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Enough with the NDAs

by Jeff Steele

NDAsLately, a lot of producers have been asking me to sign non-disclosure agreements before taking a look at their film projects. I have one thing to say that may sound blunt: Don’t. To explain a little, unless you’ve invented a whole new way of financing a film, there’s no reason for this. If you have come up with a new financing method, please file a business method patent.

In my experience, NDAs create more liability than they prevent.

Plus, an emphasis on an NDA is the mark of a novice, as in the following conversations:

PROFESSIONAL PRODUCER: Hey Jeff, I have a $7m action project with Val Kilmer attached. Chuck’s guy is doing the equity piece. It’s shooting in Louisiana. Do you want to come in for half the equity?

JEFF: Sounds doable. Send me the details and I’ll get back to you on Monday.

OR

NOVICE PRODUCER: Hi, Jeff. I have a project with an A-list star attached as well as equity from an investor. It’s shooting in Louisiana. If you’re interested, I would need you to sign an NDA.

JEFF: I’m in the middle of a closing. Can you call me in a month?

As every film financier will tell you, there are just too many similar projects with similar players for NDAs to make sense. There are a finite number of positions within a film project that are relevant to the financing, and there are a very small number of projects that are truly unique. Most projects, creatively and financially, are pretty much the same.

As a financier, my job is to review projects and be discrete. I wouldn’t still be working if I couldn’t keep quiet about individual projects or the business plans of production companies.

In short, a producer who requires NDAs for submissions is a novice. I cannot name a single entertainment company or mainstream producer that has people sign NDAs before submitting a project.

It’s a terrible way to start a relationship, because it brings everything to a grinding halt before it even has the chance to begin. It also gets lawyers involved way too early in the process.

Talent-based NDAs are especially silly, because most actors are attached to a half-dozen projects at any one time. If Hugh Laurie is attached to your project, that’s great, but where’s the secret? What am I going to do? Blog about it? At any rate, if word getting out that an actor is attached somehow derails your project, it was probably pretty flimsy to begin with.

I wonder how many indie producers are aware of tracking boards. These are website forums where development executives from all over the industry post information about project submissions and discuss the quality of the project, the writer, and the film package with other development executives. They’re definitely not conducive an NDA, but are a staple of the industry.

Please, people, throw away those non-disclosure agreements, and think hard about what you’re submitting and who you’re submitting it to. Does all trace of this project really need to be kept silent? Does the person you’re submitting it to have a reputation for being untrustworthy? If so, then (1) you shouldn’t be working with them, and (2) they’ll disregard your NDA anyway.

If you really need somebody to sign something, have them sign a non-circumvention agreement (non-circ). This basically says, “Hey, you can’t circumvent me if I make this introduction.” These agreements are shorter, cleaner, and easier to prosecute. If you’re an intermediary and you have investors who are interested in funding projects, have them sign a non-circ. That way, you only have to have one signed vs. annoying every financier in town. This will do wonders for your productivity and make you look like a seasoned pro.

10 Responses leave one →
  1. Paul Klein permalink
    April 26, 2010

    So true Jeff. I used to be one of these people that made my investors sign NDA’s over my movie project. Boy was I a novice and no longer in producing. It’s almost as if people see their films as a new technology. It’s not. It’s a story with actors and some financing or no financing (most likely) attached. who cares?

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  2. April 26, 2010

    Can you link some tracking boards that you think are worthwhile?

    Thx,
    T

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  3. Phil Botana permalink
    April 27, 2010

    Here, here!

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  4. May 5, 2010

    Jeff,

    I was going to post a comment but wanted to know if you’d sign an NDA first?

    Stan

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  5. BeerBelly permalink
    May 13, 2010

    So a NON-CIRC is actually diferent and better than a NDA?

    A producer recently asked me to sign a “Mutual Confidentiality and Non-Circumvention Agreement”, so I could submit my script t him.

    So, that’s a NON-CIRC?

    And if so, that’s okay to sign (I mean it’s just to submit a script, nothing more). Like any other writer out there, I got a gazillion ideas.

    So if by some chance I hear a logline that might sound similar to something of my own, I’ll have to shelve my own thing, just because theirs sounds remotely in the same league?

    Help, please :(

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  6. Chris permalink
    March 26, 2012

    Hello Jeff,

    I run a Meetup.com Film production group (150+ members) and we work on projects both for profit and not for profit. We also compete with local production companies in so much so that we bid in local contracts for web, disc and broadcast projects. We do require that our members sign a NDA as we have already had several instances where a) a member took the idea of a second member and soliciated the business for the commercial, b) local production companies send in their employees to sit in meeting and monitor what we are doing and projects we are working on.

    I feel an NDA is necessary for us because i am not sure how to stop these existing issues, but asking for one as a membership requirement will likely scare off potentially creative minds that may be an assets to the group as well as the group a assets to them.

    It’s clear that you are not a fan of NDAs, but how do you suggest we protect ther IP of out members and projects we are working on?

    Chris

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    • Jeff Steele permalink
      March 30, 2012

      In short, forget the NDA’s — they create more liability than they prevent (for both parties.) If somebody is hellbent on stealing an idea, then they’re going to do it; this is a fundamental business axiom. Are you really going to take legal action — at what cost? The longer the perpetrator stalls and delays the process (which costs nothing to them), the more time your attorney spends pursuing them (and billing you for it).

      They would have to erase the idea from your memory for it to be actually “stolen”. So now two people are using the same idea — happens all the time. An idea has no value, without execution. Your time, energy and money are better spent either executing your idea (since you have the head start on writing, research, etc.), or coming up with a new one.

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  7. June 17, 2013

    What about this situation: we’re about to do a table reading of our latest project. Would having the participants sign an NDA give any peace of mind to future investors, or lend credibility to our company?

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