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Answerman - What Happens When A Japanese Licensor Goes Out Of Business?




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Lord Geo



Joined: 18 Sep 2005
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Location: North Brunswick, New Jersey
PostPosted: Wed Feb 27, 2019 2:07 pm Reply with quote
As Justin had brought up back in 2014, this whole situation is also what wound up killing Anime Crash's release of Geisters: Fractions of the Earth:
Quote:
Crash's licensor went out of business, and the other two producers wouldn't talk, so that was it


The licensor in question, in this case, was Groove Corporation. I once read a rumor that Groove died because the head of the company literally just up & left, taking all of the masters for the stuff the company had, & disappeared, never to be seen again. Since the company could no longer release anything, it just died out, & none of the other companies involved with producing Geisters really cared about it.

Groove's death was also the reason why the infamous Nakoruru OVA, which was based on the Samurai Shodown franchise, was left unfinished after a single episode, as well as why the CG movie based on Namco's Xevious never saw a home video release, though it was scheduled for VHS & DVD, and listings can still be found over at Amazon Japan. It also screwed over the two compilation movies for Geisters, which were at least shown to the public via a roadshow, alongside Xevious. At least some of Groove's other shows, like Wild 7 Another, were kept safe by Enoki Films.

I remember hearing that this situation (or something similar) is likely also the reason why AnimEigo never continued releasing Yawara! on DVD, too. That was an old Kitty Films production, same as Urusei Yatsura, but now Kitty doesn't do anime production, so it seems like the new licensor for Yawara! decided to play hardball & not allow AnimEigo to license the rest.
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Aphasial
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Joined: 08 Aug 2010
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Location: San Diego, CA
PostPosted: Wed Feb 27, 2019 3:31 pm Reply with quote
Generally speaking companies don't just *die* in states in the US -- there's still a legal entity floating around somewhere as a corporate shell until it's properly wound down.

Is there a similar provision in Japanese law that would cause the contracts to be liquidated by auction to pay any remaining debts rather than simply revert back to their originating publishers? I could certainly see the latter happening if a company goes under uncontrollably, but one would think that the ability that the rights wouldn't be left on the table until dissolution if they could eventually be valuable as leverage (or royalty income sources) by... somebody.
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MarshalBanana



Joined: 31 Aug 2014
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PostPosted: Wed Feb 27, 2019 3:37 pm Reply with quote
Quote:
Not so much with Central Park Media; Managing Director John O'Donnell had a well-earned reputation for treating signed contracts as sacrosanct
I remember hearing about him on Anime Abandon once, forget the episode, but it was something about how his company was a screw you to another company.
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Lord Geo



Joined: 18 Sep 2005
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PostPosted: Wed Feb 27, 2019 4:30 pm Reply with quote
MarshalBanana wrote:
Quote:
Not so much with Central Park Media; Managing Director John O'Donnell had a well-earned reputation for treating signed contracts as sacrosanct
I remember hearing about him on Anime Abandon once, forget the episode, but it was something about how his company was a screw you to another company.


I think you might be confusing John O'Donnell with John Sirabella, the founder of Media Blasters. I believe the story between them is that Sirabella started up Software Sculptors, which CPM then eventually bought out & used as a second label. Sirabella worked with O'Donnell for a few years (you can find the former's name on old VHS tapes of Machine Robo & Dancougar), but eventually left CPM because the two hated each other so much, & Sirabella started Media Blasters partially as a "Screw you!" to O'Donnell.

I could be wrong, though.
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Covnam



Joined: 31 May 2005
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PostPosted: Wed Feb 27, 2019 7:07 pm Reply with quote
Lord Geo wrote:

I remember hearing that this situation (or something similar) is likely also the reason why AnimEigo never continued releasing Yawara! on DVD, too. That was an old Kitty Films production, same as Urusei Yatsura, but now Kitty doesn't do anime production, so it seems like the new licensor for Yawara! decided to play hardball & not allow AnimEigo to license the rest.


Oh, that's an interesting possibility. I always figured it just didn't sell and wasn't worth continuing to release a 120+ ep series
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Pidgeot18



Joined: 19 Jul 2015
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PostPosted: Wed Feb 27, 2019 7:42 pm Reply with quote
As fate would happen, there's a case before the US supreme court that was argued exactly a week ago that's very relevant. The SCOTUSblog description of the background appears to be a decent lay background to bankruptcy law.

Essentially, the way bankruptcy works is like this. Suppose company A contracts something to company B, and company A goes bankrupt. The assets are acquired by company C. Company C gets to choose whether or not to accept or reject the contract. It it rejects the contract, the contract is considered breached, and company B gets to sue company C for damages as a result of breach of contract.

When intellectual property licenses are in question, company B gets another right: if company C decides to reject the contract, company B still retains the licenses company A granted it (including exclusivity provisions!) until the contract would have normally ended. What is currently before the Supreme Court is whether or not the contract itself is actually considered breached in that scenario, which matters because trademark rights are not considered intellectual property in the relevant portions of the law.

Of course, this is solely US bankruptcy law, so if the Japanese company's bankruptcy is being handled under Japan's bankruptcy law, I have no clue what happens.
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GeorgeC



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PostPosted: Fri Mar 01, 2019 7:54 am Reply with quote
Covnam wrote:
Lord Geo wrote:

I remember hearing that this situation (or something similar) is likely also the reason why AnimEigo never continued releasing Yawara! on DVD, too. That was an old Kitty Films production, same as Urusei Yatsura, but now Kitty doesn't do anime production, so it seems like the new licensor for Yawara! decided to play hardball & not allow AnimEigo to license the rest.


Oh, that's an interesting possibility. I always figured it just didn't sell and wasn't worth continuing to release a 120+ ep series



Yawara! was actually one of the few AnimEigo titles I REMEMBER seeing at Best Buy so they thought it could sell.
AnimEigo titles were really only broadly carried by Musicland group and its subsidiaries Sam Goody, Musicland, Media Play, and Suncoast Motion Pictures video stores. They had AT LEAST one of these stores in virtually every big city across the US. Most big cities probably had AT LEAST 4-6 Musicland stores (1 Suncoast, 1 Musicland, 1 Sam Goody, perhaps a few Media Play locations; there were 3 where I live until 2007). There used to be a video store at every mall just like they had a Waldenbooks/B Dalton or Kay-Bee Toy Stores, too -- in addition to a record store. Now, all of that is GONE.
The retail market changed dramatically in the 2000s and a lot of specialty stores -- record stores, video stores, small booksellers -- got squeezed out. They were joined by Kay-Bee Toys, Circuit City, and CompUSA around the same time, too. Borders Books & Music also went kaput by 2010. Borders and the Musicland Group bought a HUGE amount of anime but they never sold much in all honesty and both organizations ended up owing hundreds of millions to distributors and the companies they got merchandise from.
Musicland Group was CPM's largest client and when they couldn't pay the bills, that's when CPM was finished. Musicland and all its subsidiaries were all shut down by the middle of 2007. All those Borders, Sam Goody, Musicland, and Suncoast stores were closed. FYE picked up a few of the scraps left from Musicland but there are nowhere near as many FYE stores as there Musicland subsids before 2007. The mall videostore is virtually extinct now and I wonder how FYE is staying in business...

AnimEigo never bet the entire company on one title unlike ADV Films or Media Blasters which got into a bidding war on the Oh My Goddess TV series which ended up costing BOTH of them far more than it should have! AnimEigo wanted to licensed the OMG TV series since in the past they licensed the original OVA but, again, AnimEigo's CEO was NOT willing to go into debt for one title, especially in a market that can be volatile.
I skipped on Yawara! not because I knew the title would never be finished but because I got the demo disc as a longtime AnimEigo customer -- I did a LOT of mail-order from them in the 1990s and early 2000s -- and I just didn't care for what I saw on the disc that had the first 3 or 4 episodes subtitled.
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Kadmos1



Joined: 08 May 2014
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PostPosted: Sat Mar 02, 2019 2:04 am Reply with quote
Of course, there is still the aspect that an anime will have American copyright coverage for the shorter term of 95 years of publication or 120 years of creation (longer copyright thanks to companies like Disney). Though, even if the anime copyright expires here after that time, if the source material is still protected under life+70 for both the U.S. and Japan, the derivative work argument could copyright restore it.
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