Santa Monica Pictures, LLC, Perry Lerner, Tax Matters Partner - Page 301

                                       - 68 -                                         
               documentation we do have is incomplete.  In addition,                  
               there are outright gaps in the chain of title as to                    
               groups of pictures; that is, certain documents relating                
               to transfers of libraries are missing.                                 
               For the foregoing reasons, it is not possible to                       
               determine what rights have effectively been acquired.                  
               It also is unclear who possesses the rights other than                 
               domestic video in the various pictures, and who                        
               possesses the reversion rights in domestic video.                      
          The memorandum related that Epic Productions provided chain-of-             
          title documentation for only 15 of the 65 film titles (and 22 of            
          26 development projects), and that many of the 15 film titles for           
          which Troy & Gould received documentation appeared to be the                
          subject of domestic video rights licenses to Embassy and                    
          Concorde, but that some of those licenses expired in May 1997.42            
               Troy & Gould stated that rights to completed pictures in the           
          EBD film library were apparently acquired by three entities,                
          Epic, Sultan (or its predecessor, Nelson), and Trans World                  
          Entertainment; however, Troy & Gould could not determine how                
          these entities acquired rights from other entities appearing in             
          the chain of title, e.g., Embassy.  Troy & Gould concluded that             
          this failure represented a significant gap in the chain of title.           


               42 From its examination of these film titles, Troy & Gould             
          determined that the licenses were for a term of years, in most              
          cases 10 years from delivery, and that it appeared for the most             
          part that the licenses had recently expired or would soon expire.           
          Troy & Gould concluded that “as to pictures for which the video             
          license to Embassy or Concorde has expired, it would appear that            
          * * * [SMHC] has no rights whatsoever, unless there are other               
          assignments (for which we have no documentation) into our chain             
          of title from the producers or other rights holders.”                       





Page:  Previous  58  59  60  61  62  63  64  65  66  67  68  69  70  71  72  73  74  75  76  77  Next

Last modified: May 25, 2011