Confusion

In the looming contract talks between Hollywood studios and above-the-line unions, confusion around AI and issues raised by the debut of synthetic actress Tilly Norwood are certain to be key themes.

“The negotiating cycle is starting and the DGA is probably negotiating their contract within a month,” said Jonathan Handel, an entertainment and technology lawyer at Feig/Finkel. SAG-AFTRA and the WGA are also also heading into negotiations ahead of the mid-2026 expiration of their current contracts with studios and streamers, with the wounds barely healed from the dual strikes of 2023.

Norwood, whose arrival last month stirred up an industry tempest, is “a difficult situation,” Handel added, “and the union did not get anything on completely synthetic characters in the last round. So maybe they will this time.”

Handel and Mishawn Nolan, managing partner of intellectual property law firm Nolan Heimann, shared their perspectives during a panel Friday afternoon at Infinity Festival in Los Angeles.

Digital scanning of human actors, for the purposes of using their likenesses in film and TV projects is another tricky area for the unions given how untested the legal questions are, the attorneys agreed.

“I actually have a client right now,” Nolan said, whose body is being scanned. “What I received [from the company] was just a sort of standard certificate of engagement. It was all rights, just like you would normally use. And I said, ‘Well, what are you gonna do with the data? What is the scope of the use?’”

Because of the intense pressure on productions to move quickly, Nolan said, “everyone would like to just turn around [a talent agreement] tomorrow.” But the complexities of copyright issues raised by AI, which is evolving at a breakneck clip, require a lot more thought, she argued. “The way that we’ve always done business can’t be done in the future. It can’t be done instantaneously,” she continued. “You have to take a moment and think about, what are you doing? What are you capturing? What are you going to use it for? How are you going to use it? How long are you going to have access to it? And what happens in the long term? Who holds onto it? Is it safe? Is it gonna be destroyed?”

The scanning of human actors, Handel said, “very much implicates what SAG-AFTRA negotiated” in its last contract, and insisting on the data being destroyed isn’t necessarily a solution. “Twenty years from now, the company may say to the celebrity, ‘You know, we really like to do a reboot of that thing with you de-aged, but the ideal de-aging is actually the data from when you were younger,’” he posited. “And the celebrity might say no, or the celebrity might say, ‘Hey, that’s great, more money for me, and I’m gonna reboot my career.’ And then they’re like, ‘Oh fuck, my talent lawyers insisted that you throw away the data. So we don’t have the data anymore.’ But on the other hand, you don’t want the necessarily want the production company or studio to have the right to store the data indefinitely.”

Another vexing area is the trove of unproduced screenplays whose copyrights are owned by studios and streamers. They could potentially be used to train AI models, Handel said. “The union agreements, as of two, two-and-a-half years ago, did not address, ‘Hey, what about retroactivity?’ That may come up in the in the current situation. It’ll be very hard fought because, you know, it’s obviously a big potential source of monetization for the companies, but also something that, OK, well, if you’re going to do that, just like when you rerun a movie, you’ve got to pay residuals.”

The use of generative AI tools in production is also problematic, Handel and Nolan noted. There are different copyright issues facing the input (text submitted to a model like OpenAI’s Sora, for example) and output (the video that is produced as a result.)

“The trouble and the confusion is that the technology and the workflow have advanced so quickly and are gonna continue to advance,” Handel said. There can be hundreds of prompts, and revisions of prompts, resulting in video sequences with some resemblance to protected work, but the eye is sometimes in the beholder. “That is going to force at some point more nuanced court decisions, and it’s going to be very difficult to figure out, you know, where’s the line?” he said.

Media giants like Disney, NBCUniversal and Warner Bros. Discovery have sued various AI players in order to enforce their copyrights. OpenAI’s Sora 2, introduced less than two weeks ago, has created an uproar that some stakeholders believe will only die down once lawsuits are filed there as well.

It all adds up to a business environment defined by profound uncertainty, Nolan said.

“The way that you’ve operated for the past year, the past five years, the past 10 years, you cannot assume that that is the business environment in which you can operate moving forward,” she said. “A lot of the foundations and assumptions that you have been relying on, you cannot rely on them moving forward.”

One example is the tried-and-true staple of all contract law: the multi-year agreement. “How do you do a five-year deal when the law and the technology can be different next week?” Nolan asked.