Hi all, I was wondering if anyone would know the legalities behind something that has come up concerning my promotional film company.
We have just made a film for a business that distributes a certain product. He has already paid us for the film. He has just asked if he can have a textless version of the film to pass on to the manufacturers for them to use. We want to ask for them to pay for the rights to use this film as well, but we are not sure we have the grounds to do so considering the affiliation between the two companies.
They are different registered companies in different countries, but the product the film is about is the same. Do we have grounds to sell it again to the manufacturer? Or does the guy we initially made the film for now have the rights to do with it as he pleases (ie pass it on for free)?
Your profile doesn't say where you live; rules may be different depending on the country. Assuming the USA, the first question is does the contract (YOU DO HAVE ONE RIGHT?) have the words "work for hire" in it.
If this project was a work for hire, you gave up ownership of the master when you got paid and the client can do with that master, whatever he wants. Including passing it on to to other users.
Asking you for a "clean" version of the work for hire, with no text on it, could be interpreted as a new contract. You could say that this is a separate project, and they have to pay, but you'll only charge the cost of the media (if applicable) and about an hour of your time, to render out the version without text (because really all you're doing is turning that layer off in your NLE and hitting the "render" button in most cases.)
One can make a case for giving them the dub free or for cost of materials only, as a gesture to keep on their good side. The choice is up to you, if as I said this was a work for hire, there's nothing else YOU can do with this stuff anyway.
If this was NOT a work for hire, you own the master AND the raw footage, and the copyright, and you can charge whatever the customer(s) will pay.
Run this past a lawyer if you're not sure. A phone or email consult should run between 50 and 100 bucks.
My guess is that your client is going to recoup some of his production costs, or getting some other consideration, by selling the clean copy to the manufacturer. If it WAS a work for hire, that's his right and you really don't have much say in it. How important is it to keep this client on for more work in the future, or for references to other clients? It may well be smarter not to fight it this time, and keep everybody happy this time, versus trying to wring every last nickel out of your work product. If you got paid all that you initially asked for, it's really unimportant if someone else makes MORE money off of the work.
But it might influence your rate calculations, going forward to the next project.
Rather than thinking of it in terms of licence, do consider asking your client whether they would make the introduction to the manufacturer. Once in there, offer them to make as many different versions/variations as they need with as many different logo's and graphics on it as they need. Give them a fair rate, and they may come back for more.
If there are actors (or presenters) involved, music etc, then maybe one could argue that each video needs a separate license.