The Barrow-Downs Discussion Forum - View Single Post

Sauron the White · 02-13-2008, 08:14 PM

This quibbling about I definegross versus expenses and how you define it is a matter of semantics. Gross, usually refers to every dollar taken in from day one. It allows nothing for deductions. The formula you cite allows for the costs to be deducted which is basically the same thing I explained in my post above. What you are calling GROSS is not the normal film definition of gross. But it looks like we are talking about revenues less expenses which is the important figure to determine what their 7.5% is.

In fact, by the formula you cite, basic production, marketting and distribution costs would easilly surpass $1 billion dollars.

Do you know how the contract defines or lists what you call "certain specified cost deductions"? That would seem to be all important here.

Do you really think that NL took in every penny of the $3 billion in box office receipts? Well over half of it was kept by the theaters in distribution costs. Add that to the $450 million in production costs and marketting costs and you have a tidy sum in legitimate expenses.

Consider just these three main items:
actual production cost of filming the three movies $300 million
marketting and advertising costs $150 million
cut of theaters to show the films 50 to 65% of box office revenue estimated at between $1.5 billion and almost $2 billion.
Those three figures alone add up to between $2 and 2.5 billion dollars.

You are saying that the contract allows that expense figure to be multipled by a figure of 2.6 before profits have to be shared?

And remember that the figure Jackson was using for revenue was $4 billion dollars. This Estate figure of $6 billion is a good $2 billion higher, thats 50% in addition to what the Jackson attorneys could document. Thats quite a difference not just in money but in the estimate of revenue.

I still think the amount we are talking about is more in line with 100 million or so. Unless the estate can prove their much higher revenue figures as the bas to begin calculating their percentage.
Even $100 million is a great deal of money. New Line should be ashamed for not having paid it already.

Okay - not a lawyer myself. Is not the purposes of damages to "be made whole"?
In this case, would not "whole" be what they should have gotten if the payments had been made?

As I said, I hope the Estate gets every penny legally due to it.

The idea of getting the rights taken away seems to be something that does not pass the smell test. It seems like a convenient excuse just to stop something they never liked in the first place - (Middle-earth movies which supplant the books in the minds of hundreds of millions of people) - but were powerless to change since JRRT himself sold those rights.

Can you cite a precedent where claims such as these were honored in a court of law and rights were stripped?

What would the Estate have to prove in court to get that type of award? And I am NOT speaking about the money but the stripping of rights from NL.

Isn't NL simply going to claim that they did not breach the contract but the differences are merely accounting differences?

02-13-2008, 08:14 PM	#32
Sauron the White Ghost Prince of Cardolan Join Date: Mar 2007 Posts: 903	This quibbling about I definegross versus expenses and how you define it is a matter of semantics. Gross, usually refers to every dollar taken in from day one. It allows nothing for deductions. The formula you cite allows for the costs to be deducted which is basically the same thing I explained in my post above. What you are calling GROSS is not the normal film definition of gross. But it looks like we are talking about revenues less expenses which is the important figure to determine what their 7.5% is. In fact, by the formula you cite, basic production, marketting and distribution costs would easilly surpass $1 billion dollars. Do you know how the contract defines or lists what you call "certain specified cost deductions"? That would seem to be all important here. Do you really think that NL took in every penny of the $3 billion in box office receipts? Well over half of it was kept by the theaters in distribution costs. Add that to the $450 million in production costs and marketting costs and you have a tidy sum in legitimate expenses. Consider just these three main items: actual production cost of filming the three movies $300 million marketting and advertising costs $150 million cut of theaters to show the films 50 to 65% of box office revenue estimated at between $1.5 billion and almost $2 billion. Those three figures alone add up to between $2 and 2.5 billion dollars. You are saying that the contract allows that expense figure to be multipled by a figure of 2.6 before profits have to be shared? And remember that the figure Jackson was using for revenue was $4 billion dollars. This Estate figure of $6 billion is a good $2 billion higher, thats 50% in addition to what the Jackson attorneys could document. Thats quite a difference not just in money but in the estimate of revenue. I still think the amount we are talking about is more in line with 100 million or so. Unless the estate can prove their much higher revenue figures as the bas to begin calculating their percentage. Even $100 million is a great deal of money. New Line should be ashamed for not having paid it already. Okay - not a lawyer myself. Is not the purposes of damages to "be made whole"? In this case, would not "whole" be what they should have gotten if the payments had been made? As I said, I hope the Estate gets every penny legally due to it. The idea of getting the rights taken away seems to be something that does not pass the smell test. It seems like a convenient excuse just to stop something they never liked in the first place - (Middle-earth movies which supplant the books in the minds of hundreds of millions of people) - but were powerless to change since JRRT himself sold those rights. Can you cite a precedent where claims such as these were honored in a court of law and rights were stripped? What would the Estate have to prove in court to get that type of award? And I am NOT speaking about the money but the stripping of rights from NL. Isn't NL simply going to claim that they did not breach the contract but the differences are merely accounting differences? Last edited by Sauron the White; 02-13-2008 at 08:28 PM.