What company setup is best?

G

ginomb

I'm finally done with the script, ready for preproduction and with hopes of starting to tape in the summer.
My question is, what's the best company setup if the budget is close to 500 dollars and I'm in fear of getting sued.
I live in Seattle. I've read all sorts of recommendations, from going the S-Corporation and LLC way to forming a non-profit organization.
But what's the best way for a 3 crew + 6 actors production with no budget and everyone working for meals and copy.
(what if I go non-profit and then someone wants to pick up the movie)
Thanks in advance for any advice.
 
Don’t go non-profit if you want to make money or intend to sell it. Why are you afraid of being sued? Besides the corporate veil is mighty thin in this case. Since you would be the only stock or unit holder and therefore the only officer of the company, then any decisions you make are the decision of the company, and if the company were to be found liable, then since it’s actions are a direct response to your actions, you are liable. The corporate veil protects unit and stock holders from the actions taken by the company or the management of that company. When you are the only stock holder, and the operating manager, it is not very hard for a suing agent to access your personal finances. Anyway, while a s-corp is fairly easy and cheap to set up, the state’s fees will almost exceed your minuscule $500 budget (in NC anyway). I wouldn’t set up any kind of company and just shoot the thing.
 
Facing the same exact thing. I have tried to find out and all I ever get is, "Call you an entertainment attourney!" If I had the money for one I would have a long time ago. I plan to shoot in about six Months myself and if you find anything out before I do, I would love to know what you hear. My concern with the first response you received is how are people like us protected (our work) if it is not "attached" to a Company of some kind. I want to enter our films in some festivals and maybe get some kind of a deal down the road, maybe, hopefuly, someday!!! I was under the impression that if you were a LLC then you as a person aren't accountable. However, that can't be true, because anyone can sue anyone for anything these days. I am more concerned about my work being credited to what I hope to have as a production Co. Long winded response I know. Rarely do I see, in these rooms, people asking these sort of questions and I am one of them. Good luck.
 
Incorporating doesn't mean you can't be sued! It just means that your personal assets cannot be touched.

You need production insurance. It runs about $700 for 12 days, or you can get a yearly policy for about $1500 - 2500.

It covers 1 million in liability, and your equipment.

Film Emporium sells the policies, and so do a lot of other places. PM me and I will give you my agents contact. He does not charge a policy fee, like some brokers do.
 
Good point. Film insurance is a better solution to this concern than incorporation. That way if anyone gets hurt of property is damaged, it’s covered, and suing becomes a moot point.

As far as ownership is concerned, the author of the script has initial ownership unless it was work-for-hire or transferred to a producer. Generally, the producer retains all copyright. When I shot my last short I didn’t set up a company, all contracts were between an individual or a company and myself, and they specified all work was work-for-hire in compliance with US copyright law. This way they have no claim on the work and I have sole copyright ownership. Therefore I’m the only one who can sell and/or profit from the work or authorize distribution in any fashion. And if anyone were to infringe on those rights, I have a certificate from the Library of Congress attesting to this fact so it’s fairly cut and dry if I had to sue them. Copyright is an asset just like any other and can be owned by an individual or a corporation (which is just a legal entity the same as an individual).

Now, as far as assigning that work to the credit of the production company, you can either sell the rights to the company, or (since I presume you’re a member) you can assign the company credit for personally owned works all you want since you are an integral component of the company. You own it, you can do whatever you want with it. I was part of a startup production company years ago, and our first demo reel consisted of the works of our management team. Since the company hadn’t produced anything, but we were selling the production skills of the component members, we had to demonstrate our skills. The company still lists those works on at the end of their credits list because the members assigned the company that right although they still retained copyright personally.

**please remember that I am not a lawyer and can not provide legal advice**
 
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