Pay Me Now and Pay Me Later: Lump Sum vs On-going Royalties


Over at the Dear Rich, Nolo's IP blog, they've got a question and answer segment which is worth some attention for those advising individuals in the creative industries:

Dear Rich: I'm trying to figure out whether to ask for a lump sum payment or royalties for a deal I am making. Is there some formula for figuring out what to ask for in terms of a lump sum?

This can be a critical question for owners of rights who are granting intellectual property rights to others for exploitation by that other person (for example, the owner of rights in a graphic novel or screenplay who is being asked to grant an exclusive option or license to a film producer). As with many questions, the question of whether to ask for a lump sum up-front payment or royalties is best answered by challenging the premises underlying the question - in short, why not choose both?

Please see full article below for more information.

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Published In: Art, Entertainment & Sports Updates, General Business Updates, Intellectual Property Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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