Fair Use and E&O Insurance for Filmmakers - Part 1

Posted by Casey Budden on Oct 24, 2018 12:48:02 PM

 

shutterstock_233760787

 

FAIR GAME? - A FAIR USE PRIMER FOR DOCUMENTARY FILMMAKERS (Part 1)

“If I have seen further, it is by standing on the shoulders of giants.” –Isaac Newton

As a documentary filmmaker, you’ll likely need to make use of copyrighted materials at some point in your production. Indeed, it’s almost impossible to avoid: film clips, music and archival interviews are indispensable tools for lending depth, color and authority to your production. However, securing the rights to such materials can be difficult, prohibitively expensive and, most importantly, fraught with potential danger if the rights holders feel that their copyright has been infringed.

For example: you’re making a documentary about Hammer Horror films of the ‘50s and you use a short clip of Christopher Lee baring his fangs. You haven’t obtained permission. Will you be sued?

The legal doctrine of Fair Use permits creators a degree of freedom to incorporate copyrighted works of others into a new creative work. The law recognizes that the rights of copyright holders to enjoy the profits of their creations must be balanced with the rights of creators to enjoy freedom of expression and build upon past works in the creation of their own.

The problem that can sometimes occur is that it can be very difficult to define what constitutes fair use, and rights holders can be aggressive in defending their copyright.

Navigating fair use can be a challenging proposition. It is particularly important to the documentary filmmaker due to the fact that documentarians usually need to use more copyrighted material than, say, the director of a period piece.

There are two important things that you can do as a documentary filmmaker to keep your production safe: understand Fair Use, and purchase Errors & Omissions Insurance. The first will help you avoid being sued; the second will help protect you if you are.

Understanding Fair Use

You want to use a short clip of music or film in your documentary. You might have a limited budget. Traditional wisdom dictates that every piece of copyrighted material needs to be cleared and paid for, but this may not be the case if you can argue that your use of the clip in question constitutes Fair Use. How do judges determine if the use of a given clip is Fair Use in any given situation? The following criteria are considered.

  • What purpose the material is used for. Courts generally hold that a use of copyrighted material which is “transformative” meets the criteria to be considered Fair Use. “Transformative” means that the material is made part of a new creative work, for a purpose and context which are different than the original.
  • The nature of the source material. Factual, non-fiction source material which was created for an academic or educational purpose, with the intention of being strictly informative in nature, is less likely to give rise to a copyright claim if it is presented appropriately.
  • How much of the source material was used. The more of the original work is used, the more likely a lawsuit becomes. For example, musicians are more likely to encounter a problem using a lengthy musical phrase copied from a prior artist than they would be using a single breakbeat or horn blast which may no longer be recognizable as part of a prior creative work.
  • How the use of the source material impacts its value. If the rights holder can argue that their profits, potential profits or the integrity of their brand have been impaired by another’s use of their material, it may provide grounds for litigation. For example, a documentarian making a film about Miles Davis might get away with showing a brief clip of Miles playing, but reproducing an entire 15-minute live performance of him is likely going to attract a lawsuit.

 

Armed with this information, you might think that these rules are just common sense, and with an abundance of caution a prudent filmmaker might be able to avoid the possibility of a lawsuit. However, the reality is not so simple. The second part of this article will discuss some common fair use misconceptions.

Tags: E&O Insurance for producers, producers errors and omissions quote, media liability insurance policy, Digital E&O insurance, Fair Use for Documentaries

Distributor's Errors and Omissions (E&O) insurance

Posted by David Hamilton on Sep 26, 2012 6:33:00 PM

Much like the producer's E&O insurance, distributor's Errors and Omissions (E&O) insurance covers  distributors from lawsuits that may arise due to the content of the material they are distributing.

Distributor's E&O insurance differs  from Producer's E&O in that distributors are insured for a list of titles they are distributing. In order to add a production to a distributors E&O policy a minimum of one year of E&O policy needs to have been in force. For each film that you distribute, you will need to ask for evidence of previous e&o coverage.

The premium is determined by the estimated annual revenue that is expect from the list of titles to be insured. A deposit premium is paid and then the deposit is adjusted at the end of the policy year based on actual distribution revenue. A distributors policy is typically much less expensive as compared to extending individual e&o policies. The adjustment rate is usually 10 cents per $1000 of revenue.

To get a quote, we will need to have an application completed and we will need a list of the titles to be covered. Would you like me to send you a copy of a blank application?

WHY E&O POLICIES ARE NEEDED?

  1. Ie. The script of your movie/show is slightly similar to another production, therefore a claim for plagiarism could arise.
  2. Covers the insured against defamation, libel and slander suits
  3. Covers against intellectual property rights
  4. Typically most distributors and broadcasters will not distribute or air any production without it.
  5. It protects a company or individual from financial loss.

 

TYPICAL E&O CLAIM SCENARIOS

  • An action brought against a production company for the production of a movie which is similar to events depicted in a novel.
  • A defamation/slander suit brought against a production company based on a recognizable likeness  between a fictional character in a tv series and an actual person.
  • A production company is sued for unauthorized use of Titles and/or Music/Stock Footage, for not acknowledging underlying works such as books, scripts of screenplays or for not requesting permission to acquire rights

Tags: Commercial Production Insurance, Documentary Insurance, Film Production Insurance, Production Insurance, Producers Errors & Omissions Liability Insurance, Producers E&O Insurance, E&O insurance for Films, E&O Insurance, Digital E&O insurance, Producers Errors and Omissions Insurance, Film Production Insurance claims, Script Clearance reports, Title reports, Front Row Insurance Brokers, TV and Film Producers E&O Insurance cost, Canada Film Broker, E&O

Film Insurance: E&O Claims Made Policies Vs. Occurrence Policies

Posted by Mike Groner on Jul 10, 2012 4:31:00 PM

CLAIMS MADE E&O POLICIES

Claims Made E&O Policies cover claims that are made during the policy term. The loss may have occurred in the past, but as long as it is reported during the current policy term, it can trigger coverage. In order for coverage to continue, the policy must stay in force.

With this type of policy, endorsements can be made so that the policy responds to incidents which occurred before the policy start date, also known as “Prior Acts” coverage. Tail Coverage is another  extension that can be obtained wherein the insurer will cover events that occur while the policy is in force, but which the insured is unaware of during the policy period, and are reported to the insurer after the policy terminates. By obtaining tail end coverage, the claims based policy is in effect converted to an occurrence policy.

 

Pro’s of a Claims Made E&O Policy

A benefit of this type of policy is that if a claim arises relating to incidents which occurred before the policy start date, the claim may be covered. Another reason why this type of E&O policy is purchased is because it is less expensive than occurrence based policies. Typically the premium increases over the first five years of coverage in increments proportional to the claims reporting for that experience.

 

Con’s of a Claims Made E&O Policy

Once a “claims-made” policy has expired, purchasing insurance for past events will become difficult, expensive and perhaps not possible. Once coverage has expired, claims can no longer be submitted, even if the claim occurred during the policy term.

 

OCCURRENCE BASED E&O POLICIES

Occurrence based E&O policies cover losses that occur during the policy term as long as the project/film is released or broadcast during the dates at which an incident causing damage occurs. Although the loss can be reported years later, it must have “occurred” during the policy term. This type of E&O policy may  not cover occurrences that happened prior to the policy being in force.

 

Pro’s of an Occurrence Based E&O Policy

A benefit of this type of policy is that there is no need to renew the policy to maintain coverage. Also, years after this type of policy has lapsed, a claim can be made for incidents that occurred while the policy was in force.

 

Con’s of an Occurrence Based E&O Policy

This type of E&O policy is typically more expensive than claims based policies because the insured is prepaying for tail costs whether the tail gets used or not. Another disadvantage is that if a claim arises before delivery to the broadcaster or distributor, any defense costs associated with the claim may not be covered. It’s important to speak with your broker about whether Prior Acts coverage is included on your Occurrence Based Policy.

 

WHY E&O POLICIES ARE NEEDED?

  1. Ie. The script of your movie/show is slightly similar to another production, therefore a claim for plagiarism could arise.
  2. Covers the insured against defamation, libel and slander suits
  3. Covers against intellectual property rights
  4. Typically most distributors and broadcasters will not distribute or air any production without it.
  5. It protects a company or individual from financial loss.

 

TYPICAL E&O CLAIM SCENARIOS

  • An action brought against a production company for the production of a movie which is similar to events depicted in a novel.
  • A defamation/slander suit brought against a production company based on a recognisable likeness  between a fictional character in a tv series and an actual person.
  • A production company is sued for unauthorized use of Titles and/or Music/Stock Footage, for not acknowledging underlying works such as books, scripts of screenplays or for not requesting permission to acquire rights.

 

WHAT CAN AFFECT THE COST OF AN E&O POLICY?

  • Whether an attorney’s services were used to secure clearances and licenses
  • The coverage limits
  • Coverage Territory
  • Type of distribution
  • Type of production ie. Documentary, TV Series
  • Subject matter of production
  • Production Budget
Contact Front Row Insurance Brokers to learn more about Film Errors & Omissions Insurance coverage.  

Tags: Short Film Production Insurance, Film Insurance, Production Insurance, Entertainment Insurance, Film insurance broker, Entertainment Insurance Broker, Film Production Insurance claims, Film Production Insurance Premiums, Film Production, E&O insurance for Films, E&O Insurance, Errors and Omissions coverage for films, Multimendia Risk, Multimedia Risk Insurance, Film Insurance claims, TV and Film Producers E&O Insurance cost, E&O, DICE Policy, Digital E&O insurance, Title reports, Front Row Insurance Brokers, Producers Errors & Omissions Liability Insurance, Producers E&O Insurance, Producers Errors and Omissions Insurance, DICE Insurance, Front Row

Film E&O Insurance Clearance Procedures for Producers - Part 1 of 3

Posted by David Hamilton on May 24, 2010 12:13:00 PM

Good film E&O insurance - otherwise known as multimedia E&O -  clearance procedures will result in the lowest possible premium and the simplest claims settlement in the event of a loss.

shutterstock_112856104

Producers E&O insurance covers: invasion of privacy, infringement of copyright, libel, slander, defamation, plagiarism.

The Clearance Procedures below should not be construed as exhaustive and they do not cover all situations which may arise in any particular circumstance or any particular production.

  1. Applicant and its counsel should continually monitor the production at all stages, from inception through final cut, with a view to eliminating material which could give rise to a claim.
  2. The script should be read prior to commencement of production to eliminate matter which is defamatory, invades privacy or is otherwise potentially actionable.
  3. Unless the work is an unpublished original not based on any other work, a copyright report must be obtained. Both domestic and foreign copyrights and renewal rights should be checked. If a completed film is being acquired, a similar review should be made of copyright and renewals on any copyrighted underlying property.
  4. If the script is an unpublished original, the origins of the work should be ascertained - basic idea, sequence of events and characters. It should be ascertained if submissions of any similar properties have been received by the applicant and, if so, the circumstances as to why the submitting party may not claim theft or infringement should be described in detail.
  5. Prior to final title selection, a Title Report must be obtained.
Part 2 to follow soon!
Producers' Errors and Omissions Insurance  Learn More

Tags: Film Production Insurance, Film Insurance, Entertainment Insurance Broker, E&O insurance for Films, E&O Insurance, Errors and Omissions coverage for films, Digital E&O insurance, Title reports

Multimedia Risk Insurance Explained

Posted by David Hamilton on Jan 25, 2010 3:47:00 PM

Otherwise known as Producers Errors and Omissions Insurance, Multimedia Risk Insurance covers legal liability and defense for the production company  against lawsuits alleging unauthorized use of titles, formats, ideas, characters, plots, plagiarism, unfair competition or privacy, breach of contract. It also protects against alleged libel, slander, defamation of character or invasion of privacy. This coverage will usually be required by a distributor prior to the release of any theatrical or television production.

If coverage is required for the title, you must obtain a ‘Title Report & Opinion' from a recognised Film Title Clearance Company offering this service and submit the report to underwriters for final approval.

Premium indications prior to actual quotes when coverage is offered can vary; However a straight forward documentary would cost $5,000 and $7,000 for a feature film.

Upon instructions from the Production Company, the broker will begin clearance procedures where the attorney for the underwriter will review and approve your lawyers clear the project - there is a fee for this service which is included in the final premium. If coverage is not bound, the fee is payable to the attorney for the underwriter and an invoice will be issued accordingly.

You should check your production/distribution/financing agreements regarding the start date for Errors & Omissions coverage. Some financiers require Errors & Omissions coverage to be in place for the first day of principle photography.

It can take up to ten (10) working days for a project to be cleared and coverage to be in place.

 

Go to our website for more information: http://www.frontrowinsurance.com/

Tags: Producers Errors & Omissions Liability Insurance, Producers E&O Insurance, E&O insurance for Films, E&O Insurance, Digital E&O insurance, HD E&O, Errors and Omissions coverage for films, Multimendia Risk, Multimedia Risk Insurance, Producers Errors and Omissions Insurance

Film Production Coverages Explained - Part 4

Posted by David Hamilton on Dec 15, 2009 3:42:00 PM

Producers Errors and Omissions liability insurance is an important coverage for any film producer. Producers E&O covers against all sums that the insured may become legally obligated to pay as damages resulting from lawsuits for:

  • a) Invasion or infringement of privacy. Does a character in your script inadvertantly resemble a real person?
  • b) Infringement of copyright or trademark
  • c) Libel, slander or other forms of defamation
  • d) Plagiarism, piracy or unfair competition resulting from the alleged use of titles, formats, ideas, characters, plots, performances of artists or performers or other material
  • e) Breach of contract, implied or in fact or in law, resulting from the alleged submission, acquisition or use of program, musical or literary material used by the insured in the insured production
  • Policy includes coverage for legal expenditures incurred in the defense of any claim

Most broadcasters, distributors and sales agents will need to see evidence of e&o coverage in force for your project before they will enter into a contract with you. Distributors and broadcasters can typically be added to your E&O policy at no charge and evidence that they have been added can be evidenced by way of a certificate.

 The typical term of the policy is 3-5 years and the typical limit of coverage is: $1,000,000 per occurence, $3,000,000 in the aggregate with a $10,000 deductible

More film production insurance explained next post.

Tags: DICE Policy, Annual Film Insuruance, Documentary Insurance, Film Insurance, Film Production Insurance, Production Insurance, Producers Errors & Omissions Liability Insurance, Producers E&O Insurance, E&O insurance for Films, E&O Insurance, Digital E&O insurance, HD E&O

Recent Posts

Posts by Topic

see all