"Help, I need Errors & Omissions for my film. Why do I need it? How do I get it done?"
To answer these questions, I, the Good Witch...well, the Insurance Broker of the West, must guide a filmmaker down the Yellow Brick Road and into the Land of Oz to get the ultimate coverage.
As a documentary filmmaker, you might not enter a world of celebrity and glamour, but even if you only achieve a modicum of fame, there still is a public perception that a filmmaker has deep pockets. This perception is, of course, a disadvantage for documentarians as this means they are open to the probable lawsuits.
Errors & Omissions (E&O) protects filmmakers from lawsuits pertaining to theft of idea, copyright infringement, libel, slander, invasion of privacy, defamation, product disparagement, trade libel, infliction of emotional distress, right of publicity, outrage and outrageous conduct, false light, wrongful entry, false arrest or malicious prosecution. Basically, issues may arise from the content of the film or frivolous allegations. As an added bonus, this coverage will cover the attorney fess and legal costs in order for you to be vindicated.
Errors & Omissions is a requirement for distribution deals with studios, television, cable networks, DVD and Internet sites. These distributors of media require the filmmaker to protect them from claims that may result when the production is released. The distributors will outline the required licensing terms and limits in their agreements--for example, standard limits are $1,000,000 per claim/$3,000,000 aggregate with a deductible of $10,000.
Before you start down the Yellow Brick Road to obtain this coverage, the insurance companies expect some due diligence from every filmmaker. This means that the filmmaker must begin clearance work at the inception of the film, continue during filming and complete it at final cut. The following are some of the clearance procedures an insurance company recommends a filmmaker follow:
1) When utilizing underlying works such as book, scripts or screenplays, a copyright report should be obtained to make sure the chain of title of all works on which the production is based is thoroughly investigated and cleared back to the original copyright owners to determine that all grants or transfers in the chain of title permit you to assign or sub-license the material in your production.
2) Written agreements must exist between the producer, creators, authors, writers, performers and any other persons providing material.
3) Written releases must be obtained for faces and likenesses of any recognizable living persons. All releases must provide the producer with the rights to edit, modify, add to and/or delete material, change the sequence of events or of any questions posed and/or answers given and to fictionalize persons or events.
4) Musical rights must be obtained from the composer and/or performers of specially commissioned music and/or cleared with the owners of pre-existing music and/or recordings.
5) All licenses and consents must be obtained from the copyright owner and any person or entity depicted in the film clip and photographs. A documentary filmmaker will need to obtain permission from the copyright owner and permission from people being depicted in the film clip. If the Fair Use doctrine is to be utilized, a filmmaker must obtain a fair use opinion letter from an experienced clearance attorney.
To obtain coverage, the filmmaker has to complete an application. If all goes accordingly, you should have answers to all questions on the application, with the exception of the music and title report, since those elements usually occur in post-production. When submitting your completed application, the insurance company requires the following information:
1) Bio/résumé of the producer. This information helps to determine if the filmmaker has production experience.
2) Script, synopsis and occasionally a DVD of the production.
3) Title report. While a title cannot be copyrighted, there is a possibility that a similar title can cause possible litigation due to the confusion that it may cause in the media marketplace. To avoid possible litigation, the insurance company requires a title search be completed by a title search company. This company will check all types of media in the US Copyright Office and Library of Congress records to see if there are any similar uses in film, television, music, books, magazines and on the Internet. The report they produce can identify other films with the same title. The report enables the insurance company to determine if the title is clear for use.
Once the above materials are received, I must present my case to the Wizard...I mean Underwriter by:
- Relaying the intended distribution of the film (theatrical, direct-to-video, cable, TV).
- Touting the experience level of the filmmaker.
- Disclosing the nature of the production (fiction, docudrama, documentary).
- Pointing out that the filmmaker consulted an attorney to assist with clearance issues.
- Verifying that all the rights and releases have been obtained for living beings (names, likenesses, etc.), film clips, music and titles.
Please note that the process of securing Errors & Omissions takes at least three to five days to accomplish, and even longer if there are unresolved clearance issues, possible litigious issues and if music clearances have not been obtained.
After deliberation, a competitive Errors & Omissions quotation is presented by various insurance companies (Chubb, Hiscox, Axis and One Beacon). Once coverage has been dealt with, certificates of insurance are issued to various distributors.
Once the policy is in place, the filmmaker would be protected from lawsuits brought forth on his or her production. Unfortunately, due to our litigious society, lawsuits do surface against the filmmaker and the distributor. Upon notification of a lawsuit, the insurance company will assist in vindicating you and will assist you with defense costs. The following are examples of claim scenarios:
1) A screenwriter claims that a movie was copied from his original screenplay.
2) An individual files a defamation suit claiming he or she was portrayed in a bad light.
3) A corporation files a lawsuit for defamation.
4) The movie sparked an individual to commit murder.
5) A release was not obtained for artwork in the film.
6) A release was not obtained for music in the film.
Well, it looks like our journey to Oz has come to an end. Now then, click your heels three times and repeat after me, "There's No Place Like Home."
Winnie Wong is vice president at Momentous Insurance Brokerage, Inc.