Film and TV Tax Credits Working for California?

California significantly increased tax credits to incentivize the location of film and TV production in the state of California in late 2014.  I've written about it and its impact, here, back in 2016.  How is it doing since then?  The California Film Commission, the government entity responsible for administering the tax credit program, issued a Report examining the impact of the program over the last three years from 2015 to 2018.  A press release concerning the Report states: 

Employment – in terms of hours worked in-state by below-the-line crew members. Program year-three continued the long-term growth trend with a 15.6 percent increase in hours worked in 2017 compared to 2014 (the year before Program 2.0 began). This growth builds on 2016’s 12 percent increase over 2014. These figures are based on data for below-the-line workers including Teamsters, IATSE members, basic crafts and others covered under the Motion Picture Industry Pension & Health Plans.  In addition, Los Angeles-area sound stages are operating at near capacity (as reported by FilmL.A.), which is leading to substantial growth in construction for new stages and production support facilities.   

- Big-Budget Films (over $75 million) – which are a target for the uncapped incentives offered by other states and countries. During year-three of Program 2.0, California attracted five additional big-budget films (“Call of the Wild,” “Captain Marvel,” “Ford v. Ferrari,” “Island Plaza” and “Once Upon a Time in Hollywood”). To date, the expanded tax credit has attracted a total of 10 big budget films. 

- Relocating TV Series – which have their own dedicated allocation of tax credits. During year three of Program 2.0, California attracted two additional relocating TV series (NBC’s “Timeless” from Vancouver, and Amazon Studios’ “Sneaky Pete” from New York). To date, the expanded tax credit program has gained a total of 15 relocating TV series from across the U.S. and Canada. 

- Production Activity Statewide – for which Program 2.0 provides an added incentive uplift. During the program’s first three fiscal years, tax credit projects spent a total of more than $78 million in 19 counties outside the Los Angeles 30-Mile Zone. This figure will continue to rise as more tax credit projects for year-three (and prior years) report their out-of-zone spending.

Moreover, the supposed impact of Captain Marvel on the local California economy has been estimated to be around $100 million.  The latest installment of Sherlock Holmes will also be shot in California, estimated to provide another $100 million boost to the local California economy.  Notably, Governor Newsom has pointed to restrictive social policies concerning abortion (mostly in Southern U.S. states, such as Georgia) as a reason for production companies to move their operations back to California. 

Reinvigorating Competition Law in the United States: A Path Forward?

In late 2018, Professor Timothy Wu at Columbia University Law School published a short, readable and nicely priced book at about 140 pages titled, “The Curse of Bigness: Antitrust in the Gilded Age.”  This ambitious and accessible book lays out and defends the general thesis that American antitrust law (competition law) has gone astray.  He essentially attacks the narrow focus on the consumer welfare theory of antitrust law as failing to completely encompass other values, particularly related to the protection of democracy from influence by a concentrated private sector relying on the work of U.S. Supreme Court Justice Lewis Brandeis.  He traces the history of antitrust enforcement in the United States from the “Gilded Age” and notes that the remedy of breakup of concentration has historically led to more innovation, and an important harm of the narrow Chicago/Harvard School approach to antitrust is a failure to find actionable concentration enough and that “bigness” in and of itself is harmful.  Indeed, concentration leads to those benefiting from it doing whatever necessary to preserve their position, which includes suppression of innovation through raising rival costs, mergers and cloning, and exercising control over government.  Cloning is essentially copying of the features of smaller rivals, particularly in the technology/internet industry.  It seems that intellectual property protection may provide some cover for small firms from abuse.  He points to the lack of enforcement by the George W. Bush administration (and also points the finger at the Obama Administration, but gives them the excuse of the background of a judiciary that has adopted the Chicago/Harvard School approach--perhaps the W Bush Administration may benefit a bit from the same excuse) that led to a significant amount of concentration across several industries.  Interestingly, the Trump administration recently approved the Sprint/T-Mobile merger. 


Professor Wu is particularly concerned about the technology sector and specifically critiques the behavior of Google, Facebook and Amazon.  Professor Wu points to several policy prescriptions: 1) reinvigorate merger review, including “a simple but per se ban on mergers that reduce the number of major firms to less than four”; 2) "democratization of the merger process"; 3) taking on big cases (he lauds the EU's approach); 4) using the breakup remedy; 5) adopting a “market investigation” practice similar to the United Kingdom; and 6) essentially “abandoning ‘consumer welfare’ as the lodestone of antitrust law” and adopting a standard based on the “protection of competition” that is process oriented in nature.  Notably, other additional values worth protecting could include individual privacy and even more difficult to cabin in today's age--national security.  Professor Wu’s book lays out a strategy for approaching antitrust issues in the Internet Age and perhaps he will be the one to lead the next Democratic administration’s antitrust enforcement.  The book is available for purchase, here, for around $12 new and $8 used. 

Another Upside of Intellectual Property's Downside?

In an article titled, The Upside of Intellectual Property Law’s Downside, Professors Christopher Cotropia and James Gibson discuss how IP’s downside, exclusion, can result in some positives or upsides.  For example, so-called “copyright trolls” may be beneficial to society by shutting down and slowing the distribution of pornography.  One relatively “hot topic” in IP law has been the presence and merits of so-called “trademark bullies”—ordinarily a well-resourced individual or large corporation, who uses overbroad trademark claims in a cease and desist letter with the effect of chilling speech, or stifling competition or creativity (for more on trademark bullying, see here and here).  The target of the cease and desist letter usually capitulates in the face of the prospect of paying large legal fees.  

Recently, an organization, Super Happy Fun America, set up a website to publicize its “straight parade.”  In doing so, it also listed a group of companies that purportedly were either associated with the parade or were in negotiations to sponsor it.  Apparently, the companies were not associated with or in negotiations with the parade in any way.  A number of companies responded with cease and desist letters and one stands out.  Adding to the fantastic list of creative cease and desist letters, an attorney at TripAdvisor sent a letter full of references to gay pride anthems.  Do we have another example of an upside of intellectual property law?  There doesn’t seem to be much free speech value in misrepresenting the relationship between one group and another—I guess I could find some comment here (that may eat up a fair bit of trademark law). Surely, this will squelch potentially harmful associations between entities. And, the added benefit of a creative cease and desist letter is the potential positive publicity and reinforcement of corporate values (at least in this case).  

After receipt of the cease and desist letters, the organization is still using the marks with "Xs" on them (sometimes, but apparently with some advice of trademark and copyright counsel) and includes a nice list with reproductions of all of the cease and desist letters its received thus far, here (which includes apparently truthful statements about their relationship with those companies). Ultimately, it appears that free speech is a winner here--and intellectual property law did not stand in its way and, indeed, may have worked to eliminate confusion as to a "true and accurate relationship" and the messages are being heard.  Here is a copy of the TripAdvisor letter: 

Dear Mr. Hugo,

I am writing on behalf of TripAdvisor LLC concerning Super Fun Happy America’s unauthorized use of TripAdvisor’s logo, as displayed on your website at superhappyfunamerica.com/2019/07/09/corporate-sponsors/. I’m Coming Out and saying this clearly: you are infringing upon TripAdvisor’s intellectual property rights. Further, your statement that you are “in negotiations” with TripAdvisor as a “potential sponsor” is completely false.

To be precise, your use of the TripAdvisor trademark and our Beautiful logo infringes TripAdvisor’s trademark and trade name rights. TripAdvisor’s trademarks are protected in many countries around the world and Over The Rainbow, including in the United States under Registration Nos. 2727627, 3171193, 4612678 and 4454774. We have become a well-known brand for our reviews of hotels, restaurants, experiences and even the occasional YMCA, but we weren’t Born This Way – we obtained that recognition through significant advertising and promotion since as early as 2000. As a result of the breadth of the services it provides and its widespread renown, TripAdvisor enjoys substantial rights in its mark and name.

Contrary to your claims, TripAdvisor is not “in negotiations” with your organization for sponsorship of its “Straight Pride Parade.” Similarly, we have not authorized you to use our name or logo in any way. You Need To Calm Down – you are not sponsored by, associated or affiliated with TripAdvisor in any way, and thus, your use of our marks could confuse the public as to an affiliation with TripAdvisor. These inaccurate statements, which I trust do not show your True Colors, infringe on TripAdvisor’s rights under the Lanham Act, and impinge upon our Freedom! to decide with what organizations we want to associate our brand. Have A Little Respect and remove those statements. TripAdvisor and I Will Survive without being associated with your event.

There is nothing Vogue or acceptable about making false claims about others merely to support your own cause. If I Could Turn Back Time, I would tell you not to use our name in the first place. But now that you have, TripAdvisor demands that you remove all uses of our name, mark and logo from your website (and anywhere else you might use it) within 24 hours and not use them again. In other words, Black Me Out with an “X” on the above webpage. You Make Me Feel (Mighty Real) disappointment that you thought this might be an acceptable way to do business.

TripAdvisor is willing to resolve this matter amicably, today, on the above terms. That said, if you Don’t Stop Me Now by taking the requisite actions, TripAdvisor reserves all rights to take whatever enforcement actions it deems appropriate, including – if necessary – taking legal action against Super Fun Happy America, its principals, affiliates, or those acting in concert with you. Finally, I likely am not Dancing On My Own here, as I suspect the above arguments apply to most or all of the companies listed on the above webpage.

Please know and Believe that we take this matter seriously and look forward to your prompt compliance.

Sincerely,

Bradford Young

Vice President, Associate General Counsel

For more discussion concerning this event, please see here, here, here and here. 

"Decluttering" the U.S. Trademark Register?

The USPTO recently announced that “foreign-domiciled trademark applicants, registrants, and parties to [TTAB] proceedings" must secure a U.S. attorney.  At least part of the justification for this new requirement is the filing of apparently fraudulent applications.  This may help declutter the U.S. Trademark Register—to the extent you believe there is a clutter problem.  I plan to open my own law office soon to provide low cost and quality U.S. trademark services (lol).  Here is some more detail concerning the requirement with helpful links to more information: 

• Foreign-domiciled trademark applicants, registrants, and parties to Trademark Trial and Appeal Board proceedings, including Canadian trademark filers, must be represented at the United States Patent and Trademark Office (USPTO) by an attorney who is licensed to practice law in the United States. See more about foreign-domiciled trademark applicants, registrants, and parties.
• U.S.-licensed attorneys representing trademark filers must provide all of the following:
• Their name, postal address, and email address
• A statement attesting to their active membership in good standing of a bar of the highest court of a U.S. state, commonwealth, or territory
• Information concerning their bar membership (state, number if applicable, and year of admission).

      See more about U.S.-licensed attorneys.

• Canadian patent agents will no longer be authorized to represent Canadian trademark applicants, registrants, or parties before the USPTO in trademark matters. See more about Canadian patent agents.
• Canadian trademark attorneys and agents will continue, if eligible, to be recognized as additionally appointed practitioners who can represent their Canadian clients, although the USPTO will correspond only with the appointed U.S.-licensed attorney. See more about Canadian trademark attorneys and agents.

New Report: UK's Cell and Gene Therapy Sector Growing at a (very) Healthy Rate

The Alliance for Regenerative Medicine and the Bioindustry Association of the UK have released a report (Report) concerning development and growth of the cell and gene therapy field in the United Kingdom.  The Report notes “four key takeaways”: 

[1] The UK is a leading source of innovation in the research and development of advanced therapy medicinal products (ATMPs) in Europe.  [2] There is strong government support for scientific innovation, capital formation, and patient access to cell and gene therapies in the UK. [3] There is significant investment in the UK   to support the development of these life-changing therapies. [and 4] The clinical pipeline in the UK, both in terms of UK-based companies and other companies interested in clinical development in the UK, is robust and growing.

The Report states that 24% of ATMP companies in Europe are headquartered in the United Kingdom, additionally there was over a billion US dollars in funding.  The funding in 2019 is on track to meet or exceed 2018’s funding.  There are detailed stats on funding by type in the Report.  Moreover, since 2012, there has been a substantial uptick in ATMP activity—from 22 companies to over 70 companies, some of which is attributed to significant government support and organization.  The Report also contains data regarding current and past clinical trials and case studies concerning relevant companies and their technology.  


The Report concludes with the following recommendations: 

Support scientific research to develop and advance both cell and gene therapies and ancillary processes, including manufacturing and scale up.

Foster economic development and the creation of a skilled workforce to promote the continued growth of this industry in the UK.

Cultivate a positive regulatory environment for the research and development of cell and gene therapies, including fostering accelerated pathways to ensure that patients are able to access safe and effective therapies in a timely manner.

Develop the necessary infrastructures within NICE and its counterparts in Scotland, Wales, and Northern Ireland to ensure health technology assessments are able to address the long-term value provided by cell and gene therapies.

Collaborate with the NHS and other public and private payers in the UK to develop innovative financing models to ensure patients can access approved therapies in an efficient manner.

The development of a skilled workforce (and attraction of one) and the related issue of international collaboration is important, but not expressly tied together in the recommendations. The full Report is available, here.