You owe me royalties on these books. #DisneyMustPay
November 18, 2020 5:10 PM Subscribe
Last year, a member came to SFWA’s Grievance Committee with a problem, which on the surface sounds simple and resolvable. He had written novels and was not being paid the royalties that were specified in his contract. The Grievance Committee is designed to resolve contract disputes like this. As part of our negotiating toolbox, we guarantee anonymity for both the writer and the publisher if the grievance is resolved.
When it is working, as president, I never hear from them.
When talks break down, the president of SFWA is asked to step in. We do this for any member.
In this case, the member is Alan Dean Foster. The publisher is Disney.
Wow. If they can do this to Alan Dean Foster, they can do it to anybody. Disney's argument is literally incomprehensible. They bought the rights but not the obligations? That's fucking bullshit. Corporations have never thought they have to abide by the rule of law, but the Trump administration has made them so cocky, they think they can get away with anything. Sick.
posted by rikschell at 5:18 PM on November 18, 2020 [52 favorites]
posted by rikschell at 5:18 PM on November 18, 2020 [52 favorites]
I would love to see the legal reasoning behind "we acquired the contracts that give us the right to publish these works but have no obligation to pay the royalties described in the same contracts that give us those rights."
But I suspect it's mostly, "err, we're Disney... we can outwait you..."
posted by ErisLordFreedom at 5:24 PM on November 18, 2020 [45 favorites]
But I suspect it's mostly, "err, we're Disney... we can outwait you..."
posted by ErisLordFreedom at 5:24 PM on November 18, 2020 [45 favorites]
Fuck that mouse and every politician and lawyer he owns. I wish that vermin didn't control so much of the IP landscape but here we are.
posted by SaltySalticid at 5:33 PM on November 18, 2020 [38 favorites]
posted by SaltySalticid at 5:33 PM on November 18, 2020 [38 favorites]
Foster can't have been singled out. I wonder who else is being fed the this same line of bullshit?
posted by Insert Clever Name Here at 5:37 PM on November 18, 2020 [28 favorites]
posted by Insert Clever Name Here at 5:37 PM on November 18, 2020 [28 favorites]
Oh shit. This is about as OG Star Wars as you can get. I'll be super curious to see if this is some massive screw-up, or part of a deliberate plan. I can't imagine what the legal theory actually is.
posted by feckless at 5:38 PM on November 18, 2020 [9 favorites]
posted by feckless at 5:38 PM on November 18, 2020 [9 favorites]
WTF? This is the second time in two days I've seen someone trying to require an NDA before opening negotiations. (The previous one was Taylor Swift )
posted by fings at 5:39 PM on November 18, 2020 [1 favorite]
posted by fings at 5:39 PM on November 18, 2020 [1 favorite]
Disney, and yet, The Mandalorian.
So conflicted...
posted by Windopaene at 5:40 PM on November 18, 2020 [3 favorites]
So conflicted...
posted by Windopaene at 5:40 PM on November 18, 2020 [3 favorites]
"When the company was sold, your rights were retained, but your royalties ceased to be our obligations. From a certain point of view."
posted by RobotVoodooPower at 5:43 PM on November 18, 2020 [9 favorites]
posted by RobotVoodooPower at 5:43 PM on November 18, 2020 [9 favorites]
Disney's argument is literally incomprehensible. They bought the rights but not the obligations?
Rights without obligations sounds a lot like Wilhoit conservatism.
Or privilege.
posted by wildblueyonder at 5:44 PM on November 18, 2020 [11 favorites]
Rights without obligations sounds a lot like Wilhoit conservatism.
Or privilege.
posted by wildblueyonder at 5:44 PM on November 18, 2020 [11 favorites]
DISNEY: ‘I am altering our deal. Pray I do not alter it any further’
posted by Fiasco da Gama at 5:46 PM on November 18, 2020 [74 favorites]
posted by Fiasco da Gama at 5:46 PM on November 18, 2020 [74 favorites]
Is the legal theory that Shell Company A can own the copyright, and be obligated to pay royalties to Alan Dean Foster if they make money from publishing -- but they license publication rights to Disney for $1 or whatever, and then Disney is free to publish themselves without owing royalties to anyone?
posted by vogon_poet at 5:49 PM on November 18, 2020 [7 favorites]
posted by vogon_poet at 5:49 PM on November 18, 2020 [7 favorites]
Damn it, as soon as he mentioned his and his wife's health problems, I knew exactly what Disney's play was. Fuck that goddamned Mouse.
posted by lovecrafty at 5:54 PM on November 18, 2020 [13 favorites]
posted by lovecrafty at 5:54 PM on November 18, 2020 [13 favorites]
I still have that book somewhere.
posted by Max Power at 5:54 PM on November 18, 2020 [2 favorites]
posted by Max Power at 5:54 PM on November 18, 2020 [2 favorites]
they license publication rights to Disney for $1 or whatever, and then Disney is free to publish themselves without owing royalties to anyone?
That's some catch, that Catch-22.
posted by flabdablet at 6:18 PM on November 18, 2020 [8 favorites]
That's some catch, that Catch-22.
posted by flabdablet at 6:18 PM on November 18, 2020 [8 favorites]
I read the book before the movie - in fact, it was because of the book that I convinced my father to take me see to the movie. Movies were a pretty big luxury for us in that era, and I can't recall another one than just he and I went to alone, they were more often a family thing at the drive-in.
That edition had a tan cover with some sort of art in an oval on in the middle, like much scifi of it's era. It also had a few pages of black and white photo prints from the movie in the middle of the book. I read Splinter of the Mind's Eye a few years later. It was one of the first adult novels I purchased with my own money. I expect I still have both in the storage locker.
In short, fuck Disney. I love me some Baby Yoda, but that's both reprehensible and all too predictable. I'm glad SFWA is making noise about this.
posted by bcd at 6:29 PM on November 18, 2020 [9 favorites]
That edition had a tan cover with some sort of art in an oval on in the middle, like much scifi of it's era. It also had a few pages of black and white photo prints from the movie in the middle of the book. I read Splinter of the Mind's Eye a few years later. It was one of the first adult novels I purchased with my own money. I expect I still have both in the storage locker.
In short, fuck Disney. I love me some Baby Yoda, but that's both reprehensible and all too predictable. I'm glad SFWA is making noise about this.
posted by bcd at 6:29 PM on November 18, 2020 [9 favorites]
They bought the rights but not the obligations?
This is how literally every merger and acquisition (well, the ones involving competent lawyers) works.
Say your buddy has an ice cream shop, and you want to buy it. What definitely does not happen is that his name gets scratched out of the incorporation docs, to be replaced by yours. Instead, a brand new company is formed and all the assets (ice cream machines, cone inventory, intellectual property including that sweet radio jingle, etc) get sold to it. The liabilities, known and especially unknown, stay with the existing company. That way, when someone weeks/months/years down the road shows up to sue you for 100 years worth of profits for something that happened (or didn't happen) before you took over, they are suing a company with no employee and no assets.
All that said, my background in this kinda thing is on the music side, not the print side, so I don't how the contracts work. In music, this would be a non-issue since the royalty stuff is well worked out and there really isn't any negotiating to be had. Since the SFWA is going "public letter" on this, my guess is book authors don't have as strong of protections as their music counterparts.
posted by sideshow at 6:32 PM on November 18, 2020 [8 favorites]
This is how literally every merger and acquisition (well, the ones involving competent lawyers) works.
Say your buddy has an ice cream shop, and you want to buy it. What definitely does not happen is that his name gets scratched out of the incorporation docs, to be replaced by yours. Instead, a brand new company is formed and all the assets (ice cream machines, cone inventory, intellectual property including that sweet radio jingle, etc) get sold to it. The liabilities, known and especially unknown, stay with the existing company. That way, when someone weeks/months/years down the road shows up to sue you for 100 years worth of profits for something that happened (or didn't happen) before you took over, they are suing a company with no employee and no assets.
All that said, my background in this kinda thing is on the music side, not the print side, so I don't how the contracts work. In music, this would be a non-issue since the royalty stuff is well worked out and there really isn't any negotiating to be had. Since the SFWA is going "public letter" on this, my guess is book authors don't have as strong of protections as their music counterparts.
posted by sideshow at 6:32 PM on November 18, 2020 [8 favorites]
I haven't thought of it in years, but reading that he wrote the novelization of Aliens brought back vivid memories of Ripley dreaming of a flamethrower.
The kind one could use on a mouse.
posted by I paid money to offer this... insight? at 6:36 PM on November 18, 2020 [3 favorites]
The kind one could use on a mouse.
posted by I paid money to offer this... insight? at 6:36 PM on November 18, 2020 [3 favorites]
Under U.S. copyright law, the failure to pay royalties is normally a material breach of the licensing agreement that allows the licensor to terminate the license, including any sublicensees. This isn't quite Copyright 101, but it's definitely Copyright 201, and it's such a bedrock rule that I have trouble believing that it is actually Disney's argument that it can enjoy the benefits but not the burdens of these licenses. I wonder if the actual argument is something subtler. Maybe it's right but frustrating, maybe it's insidious and evil, but I am definitely curious what it is.
posted by grimmelm at 6:47 PM on November 18, 2020 [22 favorites]
posted by grimmelm at 6:47 PM on November 18, 2020 [22 favorites]
Apparently it’s all creators for the Star Wars, Aliens and Predator franchises, not just Foster.
posted by seanmpuckett at 6:52 PM on November 18, 2020 [5 favorites]
posted by seanmpuckett at 6:52 PM on November 18, 2020 [5 favorites]
Forgive me, but I don't know much about how the Science Fiction and Fantasy Writer's Guild of America functions. Are they a union or more of a marketing outfit? How much collective bargaining power do they actually have? Could they do something like blacklist Disney and, if so, how much impactful would that be? Are we talking 2007/2008 Writer's Guild of America strike levels of power?
Not that I think that is likely to hurt the company's bottom line much. Half of their revenue is from media networks they have a stake in (ABC, Hulu, ESPN, etc) and then another big chunk from their hotels/resorts (although maybe different in COVID times). Intellectual property is surprisingly low as a direct money maker for them, although they certainly exploit those properties as much as possible.
posted by forbiddencabinet at 6:54 PM on November 18, 2020
Not that I think that is likely to hurt the company's bottom line much. Half of their revenue is from media networks they have a stake in (ABC, Hulu, ESPN, etc) and then another big chunk from their hotels/resorts (although maybe different in COVID times). Intellectual property is surprisingly low as a direct money maker for them, although they certainly exploit those properties as much as possible.
posted by forbiddencabinet at 6:54 PM on November 18, 2020
Yeah, I don't know much about SFWA either, but I also thought "how much power do they have?"
I am not even a tiny bit surprised to hear this story, somehow.
posted by jenfullmoon at 7:14 PM on November 18, 2020
I am not even a tiny bit surprised to hear this story, somehow.
posted by jenfullmoon at 7:14 PM on November 18, 2020
If writers are getting royalties, it seems reasonable to assume these weren't works for hire, in which case, do the rights exist without their participation, i.e. after they're severed from the asset? I imagine these kinds of contracts between entities like 20th Century Fox and Disney have a lot of nuances, but at the end of the day...were the royalties that fragile all along? From the story it sounds like ADF still has the copyright (not just an interested party with "points"), which makes it really weird. I wish there were more details.
Other creators outside of all this must be shivering.
posted by rhizome at 7:22 PM on November 18, 2020 [2 favorites]
Other creators outside of all this must be shivering.
posted by rhizome at 7:22 PM on November 18, 2020 [2 favorites]
Splinter of The Minds Eye was awesome. They should just pay him off.
posted by valkane at 7:37 PM on November 18, 2020 [6 favorites]
posted by valkane at 7:37 PM on November 18, 2020 [6 favorites]
I don't think it's creators who should be shivering.
A party who demands an NDA before negotiations begin knows what the verdict is going to be in the court of public opinion, and they're terrified of it.
Analysts appear to think Disney stock is in for a significant rise; we'll see whether Foster can take a significant bite out of that.
posted by jamjam at 7:40 PM on November 18, 2020 [8 favorites]
A party who demands an NDA before negotiations begin knows what the verdict is going to be in the court of public opinion, and they're terrified of it.
Analysts appear to think Disney stock is in for a significant rise; we'll see whether Foster can take a significant bite out of that.
posted by jamjam at 7:40 PM on November 18, 2020 [8 favorites]
Maybe Disney's argument is that the novels are derivative works based on works that they own the copyrights to, so they own the copyrights to the novels as well. All Foster has is a worthless contract with a shell company. Unfortunately, they might be right.
posted by A Thousand Baited Hooks at 7:43 PM on November 18, 2020
posted by A Thousand Baited Hooks at 7:43 PM on November 18, 2020
SFWA is a writers association - if you write in the field of SF&F, you have to have a certain number of sales, and then you can join. Joining is voluntary, and being a member gives you access to certain privileges. So SFWA can't organize a general strike, for example. John Scalzi is a past president, so I'd like to page him to the MeFi courtesy phone to explain this better than I, though I imagine he's already getting lots of emails from other, more important, people and places right now.
What SFWA & Foster are doing by putting this out there is doing a few things, from my perspective: Firstly, they are letting their membership (and potential members) know that they will fight, no matter who the group on the other side of the table is: A writer is being wronged, and SFWA has their back and will stand alongside them. Secondly, they are sending out a call for others who may be getting wronged in this way by Disney, who aren't big names or who maybe were unaware of their rights; because if Disney is doing this to Foster, you can bet that many others whose rights got transferred in Disney's ongoing osmosis of all things entertainment are probably also getting hurt; and more voices from that side are needed.
The last thing they are doing, and it might be the most important, is they are letting a pretty big fandom know about this being a problem. I've already shared this with one friend, who immediately cancelled their Disney + subscription, and is letting Disney know why. There's potential here in moving a lot of people to avoid Disney products and/or hurt their image generally; Disney holds the rights to a lot of things that intersect with that fandom (Star Wars, Marvel, and a metric shit ton of others).
posted by nubs at 7:44 PM on November 18, 2020 [25 favorites]
What SFWA & Foster are doing by putting this out there is doing a few things, from my perspective: Firstly, they are letting their membership (and potential members) know that they will fight, no matter who the group on the other side of the table is: A writer is being wronged, and SFWA has their back and will stand alongside them. Secondly, they are sending out a call for others who may be getting wronged in this way by Disney, who aren't big names or who maybe were unaware of their rights; because if Disney is doing this to Foster, you can bet that many others whose rights got transferred in Disney's ongoing osmosis of all things entertainment are probably also getting hurt; and more voices from that side are needed.
The last thing they are doing, and it might be the most important, is they are letting a pretty big fandom know about this being a problem. I've already shared this with one friend, who immediately cancelled their Disney + subscription, and is letting Disney know why. There's potential here in moving a lot of people to avoid Disney products and/or hurt their image generally; Disney holds the rights to a lot of things that intersect with that fandom (Star Wars, Marvel, and a metric shit ton of others).
posted by nubs at 7:44 PM on November 18, 2020 [25 favorites]
I still have that book somewhere.
I still have that book somewhere in my brain.
posted by ricochet biscuit at 7:44 PM on November 18, 2020 [3 favorites]
I still have that book somewhere in my brain.
posted by ricochet biscuit at 7:44 PM on November 18, 2020 [3 favorites]
Hi everybody, this is why I never paid for Disney plus and have pirated every episode of the Mandalorian.
If you have paid money to these pricks at Disney, yes, you should be fucking ashamed.
posted by deadaluspark at 7:46 PM on November 18, 2020 [33 favorites]
If you have paid money to these pricks at Disney, yes, you should be fucking ashamed.
posted by deadaluspark at 7:46 PM on November 18, 2020 [33 favorites]
While most modern work-for-hire has lots of clauses where they can end royalties, _Splinter of the Mind's Eye_ apparently had a very old-fashioned and generous contract, because Lucasfilm had no idea how to handle tie-ins at the time. And per Mary Robinette Kowal who has read them, the contracts do indeed have the standard clauses saying that the contract is fully binding on anyone buying the rights. So it really looks like Disney is trying to flat-out rewrite contract law.
posted by tavella at 8:03 PM on November 18, 2020 [30 favorites]
posted by tavella at 8:03 PM on November 18, 2020 [30 favorites]
This is similar to what Ace Books did to Tolkien, though in that case Ace's actions had an unshakable foundation in law. But Ace lost its preeminence as an SFF publisher immediately thereafter, and I believe their treatment of Tolkien was the biggest reason -- and that was just one author.
posted by jamjam at 8:05 PM on November 18, 2020 [2 favorites]
posted by jamjam at 8:05 PM on November 18, 2020 [2 favorites]
it really looks like Disney is trying to flat-out rewrite contract law
Either that or their present head of Legal is a Giuliani.
posted by flabdablet at 8:06 PM on November 18, 2020 [4 favorites]
Either that or their present head of Legal is a Giuliani.
posted by flabdablet at 8:06 PM on November 18, 2020 [4 favorites]
- Damn it, as soon as he mentioned his and his wife's health problems, I knew exactly what Disney's play was. Fuck that goddamned Mouse.
Except Disney would still owe copyright royalties to his estate.
Adam Whitehead's Wertzone SF&F blog: Other Star Wars novelists and their estates (such as the family of A.C. Crispin, a Star Wars novelist who also wrote the novelisation of Alien Resurrection) are also now querying their royalty payments to make sure that the problem is not more widespread.
[Wasn't there a different Crispin-Disney-copyright matter, years ago?]
Anyway, it's gross, Disney's legal department is gigantic and hyper-focused on intellectual property rights. Disney itself lobbied for the most recent Copyright Term Extension Act. Walt Disney lost an early copyright, and his namesake company has invested a lot in I/P work to keep its older creations out of public domain. However, if nothing changes, "Disney’s Mickey Mouse, a character whose profitable franchise motivated that company’s involvement in major changes to copyright in both 1976 and 1998, will enter the public domain in 2024, 95 years after the company first introduced Mickey in the cartoon short, Steamboat Willie."
posted by Iris Gambol at 8:21 PM on November 18, 2020 [7 favorites]
Except Disney would still owe copyright royalties to his estate.
Adam Whitehead's Wertzone SF&F blog: Other Star Wars novelists and their estates (such as the family of A.C. Crispin, a Star Wars novelist who also wrote the novelisation of Alien Resurrection) are also now querying their royalty payments to make sure that the problem is not more widespread.
[Wasn't there a different Crispin-Disney-copyright matter, years ago?]
Anyway, it's gross, Disney's legal department is gigantic and hyper-focused on intellectual property rights. Disney itself lobbied for the most recent Copyright Term Extension Act. Walt Disney lost an early copyright, and his namesake company has invested a lot in I/P work to keep its older creations out of public domain. However, if nothing changes, "Disney’s Mickey Mouse, a character whose profitable franchise motivated that company’s involvement in major changes to copyright in both 1976 and 1998, will enter the public domain in 2024, 95 years after the company first introduced Mickey in the cartoon short, Steamboat Willie."
posted by Iris Gambol at 8:21 PM on November 18, 2020 [7 favorites]
This is how literally every merger and acquisition (well, the ones involving competent lawyers) works.
Say your buddy has an ice cream shop, and you want to buy it. What definitely does not happen is that his name gets scratched out of the incorporation docs, to be replaced by yours. Instead, a brand new company is formed and all the assets (ice cream machines, cone inventory, intellectual property including that sweet radio jingle, etc) get sold to it. The liabilities, known and especially unknown, stay with the existing company.
That's not how it works. If it were possible, simply through an acquisition, to gain the ability to exercise the target's contractual rights without making corresponding payments...there would be no more contracts, because companies would be acquiring each other every day and a contract would be nothing more than an extended giveaway. I assure you Disney did not stop paying Lucasfilm's electricity and phone and water providers and expect to keep those taps turned on, nor did it expect Lucasfilm's freelancers to continue to work under their Lucasfilm contracts for Disney, only for free.
A buyer may purchase assets free and clear of existing claims against the seller. Depending on how the ADF-Lucasfilm contract and the Lucasfilm-Disney deal were structured, Disney might be able to ditch pre-existing liabilities to ADF--say, if Lucasfilm had outstanding royalties it hadn't paid. But the asset in question here is Lucasfilm's rights as a party to the contract, and if Disney is stepping into Lucasfilm's shoes, it can only exercise those rights in accordance with the contract. (Bankruptcy can affect this, but as far as I know there's no bankruptcy along the line here.) Without seeing the contracts in question (and the APA[s]), it's hard to have 100% certainty, but, no, being acquired doesn't generally entitle you to stop paying as obligated under contracts and yet continue to exercise your rights under those same contracts.
One should be cautious when one only has one side of the story, but this sounds like despicable conduct on Disney's part, especially considering how modest the sums in question must be.
Since the SFWA is going "public letter" on this, my guess is book authors don't have as strong of protections as their music counterparts.
Do you think a basically midlist SF writer with a terminally ill wife has the resources to sue the largest entertainment company in the world over relatively modest amounts of unpaid royalties?
posted by praemunire at 9:29 PM on November 18, 2020 [59 favorites]
Say your buddy has an ice cream shop, and you want to buy it. What definitely does not happen is that his name gets scratched out of the incorporation docs, to be replaced by yours. Instead, a brand new company is formed and all the assets (ice cream machines, cone inventory, intellectual property including that sweet radio jingle, etc) get sold to it. The liabilities, known and especially unknown, stay with the existing company.
That's not how it works. If it were possible, simply through an acquisition, to gain the ability to exercise the target's contractual rights without making corresponding payments...there would be no more contracts, because companies would be acquiring each other every day and a contract would be nothing more than an extended giveaway. I assure you Disney did not stop paying Lucasfilm's electricity and phone and water providers and expect to keep those taps turned on, nor did it expect Lucasfilm's freelancers to continue to work under their Lucasfilm contracts for Disney, only for free.
A buyer may purchase assets free and clear of existing claims against the seller. Depending on how the ADF-Lucasfilm contract and the Lucasfilm-Disney deal were structured, Disney might be able to ditch pre-existing liabilities to ADF--say, if Lucasfilm had outstanding royalties it hadn't paid. But the asset in question here is Lucasfilm's rights as a party to the contract, and if Disney is stepping into Lucasfilm's shoes, it can only exercise those rights in accordance with the contract. (Bankruptcy can affect this, but as far as I know there's no bankruptcy along the line here.) Without seeing the contracts in question (and the APA[s]), it's hard to have 100% certainty, but, no, being acquired doesn't generally entitle you to stop paying as obligated under contracts and yet continue to exercise your rights under those same contracts.
One should be cautious when one only has one side of the story, but this sounds like despicable conduct on Disney's part, especially considering how modest the sums in question must be.
Since the SFWA is going "public letter" on this, my guess is book authors don't have as strong of protections as their music counterparts.
Do you think a basically midlist SF writer with a terminally ill wife has the resources to sue the largest entertainment company in the world over relatively modest amounts of unpaid royalties?
posted by praemunire at 9:29 PM on November 18, 2020 [59 favorites]
This is just Disney riding a coach and horses through contract and copyright law, isn't it? What utterly evil fuckers.
posted by Dysk at 10:52 PM on November 18, 2020 [4 favorites]
posted by Dysk at 10:52 PM on November 18, 2020 [4 favorites]
Gah, I knew I shouldn't have jumped on the introduction offer for Disney+ in my country. Well, I hope it's a loss leader for them and they'll be in the red when I don't renew at the end of the period.
posted by Harald74 at 11:37 PM on November 18, 2020
posted by Harald74 at 11:37 PM on November 18, 2020
Loved the Aliens novelization. Read a fair few of Foster's books when I was younger.
posted by mokey at 12:43 AM on November 19, 2020 [1 favorite]
posted by mokey at 12:43 AM on November 19, 2020 [1 favorite]
It struck me that if this went forward, one thing the writers could do to strike back would be to only turn in shitty, incoherent nonsense to pollute Disney's IP. Then I thought "Star Wars sequels". It seems Abrams and Johnson were way ahead of us here, and heroes to boot. And Favreau is somehow letting us down. The world's gone topsy turvy. All I can do is encourage the liberal use of BitTorrent with no moral qualms whatsoever.
posted by Grangousier at 1:08 AM on November 19, 2020 [2 favorites]
posted by Grangousier at 1:08 AM on November 19, 2020 [2 favorites]
Disney holds the rights to a lot of things that intersect with that fandom (Star Wars, Marvel, and a metric shit ton of others).
Seems like a big part of the problem to me right there.
posted by Meatbomb at 1:39 AM on November 19, 2020 [2 favorites]
Seems like a big part of the problem to me right there.
posted by Meatbomb at 1:39 AM on November 19, 2020 [2 favorites]
>>They bought the rights but not the obligations?
>This is how literally every merger and acquisition (well, the ones involving competent lawyers) works.
I think you've got a broken legal system there. I can see how the sale contracts might include language that sets this up to protect the new owners from the stupid and possibly criminal mistakes of the old owners, however ... that can't destroy an obligation outright without it totally breaking any obligation one party has to another -- you've got a broken legal system there, even in the reduced from of 'it takes hours of arguments and years of expensive paper-filing procedure to make right'.
Let's nod to the specifics of this case: Lucasfilm were paying royalties for ADF's books, and 20th Century Fox were paying royalties for ADF's other books (so it's not a historical grievance with the people running the old rights-holding companies) and then Disney is getting the benefit of ADF's books without the quid pro quo of paying the agreed royalties. IANAL -- and not even in the place with jurisdiction for this -- but separating ongoing liability to perform the payment side of a contract from performing the distribution and revenue collection breaks/is a breach of that contract.
posted by k3ninho at 4:05 AM on November 19, 2020 [3 favorites]
>This is how literally every merger and acquisition (well, the ones involving competent lawyers) works.
I think you've got a broken legal system there. I can see how the sale contracts might include language that sets this up to protect the new owners from the stupid and possibly criminal mistakes of the old owners, however ... that can't destroy an obligation outright without it totally breaking any obligation one party has to another -- you've got a broken legal system there, even in the reduced from of 'it takes hours of arguments and years of expensive paper-filing procedure to make right'.
Let's nod to the specifics of this case: Lucasfilm were paying royalties for ADF's books, and 20th Century Fox were paying royalties for ADF's other books (so it's not a historical grievance with the people running the old rights-holding companies) and then Disney is getting the benefit of ADF's books without the quid pro quo of paying the agreed royalties. IANAL -- and not even in the place with jurisdiction for this -- but separating ongoing liability to perform the payment side of a contract from performing the distribution and revenue collection breaks/is a breach of that contract.
posted by k3ninho at 4:05 AM on November 19, 2020 [3 favorites]
I canceled my Disney+ this morning because I can't enjoy the Mandalorian knowing what a pile of garbage Gina Carano is. Now I'm double glad.
posted by MaritaCov at 4:34 AM on November 19, 2020 [9 favorites]
posted by MaritaCov at 4:34 AM on November 19, 2020 [9 favorites]
Say your buddy has an ice cream shop, and you want to buy it. What definitely does not happen is that his name gets scratched out of the incorporation docs, to be replaced by yours. Instead, a brand new company is formed and all the assets (ice cream machines, cone inventory, intellectual property including that sweet radio jingle, etc) get sold to it. The liabilities, known and especially unknown, stay with the existing company.
In this case you don't own the ice cream machines, but instead have a lease with the equipment supplier. The buyer would need to either do a share purchase of your business to keep the contracts in place, or negotiate a new contract with each supplier. If they kept using the equipment without paying for it they would find themselves on the wrong end of a lawsuit.
posted by mikek at 4:37 AM on November 19, 2020 [4 favorites]
In this case you don't own the ice cream machines, but instead have a lease with the equipment supplier. The buyer would need to either do a share purchase of your business to keep the contracts in place, or negotiate a new contract with each supplier. If they kept using the equipment without paying for it they would find themselves on the wrong end of a lawsuit.
posted by mikek at 4:37 AM on November 19, 2020 [4 favorites]
I'll be super curious to see if this is some massive screw-up, or part of a deliberate plan.
If it was a screw-up, when the SWFA contacted Disney, their response would be, "Oops! We're sorry, and we'll cut Mr. Foster a check right away" rather than "You have to sign an NDA before we'll even discuss paying you what we owe you."
posted by Gelatin at 5:57 AM on November 19, 2020 [17 favorites]
If it was a screw-up, when the SWFA contacted Disney, their response would be, "Oops! We're sorry, and we'll cut Mr. Foster a check right away" rather than "You have to sign an NDA before we'll even discuss paying you what we owe you."
posted by Gelatin at 5:57 AM on November 19, 2020 [17 favorites]
Some traction on Twitter now: #AlanDeanFoster, #DisneyMustPay.
posted by doctornemo at 6:06 AM on November 19, 2020 [4 favorites]
posted by doctornemo at 6:06 AM on November 19, 2020 [4 favorites]
praemunire: Do you think a basically midlist SF writer with a terminally ill wife has the resources to sue the largest entertainment company in the world over relatively modest amounts of unpaid royalties?
I suspect that's their strategy, yes.
I mean, besides saving the direct costs, think of the nice cover it will provide for future fucking-overs!
posted by wenestvedt at 6:27 AM on November 19, 2020
I suspect that's their strategy, yes.
I mean, besides saving the direct costs, think of the nice cover it will provide for future fucking-overs!
posted by wenestvedt at 6:27 AM on November 19, 2020
Star Wars author appeals to Disney in fight over royalties [Grauniad]
Following the SFWA’s press conference about the situation, the hashtag #DisneyMustPay began trending on Twitter, with major writers voicing their support for Foster. John Scalzi called on Disney to “pay up”, Cory Doctorow called Foster’s case “a gross injustice”, and NK Jemisin said it was “grotesque”.
posted by chavenet at 6:54 AM on November 19, 2020 [4 favorites]
Following the SFWA’s press conference about the situation, the hashtag #DisneyMustPay began trending on Twitter, with major writers voicing their support for Foster. John Scalzi called on Disney to “pay up”, Cory Doctorow called Foster’s case “a gross injustice”, and NK Jemisin said it was “grotesque”.
posted by chavenet at 6:54 AM on November 19, 2020 [4 favorites]
I'm reminded of the famous turn of phrase of Mr Justice Crompton in the 1861 case of Tweddle v Atkinson:
"It would be a monstrous proposition to say that a person was a party to the contract for the purpose of suing upon it for his own advantage, and not a party to it for the purpose of being sued."
Now, anyone familiar with the history of English contract law will point out that Crompton J was discussing a contract that purported to confer a benefit on a third party (a concept alien to English law at the time, and which has only been introduced formally over the last 20 years in certain circumstances). But the point is even more valid between the parties to a bilateral contract. You cannot just excise the burden of a contract while retaining the benefit.
I regularly act in cases where, at some point, company A took over company B, which had a contract with company X. If I stood up in court* and suggested that A was entitled to issue invoices to X and sue for them, but was under no obligation to provide the services that X had contracted for, I would receive pretty short shrift.
*Virtually, these days, since I now do most of my hearings by MS Teams.
posted by Major Clanger at 7:04 AM on November 19, 2020 [7 favorites]
"It would be a monstrous proposition to say that a person was a party to the contract for the purpose of suing upon it for his own advantage, and not a party to it for the purpose of being sued."
Now, anyone familiar with the history of English contract law will point out that Crompton J was discussing a contract that purported to confer a benefit on a third party (a concept alien to English law at the time, and which has only been introduced formally over the last 20 years in certain circumstances). But the point is even more valid between the parties to a bilateral contract. You cannot just excise the burden of a contract while retaining the benefit.
I regularly act in cases where, at some point, company A took over company B, which had a contract with company X. If I stood up in court* and suggested that A was entitled to issue invoices to X and sue for them, but was under no obligation to provide the services that X had contracted for, I would receive pretty short shrift.
*Virtually, these days, since I now do most of my hearings by MS Teams.
posted by Major Clanger at 7:04 AM on November 19, 2020 [7 favorites]
The ice cream store analogy is so wrong that it made me almost spit my coffee over my keyboard and I'm glad previous comments addressed it.
I really hope that the US courts do not behave they way they did in MLM court cases in standing up for predatory corporate practices.
posted by warriorqueen at 7:11 AM on November 19, 2020 [5 favorites]
I really hope that the US courts do not behave they way they did in MLM court cases in standing up for predatory corporate practices.
posted by warriorqueen at 7:11 AM on November 19, 2020 [5 favorites]
I really hope that the US courts do not behave they way they did in MLM court cases in standing up for predatory corporate practices.
The GOP just spent four years packing the courts with unqualified judges who do nothing but cater to the corporate oligarchy.
So, don't get those hopes up too high or you're in for some bad fucking news.
posted by deadaluspark at 8:07 AM on November 19, 2020 [8 favorites]
The GOP just spent four years packing the courts with unqualified judges who do nothing but cater to the corporate oligarchy.
So, don't get those hopes up too high or you're in for some bad fucking news.
posted by deadaluspark at 8:07 AM on November 19, 2020 [8 favorites]
Do you think a basically midlist SF writer with a terminally ill wife has the resources to sue the largest entertainment company in the world over relatively modest amounts of unpaid royalties?
I will point out that in terms of specifically the niche of novelizations of movie and television properties Alan Dean Foster is not a nobody midlist SF writer; he's been occupying that niche since probably before I was born. He's good at it, too, and he's the only person I can think of off the top of my head who has an established name for himself as an original SFF writer and who has made a significant part of his career doing that specific work, working with cinematic properties.
I actually cannot think of a worse writer to stiff, in terms of people who have connections to both SFF organizations and in TV/movies rather than just print, and who know exactly what their work is worth in terms of novelization rights besides. Neil Gaiman, maybe? Like, I wouldn't necessarily guess that ADF is rolling in the money or anything, but in terms of connections who can raise a fuss on his behalf--to wit, exactly how big and how fast this thing is making news once the SFWA dropped its initial bombshell yesterday--he has got to be almost ideally placed to make the Mouse hurt.
posted by sciatrix at 8:22 AM on November 19, 2020 [20 favorites]
I will point out that in terms of specifically the niche of novelizations of movie and television properties Alan Dean Foster is not a nobody midlist SF writer; he's been occupying that niche since probably before I was born. He's good at it, too, and he's the only person I can think of off the top of my head who has an established name for himself as an original SFF writer and who has made a significant part of his career doing that specific work, working with cinematic properties.
I actually cannot think of a worse writer to stiff, in terms of people who have connections to both SFF organizations and in TV/movies rather than just print, and who know exactly what their work is worth in terms of novelization rights besides. Neil Gaiman, maybe? Like, I wouldn't necessarily guess that ADF is rolling in the money or anything, but in terms of connections who can raise a fuss on his behalf--to wit, exactly how big and how fast this thing is making news once the SFWA dropped its initial bombshell yesterday--he has got to be almost ideally placed to make the Mouse hurt.
posted by sciatrix at 8:22 AM on November 19, 2020 [20 favorites]
The GOP just spent four years packing the courts with unqualified judges who do nothing but cater to the corporate oligarchy.
It is not in the corporate oligarchy's best interests to explode the fundamental principles of contract law. Contracts are the mechanism by which corporations operate and while one corporation might benefit from fucking them up in one case, all corporations will lose out if they get too fucked.
posted by jacquilynne at 8:25 AM on November 19, 2020 [8 favorites]
It is not in the corporate oligarchy's best interests to explode the fundamental principles of contract law. Contracts are the mechanism by which corporations operate and while one corporation might benefit from fucking them up in one case, all corporations will lose out if they get too fucked.
posted by jacquilynne at 8:25 AM on November 19, 2020 [8 favorites]
If Disney wins, this will send shockwaves and ripples through all manner of contract law. It would impact all manner of business, large and small, and perhaps even individuals' finances, if they have access to lawyers.
Hell, imagine if I buy a house with a shell company A, mortgaged to the bank. Then I sell the house to another shell company B for $1. Then I tell the bank, "per Foster v Disney, shell company B purchased the house, but not the liability. You need to sue shell company A (which conveniently declared bankruptcy)."
Disney is doing the standard big-business "we have more time and access to lawyers than you do" tactic, but this just will never stand up in court if it actually gets to trial.
posted by explosion at 8:31 AM on November 19, 2020 [5 favorites]
Hell, imagine if I buy a house with a shell company A, mortgaged to the bank. Then I sell the house to another shell company B for $1. Then I tell the bank, "per Foster v Disney, shell company B purchased the house, but not the liability. You need to sue shell company A (which conveniently declared bankruptcy)."
Disney is doing the standard big-business "we have more time and access to lawyers than you do" tactic, but this just will never stand up in court if it actually gets to trial.
posted by explosion at 8:31 AM on November 19, 2020 [5 favorites]
If this holds up I'm telling my mortgage company I bought the house not the 30 years of payments that came with it.
posted by cmfletcher at 8:43 AM on November 19, 2020 [8 favorites]
posted by cmfletcher at 8:43 AM on November 19, 2020 [8 favorites]
forbiddencabinet: you might want to ask Scalzi how SFWA works as he's a former President of the organization. (I'm a life member.)
jamjam: The Ace/Tolkein thing is not so simple. Short version: Tolkien and his UK publisher Allen and Unwin neglected to copyright Lord of the Rings in the USA when it came out in the UK. They didn't bother publishing it in the US, either. Fast-forward 14 years -- this was prior to the modern Berne Convention and life-plus-50 (now 70) copyright term, and the USA ran on explicit registration for 14 years (with a 14 year optional renewal), so LOTR was out of copyright.
Ace then published an unauthorized edition—essentially a pirate one—but because LOTR was out of copyright in the US there was no basis for litigation. Additionally, Ace made nice: they set aside a standard royalty portion of the revenue and handed it over to Tolkien (or his agent) when they noticed.
So, very bad form but not actually illegal (at the time).
Here's my suspicion:
Disney is panicking.
The Mouse only commissions work for hire these days. They probably haven't printed a royalty statement in over fifty years because they don't pay royalties, they buy work-for-hire.
So when they took over some other companies who owned legacy properties that royalties were due on, they either didn't notice this or chose to ignore it. And right now they're in a blind panic because they have no royalty accounting system at all and no idea how much money they're on the hook for: otherwise it would be relatively simple to hork up a six or seven digit figure in return for kicking the can down the road, or to make a lump sum offer to buy ADF out of his copyrights (which isn't really feasible unless they know how much they're worth).
posted by cstross at 8:50 AM on November 19, 2020 [38 favorites]
jamjam: The Ace/Tolkein thing is not so simple. Short version: Tolkien and his UK publisher Allen and Unwin neglected to copyright Lord of the Rings in the USA when it came out in the UK. They didn't bother publishing it in the US, either. Fast-forward 14 years -- this was prior to the modern Berne Convention and life-plus-50 (now 70) copyright term, and the USA ran on explicit registration for 14 years (with a 14 year optional renewal), so LOTR was out of copyright.
Ace then published an unauthorized edition—essentially a pirate one—but because LOTR was out of copyright in the US there was no basis for litigation. Additionally, Ace made nice: they set aside a standard royalty portion of the revenue and handed it over to Tolkien (or his agent) when they noticed.
So, very bad form but not actually illegal (at the time).
Here's my suspicion:
Disney is panicking.
The Mouse only commissions work for hire these days. They probably haven't printed a royalty statement in over fifty years because they don't pay royalties, they buy work-for-hire.
So when they took over some other companies who owned legacy properties that royalties were due on, they either didn't notice this or chose to ignore it. And right now they're in a blind panic because they have no royalty accounting system at all and no idea how much money they're on the hook for: otherwise it would be relatively simple to hork up a six or seven digit figure in return for kicking the can down the road, or to make a lump sum offer to buy ADF out of his copyrights (which isn't really feasible unless they know how much they're worth).
posted by cstross at 8:50 AM on November 19, 2020 [38 favorites]
I think that's overly generous, cstross. Someone, likely multiple someones, read the fine print somewhere during those M&As and decided, "you know what, this 'royalty thing' will be a huge hassle, we have ten thousand lawyers on retainer, these are little people, so fuck 'em." At some level, someone at the Mouse knew it was a problem, and decided to avoid the issue. If they are panicking, it's because they got caught and it's turning into a PR wildfire.
posted by seanmpuckett at 8:59 AM on November 19, 2020 [13 favorites]
posted by seanmpuckett at 8:59 AM on November 19, 2020 [13 favorites]
Hi everybody, this is why I never paid for Disney plus and have pirated every episode of the Mandalorian.
So you have acquired the assets without the obligations? Surely Disney should be fine with that.
posted by ricochet biscuit at 9:38 AM on November 19, 2020 [18 favorites]
So you have acquired the assets without the obligations? Surely Disney should be fine with that.
posted by ricochet biscuit at 9:38 AM on November 19, 2020 [18 favorites]
Hi everybody, this is why I never paid for Disney plus and have pirated every episode of the Mandalorian.
Here I was thinking they had priced Disney+ so reasonably that piracy wasn't worth the trouble, but not if this is how they are cutting costs.
posted by straight at 9:40 AM on November 19, 2020 [1 favorite]
Here I was thinking they had priced Disney+ so reasonably that piracy wasn't worth the trouble, but not if this is how they are cutting costs.
posted by straight at 9:40 AM on November 19, 2020 [1 favorite]
Here I was thinking they had priced Disney+ so reasonably that piracy wasn't worth the trouble,
As many in this thread have pointed out, there's a metric fuckton of history as to why you shouldn't give Disney any of your damn money, at least 40 years worth, before the advent of Disney fucking Plus.
Price literally had nothing to do with this choice. It's called a boycott because Disney are fucking scum and have been. This is not new.
posted by deadaluspark at 9:45 AM on November 19, 2020 [10 favorites]
seanmpuckett—I think your point is covered by cstross saying "chose to ignore it."
I am reminded of a story I read some years back by a musician (I can't dig it up now, I'm afraid) who'd had a modicum of success. He had earned enough from sales to "recoup his advance" and get ongoing royalties, although not by much. When he held the label to account, they were a bit incredulous and resentful that he was going to the trouble, and was causing them extra work. It turns out that so few artists recoup their advances that they really didn't have a proper accounting system in place to track payments to those who do.
posted by adamrice at 9:50 AM on November 19, 2020 [3 favorites]
I am reminded of a story I read some years back by a musician (I can't dig it up now, I'm afraid) who'd had a modicum of success. He had earned enough from sales to "recoup his advance" and get ongoing royalties, although not by much. When he held the label to account, they were a bit incredulous and resentful that he was going to the trouble, and was causing them extra work. It turns out that so few artists recoup their advances that they really didn't have a proper accounting system in place to track payments to those who do.
posted by adamrice at 9:50 AM on November 19, 2020 [3 favorites]
Since the SFWA is going "public letter" on this, my guess is book authors don't have as strong of protections as their music counterparts.
Music has a mass registration system that gives all musical artists the same kinds of protections. (Well, optionally. Musicians aren't required to license through ASCAP, but it's nearly universal at the pro level.) There are standards for royalty payments for various types of uses, standard ways of making exceptions, and so on.
Book contracts aren't weaker, legally, but they're all unique. There is no mass royalty system because (until recently because of internet copyright chaos hell) there is no mass distribution system. Until very recently, most people couldn't copy a book cheaper than they could buy a new one. And "public performance" of a book was limited to radio, and even where possible, wasn't common enough to need standardized protections.
For music, since there are tons of shady exploitative companies, there are tons of legal precedents about what happens when a contract gets broken. For books, there are fewer precedents, and fewer law firms tracking those precedents. (Not that there aren't tons of shady exploitative publishers. But many of them go broke, and there's no profit in suing a bankrupt company.)
An author may have six separate contracts with different terms. Foster's contracts may be different per book or per series. The royalty rates, penalties, and cancellation terms may all be different. The distribution and derivative rights may be different. If there's an agent involved, that person/companies rights may be tangled into the mess.
So: It's likely to be very complicated, and Disney is going to use that to stall, obfuscate, and confuse the court and the public, along with the standard dodge tactic of "wait until the last possible day to file a response on anything, and then ask for an extension." If Foster runs out of money to pursue the case, Disney wins.
posted by ErisLordFreedom at 9:57 AM on November 19, 2020 [4 favorites]
Music has a mass registration system that gives all musical artists the same kinds of protections. (Well, optionally. Musicians aren't required to license through ASCAP, but it's nearly universal at the pro level.) There are standards for royalty payments for various types of uses, standard ways of making exceptions, and so on.
Book contracts aren't weaker, legally, but they're all unique. There is no mass royalty system because (until recently because of internet copyright chaos hell) there is no mass distribution system. Until very recently, most people couldn't copy a book cheaper than they could buy a new one. And "public performance" of a book was limited to radio, and even where possible, wasn't common enough to need standardized protections.
For music, since there are tons of shady exploitative companies, there are tons of legal precedents about what happens when a contract gets broken. For books, there are fewer precedents, and fewer law firms tracking those precedents. (Not that there aren't tons of shady exploitative publishers. But many of them go broke, and there's no profit in suing a bankrupt company.)
An author may have six separate contracts with different terms. Foster's contracts may be different per book or per series. The royalty rates, penalties, and cancellation terms may all be different. The distribution and derivative rights may be different. If there's an agent involved, that person/companies rights may be tangled into the mess.
So: It's likely to be very complicated, and Disney is going to use that to stall, obfuscate, and confuse the court and the public, along with the standard dodge tactic of "wait until the last possible day to file a response on anything, and then ask for an extension." If Foster runs out of money to pursue the case, Disney wins.
posted by ErisLordFreedom at 9:57 AM on November 19, 2020 [4 favorites]
Price literally had nothing to do with this choice. It's called a boycott because Disney are fucking scum and have been. This is not new.
Though it should be noted that "boycott" usually implies "avoid using the service or product" rather than "use the service or product without paying for it."
posted by Justinian at 10:18 AM on November 19, 2020 [12 favorites]
Though it should be noted that "boycott" usually implies "avoid using the service or product" rather than "use the service or product without paying for it."
posted by Justinian at 10:18 AM on November 19, 2020 [12 favorites]
I'm only boycotting the liabilities.
posted by ryanrs at 10:25 AM on November 19, 2020 [30 favorites]
posted by ryanrs at 10:25 AM on November 19, 2020 [30 favorites]
As far as I know, Disney's acquisitions of both the News Corp. Fox studios business, and of Lucasfilm, were stock acquisitions where it bought companies not particular assets. In those situations, the liabilities of the purchased companies do follow the assets, because nothing happens to them in the first place.
Assuming this to be true, what is likely the case is that given the vast majority of Fox and Lucasfilm derivative works were works for hire, Disney had no idea that it was supposed to set up the legacy-contract ADF books for royalties especially given that they are mostly published by third parties. The request for an NDA is not at all unusual when one is disputing royalties because sales information for tentpole IP like Star Wars is treated as ultra-proprietary intelligence.
What is less likely but sadly still possible is that they know they are supposed to pay the royalties but are angry about given that everything else is work for hire, and are holding back the royalties to force a renegotiation.
What is least likely of all is that royalties were somehow optional and were being paid out of the goodness of George Lucas's and/or Rupert Murdoch's heart, and Disney is putting an end to that generosity.
In a world where the transactions were actually at the asset level, it certainly is unlikely that ADF's contracts were structured such Disney could have acquired the right to print and sell the books but the seller retained the obligation to pay the royalties. That kind of structure actually IS the default for transactions generally (e.g., if you buy a double scoop from an ice cream parlor that goes bankrupt the next day, you don't have to make up the dairy's loss when the parlor never pays the wholesale account receivable on those scoops), but it absolutely isn't for any kind of publishing contract. It would have required basically a separate work for hire contract (selling the book absolutely) and some kind of employment (?) contract that gave ADF the right to royalties based on sale AND 30+ years later for the transactions to have been structured to separate them. Not impossible, but not likely. If that's the case, ADF has to look to the seller / retainer of the payment obligation.
posted by MattD at 10:31 AM on November 19, 2020 [4 favorites]
Assuming this to be true, what is likely the case is that given the vast majority of Fox and Lucasfilm derivative works were works for hire, Disney had no idea that it was supposed to set up the legacy-contract ADF books for royalties especially given that they are mostly published by third parties. The request for an NDA is not at all unusual when one is disputing royalties because sales information for tentpole IP like Star Wars is treated as ultra-proprietary intelligence.
What is less likely but sadly still possible is that they know they are supposed to pay the royalties but are angry about given that everything else is work for hire, and are holding back the royalties to force a renegotiation.
What is least likely of all is that royalties were somehow optional and were being paid out of the goodness of George Lucas's and/or Rupert Murdoch's heart, and Disney is putting an end to that generosity.
In a world where the transactions were actually at the asset level, it certainly is unlikely that ADF's contracts were structured such Disney could have acquired the right to print and sell the books but the seller retained the obligation to pay the royalties. That kind of structure actually IS the default for transactions generally (e.g., if you buy a double scoop from an ice cream parlor that goes bankrupt the next day, you don't have to make up the dairy's loss when the parlor never pays the wholesale account receivable on those scoops), but it absolutely isn't for any kind of publishing contract. It would have required basically a separate work for hire contract (selling the book absolutely) and some kind of employment (?) contract that gave ADF the right to royalties based on sale AND 30+ years later for the transactions to have been structured to separate them. Not impossible, but not likely. If that's the case, ADF has to look to the seller / retainer of the payment obligation.
posted by MattD at 10:31 AM on November 19, 2020 [4 favorites]
It's risky to war against a nuclear power.
posted by TheHuntForBlueMonday at 10:38 AM on November 19, 2020 [1 favorite]
posted by TheHuntForBlueMonday at 10:38 AM on November 19, 2020 [1 favorite]
When Disney bought Fox and LucasFilm did they just get rid of all the people who were running those companies previously, or the accounting departments, etc.?
It seems to me like the idea that Disney doesn't know what it should be paying is only possible if they gutted the old accounting departments, etc. and haven't retained any of their old workflows, etc. That seems odd, because they'd also be having to figure out who all owed them money, etc. Likewise, licensing agreements that Fox and LucasFilm had in place with other entities (e.g., Netflix) were still operative through the remainder of the contracts, so it doesn't seem like Disney could claim it thought their obligations were null and void upon acquisition, right?
It's hard for me to conclude anything other than somewhere in Disney somebody affirmatively decided "stop paying these royalties" and passed that message throughout the company.
Disney is taking its first annual loss in quite some time this year, due to being hit on multiple fronts with its theme parks being shuttered and theaters closed due to COVID-19. Plus they're not able to continue producing new content for films in the pipeline.
All that said - I wonder if Disney is not paying out royalties as a stalling tactic to preserve cash flow rather than intending to make an argument that they never have to pay those royalties. I have no idea what its obligations would be w/r/t royalties to folks like ADF but if I understand the numbers correctly Disney lost quite a bit of money this year and doesn't have good prospects for income for at least six months due to COVID. They may simply be buying time, or they may be planning to try to screw people over entirely. Neither is good, but Disney going completely feral on royalties seems pretty awful.
posted by jzb at 10:59 AM on November 19, 2020 [1 favorite]
It seems to me like the idea that Disney doesn't know what it should be paying is only possible if they gutted the old accounting departments, etc. and haven't retained any of their old workflows, etc. That seems odd, because they'd also be having to figure out who all owed them money, etc. Likewise, licensing agreements that Fox and LucasFilm had in place with other entities (e.g., Netflix) were still operative through the remainder of the contracts, so it doesn't seem like Disney could claim it thought their obligations were null and void upon acquisition, right?
It's hard for me to conclude anything other than somewhere in Disney somebody affirmatively decided "stop paying these royalties" and passed that message throughout the company.
Disney is taking its first annual loss in quite some time this year, due to being hit on multiple fronts with its theme parks being shuttered and theaters closed due to COVID-19. Plus they're not able to continue producing new content for films in the pipeline.
All that said - I wonder if Disney is not paying out royalties as a stalling tactic to preserve cash flow rather than intending to make an argument that they never have to pay those royalties. I have no idea what its obligations would be w/r/t royalties to folks like ADF but if I understand the numbers correctly Disney lost quite a bit of money this year and doesn't have good prospects for income for at least six months due to COVID. They may simply be buying time, or they may be planning to try to screw people over entirely. Neither is good, but Disney going completely feral on royalties seems pretty awful.
posted by jzb at 10:59 AM on November 19, 2020 [1 favorite]
As far as I know, Disney's acquisitions of both the News Corp. Fox studios business, and of Lucasfilm, were stock acquisitions where it bought companies not particular assets. In those situations, the liabilities of the purchased companies do follow the assets, because nothing happens to them in the first place.
I think it is fairly common to do a deal structure in which, e.g., Disney sets up a sub LF Acquisition and the sub buys most or all of the assets from Lucasfilm, leaving Lucasfilm itself behind as a shell with some money from the sale but no ongoing operations. You want to avoid triggering de facto merger rules, but my understanding from a distance is that that's a higher standard to meet these days. But, yes, one would need to see the original deal documents for both transactions to know for sure what's going on.
posted by praemunire at 10:59 AM on November 19, 2020
I think it is fairly common to do a deal structure in which, e.g., Disney sets up a sub LF Acquisition and the sub buys most or all of the assets from Lucasfilm, leaving Lucasfilm itself behind as a shell with some money from the sale but no ongoing operations. You want to avoid triggering de facto merger rules, but my understanding from a distance is that that's a higher standard to meet these days. But, yes, one would need to see the original deal documents for both transactions to know for sure what's going on.
posted by praemunire at 10:59 AM on November 19, 2020
Hi everybody, this is why I never paid for Disney plus and have pirated every episode of the Mandalorian.
If you have paid money to these pricks at Disney, yes, you should be fucking ashamed.
Oh, get of your high horse. I pirate the Mandalorian too, but you don't see me berating other people who have a Disney+ subscription. And don't call it a boycott, you are still consuming the product, you're just not paying for it.
posted by Pendragon at 11:06 AM on November 19, 2020 [21 favorites]
If you have paid money to these pricks at Disney, yes, you should be fucking ashamed.
Oh, get of your high horse. I pirate the Mandalorian too, but you don't see me berating other people who have a Disney+ subscription. And don't call it a boycott, you are still consuming the product, you're just not paying for it.
posted by Pendragon at 11:06 AM on November 19, 2020 [21 favorites]
As far as I know, Disney's acquisitions of both the News Corp. Fox studios business, and of Lucasfilm, were stock acquisitions where it bought companies not particular assets.
As I said before, any deal involving real lawyers does not do this, for all the reasons we are all arguing about.
Hell, here are the documents, filed with the California Secretary of State ~50 days after the merger announcement, that involved a handful of mergers where LucasFilm Ltd. (registration date 09/12/1977) got absorbed into Disney mothership. You'll notice they got real creative with the entity names (NewCo, NewCo Merger Sub, Valor Acquisition Sub, Inc. Valor Merger Sub, LLC.), but what did not happen is that Disney just merged in LucasFilm directly.
In my 20+ years in software biz, I've had the "fortune" of obtaining thousands upon thousands of options and/or shares of companies with zero revenue and zero assets, companies whose mergers generated press releases with lots of zeros on them. I went into those jobs expecting literally zero dollars from the shares/options they promised me, so I'm not in the same boat as these authors, but I do have lots o' experience with owning pieces of metaphorically empty air after a merger/acquisition. It sucks, and it's how it usually goes.
posted by sideshow at 11:16 AM on November 19, 2020 [5 favorites]
As I said before, any deal involving real lawyers does not do this, for all the reasons we are all arguing about.
Hell, here are the documents, filed with the California Secretary of State ~50 days after the merger announcement, that involved a handful of mergers where LucasFilm Ltd. (registration date 09/12/1977) got absorbed into Disney mothership. You'll notice they got real creative with the entity names (NewCo, NewCo Merger Sub, Valor Acquisition Sub, Inc. Valor Merger Sub, LLC.), but what did not happen is that Disney just merged in LucasFilm directly.
In my 20+ years in software biz, I've had the "fortune" of obtaining thousands upon thousands of options and/or shares of companies with zero revenue and zero assets, companies whose mergers generated press releases with lots of zeros on them. I went into those jobs expecting literally zero dollars from the shares/options they promised me, so I'm not in the same boat as these authors, but I do have lots o' experience with owning pieces of metaphorically empty air after a merger/acquisition. It sucks, and it's how it usually goes.
posted by sideshow at 11:16 AM on November 19, 2020 [5 favorites]
@jzb - actually, they DID fire a ton of people during the acquisitions (I knew some of them), and even when companies don't practice such a large degree of slash-n-burn, it's shockingly common for licensing / royalty / do-we-even-own-this documents to be buried or outright lost.
It wouldn't surprise me at all if it's some combination of
A) What Cstross said
B) Whoever at Disney handles novelizations got stuck with the Fox and LucasArts IPs after many important people there were unceremoniously fired, and has literally no idea where to get the information they need.
The NDA thing is definitely scummy and awful. It may also be Disney's way of covering themselves for a conversation that opens with "Look man, now that you've signed and can't tell anyone, we have no idea how much money we owe you."
In my headcanon, the next bit is something like "... so is $2 million enough to just buy you out, or do we let lawyers fight until hell freezes over? Okay, fine, $3 million if we can end this meeting in the next 10 minutes, because I can only spend $10 million before I need to get on the phone with my boss, and I need to have this same conversation with 27 authors who are much less famous than you."
posted by ®@ at 11:22 AM on November 19, 2020 [6 favorites]
It wouldn't surprise me at all if it's some combination of
A) What Cstross said
B) Whoever at Disney handles novelizations got stuck with the Fox and LucasArts IPs after many important people there were unceremoniously fired, and has literally no idea where to get the information they need.
The NDA thing is definitely scummy and awful. It may also be Disney's way of covering themselves for a conversation that opens with "Look man, now that you've signed and can't tell anyone, we have no idea how much money we owe you."
In my headcanon, the next bit is something like "... so is $2 million enough to just buy you out, or do we let lawyers fight until hell freezes over? Okay, fine, $3 million if we can end this meeting in the next 10 minutes, because I can only spend $10 million before I need to get on the phone with my boss, and I need to have this same conversation with 27 authors who are much less famous than you."
posted by ®@ at 11:22 AM on November 19, 2020 [6 favorites]
I went into those jobs expecting literally zero dollars from the shares/options they promised me, so I'm not in the same boat as these authors, but I do have lots o' experience with owning pieces of metaphorically empty air after a merger/acquisition. It sucks, and it's how it usually goes.
But once again, unless I'm understanding the complaint wrong, the issue isn't the royalties paid by Lucasfilm in the past. The issue is that Disney has continued to receive revenue from the current-day sale of these books, and not paid royalties on the current sales.
I could have read that wrong, but it's NOT like previously purchased ice cream or previously given stock that is now worthless. It's more like continuing to order ice cream from the supplier and then not paying them, or the stock options still having value and just saying "well it wasn't us that gave them to you and we're keeping them."
posted by warriorqueen at 11:31 AM on November 19, 2020 [6 favorites]
But once again, unless I'm understanding the complaint wrong, the issue isn't the royalties paid by Lucasfilm in the past. The issue is that Disney has continued to receive revenue from the current-day sale of these books, and not paid royalties on the current sales.
I could have read that wrong, but it's NOT like previously purchased ice cream or previously given stock that is now worthless. It's more like continuing to order ice cream from the supplier and then not paying them, or the stock options still having value and just saying "well it wasn't us that gave them to you and we're keeping them."
posted by warriorqueen at 11:31 AM on November 19, 2020 [6 favorites]
The Mouse only commissions work for hire these days. They probably haven't printed a royalty statement in over fifty years because they don't pay royalties, they buy work-for-hire.
As far as I know, Disney-owned Marvel pays comic creators sales-based royalties on work-for-hire done on Marvel/Disney owned IPs.
Someone at Disney certainly knows how to track and commission royalties in those cases.
posted by thecjm at 11:41 AM on November 19, 2020 [1 favorite]
As far as I know, Disney-owned Marvel pays comic creators sales-based royalties on work-for-hire done on Marvel/Disney owned IPs.
Someone at Disney certainly knows how to track and commission royalties in those cases.
posted by thecjm at 11:41 AM on November 19, 2020 [1 favorite]
I am a real lawyer, and I have worked (albeit in a modest role) on very high-stakes litigation involving whether a de facto merger occurred rather than an asset purchase, and I second-chaired a deposition of a bank CEO whose name you would all have recognized at the time on this topic, and I promise you that asset purchase or not you can't simply ditch your obligations to a party to a contract because the contract was assigned to you (instead of your being the original contracting party). You seem to be struggling to distinguish between claims against purchasers existing prior to a sale/assignment and claims arising from the ongoing exercise of contractual rights after a sale/assignment, but it's a real distinction.
posted by praemunire at 11:44 AM on November 19, 2020 [17 favorites]
posted by praemunire at 11:44 AM on November 19, 2020 [17 favorites]
Hell, here are the documents, filed with the California Secretary of State ~50 days after the merger announcement, that involved a handful of mergers where LucasFilm Ltd. (registration date 09/12/1977) got absorbed into Disney mothership. You'll notice they got real creative with the entity names (NewCo, NewCo Merger Sub, Valor Acquisition Sub, Inc. Valor Merger Sub, LLC.), but what did not happen is that Disney just merged in LucasFilm directly.
Yes, and did you notice the part in 1.2 where all debts, liabilities and duties of the Company and NewCo Merger Sub become the debts, liabilities, and duties of the Surviving Corporation? That's what this is - under the contracts ADF has, there is a duty that was part of the deal.
posted by nubs at 12:01 PM on November 19, 2020 [1 favorite]
Yes, and did you notice the part in 1.2 where all debts, liabilities and duties of the Company and NewCo Merger Sub become the debts, liabilities, and duties of the Surviving Corporation? That's what this is - under the contracts ADF has, there is a duty that was part of the deal.
posted by nubs at 12:01 PM on November 19, 2020 [1 favorite]
To follow up on my earlier comment, here's that story (turns out the band had not recouped). And here's the original Metafilter discussion, through which I no doubt found the story.
posted by adamrice at 12:02 PM on November 19, 2020 [1 favorite]
posted by adamrice at 12:02 PM on November 19, 2020 [1 favorite]
I absolutely loved the Pip and Flinx novels and Sentenced to Prism when I was a kid. I haven't reread them as an adult, but Foster's non-mouse-owned works are definitely worth a look.
posted by gurple at 12:36 PM on November 19, 2020 [3 favorites]
posted by gurple at 12:36 PM on November 19, 2020 [3 favorites]
> sideshow: In my 20+ years in software biz, I've had the "fortune" of obtaining thousands upon thousands of options and/or shares of companies with zero revenue and zero assets, companies whose mergers generated press releases with lots of zeros on them. I went into those jobs expecting literally zero dollars from the shares/options they promised me, so I'm not in the same boat as these authors, but I do have lots o' experience with owning pieces of metaphorically empty air after a merger/acquisition. It sucks, and it's how it usually goes."
I have the sneaking suspcion that employee stock option grants and author royalties are not really as similar as you are suggesting and that your personal experience with stock option grants may not be directly applicable to Foster's contract terms.
posted by mhum at 12:44 PM on November 19, 2020 [11 favorites]
I have the sneaking suspcion that employee stock option grants and author royalties are not really as similar as you are suggesting and that your personal experience with stock option grants may not be directly applicable to Foster's contract terms.
posted by mhum at 12:44 PM on November 19, 2020 [11 favorites]
The last time I was in a used bookstore, I bought a fantasy novel I'd never heard of solely because Alan Dean Foster was the author (and it was a buck, so I could hardly lose). (Of course, being a used book, Foster didn't see a dime from the resale.) It's called The Hour of the Gate and apparently the second book of the Spellsinger series.
posted by Gelatin at 12:47 PM on November 19, 2020 [5 favorites]
posted by Gelatin at 12:47 PM on November 19, 2020 [5 favorites]
When Disney bought Fox and LucasFilm did they just get rid of all the people who were running those companies previously, or the accounting departments, etc.?
I work for the pension and health plan of one of the major entertainment industry unions and my job is to make sure the signatory companies pay their pension and health contributions for work performed in the job categories the union covers.
Disney and (for example) Twentieth Century Fox are both large enough that it would be impossible for me to say with any certainty whether this is the case company-wide, but I can say that for the part of the industry my job covers the accounting has moved from Twentieth Century Fox's accounting team to Disney's and it has been not entirely without hiccups.
posted by Parasite Unseen at 1:02 PM on November 19, 2020 [4 favorites]
I work for the pension and health plan of one of the major entertainment industry unions and my job is to make sure the signatory companies pay their pension and health contributions for work performed in the job categories the union covers.
Disney and (for example) Twentieth Century Fox are both large enough that it would be impossible for me to say with any certainty whether this is the case company-wide, but I can say that for the part of the industry my job covers the accounting has moved from Twentieth Century Fox's accounting team to Disney's and it has been not entirely without hiccups.
posted by Parasite Unseen at 1:02 PM on November 19, 2020 [4 favorites]
It's called The Hour of the Gate and apparently the second book of the Spellsinger series.
Yes. I read the series when it first came out, loved it as a teen. Went back and re-read it recently, it would make a good Netflix series or something. It's dated and definitely sexist, but the stories are fun.
posted by jzb at 1:08 PM on November 19, 2020 [3 favorites]
Yes. I read the series when it first came out, loved it as a teen. Went back and re-read it recently, it would make a good Netflix series or something. It's dated and definitely sexist, but the stories are fun.
posted by jzb at 1:08 PM on November 19, 2020 [3 favorites]
And don't call it a boycott, you are still consuming the product, you're just not paying for it.
Eh, I don't see any obligation to be originalist about it, I think it's perfectly legitimate for "boycott" to be an umbrella term for any organized (or personal!) denial of commerce.
I can say that for the part of the industry my job covers the accounting has moved from Twentieth Century Fox's accounting team to Disney's and it has been not entirely without hiccups.
Would that the parties on the other sides of these tables took a lesson from Disney's own history and held them to account and penalized them for every delay and mistake.
posted by rhizome at 1:21 PM on November 19, 2020 [2 favorites]
Eh, I don't see any obligation to be originalist about it, I think it's perfectly legitimate for "boycott" to be an umbrella term for any organized (or personal!) denial of commerce.
I can say that for the part of the industry my job covers the accounting has moved from Twentieth Century Fox's accounting team to Disney's and it has been not entirely without hiccups.
Would that the parties on the other sides of these tables took a lesson from Disney's own history and held them to account and penalized them for every delay and mistake.
posted by rhizome at 1:21 PM on November 19, 2020 [2 favorites]
In my headcanon, the next bit is something like "... so is $2 million enough to just buy you out, or do we let lawyers fight until hell freezes over? Okay, fine, $3 million if we can end this meeting in the next 10 minutes, because I can only spend $10 million before I need to get on the phone with my boss, and I need to have this same conversation with 27 authors who are much less famous than you."
I suspect the whole point of the NDA is so the Disney lawyer doesn't have to have this same conversation with 27 authors much less famous than Foster. So good on Foster for not taking the payout and instead blowing the lid off.
posted by The Tensor at 1:24 PM on November 19, 2020 [2 favorites]
I suspect the whole point of the NDA is so the Disney lawyer doesn't have to have this same conversation with 27 authors much less famous than Foster. So good on Foster for not taking the payout and instead blowing the lid off.
posted by The Tensor at 1:24 PM on November 19, 2020 [2 favorites]
Maybe people saying there's no obligation don't get what royalties are.
Royalties are not a bonus. Royalties are your compensation for your work.
The agreement is something like "you write it, we'll print it and distribute it, we'll both market it, and you get 10%." (There's all kinds of other issues but that's the core agreement.)
An advance is what you're paid up front by publishers, and usually you can keep that even if your royalties don't get you to that number. In fact, you won't get it against books that are sold to booksellers but aren't actually selling from the bookstore so if copies of your book are sitting around you won't see any more money.
However, once you've earned out your advance, you get your 10%. Because that is the agreement. It's not a bonus because your book did a good job. It is the agreed upon compensation.
So in the stock scenario it's kind of like there's a business partnership, with one person holding 10% of stock and the other party holding 90% of stock, and dividends are good. But the company is sold and you don't get an opportunity to get your 10% stock OR your 10% of dividends - your partner gets their 90% and the company that bought it just - keeps the 10% because they can outwait your lawsuit.
posted by warriorqueen at 1:42 PM on November 19, 2020 [13 favorites]
Royalties are not a bonus. Royalties are your compensation for your work.
The agreement is something like "you write it, we'll print it and distribute it, we'll both market it, and you get 10%." (There's all kinds of other issues but that's the core agreement.)
An advance is what you're paid up front by publishers, and usually you can keep that even if your royalties don't get you to that number. In fact, you won't get it against books that are sold to booksellers but aren't actually selling from the bookstore so if copies of your book are sitting around you won't see any more money.
However, once you've earned out your advance, you get your 10%. Because that is the agreement. It's not a bonus because your book did a good job. It is the agreed upon compensation.
So in the stock scenario it's kind of like there's a business partnership, with one person holding 10% of stock and the other party holding 90% of stock, and dividends are good. But the company is sold and you don't get an opportunity to get your 10% stock OR your 10% of dividends - your partner gets their 90% and the company that bought it just - keeps the 10% because they can outwait your lawsuit.
posted by warriorqueen at 1:42 PM on November 19, 2020 [13 favorites]
All this supposition that Disney doesn't have people to handle this is supreme bullcrap. Disney has enough money they could have hired 20 accountants and 40 lawyers to handle nothing but ADF royalties with the change in their couch cushions. Disney has made a deliberate decision to just not pay money owed because they have more money than the plaintiffs and decided they can delay payments for a couple decades or until the plaintiff goes away. They are a typical monopoly flexing just because they can.
posted by Mitheral at 2:17 PM on November 19, 2020 [7 favorites]
posted by Mitheral at 2:17 PM on November 19, 2020 [7 favorites]
The idea that Disney is somehow unable to provide the royalties because they don't know how is cute, but unlikely. They're a huge company that already has multiple publishing arms. Perhaps those arms publish purely work-for-hire works, but they still have accounting departments full of accountants who have worked in publishing their whole careers. They know the exact number of Foster's novelizations they've sold in the last year. They could calculate whatever percentage of the proceeds is owed to him. They could also just as easily cut him a settlement check for enough to get him to sign the rights over and go away. They're choosing not to do any of these things, because they think they can get away with it. So fuck 'em, fuck their monopolizing pop culture, and fuck what they've done to copyright law over the last 75 years.
posted by Mr.Encyclopedia at 5:06 PM on November 19, 2020 [9 favorites]
posted by Mr.Encyclopedia at 5:06 PM on November 19, 2020 [9 favorites]
I guess act cinemas who have prints of why Disney owned properties should just sell their inventory to Totally Not The Same Cinema plc, declare bankruptcy, and then start doing showings of those films without paying Disney. After all, they bought the inventory, including these here reels if film, but but the obligations to pay for their continued use.
If it's good for the goose...
posted by Dysk at 5:47 PM on November 19, 2020 [3 favorites]
If it's good for the goose...
posted by Dysk at 5:47 PM on November 19, 2020 [3 favorites]
@Mitheral & @ Mr.Encyclopedia - I don't think anybody here is *excusing* Disney. What they are doing is reprehensible, and they could 100% pay to handle this properly and never notice. My personal speculation is just about how did they arrive at the point where they made the choice to wait out the author with a dying wife.
Maybe they are callous and have a long game idea about screwing artists, maybe they are callous and disorganized (my guess), or maybe they are callous and [some other reason]. But I don't see a scenario where their actions are defensible.
posted by ®@ at 11:12 AM on November 20, 2020
Maybe they are callous and have a long game idea about screwing artists, maybe they are callous and disorganized (my guess), or maybe they are callous and [some other reason]. But I don't see a scenario where their actions are defensible.
posted by ®@ at 11:12 AM on November 20, 2020
Even if they were initially disorganized it's not like Alan Dean Foster just noticed he wasn't getting paid last week. Disney bought Lucas Films six years ago. This particular dispute has been ongoing for at least a year and they were on the ball enough to attempt to bind him with an NDA. They won't speak to his agents or the SFWA. I usually lean pretty heavily into never attributing actions to malice when stupidity is a possibility but in this case Disney would have to be willfully ignorant.
posted by Mitheral at 1:48 PM on November 20, 2020 [3 favorites]
posted by Mitheral at 1:48 PM on November 20, 2020 [3 favorites]
I usually lean pretty heavily into never attributing actions to malice when stupidity is a possibility
Heinlein's Razor: "...but don't rule out malice."
posted by rhizome at 2:31 PM on November 20, 2020 [2 favorites]
Heinlein's Razor: "...but don't rule out malice."
posted by rhizome at 2:31 PM on November 20, 2020 [2 favorites]
Just a side note, but if anyone's looking for some good SFF to read or listen to, I'd highly recommend cstross's Hugo Award nominated (and individual novella winning) Laundry Files series, and (in my opinion also excellent) Merchant Princes series.
Also, fuck the mouse.
posted by MattWPBS at 7:32 AM on November 21, 2020 [1 favorite]
Also, fuck the mouse.
posted by MattWPBS at 7:32 AM on November 21, 2020 [1 favorite]
Take this as you will, but I think what Disney is doing is gross but it's not at all unique for the type of company they now are.
They're a publicly-traded company that, at its core, is meant to extract as much profit as possible (or at least send signals to the market that they're profitable) in order to please shareholders. Given that goal, the concept of compensating the workers fairly, or even creating content and products that people would like, are secondary to goal number one in that they're contributing factors to how much profit they wring out of their assets.
The default action any time has a grievance with such an entity is to ignore or deny. Even in cases where they obviously are going to have to do something, that something then goes to the lawyers to negotiate with terms as stringent as they can think of (NDAs, negotiated settlements, etc.) and then escalates accordingly. A lot of individuals with grievances won't get very far, because the amount of money Disney would pay by compensating anyone with a legitimate claim fairly is still more than hundreds of hours of lawyer bills. And people will still do work for them even knowing these terms, because the terms suck everywhere else, and at some point you realize the Disneys of the world are the only game in town. Or you do work for some relative newcomer like Netflix, etc. until they get large enough that their terms are the same as Disney's.
Disney's bad, but given the current system, the only thing that's going to stop this crap is top-down legislation or a bottom-up general strike, neither of which seem extremely practical.
posted by mikeh at 9:00 AM on November 23, 2020 [1 favorite]
They're a publicly-traded company that, at its core, is meant to extract as much profit as possible (or at least send signals to the market that they're profitable) in order to please shareholders. Given that goal, the concept of compensating the workers fairly, or even creating content and products that people would like, are secondary to goal number one in that they're contributing factors to how much profit they wring out of their assets.
The default action any time has a grievance with such an entity is to ignore or deny. Even in cases where they obviously are going to have to do something, that something then goes to the lawyers to negotiate with terms as stringent as they can think of (NDAs, negotiated settlements, etc.) and then escalates accordingly. A lot of individuals with grievances won't get very far, because the amount of money Disney would pay by compensating anyone with a legitimate claim fairly is still more than hundreds of hours of lawyer bills. And people will still do work for them even knowing these terms, because the terms suck everywhere else, and at some point you realize the Disneys of the world are the only game in town. Or you do work for some relative newcomer like Netflix, etc. until they get large enough that their terms are the same as Disney's.
Disney's bad, but given the current system, the only thing that's going to stop this crap is top-down legislation or a bottom-up general strike, neither of which seem extremely practical.
posted by mikeh at 9:00 AM on November 23, 2020 [1 favorite]
They're a publicly-traded company that, at its core, is meant to extract as much profit as possible (or at least send signals to the market that they're profitable) in order to please shareholders
Just to clarify a detail, the goal of maximizing shareholder value is not law, and on that term it's practically impossible for a fiduciary duty case to succeed. CEOs have wiiiide latitude in how they run their companies, but they just don't, because within the ideology there are financial rewards for greed.
posted by rhizome at 11:39 AM on November 24, 2020 [3 favorites]
Just to clarify a detail, the goal of maximizing shareholder value is not law, and on that term it's practically impossible for a fiduciary duty case to succeed. CEOs have wiiiide latitude in how they run their companies, but they just don't, because within the ideology there are financial rewards for greed.
posted by rhizome at 11:39 AM on November 24, 2020 [3 favorites]
Of course it’s not law! It’s the market. And while ethical investment vehicles exist, they’re far from the norm and few 401k advisors, etc. are selecting based on ethics-based criteria. No one is suing because at the broad level, people don’t care or it’s abstract enough they don’t want to care. Playing the market as a hobby tends to be as ethically involved as a poker hand, and there’s a divorce of ethics from long-term financial planning because it’s “just there.” Not the place here, but we’ve gone so far from the company pension, supplement with financial plan, to everything being fully in wall street that we can’t even wrap our heads around it.
One of those holdings stops delivering? The market gets the message and moves. A glance at a few of the major index funds and I see Disney in there. Not subscribing to Disney+ doesn’t do much when your employer’s retirement fund is 2% Disney
posted by mikeh at 7:42 PM on November 24, 2020
One of those holdings stops delivering? The market gets the message and moves. A glance at a few of the major index funds and I see Disney in there. Not subscribing to Disney+ doesn’t do much when your employer’s retirement fund is 2% Disney
posted by mikeh at 7:42 PM on November 24, 2020
Not subscribing to Disney+ doesn’t do much when your employer’s retirement fund is 2% Disney
All the shareholding in the world means nothing if there's no revenue stream.
posted by Dysk at 6:45 AM on November 25, 2020
All the shareholding in the world means nothing if there's no revenue stream.
posted by Dysk at 6:45 AM on November 25, 2020
And while ethical investment vehicles exist, they’re far from the norm and few 401k advisors, etc. are selecting based on ethics-based criteria
I think you might be missing the trees for the forest, the shareholder imperative is used for every decision within public companies. It's literally the "where's Poochie?" of business.
posted by rhizome at 12:03 PM on November 25, 2020
I think you might be missing the trees for the forest, the shareholder imperative is used for every decision within public companies. It's literally the "where's Poochie?" of business.
posted by rhizome at 12:03 PM on November 25, 2020
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posted by Glinn at 5:16 PM on November 18, 2020 [1 favorite]