{"id":19,"date":"2011-12-15T21:44:24","date_gmt":"2011-12-15T21:44:24","guid":{"rendered":"https:\/\/bejone03.expressions.syr.edu\/trf594\/?p=19"},"modified":"2011-12-22T20:36:37","modified_gmt":"2011-12-22T20:36:37","slug":"legal-business-affairs","status":"publish","type":"post","link":"https:\/\/bejone03.expressions.syr.edu\/trf594\/2011\/12\/15\/legal-business-affairs\/","title":{"rendered":"Legal & Business Affairs"},"content":{"rendered":"
\u00a0by Michael Kandel<\/span><\/pre>\n
Recap of 2011’s Legal and Business Affairs in Television.\u00a0People reading this should not substitute it for what an experienced\u00a0professional can provide such as an attorney or accountant. This WIKI will provide and give you a sense of what has been going on\u00a0throughout the year\u00a02011.<\/span><\/p>\n
Background<\/h2>\n
During the Fall 2011 semester at Syracuse University<\/a>, I was\u00a0enrolled\u00a0in the\u00a0Television , Radio and Film Course, Television Business.\u00a0I was given the assignment to make a WIKI discussing\u00a0what is going on in 2011 pertaining to the Legal and Business Affairs of Television.\u00a0I will be using\u00a0the textbook “The Business of Television” By: Howard J. Blumenthal and Oliver R. Goodenough, printed in 2006 as\u00a0a guide. The topics I will be\u00a0going over will be: Contracts, Work Relationships, Unions, Legal Entities, Tax Issues and\u00a0any\u00a0events\u00a0that have happened during 2011. I will briefly discuss what they\u00a0are and\u00a0hopefully provide you with\u00a0examples of each that\u00a0was brought\u00a0up\u00a0in 2011. Please feel free to add\u00a0anything that is relevant and even post comments.<\/p>\n
Information on Contracts<\/h1>\n
This link, 2011 Screen Actors Guild and Basic Television Contracts<\/a>, will be able to show you what a valid Current\u00a0Television contract looks like.<\/p>\n
A contract is a binding agreement between two or more\u00a0parties. There are a\u00a0few things\u00a0people should be aware about \u00a0when making a legal contract.\u00a0Contracts can be either verbal or written but are preferred to be written down as it is harder to prove a verbal contract in the court of law1<\/sup>. However an oral contract can be used if a reasonable observer can prove the validity of the contract. In the case Trademark Properties Inc, v. A&E Television Networks<\/a>\u00a0there was an oral contract between Richard Davis and his company against A&E\u00a0Television Networks that\u00a0stated Richard had an oral agreement to split\u00a0revenues from the reality\u00a0television series “Flip This House”<\/a>. The court ruled in\u00a0Richard’s favor and was awarded $4 million.\u00a0The defendants appealed stating that there was a\u00a0lack of evidence and that the oral contract to split revenues had not been reached. The Appelate court in the Fourth Circuit upheld the jury’s\u00a0decision 2:1. The reason why it was upheld was because the court found the oral contract to be reasonable and true2<\/sup>.<\/p>\n
By writing down the agreement, allows both parties to be aware of their rights and responsibilities. An oral contract can be risky when it is used in a court of law which is why it is preferred to have a written agreement between both parties so that no conflicts can arise in the future.<\/p>\n
Rentrak<\/a>\u00a0which provides media measurement and analytical services3<\/sup>\u00a0signed a\u00a0contract with SHORTS HD<\/a>\u00a0international as of October 11, 2011. Shorts had its U.S. launch in 2010 and with the help ofRentrak’s service, Shorts HD\u00a0will be able to see TV viewing data from millions of reporting households4<\/sup>.\u00a0Rentrak serves the most recognizable companies in the entertainment industry\u00a0and they will help grow Shorts content and advertising opportunities.<\/p>\n
Information on Work Relationships \u00a0\u00a0\u00a0\u00a0\u00a0<\/strong><\/p>\n
\"\"<\/p>\n
Keeping a business relationship is an important aspect for the growth of the business. It is important to have respect in a business relationship. You want the other party to feel safe and appreciated.\u00a0Another way in building a better relationship is being open and honest with each other. One can do this by clearly communicating to the other party the good and the bad. It also helps to be an effective listener as you show you care for what they have to say.12<\/sup><\/p>\n
Check out this article (click here<\/a>)\u00a0\u00a0as it shows how competitive Television\u00a0Markets\u00a0are familiar with each other.<\/p>\n
Information on Unions<\/h2>\n
An article(SAG Board Expected to Proceed with AFTRA Meger)<\/a>\u00a0posted by the Los Angeles Times on December 13th<\/sup> 2011\u00a0talks about\u00a0how\u00a0the Screen Actor’s\u00a0Guild president, Ken Howard, is underway at merging the SAG and the American Federation of Television and Federal Arts. Howard is optomistic about\u00a0a Jan. 22\u00a0meeting to complete the merging agreement.\u00a0\u00a0Digital distribution has posed a threat to\u00a0members and had affected the traditional amount of income they would normally receive.6<\/sup> The purpose of the merger\u00a0is to give members more bargaining power\u00a0in their contracts. Former SAG president, Alan Rosenberg, is against this idea as he fears the merger into a larger union would leave actors with less of a voice.<\/p>\n
Information on Legal Entities<\/h2>\n
When deciding the type of entity to choose from, a business would look at the advantages and disadvantages that are offered for each.<\/p>\n
The most popular types of entities to choose from are:<\/p>\n
    \n
  1. Corporation (C-Corp)<\/li>\n
  2. Partnership<\/li>\n
  3. S-Corporation<\/li>\n
  4. Limited Liability Company (LLC)<\/li>\n
  5. Sole Proprietorship<\/li>\n<\/ol>\n
    This link (click here<\/a>) will provide you with detail\u00a0about each entity.<\/p>\n
    Another popular form of entity is a Loan-Out Corporation which is a separate entity that is set up for an actor\/actress. People invested with a Loan-Out Corporation because of the tax advanatges ffor the corporation such as no payroll taxes. Currently, people keep loan out corporations with purpose of using it for\u00a0 pension planning, profit-sharing plans or health insurance. 11<\/sup><\/p>\n
    Information on Tax Issues<\/h2>\n
    People\u00a0working in television business\u00a0that\u00a0do not have a permanent business affiliation\u00a0will look at ways to deduct its\u00a0expenses\u00a0with the goal of paying\u00a0as little\u00a0taxes as possible.<\/p>\n
    The following is useful in preparing 2010 Returns. For more information\u00a0click here<\/a><\/p>\n
    Lookinging at IRS Publication 463 Travel, Entertainment, Gift and Car Expenses<\/strong> we can see possible deductions employees can take. Focusing in on the Entertainment part, employees can take a deduction on entertainment expenses if they are entertaining a customer, client or employee. By looking at the chart below, you will be able to understand the rules and definitions of taking that entertainment deduction.10<\/sup><\/p>\n\n\n\n\n\n\n\n
    General rule<\/span><\/span><\/strong><\/td>\n\n
    You can deduct ordinary and necessary expenses to entertain a client, customer, or employee if the expenses meet the directly-related test or the associated test.<\/span><\/span><\/p>\n<\/td>\n<\/tr>\n
    Definitions<\/span><\/span><\/strong><\/td>\n\n
    \n
    \u2022<\/span><\/span><\/p>\n
    Entertainment includes any activity generally considered to provide entertainment, amusement, or recreation, and includes meals provided to a customer or client.<\/span><\/span>\u2022<\/span><\/span><\/p>\n
    An ordinary expense is one that is common and accepted in your trade or business.<\/span><\/span>\u2022<\/span><\/span><\/p>\n
    A necessary expense is one that is helpful and appropriate.<\/span><\/span><\/p>\n<\/div>\n<\/td>\n<\/tr>\n
    Tests to be met<\/span><\/span><\/strong><\/td>\nDirectly-related test<\/span><\/span>\u2022<\/span><\/span><\/p>\n
    Entertainment took place in a clear business setting, or<\/span><\/span>\u2022<\/span><\/span><\/p>\n
    You did engage in business with the person during the entertainment period, and<\/span><\/span><\/p>\n
    You had more than a general expectation of getting income or some other specific business benefit.<\/span><\/span><\/p>\n
    Main purpose of entertainment was the active conduct of business, and<\/span><\/span><\/td>\n<\/tr>\n
    Associated test<\/span><\/span>\u2022<\/span><\/span><\/p>\n
    Entertainment is associated with your trade or business, and<\/span><\/span>\u2022<\/span><\/span><\/p>\n
    Entertainment directly before or after a substantial business discussion.<\/span><\/span><\/td>\n<\/tr>\n
    Other rules<\/span><\/span><\/strong><\/td>\n\u2022<\/span><\/span>You cannot deduct the cost of your meal as an entertainment expense if you are claiming the meal as a travel expense.<\/span><\/span>\u2022<\/span><\/span><\/p>\n
    You cannot deduct expenses that are lavish or extravagant under the circumstances.<\/span><\/span>\u2022<\/span><\/span><\/p>\n
    You generally can deduct only 50% of your unreimbursed entertainment expenses (see<\/span><\/span> 50% Limit<\/span><\/span><\/span>).<\/span><\/span><\/span><\/em><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
    Business related meals and expenses are deducutible up to 50% unless its an:<\/p>\n
    1. Employee\u00a0Reimbursed Expense. Meaning\u00a0an employee can’t take\u00a0a deduction from a meal if\u00a0the employer reimburses you.<\/p>\n
    2. Self Employed. If you are self employed than you are not allowed to take the 50% deduction on meals and entertainment if all of the following are conditions are met.<\/p>\n