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Amidst Buzz and Rumors, Paramount Continues To Assert It Owns "Thank You For Smoking"

Indiewire By Eugene Hernandez | Indiewire September 13, 2005 at 8:49AM

The day after both Fox Searchlight and Paramount Classics announced separate deals for Jason Reitman's debut feature film "Thank You For Smoking" here at the Toronto International Film Festival, industry insiders were voraciously buzzing about the unprecedented situation. Despite a growing speculation that Fox would end up with the movie, Paramount maintained late Monday that it had rightfully reached a deal for the film before Fox.
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The day after both Fox Searchlight and Paramount Classics announced separate deals for Jason Reitman's debut feature film "Thank You For Smoking" here at the Toronto International Film Festival, industry insiders were voraciously buzzing about the unprecedented situation. Despite a growing speculation that Fox would end up with the movie, Paramount maintained late Monday that it had rightfully reached a deal for the film before Fox.

The court of public opinion which was fueled by continual speculation and discussion all day long in Toronto left few involved parties unscathed. Industry insiders faulted a newbie producer, questioned the motives of Indiewood executives seen as vulnerable, and wondered why a sales rep seemed to have let the situation get so out of control.

In a conversation with indieWIRE on Monday night, Paramount Classics co-president Ruth Vitale maintained that her company was the rightful owner of the film, despite statements from Fox and the film's producer David O. Sacks. She faulted the inexperience of the producer and added, "He needs to come to his senses." Asked how or when the situation would be resolved, Vitale singled out the film's rep, Cassian Elwes at William Morris Independent, saying, "We are waiting for William Morris to do the right thing."

Discussions within industry circles Monday included considerable speculation, coupled with numerous insiders inquiring often about the status of the situation.

William Morris' Elwes has remained silent on the matter, choosing not to return numerous messages from indieWIRE. Competitors wondered whether the situation would lead to deeper animosity from Paramount towards WMA, and others openly speculated about how the situation might affect the agency's sales business. One leading industry company chief, however, speculated that the film's producer David O. Sacks had separately pursued the Fox deal and that Elwes was trying to resolve the current situation amicably. Others indicated that the studio "parents", as well as the filmmaker's father Ivan Reitman, would work to sort out the situation. Whatever the sequence of events on Saturday night and Sunday morning, Sacks again maintained that Fox has the rights to his film.

"The fact that multiple studios bid intensely for this movie is a testament to what Jason has achieved," said the film's producer David O. Sacks, of Room 9 Entertainment, in a statement Monday evening, adding, "However, I want to be clear that only one studio, Fox Searchlight, bought the movie. Although we had negotiations with Paramount Classics, no deal was ever concluded."

In the hours after the news of the battle for the film became public, some faulted Sacks as a novice producer, speculating that his inexperience had lead to the perplexing situation. Sacks, a former lead executive at PayPal who made his film debut as producer of the movie, defended his actions in Monday's statement saying, "Although this is my first movie, I was represented by highly experienced industry professionals. I am also a lawyer and [I] have run a large public company. We know when we have closed a deal, and when we haven't."

In the case of Paramount Classics, the situation enhanced persistent speculation about the stability of the division that has circulated since the recent arrival of new top brass at Paramount Studios. Paramount's Ruth Vitale, in the conversation with indieWIRE late Monday, emphasized that her studio bosses are supporting her in the matter, explaining that she is holding the film's reps accountable for their verbal agreement. She also cited numerous cases in which verbal agreements with sales reps were not 'papered' until much later, noting a long history of industry practices that include sketching out deals on cocktail napkins, she added, "That's how we do business."

In Monday's statement, Sacks' camp sought to defend the producer's actions, emphasizing the past experiences of the producer and his lawyer. The statement said that Sacks' attorney David Bloomfield is a veteran entertainment lawyer, highlighting his experience as a former head of legal and business affairs at Spelling Films International for nearly a decade.

Ultimately, the fracas has raised numerous questions about how the entertainment industry does business and what makes a deal a deal. A random survey of buyers and sellers revealed that there doesn't seem to be much of a standard practice, despite the correct legal procedures. One esteemed industry veteran who heads a company said that "handshake deals" are common practice and widely used and accepted. Meanwhile another company chief said that short of a signature on a piece of paper, anything can happen.