Q: How binding is a letter of intent? Nearly eight years ago, I signed a one-paragraph agreement in which I allowed a producer to attach himself to my original screenplay and shop it around. He found no takers and hasn’t submitted the script anywhere for at least five years. Now I’m thinking of reviving the project, but would prefer to do so without the producer’s involvement. Do I have any further legal or moral obligation to him? I would like to add that no money exchanged hands; the producer never actually optioned or bought my screenplay.
A: A true letter of intent is as binging as your To Do list, or at least it should be. You intend to do the things on your To Do list, but if you don’t do them you won’t get sued. The only way a letter of intent is legally binding is if it’s not truly a letter of intent. It’s not what you call something, it’s what it is. You can have a piece of paper called a letter of intent that actually contains a binding agreement or you can have something called a binding agreement that actually contains no agreement at all but just a list of non-binding things the parties intend. It seems like you have something called a letter of intent which actually contains your agreement to attach a producer to your screenplay.
“Attach” or “Attachment” are terms of art that everyone uses but nobody knows the details. If a producer is “attached” to your screenplay, is it for a year, 10 years, perpetuity? What if you die before perpetuity arrives, is the producer still attached? Even if the producer does nothing with the script? What if the producer finds a buyer, you’re happy with your deal, but the producer is about to lose one of his many mansions and wants half the budget of the movie as his fee? Can the producer kill your deal? So when you “attach” a producer to your screenplay, and no other details are flushed out, neither you nor the producer nor I nor anyone knows what it actually means. That’s why typically the attachment agreement will specify the details: how long, what happens if there is a buyer but the producer or you can’t work out a deal, what if the producer steals your girlfriend, and so on.
It’s hard to have an enforceable agreement if the terms of it are clearly and hopelessly ambiguous. For example, let’s say that instead of “attaching” the producer you agreed to “schmattach” him. Now you decide to go ahead without him. He takes you to court and says, “Your Honor, I was supposed to be ‘schmattached’ to this screenplay.” The judge might “schmattach” him pretty bad.
But forget courts and judges. All producers fall into one of two categories: very litigious and spectacularly litigious (the third category is mentioned below). Producers tend to get really attached to projects, especially if after 8 years someone suddenly comes up with cash for them. So let’s say a studio wants to make your script. Assuming the producer falls into one of the two categories above, here’s what he might do. He’ll jump out of the woodwork and scream bloody murder. He’ll claim he’s attached to this project forever, and (get ready for this) he’ll say he owns parts of the script because he worked with you on it for years. The beginning, middle, and end (and characters) are really his, the rest — pagination and punctuation — is half his and half yours. Hidden behind the producer’s obnoxious, profane screaming are two legal claims: breach of contract (i.e., his “dis-attachment”) and copyright infringement (i.e., he owns parts of the script).
Assuming his claims are somewhat less than entirely 100% genuine, you could take this case to the Supreme Court and win 5-4. But you don’t have the time and money to finance litigation to prove obvious points, and more important, the studio will not go forward knowing there is a claim (especially the copyright claim). So the studio will either drop the project or will try to work something out with the producer. In some cases, if a producer is a big nobody and his claims are demonstrably delusional and inconsistent with the laws of physics, the studio will tell him to get lost (often, they will use more formal legal terminology).
Now, your producer can be the kindest, nicest, “turn-the-other-cheek” man in Hollywood. He may be spending weekends working at a soup kitchen, giving half of his income to charity, and letting local homeless men use his steam shower. Most producers are just like this, so chances are good that your producer is like this, too. This kind of producer is only moderately litigious, and you’ll only have a moral obligation to him. Let’s be honest, nobody takes moral obligations seriously anymore.
But in the unlikely event that your producer is less of a saint, he may do what I described above. In many ways, that’s why producers “attach” themselves to as many projects as they can (sometimes twice to the same project because they forgot they had already attached themselves earlier). They may not have a great legal leg to stand on, but they have a loud foul mouth to fall back on.
This blog was originally published as part of Legal Ease, Film Independent’s weekly column on legal matters pertaining to the entertainment industry. To see other LEGAL EASE columns please click here.