READER QUESTION: If I Sell a TV Show, How Do I Protect My Merchandising Rights?

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Today’s reader question comes in response to my animation interview with Charlie Stickney last week. BuffyFan47 asks an interesting question…

“I'd like to hear Charlie's and your advice on how an animation writer can protect themselves since - as you noted - they are not covered by the WGA. With tie-in merchandising worth potential billions (see the aforementioned Mr. Squarepants) how does one make sure that someone else doesn't make gazillions off their idea while they get cut out of the process and don't make a dime?”

Well, BuffyFan47, as you asked—Charlie and I put our heads together and basically had the same response.

“There are two types of shows one would write for,” says Charlie. “Pre-existing, and something you've created. If you're writing for a pre-existing show, you're not going to get anything in terms of a merchandising deal.”

In other words, if you get hired to write for Spongebob Squarepants, you’re not going to share in any of the show’s merchandising money, even though you're writing stories and dialogue for the same characters they're selling as toys, lunchpails, and T-shirts.

Nickelodeon owns Spongebob [in partnership with Spongebob creator Stephen Hillenburg, which we’ll discuss in a moment],” Charlie explains. “And when you write for them, on one of their shows, you write on a work-for-hire basis. Which means -- everything you create belongs to them. It doesn't matter if the show's covered by the WGA, or if you have the biggest agent, etc. When you write for someone else, you're writing for someone else. The best you can hope for is to get the biggest check possible for the work that you do. (This is where having those WGA minimums would help.)”

However, if you create and sell your own show—like Stephen Hillenburg did with Spongebob Squarepants—it’s a whole different ballgame.

When you sell a TV show to a TV network or studio-- whether it's animated or live-action-- you truly sell them the idea. In other words, you relinquish most of your writes and they own the majority of the idea, usually including all merchandising rights. However… they’ll often let you participate in ownership of the idea, offering you a limited number of percentage points in the idea (every show ha 100 percentage points).

I.e. Let’s say you create a show called Wally’s Wacky Fun World, which you sell to NickToons, the company that makes Spongebob. NickToons will own the idea outright, but they may give you 5 of the show’s 100 percentage points… entitling you to 5% of the show’s backend profit. This includes all monies from syndication, movie deals, merchandising, etc.

The number of points offered a show’s creator varies from show to show, depending on the clout of the creator, how savvy his agent or lawyer is, what duties he’ll be rendering on the show (is he gonna stick around and run the show himself, or just pass it off to another producer?), etc. If a big star or another important producer is attached to the project—or comes aboard—he or she may also get some backend points. The network or studio tries to keep as many points as possible, and they rarely give away more than 30.

This holds true for live-action shows as well, although live-action shows don’t usually have as many ancillary products as cartoons. A few shows—usually sci-fi hits like Buffy, Alias, or Heroes—may have toys, comic books, novelizations, etc., but most don’t. (I’ve never seen anyone carrying around a Gil Grissom doll.)

Whether in the process of selling an animated project or a live-action series, “it's up to the writer to look out for themselves,” says Charlie. “Which means… if a studio or production company wants to option, buy or develop your idea, you need to have a lawyer or an agent look over your contracts. If you don't have one, this is the perfect time to get one. Coming to an agent with a deal in hand that they can commission is one of the surefire ways to get represented.”