The Contract-Drafting Error That Gave Tommy Lee Jones an Extra $10 Million

To be filed under “There but for the grace of God go I”:

Via @Deadline, I came upon this story in the Hollywood Reporter. Here’s the opening paragraph:

A California appeals court has affirmed Paramount’s win in a legal dispute with a Morgan Stanley-backed film-finance entity that alleged it was forced to pick up some of the tab when one of the studio’s outside lawyers made a mistake on Tommy Lee Jones’ bonus payments on No Country for Old Men.

Go here for the court opinion. And here’s how the court described the drafting error:

The box office bonuses negotiated for Jones, Rudin, and the Coen Brothers provided that each would receive fixed bonuses when either the domestic box office receipts reached certain levels, or when worldwide box office receipts reached twice the domestic level. Paramount hired outside legal counsel to prepare agreements that conformed with the negotiated terms, as reflected in deal memos provided by Paramount’s in-house negotiator. However, the lawyer mistakenly drafted the agreements to provide that bonuses would be paid once worldwide box office receipts, when multiplied by two, reached the levels prescribed for domestic box office bonuses. As a result, the contracts between Paramount on the one hand, and Jones, Rudin, and the Coen Brothers on the other hand, provided for an unintended increase in their bonus compensation.

Let’s be careful out there.

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.