Translator: Nyoi-Bo Studio
Editor: Nyoi-Bo Studio
“What? Do my ears deceive me? Yang, you made it?” Zachary was shocked, incredulous, and skeptical of the good fortune that had befallen them. “Are you kidding me? Are you sure this is not a joke? Does it mean I’m going to become the male lead of a published movie soon?”
“Wow, dude. See, I told you you’d make it! I knew you wouldn’t let me down!” Joshua capered and cheered, his face brimming with joy. “My DV camcorder is going to shoot up in value. Movie fans will surely fight tooth and nail for it!”
“Oh, my God… the gracious Lord has answered my prayers!” Upon hearing the good news, Jessica jumped for joy and screamed with excitement. Crowed, delighted, and hyperbolic, she said, “God, this is great! Yang, is this true? Please tell me this is all true!”
After making his first phone call to Rachel and relaying the good news to her, Wang Yang did the same to all his other close friends. He wanted everyone to share in his joy. Of course, Zachary, Jessica, and the rest of the gang were extremely happy and excited for him. The only exception was Harry George. Upon receiving the phone call and hearing the news, he was so agitated that he blurted out, “Dog sh*t! I can’t believe it!” before hanging up abruptly.
That night, Wang Yang stayed at a motel nearby a beach in Santa Monica. Though he’d been laying on the bed for hours, he couldn’t fall asleep. A lingering sense of delight and gratification was keeping his eyes open. So, he decided to get off the bed, grab a chair, and sit on the balcony. At night, the beach seemed calmer than usual. As he listened to the roar of the surf, muted at a distance, rising and falling in waves; and watched the black sea from afar with the moon hanging still above it, a feeling of serenity came over him. Slowly, his mind settled down.
On the following day, Wang Yang returned to the main office of Lionsgate Films. The order of the day, of course, was to negotiate with Lionsgate on the terms of the publication contract.
“Good day, Mr. Wang.” A ravishing Caucasian receptionist by the name of Ms. Jennifer greeted Wang Yang with a shining smile. From her demeanor, which was much warmer than the day prior, he could tell that she’d gotten wind of the company’s decision to acquire his film. She said smilingly, “Mr. Oldenburg came here very early today, Mr. Wang. Looks like he’s very keen to see you again. Please, come with me.”
“Oh, okay.” Wang Yang trailed after Jennifer into Tom Oldenburg’s office.
The office door was open. Jennifer gave it a few knocks. Tom Oldenburg, who was pouring over work on his desk, turned to look at them and smiled. “Hi, please come in!” He watched as Wang Yang marched into his office. Then, he asked interestedly, “Young man, did you sleep well last night?”
Wang Yang seated himself in a chair in front of the office desk. Smiling and shaking his head, he said, “No sir, I didn’t sleep very well.” He rolled his eyes and continued in a self-deprecating tone, “I’m just so stoked about all of this. I can’t help but think about this project whenever I close my eyes. Is this it? Is it really happening? Man, I couldn’t sleep at all!” He said with a smile, “You know, I was so afraid that this was all just a dream. I was worried that if I fell asleep, everything would be gone when I woke up.”
Knowing the feeling all too well, Tom Oldenburg smiled empathetically. He said to Wang Yang with a wink, “Young man, this is no dream! And here’s another piece of good news: our Chief Executive Officer, Mr. Beeks, has agreed to let the company publish your film.”
“Wow! This is wonderful news, indeed. Thank you, Mr. Oldenburg!” Wang Yang celebrated furtively by clenching his fists. A radiant smile overtook his face. Finally, another load had been taken off his mind. At that point, his partnership with Lionsgate Films had become a foregone conclusion.
“From now on, I’ll be seeing this deal through,” Tom said with a pleasant smile. As the Vice President of Acquisition, it was only natural that he undertook the task of negotiating the deal with Wang Yang. He produced a contract, slid it across the desk to Wang Yang, and said, “Here’s our proposal. Please have a look.”
Wang Yang nodded, took the contract from the desk, and read its contents with great care and detail. The contract stipulated that the publishing rights to Paranormal Activity in North America and overseas, the VCD and DVD publishing rights, as well as the television rights, shall be transferred to Lionsgate Films, and held by the company in perpetuity. Since both parties had agreed on a profit-sharing model, Lionsgate Films wasn’t required to pay any acquisition fees as far as compensation was concerned.
The contract also laid out the profit-sharing ratio in black and white. Wang Yang would receive a 10 percent dividend if the pre-tax box office gross for the North American region were less than a million dollars; 20 percent if it were more than five million; 30 percent if it were more than 10 million; 40 percent if it were more than 50 million; and 50 percent if it were more than 100 million. In the event that the film would be unable to turn a profit and suffered a loss, Wang Yang would only receive a five percent dividend.
The profit-sharing scheme was exactly as Wang Yang had envisioned yesterday. The only difference was the addition of the clause that accounted for losses.
The same profit-sharing ratio applied to overseas regions. However, Lionsgate Films didn’t propose the same scheme for other projects such as VCD, DVD, and videotape rentals as it did for box office sales. Instead, they offered Wang Yang a flat dividend of 10 percent, regardless of how much money would be made from those projects.
Wang Yang had a vague feeling of why such an arrangement was made. He supposed Lionsgate Films had a dim view of the movie’s future at the box office and decided it might be more successful on the DVD market. That came as no surprise. After all, history had seen movies that had flopped in the cinemas only to gain a cult-like following in the DVD market. Perhaps his was such a movie. Perhaps his movie was not meant to be viewed on a big screen in the confines of a cinema, but instead, enjoyed on the screens of computers and televisions in people’s homes.
But it wasn’t the profit-sharing scheme of the DVD that raised Wang Yang’s eyebrows. It was the fact that he’d overlooked a crucial detail the day before: his dividend would be calculated on a regional basis, specifically the North America region and the overseas region. This made it much harder for him to obtain a 50 percent dividend. To put things into perspective, The Blair Witch Project, which would be the first DV movie to reach the silver screen, would gross over 200 million at the box office, with North America and the rest of the world each comprising half of the total amount. But after the theatre lines had taken their cut, neither the North American nor the overseas region would amount to a pre-tax box office gross of 100 million. Needless to say, Wang Yang’s prospects of getting his 50 percent were slim.
“Would it be possible to revise the contract such that the dividend is based on the worldwide pre-tax box office gross?” said Wang Yang with a quick, diffident glance at Tom, knowing full well he’d never agree to his outrageous demand.
He was right. Shrugging, dismissing the very idea, Tom Oldenburg said, “I’m afraid I can’t do that. As you may know, the system for measuring box office gross is drastically different in North America than it is in the rest of the world, not to mention the discrepancies in timing. No, splitting the profits would be very tricky.” Illustrating his point with an example, he said, “For example, after a movie is released in North America, it may take another six months or even a year before it is released overseas. Does that mean we should wait for a year before we decide how to split our profits?”
Wang Yang relented with a nod. He understood Tom was telling the truth, so he decided not to press the matter any further.
Leaning back in his chair, Tom said, “Yang, don’t worry. We’ll only consider releasing your movie overseas if it does well in North America.” He threw up his hands, one of which was twiddling a pen, and said, “In other words, if this movie ever goes international, you’d have already made 20 percent, which is a considerable sum.”
“Yeah, I know.” Wang Yang gave a smile and went back to reading the contract. Once finished, he lifted his head and said bluntly, “Make it 20 percent for the DVD.” Tom shook his head. “I can give you 15 percent, tops. Company’s policy.” Wang Yang considered for a while then nodded. He knew he had to let up. Sitting across Lionsgate at the bargaining table without any chips, he was clearly at a disadvantage. Making demands was difficult as it was; getting Oldenburg to agree to them was nigh impossible.
After agreeing upon the DVD’s profit-sharing ratio, Wang Yang made another request. “I’d like to retain the rights to the sequels, as well as all the other copyrights.”
Tom happily accepted his terms. “Okay. You may retain those rights.” The fact was, except in a buyout, those rights ought to have belonged to the filmmaker anyway. Lionsgate Films had no intention of taking such a small advantage in the first place. Besides, a movie had to reach a certain level of commercial success before a sequel was considered, and they just didn’t think Paranormal Activity had the right ingredients for it. Smilingly, Tom added, “However, our company will have priority to those rights.”
“Of course.” Rejoicing internally, Wang Yang nodded his head. At least Lionsgate Films would have to pay him a fee if they wanted to produce Paranormal Activity 2, Paranormal Activity 3, or any other sequels. A small, but perfectly acceptable consolation. Reaching out across the table for a handshake, he said to Tom Oldenburg, “Sir, in that case, I have no other concerns.”
Putting down his fountain pen, Tom reached out his hand to shake Wang Yang’s. “I look forward to working with you, young man,” he said with a glowing smile.
“Likewise!” said Wang Yang, sending back his smile.
Although both parties had more or less come to an understanding of every detail, the actual signing of the contract would have to wait. The two had decided to make their pact in two days’ time, which allowed time for Wang Yang to seek professional legal advice. He rushed off back to Los Angeles with the redlined copy of the contract. He was planning to visit a law firm and let a pair of trained eyes look over his agreement. After all, Wang Yang had no formal education in law and was uninitiated in its intricacies and loopholes. It paid for him to be cautious.
And it was especially important for someone like him, who wasn’t represented by a talent agency, to be cautious. Because if anything went awry, no one would be able to stand up for him.
But what’s the worst that could happen? The follow-up reports on The Blair Witch Project provided a clue. In an unexpected turn of events following the film’s phenomenal 200-million-dollar box office gross, Artisan Entertainment had decided to violate its agreement by withholding dividends—a pre-agreed share of 20 percent—from its three young filmmakers. As anyone in their shoes would have done, the trio of young filmmakers took the company to court. The lawsuit was long and bitter. Fortunately, after two years of hard-fought battles, they’d finally claimed what was rightfully theirs.
Though he didn’t foresee Lionsgate committing such scandalous deeds, Wang Yang thought it would be better to be safe than sorry, especially when it came to money.
Wang Yang spent the night in his own apartment getting some well-deserved sleep. The next day, he brought his contract to a law firm called Trust Law Group. It was a medium-sized legal consultancy that Jessica had recommended to him. Not only did it have an impeccable reputation, but it was also well-versed in the legalities of the film industry. Incidentally, it also served as the legal counsel for Jessica’s father’s real estate company.
The lawyer whom Wang Yang consulted was a man in his thirties. His name was Hebel Carl. At an hourly rate of 200 dollars, he was considered moderately expensive. Hebel Carl took the contract from Wang Yang and read it several times with great intent. Then with a reassuring smile, he said to Wang Yang, “Mr. Wang, there doesn’t seem to be any issues with this contract. You may sign on the dotted line without any worries. If the other party ever decides to withhold your dividend, they would stand no chance against you in the court of law.”
“Oh, thank God.” Immediately upon hearing that, Wang Yang heaved a sigh of relief. It seemed Lionsgate Films did not fail to live up to its reputation.
Then, a few words of advice from Hebel Carl to Wang Yang. As the sole owner of the film’s copyrights, Wang Yang wasn’t legally required to set up and register a film company. Instead, he should sign the contract with Lionsgate as an individual. By having the proceeds from his movie taxed as personal income, he could avoid paying the exorbitant taxes associated with business ownership.
Feeling assured, Wang Yang walked out of Trust Law Group. Although the consultation had cost him 300 dollars and left him with barely enough money to take a bus, he thought it was money well spent. God forbid he be cheated out of his dividend and left without recourse against Lionsgate Films due to an obscure provision in the contract or some arcane loophole in the legal system.
Back in his apartment, Wang Yang prepared himself for the next day, when he’d travel to Santa Monica and officially sign the contract. He entered the shower in good spirits and emerged from it feeling radiant. He hummed his way into the living room, noticed the contract on the sofa, picked it up, and gave it a forceful kiss. “My God, why are you so cute?” he said to it with a smile. Then he flopped on the sofa and was reaching for the remote when, suddenly, his cell phone buzzed.
“I wonder who it is.” Wang Yang picked up his cell phone from the television console, looked at the screen, and froze up for a second. To his surprise, it was Artisan Entertainment’s VP of Acquisition, Stephen Thomas! Why did he call? Wang Yang answered the call with furrowed brows. “Hello, this is Wang Yang speaking.”
“Hi Mr. Wang, I’m Stephen Thomas from Artisan Entertainment.” It was Thomas’ voice, as expected.
Last time they had spoken, Artisan Entertainment had told him that they’d discuss his movie internally. Did the phone call mean they’ve come to a decision? Half-curious and half-anxious, Wang Yang asked, “Hi, Mr. Thomas. What can I do for you?”
Thomas let out a ringing laugh and said mysteriously, “You see, Mr. Wang, we’ve decided to acquire your film.”
The news might not come as a total surprise, but it still stymied Wang Yang. Artisan Entertainment wanted to buy his film! What was going on with them? Whatever made them come around? Had Thomas found a way to cure his vertigo? He shook his head, smiling unconsciously. But it didn’t matter anymore. Declining politely, he said, “Sorry, Mr. Thomas, I’ve already found a publisher for my movie.”
“What did you say?” Thomas received the turndown with surprise. What did anyone possibly see in the young Chinese man’s movie? He was skeptical about Wang Yang’s response, but he was duty-bound to inquire further. “Oh, is it too late for us, then? Mr. Wang, may I ask if you’ve signed the contract already?” To which Wang Yang replied, “No, I haven’t.”
Upon hearing his answer, Thomas pressed on. “So, I’m wondering if you’d consider giving Artisan Entertainment a chance? You see, after a lengthy discussion, we think it’s worth a shot. We’re prepared to offer 200 thousand dollars for the rights to your movie.”
Without hesitation, Wang Yang declined smilingly, “I don’t think it’d be a good idea. I’ve already made a verbal agreement with another company, and I’m quite happy with the terms. Besides, I’m thankful to them for giving me the opportunity.” He shrugged a quick little shrug and spoke into the microphone, “Sorry, Mr. Thomas.” He ended the call, but a thought lingered in his mind. What could’ve compelled Artisan Entertainment to make such a bold wager? Compared to a production cost of 10 thousand dollars, 200 thousand was no small figure.
The truth was simpler than he thought. During his last visit to Artisan Entertainment, Wang Yang had left a DVD copy of his movie, just in case the company needed to refer to it during their internal discussion. At first, the DVD had been left to gather dust on a table, as Stephen Thomas hadn’t seen any potential in it. However, the DVD, through happenstance, had found its way into the hands of the VP of Publishing a few days ago. What had begun as a casual viewing had soon turned out to be a delightfully spooky experience. Thoroughly impressed by the movie, the VP had a discussion with Thomas in hopes that the company would acquire it.
Still, Thomas disapproved of the idea. Refusing to give up, the VP brought the DVD to the CEO’s office and showed it to the CEO. And just like him, the CEO was utterly spooked and drenched in a cold sweat by the end of the movie. At that moment, the CEO, the very same person who would acquire The Blair Witch Project years later, saw something special in the DV movie and thought it was a gamble worth taking. Right then and there the decision was made—Artisan Entertainment was going to acquire Paranormal Activity.
Unfortunately, they were a little late to the party, as Wang Yang and Lionsgate Films had already finalized their agreement.
Knitting his brows, Thomas upped the ante. “Mr. Wang, how about 30 thousand?” But Wang Yang refused to budge. Then, through gritted teeth, Thomas made the highest offer that his company would allow him to make. “How about 50 thousand?” Nevertheless, Wang Yang stood firm on his conviction and said: “no thanks” with a smile. Slightly desperate and slightly angry at that point, he asked, “Mr. Wang, could you please tell me, how much did the other company offer?”
“Well, I’m afraid I can’t let you know right now. It’s confidential business information.” Wang Yang turned Thomas’ question off with a smile, and said bluntly, “Mr. Thomas, my decision is final. Although we’ve yet to sign the contract, I don’t think there’ll be any changes.”
The truth was, even if Artisan Entertainment’s terms had been more generous than Lionsgate’s, Wang Yang would still not have considered working with them. The main reason was because of his gratitude towards Lionsgate Films. The second reason was that he’d foreseen the Blair Witch Project fiasco and had been put off by Artisan Entertainment’s “track record” of breaching contracts. Besides, his clairvoyant mind told him that the company would be acquired by Lionsgate Films anyway, so why should he choose a dusty, winding trail that led to a dead-end, when a clear path to success existed?
“All right, if that’s the case, there’s nothing I can say. Goodbye, Mr. Wang.” Thomas’ words came out strained and salty. Then, there was a click followed by a monotonous beep.
Wang Yang came out of the call with a smile on his face. Little did he expect Artisan Entertainment to come around so abruptly. He furrowed his eyebrows in contemplation. Suddenly, an idea flashed across his mind. Perhaps he could capitalize on Artisan Entertainment’s newfound interest in his movie. What if he used it as a lever to expedite Paranormal Activity’s release… he stood silent as his mind ventured off into speculation.
The next day, in the acquisition department meeting room at Lionsgate’s head office building in Santa Monica.
Decked out in his business attire, Wang Yang took a deep breath as he beheld the two copies of the official contract, which were laid neatly on the table. He let his eyes wander to John Feldmeyer, standing on his left, to Tom Oldenburg, and then to Michael Prosenick. There, the three VP’s of Lionsgate stood, smiling benevolently and encouragingly at Wang Yang. He reciprocated their smiles with his, nodded, picked up a fountain pen from the desk, and put his initials on the contract.
“Congratulations, young man!” John, the VP’s, and a Caucasian lawyer who’d been hired to notarize the agreement burst into applause. Face full of smiles, they went through their congratulations.
“Thank you!” Wang Yang took their hands in his, expressed his gratitude with a smile, and shook their hands, one gentleman after the other. In a flurry of excitement and adulation, his heart swelled. Finally, the deal was sealed; his movie now had a publisher, and he could proudly proclaim to others, “I’m not a failure! I’m not going to spend the rest of my life working at McDonald’s!” His childhood dream was no longer an impossibility. In fact, now that he was on course to achieving it, it never seemed closer!
After signing the contract, Wang Yang came to John Feldmeyer’s office. As the VP of Publishing, John would be managing all matters related to his movie’s publication.
“Mr. Feldmeyer, there’s something I’ve been meaning to ask you.” Sitting on a chair across the office desk from John, he looked at him and asked, “May I know around when Lionsgate is planning to release my movie?”
Throwing his hands in the air, smiling, he said, “Whoa, son, what’s the hurry? You still have your whole life ahead of you.” He chuckled, then said in a more serious tone, “Please rest assured, your film will be published. But, as you know, it’s already the end of May. Summer break is just around the corner, and our release schedule has more or less been fixed. We think it’ll be more appropriate to release your movie at, say, the end of the year.”
End of the year? That’s almost six months from now! Wang Yang expected no less. He furrowed his brows unconsciously. In reality, releasing the movie six months after signing the contract wasn’t all that slow. Other filmmakers would have no qualms about it, but Wang Yang was keener than most. Not to mention, the summer holiday was just around the corner. By the end of the semester, he would no longer be able to keep his expulsion from USC a secret. If he had nothing to show for it by then, he’d definitely get into trouble with his parents.
Besides, he needed money to survive—and fast. The movie had to be released earlier! With his mind made up, Wang Yang shook his head and said, “Sir, I think we need to get on with the movie’s release a little sooner than that. It’s not that I want to rush it, it’s just that…” He shrugged and said calmly, “Artisan Entertainment called me yesterday with the intention of buying my movie. They’ve offered me 50 thousand dollars.”
John seemed a bit stunned by Wang Yang’s words. 50 thousand dollars? In truth, the most Lionsgate would ever pay for a buyout was 30 thousand dollars. Putting on a stoical front, he said, “Oh? Artisan Entertainment? I know them. Have you met them before?”
Wang Yang nodded and said, “Yes, I met them quite a while ago. After watching my movie, they told me they needed some time to think about it internally. Then, yesterday, they gave me their decision. Of course, I turned them down. But from what I could tell, they’re a little sad to see my movie go to someone else.” Smiling sincerely, he added, “Sir, forgive me if it sounds like I’m bragging, but what I’m trying to say is Artisan Entertainment has wised up. They came to me, hat-in-hand, with 50 thousand dollars, and told me how excited they were about the potential of my movie. They want to be known as ‘the company that brought DV movies to the world’!”
At last, John’s eyebrows pleated. He nodded slowly as he listened to Wang Yang, evidently convinced.
“Sir, bear in mind that my movie was shot in a week with a budget of 10 thousand dollars.” Reeling him in with a low and urgent tone, he said, “It seems the people at Artisan Entertainment have set their sights on DV movies. What if they decide to produce one of their own? All they’d need is tens of thousands of dollars, a week’s time, no fancy scripts, and, in no time, they’d be able to shoot their movie, bring it to market, and beat us to the punch.”
“Hmm…” John glanced up at Wang Yang but said nothing. If things really did unfold as the young man had described, it’d certainly be a huge threat. But was the young man telling the truth? John, in his mind, was smiling. Incidentally, he had had a very close friend who worked at Artisan Entertainment. While he wasn’t one of the higherups, he would at least be able to dig out some information for him.
Wang Yang’s gaze stayed firmly on John’s, unafraid of what his own countenance might give away. After all, he wasn’t lying. As a matter of fact, he’d counted on John to ask around and verify that Artisan Entertainment had indeed offered him 50 thousand dollars to acquire his movie. It didn’t matter whether or not Artisan Entertainment revealed intentions to produce a DV movie. As long as John got wind of the news, Lionsgate would surely be on its toes.
“I understand.” By his eyes, John could tell that Wang Yang was hiding nothing. He nodded and said, “I’ll think about it,” to which Wang Yang replied, “Sure, Mr. Feldmeyer. That’s all from me. Goodbye.” No sooner had Wang Yang left the office than John picked up the phone on his table and called up his old friend at Artisan Entertainment. “Hi, I heard your company is looking to acquire a DV movie? Oh, really? Your CEO liked it a lot? Are there any plans at your end for the time being…”
The chat lasted for a good while. After that, John put down the handset and stared at the ceiling pensively. Wang Yang hadn’t been lying. Artisan Entertainment really was bent upon acquiring Paranormal Activity. Stephen Thomas had even been criticized by his company for overlooking the opportunity. Nevertheless, there appeared to be no news of a DV movie in the pipeline, at least not for now… pausing for a moment to digest the information, he picked up a copy of Lionsgate’s 1998 movie release schedule and studied it in silence.
Back in Los Angeles, night had nearly fallen. Wang Yang opened the door to his apartment and stepped into his home. Then, a call from John came.
“Yang, we’ve decided. We’ll proceed with the promotional campaign for Paranormal Activity immediately. The test screening is tentatively slated for early August,” John Feldmeyer said smilingly, “Of course, whether or not it’ll lead to an official release depends on the reception and feedback we get during the promotional period.”
Wang Yang jumped up. Holding his fists intensely and thrusting one into the air, he said in silence, “Yes!”