Entering into a contract can be daunting, especially when it is filled with legal jargon you’re unfamiliar with. Having a basic understanding of common contract provisions can give you the confidence you need to negotiate for your rights and services. After all, you want to be sure you understand exactly what you’re agreeing to.
This guide will break down seven common clauses you’ll encounter in entertainment contracts. We will explore what they mean and how they apply to you, so you can navigate the fine print with confidence.
What Are Common Entertainment Contract Provisions?
Below are some contract terms that appear frequently in the entertainment industry. You may have heard some of these before, but you might be unsure of their exact meaning. Let’s decode them.
1. Work-For-Hire
This is a critical term used in contracts where a person or company hires you to provide creative services. If a contract states that your work is a “work made for hire” or “work-for-hire,” it means the hiring company is legally considered the author and owner of your work, not you.
The company gains the right to use your work in any way they choose (e.g., create a film, TV series, or podcast). They can also exploit it across all media (e.g., streaming, broadcast, and even methods that haven’t been invented yet) forever. This is different from an “assignment of rights,” which can sometimes be terminated after a certain period under U.S. Copyright law.
Example: A studio hires you to write a screenplay. Your contract states the “results and proceeds” of your services are a “work-made-for-hire.” The studio now owns all rights to that screenplay, including the right to create derivative works like prequels, sequels, and remakes.
“Results and proceeds” is another key phrase that refers to your work product—everything you create for the project. This includes all screenplay drafts, outlines, brainstorming materials, and notes.
Even when you are hired on a work-for-hire basis, you can often negotiate for other benefits. These might include on-screen credits or additional compensation if the project is successful.
2. Droit Moral (Moral Rights)
“Droit moral” is French for “moral rights,” a concept that originated in European copyright law. It refers to an artist’s right to protect their personal connection to their work, including their integrity and reputation. This could involve the right to object to changes that might distort the work.
In the U.S., moral rights are very limited. However, entertainment contracts often include a waiver of “droit moral.” This is because projects are distributed internationally in countries that may have stronger moral rights laws.
Film and television projects are highly collaborative, often with hundreds of individuals contributing. Requiring artists to waive their moral rights ensures the studio can adapt and edit the final product without legal challenges from individual creators.
3. Waiver of Injunctive Relief
Most entertainment agreements require talent to waive their right to injunctive relief. This clause relates to situations where one party fails to fulfill its contractual obligations and the other party asks a court to intervene.
Courts can provide two types of remedies:
- Money Damages: A court orders one party to pay another to compensate for harm.
- Equitable Relief: A non-monetary remedy, where a court orders someone to do or stop doing something.
Injunctive relief is a type of equitable remedy that prevents a harm before it happens. If you waive your right to injunctive relief and a studio breaches its contract with you, you cannot stop the project’s release. Your recourse is to sue the studio for money damages.
Studios require this waiver because they invest huge sums in developing, producing, and distributing a project. The financial risk would be too great if any single contributor could halt a release over a minor breach, especially when financial compensation can resolve the issue.
While individuals typically waive this right, studios often retain it for themselves. For example, if you sign an exclusive screenwriting deal with a studio and secretly start writing a similar script for a competitor, the studio could seek an injunction to stop you from working on the competing project.
4. Conditions Precedent
This part of a contract is sometimes overlooked, but it is crucial. The obligations of each party—including your start date and payment schedule—do not begin until these specified conditions are met.
Example: You are hired to adapt a book into a television series. Your agreement will likely be conditioned upon the company’s approval of the “chain of title.” This means the company must first verify that the person selling the book rights is the actual owner.
The company would not want to hire a writer to adapt a book if it does not control the underlying rights. Understanding the conditions precedent is important because they can delay the official start of your contract.
5. First Negotiation, First Refusal, and Last Refusal
You might grasp the basic idea of these terms, but their distinctions are important. Let’s say a studio buys the film rights to your book. To protect its investment, the studio may ask for a right of first negotiation, first refusal, or last refusal on any sequel you write.
This makes sense for the studio—if it finances and markets a successful movie, it doesn’t want a competitor to easily acquire the sequel rights. For you, the author, these clauses still provide leverage to negotiate the best possible deal.
- Right of First Negotiation: You agree to negotiate exclusively with the studio for a set period (e.g., 30 days) before offering the sequel rights to anyone else. If you don’t reach a deal in that time, you are free to sell the rights to anyone else on any terms.
- Right of First Refusal: This gives someone the first chance to buy something. If you have a right of first refusal (but not first negotiation), you can shop your sequel to other buyers. However, before you accept an offer, you must present it to the original studio. That studio then has the right to match the offer and buy the sequel rights on the same terms.
- Right of Last Refusal: Also known as a “last matching right,” this is similar to a first refusal but more restrictive. After shopping your sequel and choosing a buyer, you must take that final offer back to the original studio, which has the right to match it. If any terms of the third-party offer change (e.g., the price is lowered), you must go back to the original studio and give them the chance to match the new deal.
Rights of first and last refusal are often paired with a right of first negotiation.
6. Frozen Rights
When you sell rights to a studio, you can often negotiate to keep certain rights for yourself to monetize later. These are called “reserved rights.” Beyond granted and reserved rights, a third category exists: “frozen rights.”
Frozen rights are rights that neither you nor the studio can exploit until you both agree on how to do so. For instance, if a studio buys the film rights to your book, it may ask you to freeze the television rights. The studio does this because a competing television series could diminish the value of the film it is producing.
Final Insights
Always read every agreement carefully before you sign it—especially the fine print. While the financial terms are important, failing to understand your full obligations could put your compensation at risk. Most importantly, consult with an experienced entertainment lawyer to review your agreements and negotiate on your behalf. Legal experts can help protect your rights and ensure you’re not disadvantaged by complex contract terms.
By Kimberly Koslow, Film & Ink Attorney
