Preparing a film production at DVinfo.net

Matthew Overstreet · November 9th, 2005, 02:34 PM

All right everyone, I have another question. When preparing an independent film production, what is the best business layout?

I know that you should open a new LLC for every film you produce. The thing I'm wondering is, how is it that companies such as View Askew, Happy-Madison, and Cappra produce film after film under the same name? Do they open a new LLC for each film and just keep the same name? Or, do they form an initial production company to work under at all times, and then form new companies for each production; so that in effect, there would be two companies working on the same production . . . is that clear enough? Anyway, could someone clarify this for me.

Jipsi Kinnear · November 9th, 2005, 06:00 PM

A Limited Liability Corp. (LLC) is just as it sounds. It reduces the productions "liability" in the event of something bad happening. An example would be a stunt or fx shot going awry with horrible results. The idea of an LLC is to protect the parent corp. So when a studio like Fox shoots a tv series such as the X-files in Canada they do so under the protection of their LLC. Of course this is just a vague desricption of one of many possible scenarios. So to answer your question best, I would say YES, you should form a new LLC for every production you and/or your company undertakes. For your protection as well as investors and such.

Jipsi K.

Matthew Overstreet · November 9th, 2005, 11:50 PM

Thanks for the reply, but I'm already quite familiar with what an LLC actually is. What I'm wondering is . . . if I were to start a production company today (theoretically), and wanted to shoot a film starting immedietly, would I have to open TWO businesses? One for the production company, one for the film?

Brian Duke · November 10th, 2005, 12:24 AM

Quote:

Originally Posted by Matthew Overstreet

Thanks for the reply, but I'm already quite familiar with what an LLC actually is. What I'm wondering is . . . if I were to start a production company today (theoretically), and wanted to shoot a film starting immedietly, would I have to open TWO businesses? One for the production company, one for the film?

First, I would open a corporation. Second, I would have everyone sign a form waiver to limit your liability, similar to the one you sign when you join a gym. I don't know of any company that opens a new company every time they do a movie. Third, I would buy insurance for each movie and/or the company covering personal and property damage. Just like renting a car. hope that helps.

Bob Costa · November 10th, 2005, 07:22 AM

It depends on your funding. If you are bringing in different partners or investors for each production, then it should be it's own company, even if that company hires your production company to produce the film. Clear?

Luis Caffesse · November 10th, 2005, 07:33 AM

Quote:

Originally Posted by Brian Duke

I don't know of any company that opens a new company every time they do a movie.

It's a very common practice actually.

To answer the original post, yes, I think you would set up 2 companies.
Best to talk to a lawyer about these things, obviously, but I think Bob outlined it well. The first company would hire the second. Or, I know some people who finish the film and then sell it to their parent company.

Either way can work.

Matthew Overstreet · November 10th, 2005, 02:02 PM

Thank you for the information. That's exactly what I was trying to figure out.

Heath McKnight · November 13th, 2005, 11:54 PM

My company, MPS digital studios, inc., is a legal company. Every time I make a feature film, starting next year, a seperate company (whether it's an LLC or an s-corp) will be formed to produce each film. If there's a sequel, the same company will do so. Key thing is, you want investors in the film, not your main company. Talk to a lawyer, though.

My favorite production company name was Big Bug Pictures, which produced Starship Troopers for Sony and Disney in 1996.

heath

November 9th, 2005, 02:34 PM	#1
Matthew Overstreet Regular Crew Join Date: Dec 2004 Location: Whitman, Massachusetts Posts: 168	Preparing a film production All right everyone, I have another question. When preparing an independent film production, what is the best business layout? I know that you should open a new LLC for every film you produce. The thing I'm wondering is, how is it that companies such as View Askew, Happy-Madison, and Cappra produce film after film under the same name? Do they open a new LLC for each film and just keep the same name? Or, do they form an initial production company to work under at all times, and then form new companies for each production; so that in effect, there would be two companies working on the same production . . . is that clear enough? Anyway, could someone clarify this for me.

November 10th, 2005, 07:22 AM	#5
Bob Costa Major Player Join Date: Nov 2004 Location: Venice, FL Posts: 850	It depends on your funding. If you are bringing in different partners or investors for each production, then it should be it's own company, even if that company hires your production company to produce the film. Clear? __________________ You are either growing or dying.

November 13th, 2005, 11:54 PM	#8
Heath McKnight MPS Digital Studios Join Date: Apr 2003 Location: Palm Beach County, Florida Posts: 8,531	My company, MPS digital studios, inc., is a legal company. Every time I make a feature film, starting next year, a seperate company (whether it's an LLC or an s-corp) will be formed to produce each film. If there's a sequel, the same company will do so. Key thing is, you want investors in the film, not your main company. Talk to a lawyer, though. My favorite production company name was Big Bug Pictures, which produced Starship Troopers for Sony and Disney in 1996. heath __________________ My Final Cut Pro X blog

November 9th, 2005, 06:00 PM	#2
Jipsi Kinnear Regular Crew Join Date: Jul 2004 Location: Canada Posts: 108	A Limited Liability Corp. (LLC) is just as it sounds. It reduces the productions "liability" in the event of something bad happening. An example would be a stunt or fx shot going awry with horrible results. The idea of an LLC is to protect the parent corp. So when a studio like Fox shoots a tv series such as the X-files in Canada they do so under the protection of their LLC. Of course this is just a vague desricption of one of many possible scenarios. So to answer your question best, I would say YES, you should form a new LLC for every production you and/or your company undertakes. For your protection as well as investors and such. Jipsi K.

November 9th, 2005, 11:50 PM	#3
Matthew Overstreet Regular Crew Join Date: Dec 2004 Location: Whitman, Massachusetts Posts: 168	Thanks for the reply, but I'm already quite familiar with what an LLC actually is. What I'm wondering is . . . if I were to start a production company today (theoretically), and wanted to shoot a film starting immedietly, would I have to open TWO businesses? One for the production company, one for the film?

November 10th, 2005, 02:02 PM	#7
Matthew Overstreet Regular Crew Join Date: Dec 2004 Location: Whitman, Massachusetts Posts: 168	Thank you for the information. That's exactly what I was trying to figure out.