As covered in this issue’s lead story, the economic squeeze is tightening on commercial production houses. Indeed the financial pressures being exerted in the marketplace–particularly the slow payment dynamic–proved to be a significant factor in the closure of longstanding production company Villains. Dating back to its predecessor shop GMS, which opened in 1985, Villains enjoyed a 23-plus year run (the Villains banner was established in ’97) until its owner John Marshall closed the Los Angeles-based company in October.
SHOOT recently caught up with Marshall–a partner in GMS and then Villains before becoming the shop’s sole owner a couple of years ago (SHOOT, 1/26/07)–to gain his reflections on growing industry challenges that triggered his decision to pull out of the business.
“The business isn’t as much fun as it used to be for production companies generally,” assessed Marshall.
“Slow payment was just getting very difficult for us. And seeing what GM [General Motors] is doing now in terms of delaying payments even further [see the earlier referenced front page story] makes the situation even more difficult. GM has been a leader in trying to do its own guidelines.”
Add to this the growing prevalence of sequential liability by which agencies won’t pay production houses according to the contractually agreed upon timetable if they haven’t yet been paid by the clients, and you find the production community bankrolling in many cases large multi-national agencies and clients for extended periods. Even those houses that have regularly fronted money for inordinate periods of time are finding it more difficult to do so now in light of a credit freeze that has made getting short-term financing pretty much improbable, if not impossible.
“Getting lines of credit is hard,” said Marshall. “And no bank in its right mind would loan you money on a GM contract. We’re in a climate where everybody is squeezing everybody and that contributed to our deciding to close Villains. I love this business. It’s been very good to me over the years. But now as far as my getting back into it, I think I’d rather take cyanide.”
Marshall noted that if the squeeze continues, clients and agencies will find themselves with more limited choices in the production community as more houses will have to close. “They’ll wonder,” said Marshall, “why a bunch of 25-year-old kids are running their production with little or no clue about advertising.”
Marshall observed that the handwriting has been on the wall for some time. He said that the actors’ strike of 2000 took a major bite out of the business as clients who were forced to go overseas to shoot learned they could continue to run those spots for years sans having to pay residuals.
Marshall also referenced an AICP study done years back in which a UCLA business professor characterized commercial production practices as being part of a bad business model. “I remember him making such points as we are managers of directors careers and not getting paid for it. We are showing our markup to our clients, which is something that most businesses would never do,” said Marshall. “Though we don’t do cost-plus anymore, it’s like the business has become cost-minus for many production companies.”
As for his future plans, Marshall said he has several businesses and interests outside the spotmaking industry which he will likely pursue. And in the big picture, Marshall can’t complain given the long run enjoyed by Villains, which includes, he said, helping to launch Smuggler, a production company success story. “I’ll miss the many friends I’ve made in the business and getting to collaborate with them,” affirmed Marshall. “I’ll also miss line producing which I love to this day.”
Justin Baldoni Sues Blake Lively and Ryan Reynolds For $400M As “It Ends With Us” Fight Continues
"It Ends With Us" actor and director Justin Baldoni has sued his co-star Blake Lively and her husband, "Deadpool" actor Ryan Reynolds, for defamation on Thursday in the latest step in a bitter legal battle surrounding the dark romantic drama.
Baldoni's suit seeks at least $400 million for damages that include lost future income. The lawsuit from Baldoni and production company Wayfarer Studios, which also names publicist Leslie Sloane as a defendant, comes about two weeks after Lively sued Baldoni and several others tied to the film, alleging harassment and a coordinated campaign to attack her reputation for coming forward about her treatment on the set.
That lawsuit came the same day that Baldoni sued the New York Times for libel, alleging the paper worked with Lively to smear him.
The new lawsuit filed in federal court in New York says the plaintiffs did not want to file the suit, but that Lively "has unequivocally left them with no choice, not only to set the record straight in response to Lively's accusations, but also to put the spotlight on the parts of Hollywood that they have dedicated their careers to being the antithesis of."
An email seeking comment from Sloane, whose PR company represents both Lively and Reynolds, was not immediately answered.
The two actors are also both represented by agency WME, which dropped Baldoni as a client after Lively filed a legal complaint that was a precursor to her lawsuit and the Times published its story on the fight surrounding the film.
The surprise hit film based on the novel by Colleen Hoover has made major waves in Hollywood and led to discussions of the treatment of female actors both on sets and in media.
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