Real life tales of (in)famous royalty accounting
Story #1: Kevin Smith vs. Miramax
This started with me trying to run down a rumor I’d heard that Matt Damon and Ben Affleck weren’t paid any backend royalties for Good Will Hunting. Instead I found this juicy story from Kevin Smith’s recent press tour for a new documentary about his life, featuring the very same villain. As quoted in an interview with Variety…
This much I know. They bought “Clerks” for $227,000. And the movie went out and made $3 million at the box office and stuff. And it took seven years for us to see any profit from that movie. For seven years, they were like: “Nope, the movie is still not in profit.” And we were like “How?” And then there were things.”
“Clerks” was financed with credit cards that Kevin Smith assumed he would never be able to pay back — he just wanted to make his movie. So the $227k was an advance to Smith that (presumably) paid down that debt, and the rest of the costs were just distribution, pr/marketing, and manufacturing (highly profitable) VHS tapes. So what “things” kept the movie from recouping? Well…
We all went to Cannes. There were four movies that Miramax took to the Cannes Film Festival in 1994 — “Fresh,” “The Picture Bride,” “Clerks” and “Pulp Fiction.” Miramax didn’t get “Clerks” in. We were in the International Critics Week section, which we actually won. I get flown over by the festival. I was given a free hotel room from the festival. This is a long way of saying Miramax didn’t have to pay for anything. There was a yacht, the Miramax yacht, it was called. That’s where all the stars were. We hung out on it, hung out with Quentin [Tarantino] after he won his Palme d’Or and stuff. But that yacht wasn’t for us. When the festival was over, we got the financial statement. They had taken the entire Cannes bill, everything they spent in Cannes, and just chopped it up into four and “Clerks” was charged as much as “Pulp Fiction.” So we all paid an equal share.
At least they got a statement! Now, I don’t have much experience equitably chopping up the cost of a yacht in Cannes. And I can understand that figuring out how many drinks Quentin Tarantino had vs. how many Kevin Smith had and billing back their respective films accordingly might be overkill. But given Mirimax didn’t actually pay for anything Clerks-specific or even get them in to the festival, I think it’s safe to say this is some serious bullshit.
Years later auditors agreed, but not before Kevin Smith showed how power dynamics invariably work to keep artists from getting paid properly…
I remember John Sloss, my lawyer, being like, “This is nuts. We have to audit them.” And I said, “No, I can’t audit people I’m in business with. That’s gross.” And we never audited them for years until after “Clerks 2.” And then we audited them years later and got a bunch of money. If I was a better business person, I would have gone for more money. But it felt like — “Oh, there it is. That’s their process. Movie math.” And, to be fair, I worked at studios and they have way more paperwork and you can see where every dime is going. But the nature of this business is everybody wants to keep as much money as they possibly can.
The resistance to “rocking the boat” of a working relationship, especially regarding the financial stuff, is very real. The stigma associated with demanding money, even if it’s rightfully yours, is sadly real. The people who control the purse strings would do well to be open and honest about how the money is breaking down, so they can build positive and productive relationships (and so they don’t get exposed down the line). In other words, be more Jay than Silent Bob.