The Toronto International Film Festival (TIFF) is a pivotal event for filmmakers, distributors, and legal professionals. With fast-paced deal-making and high stakes, the right expertise is critical. In this Q&A, entertainment lawyers at Blaney McMurtry LLP, Dave Stern and Corey Hock, share their insights on common challenges, contract pitfalls, intellectual property protection, and more, offering practical guidance for clients and legal professionals alike.
Q: What are the most common legal issues that you see raised at TIFF?
DS: I would say chain of title, errors & omissions insurance and general clearance. Chain of title is essentially a series of legal documents proving that the production company of record owns 100% of the intellectual property in their film. It's really important to have, at the very least, chain of title completed without any type of issues before a film is shown at TIFF and ultimately distributed .
Clearances focus on any legal concerns that may be apparent in a feature film. For example, issues pertaining to individuals caught on camera, locations, brands or logos, third-party clips or archived materials, photographs, or music that don't have the proper permission or clearance need to be dealt with prior to the exploitation of a film. Errors & omissions insurance protects the production company and film from potential claims that may arise during its exploitation. TIFF is a platform that will allow for a film to be licensed/acquired. In an ideal circumstance, a lawyer reviews these elements and clear them beforehand, and assist the production in obtaining insurance so there are no real concerns when distribution or acquisition deals are offered.
Q: What are some of the key contract pitfalls to avoid when negotiating deals at TIFF?
CH: There are many areas at the deal stage that are important to look out for, especially when negotiating in such an exciting environment. A common contract that gets negotiated at TIFF is the distribution deal. The territory, for example, could be worldwide — often distributors want to take as many rights as they can, if it makes sense — or just for Canadian rights. You have to consider the rights language itself: is it just for the film distribution or is it expanding to merchandise or gaming? Term length is also one to watch out for: how long is this going to be distributed and is there an opportunity to work with another distributor after the first has their run?
Of course, compensation is important. Is there going to be an upfront advance? A guarantee to the producer? What about subsequent or derivative rights, if after the film they want to do a remake, prequel, or sequel. How is the filmmaker going to be involved, compensated, and credited?
As I said, it's an exciting time for filmmakers and that feeling only intensifies when an offer comes in. They want to lock up the opportunity in hand, but they must be mindful that other deals may come along. Keeping some of the bundle of rights for bargaining strength in future deals is a critical consideration.
DS: I’d add the fact that these offers often have 48-72 hour time limits, because distributors or buyers will go to these markets and submit 10, 15, 20 offers. They don’t expect all of them to be accepted or finalized. There's a certain budget they have to make offers. So if a filmmaker receives an offer, hopefully they have a competent entertainment lawyer who knows how strongly to push on some of these points with two to three days to negotiate.
As Corey mentioned, it’s a time to celebrate but also a time to really pay close attention and give great consideration to the fact that the film that you've worked on for years is about to be acquired.
Q: What happens or what should be considered when someone signs away their life rights?
DS: Signing away your life rights, so to speak, essentially refers to giving the rights to a production company to develop, produce, and exploit an audiovisual or audio production based on one or more components of your life. It's not a blank permission, however. The subject matter has to be mindful of a few things. For example, making sure the story is told in a way that feels authentic to them. They won’t get approval rights over this, but consultation or meaningful consultation rights is going to be important.
Nobody lives a life in complete solitude. There will be family members, friends, colleagues, adverse parties that play a role and they’ll look to the person to provide context as well as connections to those individuals. There might be specific venues or locations that are critical to the story where they’ll need the subject matter to open those doors. For documentaries they'll likely ask for old photos, videos, newspaper clippings. There's going to be some effort that the subject matter must undergo to make sure they’re fulfilling their contractual obligations.
Also consider who the partner is. You want someone with a proven track record and who potentially has connections to the right buyer. If you believe Netflix or Disney is the right home, for example, can they make that happen?
Finally, you want to be aware of certain legal clauses and key terms in the offer, such as compensation and reversion of rights. If they commit to paying your purchase price, but it still doesn't go into principal photography within X amount of years, then perhaps we should make sure that the rights come back to you. Does the offer include a commitment to engage you as a consultant or potentially an executive producer, and if so, what does that compensation and commitment look like? Are you entitled to episodic royalties and/or profit participation? Will you be tied to ancillary projects , such as merchandising, podcast rights, literary rights, and other licensing opportunities? Will you be tied to subsequent and/or derivative productions?
If a subject matter comes to me and they've received an offer for their life rights, these are the key terms I'd focus on, as well as just guiding them generally in terms of what this really means and entails.
Q: How can creators protect their intellectual property at festivals such as TIFF?
CH: As we've been talking about, having a properly drafted and negotiated contract with the proper protections built-in by a legal representative is important. What are the filmmaker’s reserved rights? These rights stay with the person for future opportunities and protect other elements of the IP, giving creators control to make decisions such as adapting the property into a game or a theme park. Again, there are all kinds of rights that don't necessarily need to be given to a distributor who may not even be in that business.
As above, meaningful consultation is critical. The project is near and dear to the filmmaker’s heart, so they want a hand in how those rights are exploited and distributed. Are they going to follow the envisioned creative direction? A right to consult on the project is a method to retain some control over the IP.
Q: What about the legal implications or considerations of using AI in this kind of arena?
DS: Notwithstanding the restrictions that unions and guilds outline in their collective agreements in terms of what can and cannot be done with respect to AI for certain talent, our advice and how we help navigate really depends on who we're representing.
In most cases, it’s production companies that produce feature films or TV series. We're bound by union guild collective agreements but we look to expand some rights as much as possible, keeping in mind the best interests of the production. In the production itself, perhaps AI will be used to age someone up or down. But we also look at its use in promotional and marketing materials, such as print ads, teasers, and trailers, or even future seasons when the talent has left the show or been killed off, and are unwilling to appear in flashbacks. The talent agent tries to limit as many rights as possible for the fee that you've agreed upon, but when representing the production company, we advocate expansive AI rights to ensure the producer can tell the story the way they need to.
If we're representing the talent, obviously we would have the opposite approach. We’d advocate to protect the name, image, and likeness rights generally of the individual and make sure they have approval rights over the portrayal of their character, especially when its artificial. If our client is unavailable to appear for marketing or promotional materials, the production company shouldn’t have unfettered rights to simply produce an artificial version of my client’s image. What if it shows the talent in a negative light, or they're perceived physically in a way they're not comfortable with? We want to keep a lid on some of those rights.
This is just this is the tip of the iceberg. AI is a hot topic and the rights and the discussion around those rights are ever changing and ever increasing. This conversation next year might be very different.
Q: How do international co-productions navigate Canadian content rules and incentives?
DS: Canadian content is a certification process for productions based on a list of parameters and criteria whether it's governed by the CRTC or CAVCO. If eligible to receive Canadian content certification, of the production would be entitled to access certain benefits.
Incentives include federal, provincial, and potentially, regional tax credits and additional incentives, as well as development funds and financial opportunities. They would also be competing in a much smaller group for certain broadcast and distribution rights because distributors and broadcasters in Canada have quotas to acquire, distribute, and exploit CanCon projects.
The only way that you can still be entitled to these benefits without satisfying applicable CanCon criteria would be in the case of treaty co-productions, which are governed by Telefilm Canada and the governing bodies for other treaty countries by way of memorandums of understanding. If you have a Canada-Mexico co-production, for example, there are certain thresholds that must be met on the Canadian side but not all. You're able to engage third-party talent outside of Canada (i.e. Mexico), you don't have to shoot in Canada, not all of your spend has to be Canadian. The percentages on each country’s side must be proportional throughout, so if the percentage is 60%/40% in favour of Canada, Canada has an obligation to commit 60% of the financing and incur 60% of the production spend. It's really a great opportunity to expand Canada's reach and global appeal while still being able to touch on and receive all of the benefits of it being Canadian content.
Q: Do you attend TIFF yourselves?
DS: Yes, it's a critical, and fun, part of our job. This was my 13th year in a row. It's extremely exciting and a great opportunity to see some of Canada's best work and most importantly to promote and support our clients’ projects. It’s a busy for us as entertainment lawyers because we need to be at the events, screenings and parties, but also have to be on deck if our clients’ films receive offers during the festival.
We had four films this year that we did production legals on: Nirvana The Band The Show The Movie, Mile End Kicks, Still Single, and Honey Bunch. Our firm was a sponsor for Honey Bunch’s after party which was a great way to celebrate with our clients. It was fantastic.
CH: This was my first TIFF in my capacity as an entertainment lawyer, having been a lawyer in L.A. and now practicing in Toronto. What amazed me most is seeing such talented people wearing multiple hats. They're selling. They're celebrating. They're taking in content from their peers, their mentors, and their inspiration. It's a whirlwind for all people involved.
Q: What advice would you give to first-time TIFF participants?
DS: It’s always best to engage an entertainment lawyer as early as possible on a project (i.e. development or pre-production). Things like chain of title are real time documents, tracking and linking intellectual property rights and ultimately tying it into the production company. Anyone that you hire — producers, executive producers, writers, directors, talent — these deals need to be papered. Unions and guilds, those relationships, those documents need to be done properly. Financing, interim financing, clearance, obtaining permits, locations, appearances; all need to be dealt with well in advance. Even if your film is fantastic, if it’s not done and you receive an offer, it will be contingent on you being able to deliver the film to that buyer; not just the technical specs, but the legal delivery is critical, sometimes several pages long of certain requirements. So get your legal ducks in a row is the best advice I can give.
My second piece of advice is patience. I find the tragedy in this industry at times is people do not take the same focus, priority, and care when it comes to the licensing or acquisition of their projects compared to the years they’ve taken to develop and produce it. They're so excited for an offer that they often jump at it, and are scared to negotiate for better terms in fear that the offer will be rescinded.
You make a movie for one main reason: for the world to see it. You must maintain that perspective throughout the process of negotiating the distribution/exploitation deals. You need the right entertainment lawyer to be your partner through this journey and guide you through this process.
Q: And finally, what advice would you give aspiring entertainment lawyers?
CH: Get out there, get experience, meet people, connect with the industry. The people who thrive in the legal entertainment space are the ones who are passionate about the industry, who care about what's going on. Read the trades, get involved, help people bring their projects to fruition and put them on screen. Really immerse yourself.
DS: Once you're in the industry, the standard important points of being a lawyer apply. Develop your book of business and focus on the craft itself; the negotiation, the drafting, all the legal skills. But getting into this industry, is very competitive because it's very desirable. A lot of lawyers want to practice entertainment law. You have to be resourceful and you have to be tenacious. You can't exactly Google “what is a day in the life of an entertainment lawyer.” If you're lucky, you have one course in law school that talks about it — and they miss 80% of what we do because it's just such a broad topic.
One cannot practice entertainment law without understanding the industry itself. As Corey mentioned, read the trades, go to as many events as you can, connect with people and learn about this business.
To learn more, visit the firm’s entertainment law group site.
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Dave Stern is a partner at Blaney McMurtry LLP. Dave provides creative and practical solutions for complex matters in the areas of Sports, Entertainment and Corporate/Commercial Law. In particular, Dave’s practice focuses on audio-visual production, distribution and exploitation (films, television series, digital media projects), brand licensing, influencer representation and commercial transactions. Dave also represents labels, bands, producers and artists in the negotiation of recording, management and publishing agreements. In addition, Dave is involved in establishing optimal corporate structuring for his clients.
Corey Hock is an associate at Blaney McMurtry LLP, developing his practice in the areas of Entertainment, Sports and Corporate & Commercial Law. Corey is a member of both the Law Society of Ontario and State Bar of California and provides strategic advice on a broad range of matters including, but not limited to, audio-visual production, distribution and exploitation (films, television series, digital media projects), intellectual property acquisitions, and above-the-line and below-the-line talent agreements.