CBS/Paramount sues to stop Axanar
- Thread starter Richard Baker
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Guys.
From the Wonder Con schedule:
LINK
"Producer"
I can see it already. "Excuse me, Mr. Peters ... I have a question. What's your position on doxxing?"
oh, so AP has landed a gig as the future Producer of a BSG reboot?
NO WONDER he wants a studio for free.
oh, wait!
is he Producer without license again? Did the license holder announce he is hired as Producer? Is Axanar Productions really banking on repeating their prior success so soon?
Does that matter? He announced that they had obtained the rights to a David Gerrold property, which I'm pretty sure has since been refuted by Gerrold himself. Apparently, AP's understanding of "rights" is different from any legal definition that I'm aware of.
Then again, I'm not a lawyer by training. Just a fan.
I'll bet it would matter if the license holders for BSG were in the audience.
Axanese dictionary, continued: "rights": absolute preemptive ownership bestowed by belief in the worthiness of oneself.
We had an LLC for the short film, so the kickstarter funds applied to that. And of course, we accounted for every penny.
Well. They would've incurred rent and utility expenses regardless of the suit. They are business expenses.
Rent and utility just sufficient to get on with making the fan film and then stopping. Rent and utility for an ongoing independent professional Trek and other SF studio turning out 3 minutes of media per year, perhaps a diversion of donations.
But they wouldn't have incurred the several months of rent for the production delay. I'm not referring to whether or not rent & such are IRS tax writeoffs, I'm referring to what mkstewartesq posted about Axanar being able to subtract rent expenses from income for purposes of awarding damages. Rent expenses that only occurred because the production was delayed. Thoughts, mkstewartesq?
Jenn is obviously back.......#nomercy
Well, they can only deduct expense attributable to the production of the infringing activity. Last I heard, since the script wasn't locked, they had not infringed yet. So, no infringing activity, no deductible expenses, right?. Axanar can't have it both ways.
But let's assume they are found liable for infringement- no, I don't think rents during a period of shutdown would be deductible, as the rents are not attributable to an infringing activity if no infringing activity is going on.
Lastly, the defendant can only deduct expenses "directly" attributable to the infringement. yes, this includes "general" costs such as rent and even overhead - but the law doesn't allow them to deduct the whole amount just because an infringement occurred on the premises - only that portion that is directly related to the infringing activity. For example - a common scenario - if a store is found infringing because they sold an infringing item, sure they can deduct a portion of rent and overhead. But the only rent attributable to the sale of the infringing item may be 1 foot of shelf space in a 10,000 square foot store, so defendant can only deduct 0.0001% of the rent (the rent attributable to that 1 foot of shelf space); same for overhead.
In Axanar's case, I could see them trying to deduct the rent during times when there was actual infringing activity going on (writing a script, actual shooting etc.) and claiming 100% during that time because the infringing film was the only thing being worked on at the studio. But I don't see the court allowing a 100% deduction of that rent for that time - I'm sure there were other activities going on in that rented space, whether blogging, tweeting, doing podcasts, storing Alec's prop and toy collection, etc. that are not directly related to the production of the infringing movie.
Lastly, and this is a fun point - the plaintiff only has to put in evidence of defendants gross revenue from all sources (one aggregate number) without distinguishing where the money came from or what for. Plaintiff doesn't have to put up any additional numbers or evidence on this point, The law then shifts the burden to the defendant to prove deductible expenses to reduce that number, and the judge decides whether he or she will allow a given deduction and how much. Whatever defendant can't get deducted is "profit attributable to the infringement" to be awarded to plaintiff.
M
Interesting. I wonder if C/P is aware of all the other sources of revenue Axanar utilized outside Kickstarter and Indiegogo:
1. Selling merch like patches, t-shirts, blurays, etc at cons
2. Selling merch in the “Donor Store”
3. Soliciting direct donations at cons
4. Soliciting additional donations inside Ares Digital
5. Soliciting additional donations on the Axanar website aka “Retroactive Donations” wherein someone could donate an unlimited amount of money
When would C/P have access to the books?
1. Selling merch like patches, t-shirts, blurays, etc at cons
2. Selling merch in the “Donor Store”
3. Soliciting direct donations at cons
4. Soliciting additional donations inside Ares Digital
5. Soliciting additional donations on the Axanar website aka “Retroactive Donations” wherein someone could donate an unlimited amount of money
When would C/P have access to the books?
I wonder what the tax implications are, since AP (Axanar Productions = Alec Peters) is registered as an S-corp in CA.
Are Kickstarter and Indiegogo donations taxable in this case? I assume they are. How about the donor store? I would have to think so.
Is the tax information public record? If so, how do we access these records?
Will the records be used in court?
Just wondering.
Are Kickstarter and Indiegogo donations taxable in this case? I assume they are. How about the donor store? I would have to think so.
Is the tax information public record? If so, how do we access these records?
Will the records be used in court?
Just wondering.
They are absolutely entitled to those books and records during discovery, as that evidence is relevant to determining the gross revenue number C/P as plaintiff has to put into evidence.
And, as noted above, once C/P puts that number into evidence, the law's position is to turn to Axanar and say "well, we're going to presume that every penny of this is profit attributable to the infringement unless you can prove otherwise. Good luck."
M
Just in case anyone is looking at me - I know zero about tax or tax implications. Don't judge - we all have our limits.
M
And as I said, just wondering.Just in case anyone is looking at me - I know zero about tax or tax implications. Don't judge - we all have our limits.
M
As a private for profit corp, any money Axanar receives is income. As of July 31st, 2015 it had spent everything it had taken in, so no taxes would be due for 2014 (a business tax return has to be filed, even if the corp made no money). Tax returns are usually confidential, although I don't know if C/P could compel Axanar to produce them.
The final roughly $519,000 from the 2015 Indiegogo campaign has not been tallied up, so if there was money from that left over at the end of 2015, it would be taxable. S corp net taxable income flows through to the individual, so Alec would get a K-1 from the corp saying how much it made or lost, and he would either pay taxes based on his personal tax bracket, or use the loss as a write off. Since Alec spends money like a drunken sailor, there may or may not have been anything left to tax, and he may in fact have gotten a write off to offset the salary he was paid.
What bugs me is the ongoing use of the word "donation" by Axanar. It's not a donation - it's a pledge by a backer according to Kickstarter. "Donation" and "Donor Store" brings up all that "non profit" nonsense. When you give money to Axanar, your are handing a for profit corporation money to make a product you want. ALL that money is income to the corp and must be accounted for on the books.
I would never put myself out as an expert in anything really - I've just done S corps (doing start ups, buying and selling them, general running of businesses) for almost 30 years. Let's just say I'm "entertained" by Alec's books so far, and eagerly await the release of the Indiegogo books.
"Your honor, I would have loved to submit our financial records, but Open Office keeps crashing. If you'd like, I can annotate a printout of our Kickstarter page..."
I don't think corporate tax filings are public record. Discovery could become public if either side puts materials from the discovery into a court filing.
so, if Axanar maintains they have no infringing activity, they roll the dice that they can win, or pay it all. To the extent they admit infringement, they can reduce their exposure. Does that sound about right?
It will be very interesting if donors end up misled by all the claims of 'nonprofit' and 'donation', and submit their gifts to AP's business as a charitable write-off.
All this abuse of the vocabulary around the legal concept of not for profit incorporation really bugs me too. The profound contradiction of their assertions and the meaning of the terms makes it look like intentional misdirection, and manipulative.
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