken off.