LOS ANGELES, March 28 — Can Hollywood make quality movies for both love and money?
Skip to next paragraph
Kim D. Johnson/Associated Press
Randy Quaid, who played a small part in "Brokeback Mountain."
Not according to a lawsuit filed last week by the actor Randy Quaid over payments for "Brokeback Mountain," in which he played a small supporting role.
The dispute, one of dozens that annually erupt over pay and practices in the film industry, has been dismissed by some film veterans as a case of sour grapes over a deal that could have been better negotiated for Mr. Quaid.
But others say it points to an uncomfortable contradiction in the specialty divisions owned by the major studios, including Focus Features, Fox Searchlight, Warner Independent, Miramax and others. That is, movies are budgeted as though they were in the independent world, often squeezing every nickel out of actors, directors and production staff, who cut their fees to near nothing for the privilege of making a picture they are passionate about.
When it comes to releasing the film, however, the "arthouse" divisions can take advantage of the deep pockets of their studio parents, frequently spending tens of millions of dollars to promote a movie to glory or box office success in the award season.
"There is a trap in there somewhere, with the specialty divisions working in bigger and bigger contexts, trying to get bigger numbers," said Ira Deutchman, president of Emerging Pictures, and a longtime player in the independent world.
In his lawsuit, Mr. Quaid claims he was tricked into accepting a tiny (unspecified) fee for the part of Joe Aguirre, the rancher who hires the shepherds played by Heath Ledger and Jake Gyllenhaal, because the director, Ang Lee, told him the movie was being made on a shoestring budget by Focus, the arthouse division of Universal Studios. And while the production budget was very low, $14 million according to documents filed in Canada where the movie was shot, the lawsuit claims that Focus knew all along that it would throw millions — $30 million, according to the complaint — into marketing the film.
The complaint says that the defendants, in this case Focus and its recent co-presidents David Linde and James Schamus, "have enriched themselves to the tune of approximately $160 million in worldwide gross box office receipts on the back of actors who were convinced to cut their fees purportedly to ensure that the film reached the screen." Far from being a labor of love, it says, the picture was a "movie laundering" scheme that "in reality, had studio backing and would be exploited using traditional studio marketing and distribution techniques."
A Focus representative declined to comment on the lawsuit, citing a policy against discussing pending litigation.
To be sure, Mr. Quaid's role in the Oscar-winning film was tiny, and few would attribute the success of "Brokeback" to the handful of minutes he spends on screen.
But the disparity between actors' fees and the film's promotional budget points toward what may be an endemic problem for the specialty divisions: even actors whose contracts provide for profit participation in successful films may find there is no profit left in which to participate, while the studios still collect rich distribution fees.
"It's a complicated question, and it is both the genius and the nefarious nature of these mini-majors," said Linda Lichter, a lawyer who sells films in the independent world. "The purpose of those mini-majors is to try to make movies that the major studios can't afford to make, for less money. But they don't make those movies unless they get big players who are willing to cut their price." On the other hand, "Randy Quaid had a tiny part," she said, adding, "There's an aspect here of biting the hand that feeds him."
Another veteran entertainment lawyer, Susan Bodine, said it was typical for actors who took low fees for arthouse movies to be given points in the net profits of a film. But, she pointed out, "as a general matter, net profit participants on studio-released films, even low-budget films, can be nothing, even when the film does really well." She said it was too early to know if that would be the case with "Brokeback Mountain." But in the Oscar season, "the better the film does, the more they spend on it, the less likely there'll ever be any net profit." (Ms. Bodine represents Mr. Schamus, in private matters, but did not have any dealings on "Brokeback Mountain.")
That would seem to be the case with some of the films that made it to the best picture category this year at the Oscars. "Good Night, and Good Luck," from Warner Independent, cost a mere $8 million to produce, with the actors earning the lowest permissible union fee, known as scale, an executive involved in the film said. Warner Brothers spent about $25 million to promote the film for the Oscars and in its general release, so while the movie took in $51 million around the world, there will be no profit to share in, the executive said. (Distributors share box office revenue with theater owners.)
Similarly, "Crash," which cost $6.5 million to produce, and was released by Lionsgate, has taken in $90.8 million around the world. So far, the movie's main participants, who deferred their fees to get the movie made, have seen only minimal payments, said an executive involved in its release. The lack of payment to one producer has kicked up a lawsuit against Bob Yari, who put together the film's financing.
Some in Hollywood defended Focus against Mr. Quaid's claims, though they declined to speak on the record so as not to affect their own business relationships. An executive from another arthouse studio, for instance, said that these companies could not function without actors working for low fees, since the vast majority of their films were not successful commercially or otherwise. The executive said that the most prominent actors were granted bonus fees for successful films, or a cut of the adjusted gross box-office receipts.
Several pointed out that Focus could not have known that its gay-themed love story would become the success that it eventually did, and did not set out to deceive Mr. Quaid. A lawyer for Mr. Quaid, who is seeking $10 million in damages, would not comment on his deal, although the complaint notes that the actors were paid a total of $521,000 for their work on the film.
But Mr. Deutchman, the Emerging Pictures president, said the lawsuit illuminated a problem that could lead to actors and other talent becoming more reluctant to sign on to arthouse movies made at the studios. "If, in fact, the smaller movies don't pay off for talent even when they hit, the studio arthouse divisions will stop being able to make the movies," he said. "They'll fall into the same trap as the parent companies: if no one believes there's a back end, then actors will want higher and higher salaries to be in those movies."
