Earlier this year director Stanley Donen
, the estate of Charles Bronson
and several other filmmakers filed class-action suits against five studios over a practice that has long been a standard way of doing business: When it comes to divvying up backend homevideo money to profit participants, studios take it from a pot of just 20% of the returns.
The other 80%? The studio, Donen’s suit stated, “wrongfully” keeps the money. In Donen’s case, the studio was Fox.
Why would the studios withhold 80% of the kitty from profit participation? It’s a practice that dates back to the early days of homevideo, when it was written into the original contracts. At the time, the rationale was that the studios needed the money to cover the high cost of manufacturing and distributing VHS tapes.
The question now hanging over Hollywood — and the lawyers representing its players — is whether that one-fifth share will endure in the digital age.