Why You Should Always Enter Into A Collaboration Agreement

I can't tell you how many times I've seen someone in a legal mess because they didn't enter into a collaboration agreement before starting their project. This information isn't new, but it s so often overlooked that I feel it's worth covering again.   Hopefully the information below will resonate with you so that moving forward you can avoid often costly mistakes. The most important thing to be taken away from this article is the following:

When collaborating with someone on a project (e.g., a script, book, song, etc.), always have an experienced entertainment lawyer craft a written collaboration agreement which all parties sign before any work on the collaboration begins!

Just taking this simple suggestion can save you a ton of potential headaches throughout your career. Don't delay.

What Is A Collaboration Agreement?

Briefly, a collaboration agreement is a contract entered into that spells out the specific terms and conditions of the parties working relationship, including, the disposition of the completed work, allocation of responsibilities and division of revenues derived from the exploitation of the work. Simply stated, the collaboration agreement clarifies the nature and scope of the relationship, including the ownership, business and creative controls over the work that's jointly created. Think of it as a prenuptial agreement for creative collaborators, because just like marriages, unfortunately many collaborations end in separation, if not outright divorce.

The provisions of a collaboration agreement typically cover things like:

  • Ownership Percentages In The Work (e.g., Is It 50%/50% Or Some Other Allocation?)
  • Specific Responsibilities Of Each Collaborator
  • How Are Monies Received In Connection With The Work Disseminated? (e.g., In What Percentages?, How Are The Collaborators Expenses Dealt With?, etc.)
  • What Happens If One Collaborator Withdraws For Any Reason? (e.g., Can The Other One Continue Working To Finish The Project?, May The Remaining Writer Bring On Another Collaborator?, How Are The Ownership Percentages Revised As A Result?, etc.)
  • How Will The Collaborators Be Credited In Connection With The Work?
  • Are The Collaborators Members Of Any Applicable Guild/Union?
  • What Happens If The Parties Have A Disagreement? (e.g., How Are Disputes Resolved?, Will There Be A Third Party Who Resolves Them?, If So, Who Is He/She Or How Will He/She Be Selected?, etc.)
  • How May Rights In The Project Be Disposed Of? (e.g., Does This Require A Unanimous Decision?, May Either Party Dispose Of Their Own Rights Or Even All Rights?, If A Collaborator Wants To Dispose Of His/Her Interest, Does The Other Collaborator Have The Right To Block The Sale (Or A Right Of First / Last Refusal)?, Is Any Third Party Authorized To Dispose Of Rights On The Collaborators Behalf?, etc.)

Without a signed collaboration agreement in place, questions may be raised about the ownership and control of the work, as well as the ability to dispose of any rights in the work. It is also vital in determining what happens in the event that the collaborators separate for any reason.


Forms of Collaboration

Collaborations can take many forms, even ones that you may not intend. The two most common forms of collaboration I see are:

  • Two People Intentionally Collaborate From The Beginning Of A Project This is exactly what it sounds like. You and another writer come together to create a single collaborative work and the presumption (in the absence of a collaboration agreement to the contrary) is generally that 50% of the work is owned by each of you and that both of you will share equally in any revenues from the project. This is all well and good, assuming both parties share the same expectations about each facet of the project. However, once there's a disagreement, a standstill or one collaborator wants to walk away for any reason, problems begin, often leading to a stalemate which freezes the project indefinitely. At that stage, unless both parties can find a way to reach an agreement with respect to each other's rights and obligations going forward, there is often no way to proceed effectively to finish or exploit the work.
  • A Solo Writer Inadvertently Lets Someone Become A Collaborator In Their Project

This can happen in a variety of ways.   Letting a friend casually contribute notes/suggestions/additions/alterations, etc. to your work can create a collaboration.   Incorporating a producer s (or other third party s) notes when conducting a rewrite can create a collaboration.

As just one common example of how this may play out, let's say a producer is interested in your screenplay. The producer may say that they want to see a rewrite from you before deciding how they want to proceed, and, to shape the project more to their liking, the producer contributes notes/suggestions/additions/alterations to your script. Once you incorporate those notes, you have inadvertently given that producer a rights interest in your project.

Now, even if that producer elects not to option or purchase your script (or if they option it but don't ever exercise their option), technically that producer still has rights in your material, since you incorporated and expressed their ideas in your work. There's now the potential that if you want to option/sell your script elsewhere, this producer may fly in (often out of nowhere once they get wind of your impending deal) and demand to be compensated for their work and/or involved in the project somehow.

Whatever the case, once someone's intellectual property finds its way into your work, that collaborator has an argument that they have an ownership interest in your project. This dilutes your absolute interest in your own work and can potentially inhibit your project from ever seeing the light of day. If a third party is excited by your work and anxious to make a deal with you, it can be problematic (and potentially expensive) to have to seek out a signed document from your collaborator granting you all of their rights. It's also unlikely that the excited third party will wait around while you sort things out and negotiate with your collaborator. Without the ability to grant 100% of the rights in your project to a third party, you may have great difficulty finding anyone willing to offer you a deal.

What Can Go Wrong If You Don't Have A Collaboration Agreement In Place?

Without a signed collaboration agreement in place, all of your efforts may be lost down the road if you re unable to come to a resolution with your collaborator and your project is stuck in limbo. Your collaborator may have the ability to veto any of your decisions, since by default, sharing equal control means decisions about the work must be unanimous. There's even the potential that the project may end up involved in a litigation if you or your collaborator wish to salvage it. In any case, the time and money spent up front to sign a collaboration agreement which addresses and provides ways to avoid these issues is almost always a preferable alternative.

To avoid the majority of issues that may arise among you and your collaborator, it's a great idea to sit down at the beginning and negotiate all of the terms of your collaboration agreement. This will force you to discuss each element of your working relationship and to make sure that if there are any differences in your expectations, you are aware of them before the collaboration starts. If for any reason you are unable to reach a resolution on any facet of your relationship, you can step back and rethink working together before any work is done. This saves you wasting a lot of time and energy working on a project with someone only to learn much later that there are differences of opinions as to how things should proceed. Once tempers flare over disagreements, it becomes exponentially harder to reach a resolution on any matter.

For the record, there are places online or in books where you can find forms or sample collaboration agreements. I strongly recommend you avoid using them. Each project has its own set of circumstances which can lead to different terms and arrangements. An experienced entertainment lawyer should be able to assess the issues between you and your collaborator(s) and, in a relatively short period of time, craft an agreement that spells out each party's expectations and obligations. The cost for the guidance of such an attorney is a small price when compared with the potential costs (financially and emotionally) that might arise from your project being blocked from proceeding, whether as a result of an informal disagreement or costly litigation.

Once a well-crafted collaboration agreement is in place, you can freely proceed on your collaboration with a clear conscience, knowing that if for some reason things go awry, there is a mechanism in place to sort things out and permit you to part ways in a reasonable manner. This should save you any time second guessing what your collaborator is thinking or expecting.

If you would like further information on collaboration agreements or would like someone to prepare one for you, please feel free to contact me at any time. I wish you all the very best of luck for your ever-increasing success!

© 2009 Law Office of Jesse Rosenblatt, PLLC. All rights reserved. This article contains information of a general nature that is not intended to be legal advice and should not be considered or relied on as legal advice. Any reader of this article who has legal matters involving information addressed in this article should consult with an experienced entertainment attorney.   This article does not create an attorney-client relationship with any reader of this article. Law Office of Jesse Rosenblatt, PLLC does not represent or warrant that this article contains information that is true or accurate in all respects or that is the most current or complete information on the subject matter covered.

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