Despite the hoopla generated at Sundance and other film festivals, most independent films still have trouble getting into movie houses around the world.
But on March 3 at the Bel Age Hotel, 15 independent films go on the block in what is being billed as "The World's First Film Auction."
"The mission of a film festival is to provide an opportunity for movies to be seen, and business is a byproduct," said Hal "Corky" Kessler, an attorney and filmmaker who helped conceive the auction. "With us, the business is the sale of movies and showcasing is the byproduct."
While the quality of the films may be debatable, the list of registered bidders is impressive Miramax Films, Walt Disney Co., Time Warner Inc., USA Films, Sony Classics, and DreamWorks SKG.
What appealed to the creators and sponsors was the simplicity of the format. Most independent films get sold to distributors on a hit-and-miss basis at festivals and film markets. Films that generate the most advance buzz usually three or four films have no trouble getting picked up. The rest tend to languish, forcing their sales reps to go from distributor to distributor trying to make a deal, often any deal. Many films, however, are left on the shelf and never released to the public.
Even if a film is picked up, there are plenty of additional hurdles to overcome, including a pile of contracts that can be a daunting and infuriating.
"The definition of 'net profits' can be 37 pages," said Kessler. "You have to worry about net profits, which usually get you zero anyway. Here you just let the buyer set market value through bidding."
At the sale, the winning bidder will get world rights to a film, except for any foreign territories that may have been previously sold. There are no accounting battles over profits. Everything is sold off the night of the auction. The only outstanding issue will be residuals for union films. Six out of the 15 films on the block are union films.
Each winning bidder must pay 25 percent on the night of the auction and the balance within five business days. Any buyer failing to pay the balance by the end of that period will forfeit its down payment, as well as any ownership rights to the film.
The auction, titled Films4Auction, will be gaveled by William Doyle Galleries, a New York-based auction house that has specialized in the sale of the estates of such Hollywood stars as Gloria Swanson, James Cagney, Bette Davis and Rock Hudson.
Films4Auction gets 10 percent of each film's final sale price. The Doyle auction house gets 10 percent on top of the price of the film, which is the standard in the auction industry.
"I guess it is the latest entrepreneurial brainstorm to unload films that probably nobody wants," said Richard B. Jewell, a professor of film at USC. "If somebody has a hot film, you won't have to put it to auction. People will be beating down the door. But a lot of films do go wanting for a distributor, and this is a new idea."
Among the films being auctioned are the drama "Escape from Cuba," the thriller "The Next Tenant," and a romantic comedy, "Only in L.A." Two films, the drama "El Maya" and the romantic comedy "Killing Cinderella," will make their world premieres before the auction opens. All the films will be screened Feb. 29 through March 1 at three Los Angeles theaters.
An innovative process
Kathy Doyle, who runs Doyle Galleries, sees the auction as an innovative but simple way of selling films. It also puts Doyle in a new business.
"Corky has tapped into something that was once a very complicated process and made it simple and streamlined," she said. "We like to look at possibilities for new formats and that was the key reason why we got involved."
Kessler was initially concerned that he would not get enough films, but more than 50 filmmakers paid a $375 registration fee. Those films were all viewed by a panel of experts, who determined how many would be worthy to auction.
"The second test was, would we get enough films of value, and we had more than we could handle," he said. "We had to drop the number of films to 15 because any more would have been too much."
Nur Nur Cummings, director of "Only in L.A.," which premieres Feb. 19, said he was tired of spending month after month on the festival circuit.
"It's great exposure, and if people don't know about your film, they won't come to see it," he said. "The main challenge for independent filmmakers is promoting their films. Most just have enough money to make their film, and then they have to be in the good graces of their distributor to get any promotion."
Cummings said one of the biggest problems for any independent moviemaker is keeping track of the money once a distributor takes over. Distributors' accounting procedures can make the arcane dealings of a Hollywood studio look like basic math. The auction, on the other hand, puts money into filmmakers' pockets immediately.
"Most indies get robbed by their distributors," Cummings said. "Most never see a dime. Maybe the director, writer, producer get their name out there, but they don't see any fair return."
Jewell cautioned that the bidding may not be very high. "Everybody who goes into this bottom-feeding wants to pay as little as possible to get these films," he said.
Kessler doesn't look at his auction as bottom-feeding, but as an opportunity to assemble interested buyers from a variety of venues, including cable. And for a filmmaker, who has spent months if not years trying to get his film distributed, to get a sense of closure.
"It is all going to be done that night," he said.
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