Frequently Asked Questions: Directing

Answers from Mark Litwak, Attorney At Law



DISCLAIMER: The information provided here is intended to provide general information and does not constitute legal advice. You should not act or rely on such information without seeking the advice of an attorney and receiving counsel based on your particular facts and circumstances. Many of the legal principles mentioned might be subject to exceptions and qualifications, which are not necessarily noted in the answers. Furthermore, laws are subject to change and vary by jurisdiction.



Question: I am going to shoot a no-budget feature using my friends as actors. Two or three (out of ten or twelve) are members of SAG with no major credits. Do I need to register with SAG? What do I have to worry about when it comes to SAG? And how do I get around those things I have to worry about? Also, does "Contracts for the Film and Television Industry" contain contracts/deal memos that pertain to deferred/contingent methods of payment? If no, how do I incorporate those ideas into the existing contracts? Is there a difference between deferred and contingent? I will only be able to pay my cast and crew if I get some sort of distribution deal down the road.



Answer: If you are not a signatory to SAG, and you hire SAG actors, the actors may get in trouble with their union. Since you haven't signed with SAG, you have not violated or breached any contract with SAG. The major danger to you is having the actors run off in the middle of a shoot because a SAG representative shows up.



In regard to your question regarding deferred and contingent compensation, these are not the same. A deferment can be paid before or after the investors' recoup. Typically it is conditioned upon a film going into production and a certain amount of revenue being generated to pay the deferments. The deferred holders can have priority or they can all receive their deferments on an equal basis. Contingent compensation also referred to as "points" or "net profits," is far less likely to be received by a profit participant. That is because net profits are typically defined in such a way that all kinds of costs and expenses and distribution fees are deducted before any profits are declared.



Question: I'm aware the DGA and SAG have Low Budget Agreement deals that work to the benefit of the independent producer. Are you aware of any similar deals offered by the unions for cinematographers and sound-recorders? Thank you.



Answer: IATSE allows independent filmmakers the option of signing under a low-budget agreement. For more information you can call IATSE at (818) 905-8999. You should be aware that most low-budget producers would sign with SAG, although they may not with the DGA, WGA, and the Teamsters or IATSE.