Buying Back Rights To A Character by Pamela A. Schechter, Esq.

Selling a character to a film or television company is a very exciting event. This can be a big turning point in an animator's career. The company purchasing the character usually pays a substantial sum of money for all of the rights to the character. In addition, the animator is often asked to develop a treatment or a pilot consisting of several minutes of animation using the character. For these tasks, the animator is also compensated. At this point in time, both the company and the animator have great hope that eventually there will be several projects using the character which will be quite lucrative to all those involved.

However, not every character sale turns into the success story of Beavis and Butt-Head. After a treatment has been written or a pilot has been created, the company that now owns the character can decide it does not want to do anything further with it. It has the right to make this decision because it owns all the rights to the character and can either do or not do anything it wants with it.

This can be a very disappointing time for an animator who is attached to his character and wants to see it developed further. However, all is not lost. An animator who has sold all of his rights in his character to a company can offer to purchase it back. Negotiations begin with the company determining a buyback purchase price for the character. It is important that the animator be represented by an entertainment attorney during this process because it can be quite complicated.

In addition to the character, the animator wants to buy back any material created during the time of the agreement which can include any treatments or pilots. It is important for both the animator and his attorney to review all of the projects that have been worked on utilizing the character during the time of the original purchase agreement. The contract can be in place for a number of years and it is easy to forget what material has been created using the character during the time of the agreement.

Most companies determine the price for the buy-back of a character by adding together all of the money spent on the character. This amount includes the purchase price for the character, the amount spent on any treatments or pilots and any other money spent creating projects with the character during the time of the agreement.

Sometimes the animator has created animation prior to the sale of the character to the company. The company often buys the rights to this animation when it purchases the rights to the character. If this is the case, the animator will also want to buy back the rights to any animation he has sold to the company.

Once the animation company and the animator has agreed on the buyback purchase price, a letter agreement amending the original character sale agreement is drafted. This agreement states that the company will allow the animator to buy back all of the rights in the character and any other material the animator wants to purchase for a specific sum of money. Usually, the rights will only revert back to the animator when the company receives a signed copy of the letter agreement and the purchase price for the rights. Sometimes the company will keep the rights until the animator's check has cleared.

Once the company has received a signed agreement and the money, the rights revert to the animator and he is free and clear to do what he wants with the character. Usually, another company is interested in purchasing the rights to the character and a new negotiation process begins.