CBS/Paramount sues to stop Axanar

[Jedman67]

As I see it, Axanar only has 2 options: they either shut down and reimburse those who contributed money or they negotiate something with CBS/Paramount whereby Axanar pays them money in exchange for the rights to produce the movie.

The reason that Peters isn't immediately doing that is because a chunk of the donor money has already been spent. If the project doesn't go ahead he'd be obliged to refund every donor - and that will likely mean that at least tens of thousands will need to come out of his own pocket.

In all likelihood he's screwed if he aborts and screwed if he continues. His only option is some level of settlement that allows the project to continue. But, that can only happen if the studio grants permission to use the IP IMO.

I could see CBS theoretically allowing him to continue ONLY if he stops all quasi commercial ventures (selling tshirts and dvds in exchange for donations, etc) halts any future crowdfunding and eliminates all salaries (except those required by unions).

Highly unlikely, but possible.

 

[jamestyler]

My 3-year old and 1 year old are encouraged to share, and that there's no problem with the 1YO playing with the 3YOs toys as long as long as the 3YO isn't stopped from using it (and vice versa)

I guess that's not the american way though.

Peters may act like a 3 year old, but he's an adult.

Misrepresenting himself to donators, representing himself as someone elses 'true' property and profiting ffrom someone elses trademarks doesn't quite match up to the moral tale of children wondering who's getting to play with Iggle Piggle next.

 

[The Transformed Man]

Talked with my wife, who herself has started more than her share of 501C's for charitable fund raising and has supervised more than a few nonprofits, and not-for-profits over the years; plus I also spoke with the lawyer she used for filing the correct paperwork with state officials and the IRS, and both came to the same conclusion, Axanar's main problem lies in Ares Studios.

Sure the coffe sales are questionable, as are the "gifts" for donations, but rules for nonprofit/not-for-profit ventures are pretty loose in this regard. For example, as I mentioned earlier, if Hansa coffee was essentially donating the coffee and only charging their cost for the coffee, then giving the rest to Axanar as a donation, then techinically no one has made a "profit" and I suspect Axanar's lawyer would argue that in court. This would also apply toward the "perks" they give for donations. So the question then becomes, did Alec peters use the Star Trek license to make a profit... they will of course argue they did not.

Even paying one's self a salary (which looks really bad), as well payments to the professionals involved would be allowable under nonprofit guidelines. Most people would be shocked when they donate money to a charitable cause how little of each dollar goes toward that cause, and are instead absorbed into "administrative costs." Again, I'm sure that's something Axcanar's lawyer is going to argue.

However, where Axanar has ZERO leg to stand on in Ares Studio. Based on past statements by the crew it is clear the INTENT is to use the studio to generate revenue to create profit-making movies down the road. Between their "Sci-Fi Film Academy" and their option on David Gerrold novels it's pretty clear they plan to make money down the road. Also just buying the property, bulding on it, and rennovating it creates an issue because wouldn't that cause the value of the property to go up? Theorhetically a higher property value is profit... the only way around that issue that I can see if if Alec Peters, out of the goodness of his heart, donates the property to a charitable organization after he's done with it.

What I suspect Peters and comapny will try to do though is argue that Ares will continue to be not for profit and will only pour money they make back into future productions, and use further crowd funding to make their films. Basically Peters thinks he's found a giant loophole in the system and plans to use it to create a career for himself.

When CBS/Paramount first started allowing fan films under the simple guideline that it was permissable "as long as no one made a profit," I doubt, even in their wildest dreams, that they believed any production would be so bold and arrogant with the Star Trek license. Even "big dogs" like NV/PII and STC have run pretty tight ships and have been clear where donations go. Even the "perks" offered have all been related directly to the production (i.e., production photos, posters, scripts, etc.), and not vague, quasi-official looking merchandise that dances a super fine line between legitimate "perk" and licensed merchandise.

CBS/Paramount really was left with no choice but to file a suit.

 

[Campe]

As I see it, Axanar only has 2 options: they either shut down and reimburse those who contributed money or they negotiate something with CBS/Paramount whereby Axanar pays them money in exchange for the rights to produce the movie.

The reason that Peters isn't immediately doing that is because a chunk of the donor money has already been spent. If the project doesn't go ahead he'd be obliged to refund every donor - and that will likely mean that at least tens of thousands will need to come out of his own pocket.

In all likelihood he's screwed if he aborts and screwed if he continues. His only option is some level of settlement that allows the project to continue. But, that can only happen if the studio grants permission to use the IP IMO.

I could see CBS theoretically allowing him to continue ONLY if he stops all quasi commercial ventures (selling tshirts and dvds in exchange for donations, etc) halts any future crowdfunding and eliminates all salaries (except those required by unions).

Highly unlikely, but possible.

Even if that would happen, would Peters continue knowing he would no longer be drawing a salary?

 

[SuperSpaceMan]

As I see it, Axanar only has 2 options: they either shut down and reimburse those who contributed money or they negotiate something with CBS/Paramount whereby Axanar pays them money in exchange for the rights to produce the movie.

The reason that Peters isn't immediately doing that is because a chunk of the donor money has already been spent. If the project doesn't go ahead he'd be obliged to refund every donor - and that will likely mean that at least tens of thousands will need to come out of his own pocket.

In all likelihood he's screwed if he aborts and screwed if he continues. His only option is some level of settlement that allows the project to continue. But, that can only happen if the studio grants permission to use the IP IMO.

I could see CBS theoretically allowing him to continue ONLY if he stops all quasi commercial ventures (selling tshirts and dvds in exchange for donations, etc) halts any future crowdfunding and eliminates all salaries (except those required by unions).

Highly unlikely, but possible.

IF CBS/Paramount intended on a path to allow Axanar to continue, wouldn't they have just had internal counsel draw up a C&D, and send it over? I mean, the heavy handedness of the Suit to me, suggests, that CBS/Paramount aren't playing, and don't want this thing done...

I mean, people with legal experience may be able to school me on legal strategy in cases like this.... but it just seems like this action was taken to basically shut down the project.

 

[Mudd]

What I suspect Peters and comapny will try to do though is argue that Ares will continue to be not for profit and will only pour money they make back into future productions, and use further crowd funding to make their films. Basically Peters thinks he's found a giant loophole in the system and plans to use it to create a career for himself.

All well and good but, again, the CBS complaint and petition for injunction don't talk about profit.

On information and belief, in direct violation of Plaintiffs’ exclusive rights, Defendants have directly infringed, and unless enjoined by this Court, will continue to infringe the copyrights in the Star Trek Copyrighted Works by, among other things:

a. Preparing unauthorized derivative works of the Star Trek Copyrighted Works in the form of the Axanar Works;

b. Reproducing copyrighted elements of the Star Trek Copyrighted Works in the Axanar works;

c. Distributing copies of the Axanar works, which contain copyrighted elements of the Star Trek Copyrighted Works; and

d. Publicly performing the Axanar Works, which contain copyrighted elements of the Star Trek Copyrighted Works.

 

[starburst]

The Transformed Man Ares Studio is rented not owned so the only person the installation of the floor, stage door etc would benefit in terms of property value is whoever they have rented it from.

 

[The Transformed Man]

As I see it, Axanar only has 2 options: they either shut down and reimburse those who contributed money or they negotiate something with CBS/Paramount whereby Axanar pays them money in exchange for the rights to produce the movie.

The reason that Peters isn't immediately doing that is because a chunk of the donor money has already been spent. If the project doesn't go ahead he'd be obliged to refund every donor - and that will likely mean that at least tens of thousands will need to come out of his own pocket.

In all likelihood he's screwed if he aborts and screwed if he continues. His only option is some level of settlement that allows the project to continue. But, that can only happen if the studio grants permission to use the IP IMO.

I could see CBS theoretically allowing him to continue ONLY if he stops all quasi commercial ventures (selling tshirts and dvds in exchange for donations, etc) halts any future crowdfunding and eliminates all salaries (except those required by unions).

Highly unlikely, but possible.

The problem is Peters will argue that he's following the "resonable compensation" guidelines from the IRS that govern nonprofits/not-for-profits. Peters will argue that he is the CEO of Axanar and that as the CEO he is entitled to compensation. The IRS guidelines for CEO compensation are fairly loose and only require that the "board of directors" (in this case Peters' pals) set a salary that is "reasonable and not excessive" (that's directly from the IRS rules governing nonprofits). So Peters will then argue that $38.500 is not excessive.

Here's a good website with some guidelines for nonprofits:

https://www.councilofnonprofits.org/tools-resources/executive-compensation

 

[The Transformed Man]

What I suspect Peters and comapny will try to do though is argue that Ares will continue to be not for profit and will only pour money they make back into future productions, and use further crowd funding to make their films. Basically Peters thinks he's found a giant loophole in the system and plans to use it to create a career for himself.

All well and good but, again, the CBS complaint and petition for injunction don't talk about profit.

On information and belief, in direct violation of Plaintiffs’ exclusive rights, Defendants have directly infringed, and unless enjoined by this Court, will continue to infringe the copyrights in the Star Trek Copyrighted Works by, among other things:

a. Preparing unauthorized derivative works of the Star Trek Copyrighted Works in the form of the Axanar Works;

b. Reproducing copyrighted elements of the Star Trek Copyrighted Works in the Axanar works;

c. Distributing copies of the Axanar works, which contain copyrighted elements of the Star Trek Copyrighted Works; and

d. Publicly performing the Axanar Works, which contain copyrighted elements of the Star Trek Copyrighted Works.

Which makes me wonder if the upcoming Trek series might be set in this same timeframe...

 

[Zaminhon]

IF CBS/Paramount intended on a path to allow Axanar to continue, wouldn't they have just had internal counsel draw up a C&D, and send it over? I mean, the heavy handedness of the Suit to me, suggests, that CBS/Paramount aren't playing, and don't want this thing done...

I mean, people with legal experience may be able to school me on legal strategy in cases like this.... but it just seems like this action was taken to basically shut down the project.

Somewhere in these 3000+ posts there is evidence of previous warnings from CBS that were ignored. Shutting down the project seems like an appropriate response.

 

[JoeZhang]

Except.. Being a non-profit isnt as simple as uttering the words.

Legally there are not a non-profit so there is no defence there.

 

[The Transformed Man]

The Transformed Man Ares Studio is rented not owned so the only person the installation of the floor, stage door etc would benefit in terms of property value is whoever they have rented it from.

So who is the lessor, that might be interesting to know. Do they have any ties to anyone on the production staff? That could cause a legal problem.

 

[SuperSpaceMan]

The reason that Peters isn't immediately doing that is because a chunk of the donor money has already been spent. If the project doesn't go ahead he'd be obliged to refund every donor - and that will likely mean that at least tens of thousands will need to come out of his own pocket.

In all likelihood he's screwed if he aborts and screwed if he continues. His only option is some level of settlement that allows the project to continue. But, that can only happen if the studio grants permission to use the IP IMO.

I could see CBS theoretically allowing him to continue ONLY if he stops all quasi commercial ventures (selling tshirts and dvds in exchange for donations, etc) halts any future crowdfunding and eliminates all salaries (except those required by unions).

Highly unlikely, but possible.

The problem is Peters will argue that he's following the "resonable compensation" guidelines from the IRS that govern nonprofits/not-for-profits. Peters will argue that he is the CEO of Axanar and that as the CEO he is entitled to compensation. The IRS guidelines for CEO compensation are fairly loose and only require that the "board of directors" (in this case Peters' pals) set a salary that is "reasonable and not excessive" (that's directly from the IRS rules governing nonprofits). So Peters will then argue that $38.500 is not excessive.

Here's a good website with some guidelines for nonprofits:

https://www.councilofnonprofits.org/tools-resources/executive-compensation

Would those even apply, considering at the moment, Axanar Productions is not an IRS Recognized, Non-Profit?

 

[Mudd]

Why wonder about the timeframe of the new series? That really has no bearing at all on Axanar's infringement.

Scanning the complaint, the one direct reference to money that I see is:

Defendants have raised over $1 million so far to produce these works, including building out a studio and hiring
actors, set designers, and costume designers.

Look, if Axanar is permitted to do this it won't be the epitome of unlicensed Star Trek crowdfunding for very long - it will only be the beginning. If CBS permits it in this instance, why wouldn't Star Trek Continues, or New Voyages, or Farragut pull out all the stops? Letting Axanar proceed would amount to tacit permission from CBS to do just that, and CBS clearly understand that.

 

[SuperSpaceMan]

The Transformed Man Ares Studio is rented not owned so the only person the installation of the floor, stage door etc would benefit in terms of property value is whoever they have rented it from.

So who is the lessor, that might be interesting to know. Do they have any ties to anyone on the production staff? That could cause a legal problem.

They used Monies, raised from unlicensed use of CBS IP, to make real improvements to a leased structure, (which rent was paid using monies raised from unlicensed use of CBS IP) which, they have openly admitted, to planning to use for commercial ventures once Axanar was completed.

Go listen to Podcast#20... they spell it out all right there.

 

[The Transformed Man]

Except.. Being a non-profit isnt as simple as uttering the words.

Legally there are not a non-profit so there is no defence there.

No, a 501c is primarily a definition set by the IRS that defines your tax status based on being a charitable organziation. But states have various rules for not-for-profit ventures, and many of these same guidelines apply to both, including executive compensation.

I guess we'd really need to know what paperwork has been filed with the State of California... the 501c filing is a bit of a joke since it's really nothing more than "fixing the barn door after the horses have come home."

 

[YJAGG]

Talked with my wife, who herself has started more than her share of 501C's for charitable fund raising and has supervised more than a few nonprofits, and not-for-profits over the years; plus I also spoke with the lawyer she used for filing the correct paperwork with state officials and the IRS, and both came to the same conclusion, Axanar's main problem lies in Ares Studios.

Sure the coffe sales are questionable, as are the "gifts" for donations, but rules for nonprofit/not-for-profit ventures are pretty loose in this regard. For example, as I mentioned earlier, if Hansa coffee was essentially donating the coffee and only charging their cost for the coffee, then giving the rest to Axanar as a donation, then techinically no one has made a "profit" and I suspect Axanar's lawyer would argue that in court. This would also apply toward the "perks" they give for donations. So the question then becomes, did Alec peters use the Star Trek license to make a profit... they will of course argue they did not.

Even paying one's self a salary (which looks really bad), as well payments to the professionals involved would be allowable under nonprofit guidelines. Most people would be shocked when they donate money to a charitable cause how little of each dollar goes toward that cause, and are instead absorbed into "administrative costs." Again, I'm sure that's something Axcanar's lawyer is going to argue.

However, where Axanar has ZERO leg to stand on in Ares Studio. Based on past statements by the crew it is clear the INTENT is to use the studio to generate revenue to create profit-making movies down the road. Between their "Sci-Fi Film Academy" and their option on David Gerrold novels it's pretty clear they plan to make money down the road. Also just buying the property, bulding on it, and rennovating it creates an issue because wouldn't that cause the value of the property to go up? Theorhetically a higher property value is profit... the only way around that issue that I can see if if Alec Peters, out of the goodness of his heart, donates the property to a charitable organization after he's done with it.

What I suspect Peters and comapny will try to do though is argue that Ares will continue to be not for profit and will only pour money they make back into future productions, and use further crowd funding to make their films. Basically Peters thinks he's found a giant loophole in the system and plans to use it to create a career for himself.

When CBS/Paramount first started allowing fan films under the simple guideline that it was permissable "as long as no one made a profit," I doubt, even in their wildest dreams, that they believed any production would be so bold and arrogant with the Star Trek license. Even "big dogs" like NV/PII and STC have run pretty tight ships and have been clear where donations go. Even the "perks" offered have all been related directly to the production (i.e., production photos, posters, scripts, etc.), and not vague, quasi-official looking merchandise that dances a super fine line between legitimate "perk" and licensed merchandise.

CBS/Paramount really was left with no choice but to file a suit.

Yeah donor intent is not a real option on crowdfunding sites is it ( my missus is also in the non profit development world, and she just rolled her eyes on this train wreck)

I see that from their site that you have to donate to even be able to buy items from their store, so anything worth getting as a souvenir to this circus before it gets shut down?

I mean I do think the ship looks nice...

 

[Karzak]

The Transformed Man Ares Studio is rented not owned so the only person the installation of the floor, stage door etc would benefit in terms of property value is whoever they have rented it from.

So who is the lessor, that might be interesting to know. Do they have any ties to anyone on the production staff? That could cause a legal problem.

They used Monies, raised from unlicensed use of CBS IP, to make real improvements to a leased structure, (which rent was paid using monies raised from unlicensed use of CBS IP) which, they have openly admitted, to planning to use for commercial ventures once Axanar was completed.

Go listen to Podcast#20... they spell it out all right there.

All CBS has to do is tell the court that no production - TV show or film, high budget or low, wastes time remodeling a production office if their goal is to make a film.

You come in, you set up your gear, you rehearse, you shoot, you clear out. Post is usually done elsewhere.

Peters is just uninformed enough about the usual operation of legitimate Hollywood productions that he is shooting himself in the dick here. How much did Ares Studios spend 'redoing the floors' again? And why?

 

[Tom]

Since this all started we have heard nothing from CBS and I suspect STC and STNV have also heard nothing as well. Understandably I'm sure all the fan production are nervous. I'm curious to see who is going to have the next Crowdfunding campaign, and if that will happen now. I know STC was talking about doing one soon. Many fans are going to be nervous about donating money to any production.

 

[Karzak]

Talked with my wife, who herself has started more than her share of 501C's for charitable fund raising and has supervised more than a few nonprofits, and not-for-profits over the years; plus I also spoke with the lawyer she used for filing the correct paperwork with state officials and the IRS, and both came to the same conclusion, Axanar's main problem lies in Ares Studios.

Sure the coffe sales are questionable, as are the "gifts" for donations, but rules for nonprofit/not-for-profit ventures are pretty loose in this regard. For example, as I mentioned earlier, if Hansa coffee was essentially donating the coffee and only charging their cost for the coffee, then giving the rest to Axanar as a donation, then techinically no one has made a "profit" and I suspect Axanar's lawyer would argue that in court. This would also apply toward the "perks" they give for donations. So the question then becomes, did Alec peters use the Star Trek license to make a profit... they will of course argue they did not.

Even paying one's self a salary (which looks really bad), as well payments to the professionals involved would be allowable under nonprofit guidelines. Most people would be shocked when they donate money to a charitable cause how little of each dollar goes toward that cause, and are instead absorbed into "administrative costs." Again, I'm sure that's something Axcanar's lawyer is going to argue.

However, where Axanar has ZERO leg to stand on in Ares Studio. Based on past statements by the crew it is clear the INTENT is to use the studio to generate revenue to create profit-making movies down the road. Between their "Sci-Fi Film Academy" and their option on David Gerrold novels it's pretty clear they plan to make money down the road. Also just buying the property, bulding on it, and rennovating it creates an issue because wouldn't that cause the value of the property to go up? Theorhetically a higher property value is profit... the only way around that issue that I can see if if Alec Peters, out of the goodness of his heart, donates the property to a charitable organization after he's done with it.

What I suspect Peters and comapny will try to do though is argue that Ares will continue to be not for profit and will only pour money they make back into future productions, and use further crowd funding to make their films. Basically Peters thinks he's found a giant loophole in the system and plans to use it to create a career for himself.

When CBS/Paramount first started allowing fan films under the simple guideline that it was permissable "as long as no one made a profit," I doubt, even in their wildest dreams, that they believed any production would be so bold and arrogant with the Star Trek license. Even "big dogs" like NV/PII and STC have run pretty tight ships and have been clear where donations go. Even the "perks" offered have all been related directly to the production (i.e., production photos, posters, scripts, etc.), and not vague, quasi-official looking merchandise that dances a super fine line between legitimate "perk" and licensed merchandise.

CBS/Paramount really was left with no choice but to file a suit.

Yeah donor intent is not a real option on crowdfunding sites is it ( my missus is also in the non profit development world, and she just rolled her eyes on this train wreck)

I see that from their site that you have to donate to even be able to buy items from their store, so anything worth getting as a souvenir to this circus before it gets shut down?

I mean I do think the ship looks nice...

No. None of it is worth getting. This is exactly the kind of mindset that allowed Peters to get away with this fraud to begin with. He recognized that Trekkies will pay for anything if that anything includes something they want.