How does a toy licensing deal work? Why are toys double licensed? David Schnider, TOY LAWYER speaks!
Вставка
- Опубліковано 9 жов 2024
- Scott Toy Guru Neitlich from Spector Creative is joined by special guest David Schnider Partner with Nolan Heimann LLP to answer many of the toy communities burning questions about licenising deals, double licensing and other toy related legal issues. David is a toy fan himself and shares his toy memories and professional experience working to help make toy deals happen!
Do you recommend that book you should in the video?
Do you have a video on how to find a toy manufacturer thanks
Thanks for the video I learned a lot keep up the great work
Hello. I have a question: What about those so-called "third party" companies that manufacture toys using likenesses of popular characters (e.g. a Ninja Turtles action figure) but DO NOT put the copyrighted character name on the product box? Apparently, they don't get sued, how is that possible? Thanks!
I did a video on that a few months back!
@@spectorcreative1872 can you link the video?
Thanks 🙏 you for your time
And thank you for watching!
just so i understand correctly, the advance you pay is essentially deducted from the guaranty? in the example given, at the end of the year McF would be on the hook for $40K of the $50K guaranty since they've already paid $10K up front?
I had a quick question. What is the average advance and guarantee that a licensee pays a licensor?
Thank you for this. Very much appreciated!
Well so glad you enjoyed! Any help reposting is always appreciated
I needed this video thanks for making it.
I would kill for a one on one with David! I'm a film maker shooting a toy feature film and the whole goal of it is to license the toyline from the movie. Hit me up!
You can always hire him through Spector creative. Check out spectorcreative.com for all our services
Excellent, clear, simple explanation of IP licensing from idea to market to bargain bin.
Glad you enjoyed! Any help reposting is most appreciated
di$ney was very polite when i asked them for a license. :)
my question is if the advance goes towards that royalty you have to pay, and what monetary threshold to you have to show the licensee to be taken seriously on average?
Well there is no one blanket royalty. Each brand is different and the amount is set by the licensor. Not something you bid for
@@spectorcreative1872 oh, sure, each deal is probably somewhat unique, but i'm not really talking about hasbro and master licenses and such as much as the low-level license requirements.
You two sound alike
Maybe we are the same person!
Hmmmm interesting interview. 😆🙂👍
Glad you enjoyed! more to come
Well the great and wise Sage Yogurt did say that we were in this to make a “certain” load of money…..
Where the real money from the movie is made
You know lawyers??…. 😉😙🥸
Only the ones that get eaten by Dinosaurs on the toilet
While you were having a lawyer around, did he ever warn you about your lax use of pictures from the internet?
He had me arrested for it
Considering the risks and possible reward being (possibly) minimal, its amazing someone wanted to tap into the market in the first place...
Very much so
I'm gonna have to listen to this a few times to fully absorb everything. 😅
It won't be deleted I promise!
Another fascinating insight video the whole "guaranteed payment" thing yeah it makes sense plus it also makes sense that if the product doesn't sell that it diminishes the value of the brand and not necessarily the manufacturer.
Exactly. Which is why licensors want to know what they are getting into
Interesting then you got likeness rights and expense why I think super man movie 1 .4 reeve figures or merchandise has never been done
Oh yes it is several different licensees
@@spectorcreative1872 and explains the sheer cost well juice not worth the squeez
Thanks for that video...it was very informative. Thanks David for your time and expertise.
As a Transformers fan, one of the things that bothers me the most are the UNlicensed toys that "third party companies" make...figures that mimic the look of a Hasbro character but are not produced with a license and most often don't include faction symbols and go by different names, such as "Boss Gun" or "Red Truck" instead of Megatron and Optimus Prime respectively (yes, I know those aren't really the fake names used but just an example). These toys are made without the permission of the IP holder, get around all safety standards, and "fans" justify them by saying "Hasbro doesn't care about making the things we want" or "this is a better quality item than Hasbro makes". It drives me crazy that there seems to be no legal recourse for Hasbro/Takara in this situation to stop these companies from making money off their IP without paying licensing and having to follow proper toy safety standards.
Is that something David might be able to wade into...the shadowy world of "third party companies" and "knock offs" and how they continue to thrive without any legal repercussions and if there are any ways that an IP holder can fight back against these thieves?
Yeah we are looking into another video on bootlegs
Another excellent industry insight video! It's so frustrating to argue with Hot Toys "collectors" regarding this exact very same specific topic! They just think "Hot Toys has the star wars license, why haven't they released a Kabe Chadra-Fan figure yet? They never listen to the fans" But they hate to hear that:
1. Hot Toys is a business, and as such are aware of what they need to do to net a profit.
2. There are upfront costs and expenses as well as legal barriers that exist that could limit what they are able to produce.
3. The market for a $200+ "action figure" isn't as large as most collectors think it is. Even if Hot Toys only produced 10,000 units for worldwide distribution, those figures often sit in inventory for months and get discounted by the retailers before selling out of stock.
Your videos are such a great resource, and they really help me keep my sanity intact while navigating the online collector-sphere 👏😎👍 thank you Scott and David for the great information
So glad this could clarify. I’ll look into doing a hot toys specific video too!
@@spectorcreative1872 That would be greatly appreciated 👏😁👍
Also keep in mind production pipelines. It takes a team of artists months to develop those statues and often years to get them to market. They can only fit so many into that pipeline so it’s not surprising they tend to lean towards the more popular characters.
@@davidschnider8443 Great point! I'm sure that there is an opportunity cost for Hot Toys when they decide to produce one figure vs another. With such a large investment of time and resources, I can imagine that Hot Toys has to exercise some discretion.
Great, informative video! It seems like there's a lot of risk for licensees and thus a real lightning in a bottle miracle that say Kenner did so well with their Star Wars gamble.
Very much so. And failure is much more common then success
Just look at all the scifi movies and tv shows toy companies threw money at in the early 80s to try and catch some of that bottled lightning for themselves.
EDIT: I misspelled "threw" as "through." 😅
when people say toys and scale and proportion I always laugh because I am a big Transformers fan/collector....Makes me think to my self, "scale and proportion, that is a thing?"
Scale is more relative to the true size, proportion is that all the individual parts are correct to each other. (Ie a big head)
You and David sound alike!
Collectors will collect
I deny that Scott Neitlich is my secret identity
As a recent law graduate and toy collector, I'd love to hear more about David's work in the toy industry. Scott, how could I get in touch with him?
I’ll ask him if I can post his contact info. You can also try Google!
took me less than ten seconds to find where he worked, email, and phone number, lol.
dschnider@nolanheimann.com
Can anyone get a license? For example, if I wanted to bring the Silver Hawks back.
Coming from a fan: Yes. But it seems to be cash and ability to produce. 2 instances would be independent toy co October Toys getting rights and making Skeleton Warriors. There is a more fan example of a guy getting and making Boglins. Same guy may have made some Maxx Steel toys with O’Neil designs.
Technically, but you would need to have a business plan as part of your pitch
Very good explanation of the complexities between licensor and licensee relations
I’ll pass this along to David!
How would I love X manufacturer to get back the motuc brand on tracks comes 2023 ... After all, these toys aren't exactly 7" scale. So no competition of any sort with Masterverse. OnlyOneSkeletor
Well anything can happen in 2023. Even Mattel keeping the license per Universal
Why are illegal downloaders of films and songs forced to use vpn's but buying 3rd party bootleg figures can be done out in the open on big toy sites?
Working on a video about this!
Thanks for sharing this video. Very educational.👍
Glad it was so! Feel free to share with others it helps the channel a ton
Rose Tico. Remember Atari E.T. ?
Oh dear…
What happened with Toy Biz and the Batman/DC Heroes line in 1989/1990? How were Kenner able to produce movie-based Batman figures in 1990 as well? This has always been a mystery to me. Maybe the slightly smaller size of the Kenner figs put them in a different licensing category/scale? Thus subject to a separate deal?
I’ve got a video in the craziness of the DC license in the works!
4k photos followed by > 720p photos makes my head hurt from eye strain. 🤷♂️
Might be due to licensing? Pun intended.
I’ll try to do better! Noted
Applause? I had no Idea Spector Creative was filmed in front of a live studio audience.
They are glued to their seats
I really screwed myself writing a screenplay based on Monster in My Pocket and an opera based on The Man-Thing because I can't pay the licensor anything up front. The last licensees on those totally screwed them up, too. Of course, I couldn't say that when I attempted to contact the producer of the Man-Thing movie over LinkedIn after attending the legal portion of American Lyric Theater's Opera Writers Symposium after they told us that 99% of the time whoever has the film rights also has the stage rights, but I still didn't get a response.
Sometimes these things just need to be fun creative exercises like I did with the motu script
@@spectorcreative1872 Maybe I'd feel that way if I hadn't spent eight years and three months in the NYC homeless shelter system seven years after earning a master's degree in film.
If there is a pt 2: so is it an unspoken rule that custom creators like Sucklord get a pass? Ex: the still at 2:44 . An art teacher once said an artist went to jail because he continued to draw Mickey Mouse after her was ordered not to. Are there other known times when the toy industry (in the US) had to clamp down on artists or customizers?
I make custom and repro 80s joes and few vintage sw figures and accessories.
Im friends with all the big names in the casting and repro world and i can tell you two things...
1. For every one collector that cares there's 100 that don't.
2. If anyone at any company cared at all they sure don't show/act on it.
We are looking into a sequel
nice information on the higher level, HQ deals & licensing..but I think companies (licensee) are assured depending also on their contracts w/ their distributors. when the distributing HQ had a deal with the toy car model companies, store branches like my dad's were "forced" to take products & he paid out of pocket to accommodate at least 4 boxes of 20 toy car models/ delivery, so now his store is burdened to sell those toy figures to re-acquire his own purchase/ investment & make profit...so unfortunately, if a scalper comes to his store & buys 2 dozen toy ferraris, he had no choice, as its "his own" money was at stake, & yes he has to pay bills for the month..how do we solve the scalper problem, & help our regular customers.. you can pay in advance & we'd save you a toy ferrari. (pre-order).
An example of the fact that this or any system in business is far from perfect
Bottom line: Hasbro rents the space from Walmart and is responsible for filling the pegs with product. The Hasbro pegs are empty because Hasbro wants them empty. Hasbro knows 1 unit per week is not near enough to cover the demand. The Mattel pegs are full because Mattel wants them full and because they are employing the McDonald’s fish sandwich strategy. It’s not rocket science.
Not exactly. It is up to the retailers to place a large enough order to keep the pegs full.
I in no way endorse this video!
Your cease and desist order is being review by the Montesento Corporation and the Department of Redundancy Department
@@spectorcreative1872 LOL!!!
Scott and/or David: Is it possible to buy the rights to one single character in a toy-line? Like, if I wanted to buy the character of Hordak and use him as the villain in my story, but in my story he has nothing to do with He-Man or She-Ra? Just for the record, the character I want to use in my story is not Hordak, and is not a Mattel property.
Personally I’ve never heard if this but I wouldn’t say it is impossible. It may depend on the brand and the ip owner
I agree with Scott, it’s unlikely. Content owners are protective of their characters and brands and usually won’t license them out without a decent prospect of a return and control over the content. Characters do occasionally cross over, but typically only when the studio controls both properties.
I think any likeness of character they might trip out any. i am told of games for pc u can create characters for game but cant be any likeness to a real character any. so u have to create a total different guy or gal with a unique power any.
What was Faux Riddler's name again?! I remember he had a bunch of infomercials for government grants back in the day. There was him and the "don't pay your taxes" guy. I think that one went to jail. Great video, btw.
Matthew John Lesko
@@spectorcreative1872 yeah that's him! I remember him, Irwin Schiff, and that Trudeau guy selling handouts, tax dodging, speed reading, and diet info all around the same time. Like a Fox News version of the Flash's Rogues. I don't know for sure they were at the same time but that's how I recall it.
Oh man, I remember that guy with the question marks on his suit screaming into the camera about money in his crappy commercials. I bet he made a lot of money selling nonsense in his money books. Haha.
His name was Matthew John Lesko
He still does give info as to where u can try get help for stuff anytime. he just doesnt do ads as before. but think has books of info u can try get help for funds to do stuff anytime. it like some or many want funds for any reason but dont always search for teh info to get it, so there are books u can check and note info or just buy book or get otehr ways to have info anytime.
@@cable30 The thing he doesn't say is that almost no one qualifies for that "free money". So his claims are very misleading in order to help sell books.
This is why this is one of my favourite channels on UA-cam, I absolutely love learning about every step in the process of making toys and the way the toy business works.
Thrilled to hear it! Please feel free to pass these videos to others, it helps the channel a ton
And i think this first channel that even address the empty pegs chaos lol. as to why it happens at any store anytime as if they hoard them in back or do backdoor deals as i read of the cards any lol. it just that some or many snag to resell or to get all just to make the figure lol. and some video even show traffic even steal the parts so u getting ripped off if u get or try get figure and stuff missing lol. i think if just wanted figure and part missing i would ask for some kinda discount any so it not just put back on shelf. cause guess if put in damage bin i can guess a wroekr may just take it home or try resell as pre owned lol
@@spectorcreative1872 I absolutely spread the word of this channel around quite often!
This is a great crash course on cost/benefit analysis and risk management. However, I think there is one detail that could have helped to paint a more full picture. Specifically, I think the element of _opportunity cost_ is a major, often overlooked factor.
By licensing the Ted Lasso figures to Mcfarlane, Apple loses the opportunity to give the license to Mattel or Hasbro or Neco or whomever. It’s not just the quality and success of the product sold by McFarlane, it’s also the loss of the benefit gained from potential products created by a different company.
Consider how wildly different the landscape of modern fandom would be if Kenner had not won the license for Star Wars toys. What if it had gone to a company that only produced role playing items like battery powered light sabers and squirt gun laser blasters? What if the license went to a company that decided hot wheels sized cars were the only vehicles we would get from A New Hope? I could easily see a world where something like that could be used to compliment a full, 12-inch line of GI Joe style figures? Would Star Wars even be _Star Wars_ without the brilliant, innovative and unforgettable 3 3/4ths focused, vehicle-heavy line we got?
I think this is the root cause of a lot of the slice-encing described in this video. You can hypothetically minimize the opportunity cost by granting licenses to as many different approaches as possible. Unfortunately, this does create a NEW problem, because obviously these competing, similarly-themed products carry significant potential to cannibalize one another.
I’d love to see a follow up video that contends with this angle and considers some unmade lines, or famously failed lines as well as the ways in which many mega successful brands have been defined in public consciousness by their licensed products.
Cannibalization is down stream of the Licensor. While Pop Vinyls, Jada Metals, and Mighty Muggs are all competing in the same sphere as long as one company is successful the other two can bomb, and disappear from the market without damaging the brand name. It can also breed healthy competition like Hasbro outbidding Jazzwares for the 6" Fortnite license after seeing how successful Jazzwares has been over the last 3 years. While Hasbro now holds the 6" license Jazzwares keeps the 4". In all this did McFarlane's poor sales damage the Fortnite brand?
I will certainly add that to the list. A gréât post and very good follow up!
I think sales depend on what true fans of the game want really. some or many want statues while rest want figures. also depend on whole buys the figures detemines out of the different figures what u want most. kids if so want like the toy figures while adults want bigger or statues kinda of them any. not sure poor sales ruin a beand , it just shows fans of game didnt like the figures or statue for any reason. they make alot different figures or statues any and they do sell it all depends on what fans of the figure want or like of it at time. besides the price can be a factor also and some wait if go on clearance any by chance.
It’s a good point and one that comes up a lot with younger properties. New content creators are often thrilled to get a license opportunity. I have seen them enter into term deals with no advance or guaranty. A year later they get better opportunities and are locked into a sucky deal (the legal term). That’s why picking good partners is so important.
@@cable30 sales don’t reflect what fans want. Sales reflect only what is _made available to fans._ it’s a one way street. In 1978, kids desperately wanted Star Wars figures that fit inside various space ships. That demand would have been there even if the toy manufacturer wasn’t savvy enough to feed that desire. I’d say we have similar situations all over the place today. Tons of different toys and play patterns that kids/fans _want_ but toy companies aren’t producing. Could be out of lack of imagination, aversion to risk, cost of production, or any number of other issues. I’m not talking about the success or failure of toys that exist. I’m talking the cost of missing out on figures that never got made.
You make awesome videos man, gonna change the subject, your phone should be ringing off the hook by hasbro. They need help bad with G.I. Joe bad. The only way I have access to figures is on the scalpers market. I’m glad I still have the toys, for the most part when I was a kid, so as far as I see it I have the best versions that I can get, man would be nice if they had a matty collector or just make them available at stores cause peeps out there trying to army build major bludd or something, crazy times.
I just found out from a local toy store, that the GI joe figures they got were only Gun-Ho and Cobra commander. It was a full wall of like 30 Cobras and Gun-Ho . Then I saw a box on top of the shaves, and I asked if there were different characters inside. Guess what? Only Cobra and Gun-Ho.
@@juanfelixsoto wow dude I feel your pain, the gi joe pipeline is broken, hasbro needs to fix it.
Well I am always available on spectorcreative.com! Most appreciated the kind words
We know places like to mass produce characters but way so many of certain characters lol ? i mean not everyone likes all the characters for any reason. so they do need a wake up call as to start doing different ones or they just gonna have some or many sitting on pegs for any reason.
Licens-or sounds like a MotU character. Just throwing that out there.
Law-or works too :)
Make it happen mattel
members of Mo-Larr's special team The Work-ors.
I picture a muscular version of the blue haired lawyer. He attends all the zoning hearings which involve Castle Graystull in the Eternia County Board meetings. Has a spring-loaded arm to raise for procedural objections.