Hollywood's Double Whammy: SAG's Big Election and DreamWorks' New Deal

Next comes a distribution deal, which is why GE’s Jeffrey Immelt and Universal’s Ron Meyer were dining with Spielberg and Snider last Thursday, and why NBC Universal boss Jeff Zucker spent the better part of that afternoon with Spielberg planning the rebuild of the fire-ravaged Uni back lot. Given how Spielberg sees Universal as his professional home (he’s never moved his offices, even after Paramount bought DreamWorks), I’ve always assumed he’d land there. But I hear Spielberg is concerned GE might decide to sell NBC Universal, especially if the studio is combined with Warner Bros., which would create too much product. Nevertheless, with Immelt and Zucker paying homage to Spielberg, it looks like another done deal to be negotiated by Hollywood superlawyer Skip Brittenham.

The official DreamWorks/Reliance news release was late coming because Paramount jumped the gun with an artfully worded press statement that said basically, “Don’t let our iron studio gates hit you on the way out.” That actually was a relief to DreamWorks, whose principals were worried about even preparing for a transition “because nobody wanted to be in breach of contract.”

After Paramount purchased DreamWorks in 2006, many top DreamWorks execs moved into big jobs at Paramount, like Jim Tharp into head of distribution, and Kelly Avery into prez of home entertainment. They’re expected to stay put. But about 150 people are classified as DreamWorks employees even if they receive Paramount paychecks. Paramount is hoping Spielberg/Snider decide sooner rather than later which employees to take to the new company and get them off the Paramount payroll. “We hope as a practical matter they respond quickly,” a Paramount insider told me.

Same thing goes for the producers and production companies housed at DreamWorks, like Stiller’s Red Hour Films and Reitman/Pollock’s Montecito Picture Company or Parkes/MacDonald.

Paramount estimates that 200 projects are active between the studio and DreamWorks, and believes it owns all of them. However, as I’ve previously reported, friction may arise out of the exact terms of Spielberg’s deal with Paramount. The director-producer has the right to elect to be involved in any project DreamWorks has developed at Paramount. As an ex-Paramount business affairs source once told me, Spielberg’s so-called “Amblin deal” would apply even if he chooses to leave and is no longer under contract. He’d still make 7.5 percent of the gross and 50 percent of the profits to cash break. And if the projects won’t be made, they have to be offered to him in turnaround.

Physically speaking, DreamWorks never moved to the Paramount lot because Spielberg never left the Universal lot. (DreamWorks execs used guest offices inside the different Paramount departments when they had to sit in face-to-face meetings.).

Meanwhile, the unsung hero of the DreamWorks/Reliance pact was Emanuel “Manny” Nuñez, a motion picture 10-percenter at Creative Artists Agency, who’s a pioneer in structuring deals for India-based production entities to invest in U.S. film projects. His role from start to finish (he even arranged for Reliance to approve the final press release) also highlights the increasingly vital nature of a Hollywood agency’s indie division, often referred to as the “packaging” or “financing” department, these days. It’s not only there to help the 10-percenter’s clients get passion projects made, but they increasingly serve as gateways for the ongoing influx of financiers looking to invest in movies.

As a member of CAA’s 16-year-old department, Nuñez is accustomed to finding funding and distribution for individual films and even companies. But this was certainly the biggest indie deal of his career. Months ago, when DreamWorks decided to exit owner Paramount, Nuñez phoned up and said he had “someone who’s interested in putting up money” and arranged the meeting. That “someone” turned out to be Reliance chairman Ambani. And the rest is, well, history.

CAA pockets what insiders tell me is $2.5 million for its part. And Nuñez can expect a fat end-of-year bonus for 2008.