Digital Signatures and Verbal Agreements

Entertainment Lawyer Question and Answer Forum:

Welcome to this week's Entertainment Lawyer Q&A, published by The Film & Television Law Quarterly and the entertainment law firm of BLAKE & WANG P.A. Each week an entertainment lawyer will respond to reader questions and publish the best discussions.

Have a question for an entertainment lawyer? Post it on our website at blakewang.com and get the answers you need.

Question:

I entered into a verbal agreement with an author of a short story. Someone adapted his short story into a script and I did a page one re-write of that script. He sent me text messages giving me the right to make our independent film. During casting, the writer told me that he never gave me "written permission" to make my film and that I can no longer proceed. I'm in the process of trying to shop this script and I just want to make sure that I'm safe.

Answer by Brandon Blake, Entertainment Lawyer:

Great question. Thanks for sharing it with our readers. There are a lot of rights questions here but I want to focus on two issues, one is the idea of the “derivative work”, and the other is about the US Copyright Act requirement for a “signed writing.”

First of all, we need to look at how many different versions of the creative work exist. In film and television we usually talk about the underlying work, such as a book, short story, comic book, etc., the script, and the film or television production itself. Each of these three works has a copyright, and none of these works need to be owned by the same party.

The underlying work is considered to be the original work. It was not based on a previous property and is copyrighted solely in the name of the author or of the company that commissioned the work. A script or teleplay could also be an original work if it was written without reference to an underlying story or other creative work.

Each of the subsequent works based on the original work are “derivative works”, meaning that they are based on other copyrightable works and that they therefore must be licensed from the original author.

In this case, there are multiple derivative works. The short story is the original work, the first script is a derivative work, and your rewrite is a derivative work, based on both of the two previous works. In order to precede you would need to license the rights from both the original short story and also the other screenplay, unless the original author had acquired all rights to the first script that was written.

Now the next question deals with how a creative work can be licensed. The Copyright Act specifies that a “signed writing” is required to transfer those rights. But it does not provide any more detail or a template for what is required. There have been cases where even a check was used as evidence of a transfer, although the writing must be signed by the party transferring the rights.

But electronic communications create a whole new issue regarding what “signing” means. The federal ESIGN Act clarified a few things, making it federal law that digital signatures are considered to be as binding as ink on paper signatures. The ESIGN Act provides a number of steps that help to confirm that a signature is binding, but it specifically does not require any one technical step to complete an electronic signature.

So then that creates a gray area with regard to emails and text messages. Emails are often “signed” by the party sending the email, although email communication can certainly be easily altered.

Text messages, Facebook and Twitter posts are even more difficult, because they could be considered signed writings in some ways, although certainly are not expected to be formal contracts by the parties sending them.

So the best advice is to be cautious with electronic communications. Do not assume that what is said by email is “not binding”, because under federal law it can be held to be a signed writing. On the other hand, a writer or producer cannot rely on an email to be a final disposition of the underlying rights either, given that there are not all the formal steps needed to confirm a signature under the ESIGN Act.

When it comes to the underlying rights to your film or television project, writers and producers should not take chances. Even independent or web projects have the potential to become valuable properties in the future. Have a formal contract drafted, or if a contract is presented, have it reviewed. There are a lot of issues in film and television rights agreements that come up other than the transfer of rights and the overall division of royalties or profits.

As with any legal matter, please do not make a decision about complex matters without consulting an experienced entertainment attorney first. I have been representing feature film projects and television series for more than 14 years. Please feel free to contact my office about a quote.

- By Brandon Blake, Entertainment Lawyer

About the Editor:

Brandon A. Blake is an entertainment lawyer and producer who works with Academy Award winning actors, directors and filmmakers. A complete biography is available online.

About the Entertainment Lawyer Q&A: The Entertainment Lawyer Q&A does not create an attorney-client relationship, nor is the information treated as confidential. Responses to selected questions will be made public and shared with our subscribers. All entertainment law information is informational in nature and is not intended to be acted on without entertainment lawyer counsel.