Under the Spotlight: The Effects of Buchwald v. Paramount on Hollywood Accounting Thirty Years Later
Date of Award
Spring 2018
Degree Name
Bachelor of Science (BS)
Advisor(s)
Iris Schneider
Abstract
The inflation of expenditures reported by production studios and distribution companies to avoid obligating net-profit agreements, a practice known as Hollywood accounting, has plagued the movie industry for decades. However, studios carried out their arcane accounting techniques largely unnoticed until 1990, when Buchwald v. Paramount¸ a landmark California court case that is commonly considered the watershed for exposing this phenomenon, gained widespread media attention. Buchwald v. Paramount established the precedent that certain accounting formulas could be “unconscionable” and recognized the ease with which film companies were able to get away with offering talent unfair contract terms. The purpose of this thesis is to examine the long-term ramifications of this monumental case on Hollywood accounting and its influence on industry tactics today to see if creative talent is better protected against this type of exploitation almost thirty years later. By comparing the circumstances that surrounded Buchwald v. Paramount with the current structure of Hollywood contracts and other non-related factors that have shaped the leverage with which parties have during negotiations, this paper will show that successfully litigating against studios for withholding net-profit payments remains an almost equally daunting and challenging task.
Recommended Citation
Cheng, William, "Under the Spotlight: The Effects of Buchwald v. Paramount on Hollywood Accounting Thirty Years Later" (2018). Gabelli School of Business Honors Thesis Collection. 113.
https://research.library.fordham.edu/gabelli_thesis/113
