Legal Question in Entertainment Law in Massachusetts
Royalties Continued...
I think in order to paint a clearer picture, I should let you know of a few things which may help you understand further the situation.
The team is a Professional Gaming Team to which we are members of (by contract). Even so, our contracts with the company have no indication on who gets what in the event of tv or promotional appearance involving payment. We had not signed contracts for the commercial in regards to the company. The only forms we had signed were with the production company. As well, the four of us all agree that we were told we were paying a finders fee, and I do have an e-mail stating it is 33% off of the original cheque. Here is a quote from an e-mail: ''In regards to the 33% due to (removed company name) it will obviously not be 33% of $1,900 as previously determined. It is now 33% of $1,308 (the amount with tax deductions applied), which amounts to $436 USD.''
We had all agreed to pay that amount. To reiterate, everything was done on a verbal basis, however we were told one thing (that the 33% is a Finder's Fee), and now we are being told it isn't a Finder's Fee (the company is calling it their royalties for the commercial and they are owed 100%).
The commercial took place in MA. The company is from PA.
2 Answers from Attorneys
Re: Royalties Continued...
The company is not entitled to 100% of the "royalties." This would be royalties related to your appearance in the commercial which is generally required under certain industry contracts. The company would not be entitled to the entire amount of such royalties unless there is a written agreement with respect to same.
If this is really a significant amount of money for the 4 of you, I suggest you contact an attorney. If we are talking about a few hundred dolars for each of you, you can file a small claims complaint against the company for up to $1,500 or $2,000 for each of you if they keep the royalties.
Good luck.
Re: Royalties Continued...
Based on the limited facts presented here, it would appear that you had a verbal contract with someone (it is not clear who) to pay 33% of some amount (it is not clear what) as a finder's fee.
To answer your previous questions, a verbal contract is enforceable, and you can be made to pay back the full amount of the finder's fee/royalties if a court were to determine that the contract was for 33% of all revenue, and not 33% of the first check only, as you claim. Whether your contract was for a one-time payment of 33% of some fixed amount or 33% of all revenue derived from the engagement is a question of fact, and standard industry practice here will be relevant to interpreting the understanding of the parties.
The amount of money in controversy here will likely determine whether the other party decides to take any legal action against you. If the amount in controversy is a good sum of money, you should speak to an attorney in your area to protect your interests.
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