Film rights are a type of intellectual property rights that allow the holder to make a film based on the existing property or idea. In order for a producer, director, writer, or production company to legally create a derivative work meant for the screen, they must obtain the film rights from the copyright holder. Film rights may be purchased outright, or may be “optioned” in an attempt to get a buyer for the full rights.
When a person creates a piece of intellectual property, such as a book, play, song, character, video game, television show, or painting, he or she inherently owns the copyright to the material. Anyone who wishes to copy or use the work legally, such as by putting on a production of a copyrighted play at a high school, must get the copyright holder's permission and often pay a royalty. The permission may be strictly limited and very specific; for instance, a high school might get permission to put on a play, but this does not allow them to write and sell a sequel to the play. Film rights are a grant from the copyright holder to turn the intellectual property into a film.
Folded into film rights may be many associated requests that are common concerns with the movie industry. For instance, if a person wants to make a film out of a hit children's book, he or she will likely also want to get merchandising rights from the owner, so that the filmmakers can also release a line of toys to go with the movie. The right to make sequels is another common element in a film rights deal. Intellectual property holders sometimes have considerable bargaining chips in the process of negotiating a film deal; experts strongly recommend that anyone approached about film rights use an entertainment lawyer to ensure a fair deal.
Often, the first step to getting film rights to a property is to option the material. Optioning is a process where a writer, director, or producer temporarily rents the rights to a property for a small fee, in order to legally bring the idea to film companies that might be willing to finance a movie. Usually, an option agreement is exclusive, meaning that the copyright holder will give the rights to only one person at a time. If the filmmaker is able to find financing and set up the film before the option expires, the copyright holder must agree to sell the full film rights. If the filmmaker does not find financing before the option expires, the rights automatically revert to the copyright owner.