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The Axanar Settlement has arrived. Details are sketchy (and will likely remain so). However, I do have commentary on the matter.
However, I caution you: parties and courts rarely disclose detailed settlement terms. And I don’t expect anything different here. Hence we have mainly news stories and my own ideas. Furthermore, the sign of a good settlement comes when both parties walk away angry. I suspect no one loves this but at least it’s done. At least, it ends on the plaintiffs’ side, more or less. More on that later, infra.
In addition, I have some earlier documents so I will add them now. Because when I last blogged, it was all about the jury instructions. The parties lined up their ducks for the trial, which had been set for January 31, 2017.
Order on Plaintiffs’ Application
First of all, this ended up yet another document about redaction. However, the court rejected it on procedural grounds. And this set the Axanar settlement wheels in motion. Because when the judge decided the matter, suddenly the complete and unredacted financials came into play. Finally, the order came down January 17 – so this all happened very, very quickly. Most likely, defense counsel explained the facts of life to their client. Hence defendant Peters realized an Axanar settlement would end up the better outcome.
Furthermore, defense had already lost on fair use and on most of the ‘substantial similarity’ test. Hence a final question of willful infringement loomed. So if a jury had found willfulness, it would have awarded up to $150,000 per instance of infringement.
Defense Brief Regarding Damages
Also, defense filed this document, in an effort to limit the scope of damages. And that meant defense had already thrown in the towel on liability. By Mr. Peters’s own statements, he looked toward appeal. Would Winston & Strawn have continued to represent him pro bono publico if the matter went to appeal? Maybe. While W & S certainly wanted to make law when they took on the case in the first place, it had to have cost them a pretty penny. Hence they may have pushed to renegotiate the terms of their engagement. Note: I am only speculating here.
On to the settlement itself.
Defense Admissions Required
According to The Hollywood Reporter, the terms include:
Paramount Pictures Corporation, CBS Studios Inc., Axanar Productions, Inc. and Alec Peters are pleased to announce that the litigation regarding Axanar’s film Prelude to Axanar and its proposed film Axanar has been resolved. Axanar and Mr. Peters acknowledge that both films were not approved by Paramount or CBS, and that both works crossed boundaries acceptable to CBS and Paramount relating to copyright law. …
Therefore, defense concedes on liability.
Axanar and Mr. Peters have agreed to make substantial changes to Axanar to resolve this litigation, and have also assured the copyright holders that any future Star Trek fan films produced by Axanar or Mr. Peters will be in accordance with the ‘Guidelines for Fan Films‘ distributed by CBS and Paramount in June 2016….
So if you recall the guidelines, this means:
- They only permit two fifteen-minute-long segments, and no more than thirty minutes for a story line
- Crowdfunding caps at $50,000 per fifteen-minute-long segment, for a total of $100,000 per thirty minute story line
- Nobody who previously worked on Star Trek can work on a fan film
- They must either make costumes and props or purchase from licensed vendors
- In addition, “The fan production cannot derive revenue by selling or licensing fan-created production sets, props or costumes.”
What Happens to Axanar and Peters?
First of all, it’s time to deliver. However, that will prove difficult, as the guidelines will do the following:
- The cap on crowdfunding might mean the $1.4 million already raised and no more. Hard to say. However, crowdfunding already showed diminishing returns before CBS/Paramount filed suit in 2015. Furthermore, per a preliminary (not-yet-confirmed) communications I believe went to the donors, the next segments will be privately funded and not crowdfunded, anyway.
- Anyone formerly employed by CBS, Paramount, or any of their affiliates must depart. That means no more:
- Gary Graham (probably)
- JG Hertzler (probably)
- Tobias Richter
- Robert Meyer Burnett
- It may even mean Mr. Peters must officially depart. Also hard to say.
- They most likely must shutter the donor store.
- They probably have to change the @StarTrekAxanar Twitter handle.
What About the Studio?
I suspect we will not hear anything specific out of plaintiffs or the court documents. However, Axanar plans to contact their cast, crew, and donors. So the answer might end up in those communications. However, retaining the studio may prove difficult because:
- I understand (please correct me if I err) the electrical grid is not yet up to code
- The rent clocks in at $15,000 per month
- The production is low on funds
- and several competing studios exist in the area
Hence, even retaining the studio might prove an albatross for the production.
Did Defense Pay Anything?
Apparently, no. Quoting an Ars Technica article:
A spokesperson from Axanar told Ars Technica in an e-mail “we’re not paying anything,” with respect to the settlement.
What About Future Crowdfunding Efforts?
No guarantees there, that Axanar will be able to reach its previous heights. Some donors eagerly will add more. Others might not wish to throw good money after bad, as they might see it. Furthermore, as I stated, supra, crowdfunding already provided diminishing returns. In addition, plenty of social media meltdowns exist online. And so do not so happy donors and former supporters. Expect crowdfunding to be harder for Axanar. But not necessarily impossible.
What About Peters’s Future?
If he cannot truly be a part of Axanar, he might not want to continue. Certainly, the film must radically change.
However, his other issues may prove worse. First of all, Ares Digital, the fulfillment software, might end up the subject of its own future fight in court. In addition, if California Revenue or the Internal Revenue Service feel the donor store did not collect taxes properly, those might end up new fronts. Or the California Department of Labor might feel Axanar’s employees did not receive correct wages or the records might not be considered correct. Maybe the donors could rise up in a class action suit of their own, or even sue individually in small claim courts across the country or even their equivalents around the globe. Or nothing. We shall see.
Oh, and if he files for bankruptcy due to his financial woes, the Bankruptcy Court will do what’s called a look back. They will determine whether any assets may be missing, and they will look closely, because Mr. Peters already has one bankruptcy under his belt.
What About Semantic Shenanigans’s Future?
Hey, we are not just about the Axanar case! There’s plenty more to discuss, including the Seuss case and an interesting brouhaha is brewing over independent publisher All-Romance E-Books. So please stay tuned! And if we get any more information on the settlement and/or its aftermath, I will blog about it. Thank you for reading!