Legal Impact Report 2012
In 2005, Columbia Pictures was assembling the key pieces of perhaps the most anticipated book-to-screen adaptation of the decade, “The Da Vinci Code.”
At the time, a just-hired Andrew Gumpert proposed something audacious — to cap profit participation at 25% of the film’s gross.
“We were working with high-level individuals: Ron Howard, John Calley, Brian Grazer, Tom Hanks, and we fit everyone into this 25% pool,” recalls Gumpert. “If you take everyone and their quotes, you could almost double that. Tom Hanks is probably 20 points on his own. That was significant.”
The deal, which proved to be a bellwether for the film industry well before the coming global economic meltdown, offered a glimpse into the bold and prescient style of negotiating that has become a trademark for Gumpert, now president of worldwide business affairs and operations at Columbia and recipient of Variety’s first Legal Leadership Award.
“Andrew can uniquely see deals not just from every party’s perspective, but, like a master chess player, he also has the incredible ability to see three moves ahead, which is why he is so extraordinarily valuable running business affairs for us,” says studio chief Amy Pascal. “I am definitely more comfortable knowing he is negotiating on our side of the table.”
Since joining the studio in 2005 for the second time in his career (he worked in Columbia’s legal department from 1995-97 before seguing to Interscope), Gumpert has left his imprint on all of the studio’s biggest deals including last year’s pact with MGM for worldwide distribution rights of the 23rd and 24th James Bond films as well as other co-financing arrangements.
Still, the self-described Type A lawyer almost missed his calling in the business affairs arena. Gumpert began his career as a litigator with the law firm Hill, Wynne, Troop and Meisinger, where he worked on one of showbiz’s first profit-participation cases: Sigourney Weaver’s suit against Fox over the 1986 film “Aliens.”
“Looking through (Weaver’s) talent contract and the backend I realized it was a lot more interesting than the litigation process,” he quips. “I said to myself, ‘This is something that, had I been drafting, here’s some things I would have done to make it more clear. You have litigation experience. You know where things can go wrong. You know where the gray area is. If you were drafting these things, you could probably avoid litigation. Wouldn’t you be an asset?’ ”
Having caught the bug, Gumpert began his transactional career, which eventually led him to a seven-year stint at Miramax, where he gained a 360-degree view of the filmmaking process.
“The biggest criticism of Miramax then was it was understaffed,” he says. “But it made me learn every facet of the movie business. It wasn’t enough there to just be a lawyer of business affairs. You would have Bob or Harvey (Weinstein) say, ‘Look at a trailer, look at a TV spot. How should we approach distribution in an international territory?’ Harvey used to say working at Miramax was like getting an MBA in the film business.”
One of the most valuable lessons learned from the Weinsteins was keeping a financially pragmatic mindset with every deal. Gumpert learned to take a Bill James-style approach to deciding such details as how to determine an appropriate budget and when to sell off foreign rights.
“They were very analytical,” says Gumpert of the trailblazing brothers. “We’re all playing Moneyball now, but it certainly wasn’t mainstream then. At Miramax, data was always part of the conversation. For many years, a lot of the major studios were discounting the data and going more with a feel. Data should not be the defining end of the conversation. But it can’t be discounted.”
The father of three, who spends much of his downtime raising money for the Epilepsy Foundation of Greater Los Angeles (his oldest daughter suffers from the disorder), brought that mentality with him to Columbia. Around the Culver City lot, where he is affectionately known as “Gump,” he garners praise for his meticulous approach as well as his collaborative spirit.
“Andrew is one of the hardest-working people I know, and I couldn’t ask for a better partner to work with when we’re closing deals,” says Leah Weil, Sony Pictures Entertainment’s senior exec VP and general counsel. “He understands first hand and values the important role of the legal department and respects our ability to collaborate to best effect.”
Though the MGM and “Da Vinci” pacts stand out, Gumpert has also helped close scores more that also presented Herculean challenges, including the myriad talent deals that brought “Men in Black 3” to the bigscreen.
“Obviously, it involved the biggest of the biggest with Mr. (Steven) Spielberg and Mr. (Will) Smith,” remembers Gumpert. “But now we really were in the new economy. If we had made the deal two years earlier, we wouldn’t know that video has fallen off a cliff. So, how were we going to adjust the economics so that they feel like they’re being appropriately rewarded? That was a tough one. It was a lot of shuttle diplomacy among the agents, the law firms. You had to use your negotiating skills.”
But for Gumpert, diplomacy is a studio lawyer’s greatest weapon.
“I am truly of the school of make it a win-win,” says Gumpert, who learned the business from his father, former Universal business affairs head Jon Gumpert. “He taught me that a short-term victory can turn into the end of a career. So, why do it? Leave some sugar on the table so everyone is left with a sweet taste in their mouth.”
Since its inception in 1924, Columbia Pictures has inked countless deals, leading to such classic films as “It Happened One Night,” “On the Waterfront,” “Kramer Vs. Kramer” and “Ghandi”. Here is a sampling of key moves that shaped the studio into its current incarnation.
CBC Film Sales incorporated as Columbia Pictures Corp., becoming one of the eight major film studios of Hollywood’s Golden Age.
The studio buys two sound stages in Hollywood.
Col hires director Frank Capra, kicking off an era of talent-friendly relations — a reputation that holds to this day.
Col acquires a 35-acre ranch in Burbank that becomes the site for many Westerns.
Columbia Pictures moves from Poverty Row to share the Burbank Studios with Warner Communications.
The Coca-Cola Co. buys Columbia Pictures Industries, parent company of Columbia Pictures.
The theatrical divisions of Columbia Pictures and TriStar Pictures merge to form Columbia Pictures Entertainment.
Coca-Cola sells Columbia Pictures Entertainment to Sony Corp.
Sony ends the Burbank Studios partnership and moves to the historic MGM lot in Culver City, sinking $100 million into its rehab. The studio is rechristened Sony Pictures Studios.
Sony Pictures Entertainment buys the Culver Studios.
Amid mounting losses and a string of flops, co-head of production Peter Guber fires his partner Jon Peters.
Sony Pictures Classics launched, becoming the home of such Academy Award-winning pics as “Indochine,” “The Lives of Others” and “A Separation.”
Screen Gems reorganized as a specialty label for genre pics.
Col caps profit participation in “The Da Vinci Code” at 25%. The groundbreaking move has become standard in the new Hollywood economy.
Col inks a deal with MGM for worldwide distribution rights of the 23rd and 24th James Bond films as well as other co-financing arrangements.