Entertainment Industry Contracts and Sky-High Salaries Require a Skilled Attorney
Because of the variety of different ways entertainment companies pay actors, contracts for entertainers can be complex works. Many of the biggest payments to television and film stars, for example, are on the back end, through residuals or royalties, and contracts need to stipulate the percentage an actor might be paid for shows that are airing in syndication or on a streaming service such as Netflix or Hulu.
And when it comes to how much money can be made in royalties, it all comes down to the contract.
TV Stars Can Make Bank, or Not, Depending on the Contract
For example, the stars of the hit sitcom “Friends,” which ran for 10 seasons, negotiated initial salaries of just more than $22,000 per episode the first season and $1 million per episode in the last two seasons.
But that’s not where their biggest money was actually made.
Running in syndication since the show ended its run-on NBC in 2004, the show’s six stars—Jennifer Aniston, Matthew Perry, Matt LeBlanc, Courteney Cox, David Schwimmer, and Lisa Kudrow—negotiated healthy residual payments of $20 million a year, each being paid two percent of the $1 billion Warner Bros. earns annually.
On the other hand, stars of some of the most popular shows to air on television, such as “Seinfeld” and “Gilligan’s Island,” often receive little or no royalties from syndication earnings because it wasn’t stipulated in their contracts.
Show creators, however, usually continue to make millions, decades after a show ends, because of contract stipulations.
Jerry Seinfeld and Larry David, co-creators of the sitcom “Seinfeld,” make millions in royalties each year, while Seinfeld’s co-stars, Julia Louis-Dreyfus, Jason Alexander, and Michael Richards, did not negotiate contracts giving them a stake in the show, so their royalty checks don’t come close to matching that hefty sum.
Movies Can Also Be Long-Run Lucrative
Contracts can totally determine how much money a movie actor makes, and smart movie leads will negotiate contracts that provide royalties. Some actors will even take a cut in salary, banking on the success of his or her movie.
In 1994, Tom Hanks starred in the movie “Forrest Gump,” and he had a hunch the movie was going to be a blockbuster. Hanks agreed to star in the movie for a paltry $7 million, but the contract he negotiated included part of the film’s box office take.
He ended up earning $60 million for the movie, according to the magazine Entertainment Weekly.
Hanks’ ultimate salary was the result of smart contract negotiations, which required the work of a savvy attorney with experience in entertainment industry contracts.
Are you in Search of an Entertainment Industry Contracts Attorney?
Contact the law office of Rowena Nelson, LLC. She and her team of skilled attorneys can handle entertainment industry contracts and can be reached via email at [email protected] or by calling (301)-358-3271 for a consultation.
Located in Upper Marlboro, Maryland, Rowena N. Nelson’s offices serve the entire state of Maryland.