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About a month after a similar deal with Netflix, the Writers Guild of America has informed members that it has won over $4 million in previously unpaid residuals and interest in a settlement with Amazon.
The multimillion-dollar settlement results from an arbitration over the compensation for 37 screenwriters on 31 films distributed by Amazon, the Guild told members on Wednesday, The Hollywood Reporter has confirmed. (Deadline was the first to report the news; THR has reached out to Amazon for comment.)
“Like Netflix, Amazon had been systematically undervaluing imputed license fees on theatrical films where it was both the producer and the distributor,” the WGA West message said to members. “Amazon even underpaid residuals on films it acquired from independent producers, imputing a low license fee for these films rather than paying the writer a residual of 1.2% of the actual license fee paid to the producer, as required by the MBA (Minimum Basic Agreement).”
In early August, the Guild informed members of an arbitration with Netflix sparked by the 2018 film Bird Box that resulted in hundreds of writers receiving $42 million of previously unpaid residuals. The Guild argued that when Netflix produced its own films, it underpaid residuals based on license fees that were not equal to the license fees paid for films produced by third parties. The Guild wanted Netflix to use its “cost-plus” model for calculating license fees on films produced by other companies on its own films. After the Guild’s win in arbitration, WGA leaders told members in August that the union is continuing to pursue $13.5 million in interest for late payment of residuals.
In its communication to members on Wednesday, the Guild claimed that Amazon previously sought to use the same “substandard” license fee formula once employed by Netflix. After the WGA won millions in its arbitration over those fees and the resulting residuals with the streamer, Amazon agreed to replace its approach for its original films with one that would calculate license fees as 111 percent of gross production budgets, the WGA said. The Guild added, “Amazon also agreed to pay residuals of 1.2% of the actual license fee paid to the producer on its acquired films.”
In total, the Guild said, 19 writers who worked on films produced by Amazon will receive $2.1 million in residuals and $1.2 million in interest, while 18 writers on films purchased by the company will receive $458,126 in residuals and $308,874 in interest.
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