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COVER STORY : The Bucks Start Here : Write a great song (or play or TV show) and cash those royalty checks forever. Pretty great gig. Who’s cashing in, and who’s not? You might be surprised.

<i> Diane Haithman is a Times staff writer</i>

Sit right back and you’ll hear a tale ,

A tale of a fateful trip .

It started from this tropic port aboard this tiny ship.

The mate was a mighty sailing man ,

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The skipper brave and sure ,

Five passengers set sail that day

For a three-hour tour. . . .

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Shakespeare it’s not. Producer Sherwood Schwartz, who wrote the lyrics of this theme song for the 1964-67 TV series “Gilligan’s Island,” would be the first to admit it. Schwartz also wrote the lyrics to the theme for the 1969-73 family sitcom “The Brady Bunch"--rarely cited as a classic.

But there’s a payoff to having penned those words. Schwartz, 78, says those two songs alone pay him about $60,000 a year in royalties.

Besides earning royalties each time the shows are rerun on TV, Schwartz said, he gets checks every now and then from unexpected sources. For example, Ted Danson recited the “Brady Bunch” song lyrics as a wedding toast in the 1989 film “Cousins.” And Schwartz once received a royalty check for less than a dollar when a marching band in a football stadium played “Gilligan’s Island” at halftime.

Theme song royalties represent a tiny fraction of the Schwartz empire; Schwartz created “Gilligan’s Island” as well as “The Brady Bunch” with son Lloyd Schwartz, 49. Both shows have spawned successful TV reunion movies, including the 1989 ratings blockbuster “A Very Brady Christmas,” and the two earn healthy sums for their roles in creating these enterprises.

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The Schwartzes wrote the book for a 1992 stage musical, “Gilligan: The Musical,” and an as-yet-unproduced film (“Gilligan’s Island: The Movie”). “The Brady Bunch” inspired this year’s “The Brady Bunch Movie” (which the Schwartzes produced) and an earlier stage satire called “The Real Live Brady Bunch” (which they did not). There was a “Brady Bunch"-based cartoon series and a touring singing group (for which the Schwartzes waived their right to profits), and now there is a “Brady” CD-ROM.

Still, Lloyd Schwartz said in a recent interview with his father at the latter’s Beverly Hills home, royalties and residual payments for all of these projects represent the icing on a very large cake.

The younger Schwartz, who has also written plays, enjoys getting modest checks from around the country because it lets him know where his work is being performed. And, like his father, he has musical credits: “We wrote a movie called ‘The Invisible Woman,’ and we wanted the song at the beginning of the movie to be like the song ‘Tequila,’ where there’s a whole lot of music and then one word--'Tequila!’ So we had a bunch of music, then the line was: ‘She must be around here someplace.’ We [Lloyd and Sherwood] wrote the lyric together. So I joined ASCAP for writing half of the lyric ‘She must be around here someplace.’ ”

(ASCAP is a performance-rights society that makes sure that the owner of the copyright for a piece of music is paid for public performance of that song; BMI and SESAC serve similar functions.)

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“It’s like Christmas,” Lloyd Schwartz said. “It’s not like any other business I know. You open up your mailbox, and there’s a check for some show you did a long time ago that’s now playing in Australia. Sometimes they’re large, sometimes they’re small. I have friends who have gotten zero dollars and zero cents--but they get a check.”

Royalties and residual checks are like getting paid on Tuesday for a hamburger today. Actually, it’s more like getting paid every time the hamburger is shown on cable. All facets of the entertainment industry--theater, film, TV and music--offer the enticement of royalty or residual moneys to be made not only for immediate services but for many years beyond.

“I have a friend who, whenever he would write an episode of something, would take the money and buy something for his house,” Lloyd Schwartz said. “He would say: ‘That’s the “That’s My Mama” couch [from the 1974-75 series about a Washington barber].’ Everything in his house was identified by show.”

Added Sherwood Schwartz: “I have a lot of writer friends who wrote so many episodes of so many shows . . . that they can collect enough money to make a living now without really doing any work.”

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Gordon Davidson, artistic director-producer of the Music Center’s Center Theatre Group, said royalties from plays originated at the Taper, Doolittle and Ahmanson help the Taper continue to develop new work.

“Every deal is different. But royalties have played a modest factor in the life of this theater--and thank God for that,” he said.

“The biggest moneymaker for the Taper was [1981’s] ‘Children of a Lesser God,’ and the reason is it ran for two years on Broadway, two years on the road and two years in London [and became a 1986 movie]. It’s a very important funding bridge for us.

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“The Ahmanson, historically, has benefited most from Neil Simon,” Davidson said of the playwright, who originated “I Ought to Be in Pictures” at the Mark Taper Forum in 1979 and “Brighton Beach Memoirs” in 1982. “When that income went away, the Ahmanson began to have some real financial problems.”

Those in the theater always hope for another “Chorus Line,” Davidson said. Philanthropist LuEsther T. Merz, a general partner in Publishers Clearing House, underwrote the moving of Joseph Papp’s production “A Chorus Line” from New York’s Public Theater to Broadway, where it ran from 1975 to 1990. “They were the sole producers, they weren’t partnered with anybody,” Davidson said. The production earned close to $24 million, which was put into a reserve fund as part of the endowment for Papp’s New York Shakespeare Festival.

Country star Willie Nelson said that royalties keep him afloat: “Well, since I consider myself a professional songwriter. There will probably come a point in time when I will be relying entirely upon [royalties], so all the copyrights on everything done now are very important.” Nelson said his most profitable songs include “On the Road Again,” “Crazy” (especially the Patsy Cline recording), “Night Life” and “Funny How Time Slips Away.”

Like most artists, Nelson, who has had well-publicized problems with the Internal Revenue Service, won’t reveal any royalty totals for his songs: “Let’s say, more than $100,” he cracked.

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In film and television, an estimated half a billion dollars is paid in residuals each year. Music royalties are a substantially larger force: Jay Morgenstern, executive vice president and general manager of Warner Chappell Music and chief executive officer of Warner Bros. Publications, said that in excess of $1.5 billion is paid annually to music publishers and songwriters in the United States alone--and as much or more in foreign markets. “It is a huge industry where the creators are concerned,” he said.

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Television, movies, music and theater all have their own structures for royalty or residual payments to writers, directors, composers, choreographers and actors. Such moneys have led to steady incomes for some creative people and virtually nothing for others.

In film, theater and music, royalties and residuals are dependent in various ways on profits; in television, residual payments are determined by the unions and paid each time the show runs, whether or not it wins high ratings or earns lots of money. When American entertainment goes to other countries, yet another structure for payment goes into play.

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“There are over 1,000 formulas” for residual payments alone, said Chuck Slocum, special projects director of the Writers Guild of America, West.

Along with fees due to writers, actors and directors, film and television also usually end up paying music royalties--a synchronization fee (“sync” fee for short)--for using popular music in their productions or else for theme songs and musical scores. “The Tonight Show With Johnny Carson” theme, co-written by Carson and Paul Anka, is said to have earned $400 in royalties for the two writers each time the show aired--almost every weeknight for 30 years. Carson declined to provide a figure, but if the rumor is right, it could add up to as much as $3 million.

Popular music is even more prevalent in advertising. George Gershwin’s “Rhapsody in Blue,” for example, has been used in United Airlines commercials for more than 10 years. Don Biederman, general counsel for Warner Chappell Music, said that Herman Hupfeld’s 1931 composition “As Time Goes By"--made famous in the 1942 film classic “Casablanca"--is one of the songs in Warner Chappell’s catalogue that is most often used in commercials, TV and film.

“Herman Hupfeld and his estate have probably made more from ‘As Time Goes By’ than anyone who has ever recorded it,” Biederman said, although Warner Chappell representatives said it would be impossible to calculate a dollar figure for a song that is more than 60 years old.

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There is plenty of crossover. Say that we are talking about a television series based on a TV movie that was based on a popular song. Don’t laugh, it can happen: Witness the 1980 TV series “Harper Valley PTA.” It was written by the Schwartzes, based on the movie based on the song, which hit No. 1 for singer Jeannie C. Riley in 1968. Royalties and residual checks flew in a dozen different directions.

The 1992 film “The Bodyguard” was not based on a song--but it certainly breathed new life into a little tune called “I Will Always Love You,” written and recorded earlier by Dolly Parton. The song was a No. 1 country hit for Parton in 1974 and again in 1982 when she sang it in the movie “The Best Little Whorehouse in Texas.” Parton was unavailable for comment, but a music industry source said her profits for the song, this time around, may have been as high as $4 million. “That pays for a whole lot of rides at Dollywood,” the source said.

Existing and potential royalties and residuals can be traded, sold, divided, borrowed against and even left to relatives in one’s will.

“It’s creative real estate,” said Evan Medow, president and chief executive officer of Windswept Pacific, a music publishing company whose catalogue includes songs by Burt Bacharach, Willie Nelson, Tito Puente and many others. “Sometimes we say there should be a lower royalty for the heirs because they can’t do anything.”

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The Andrew Lloyd Webber musical “Cats,” based on T.S. Eliot’s “Book of Practical Cats,” is reported to be worth $2 billion, including record sales and merchandising--and has paid a nice sum in royalties to Eliot’s widow, Valerie. (Her representatives in London declined to comment on the exact amount.)

Chuck Rubin, president of Artists Rights Enforcement Corp.--responsible for helping recording artists from the ‘50s and ‘60s such as Richard Berry (“Louie Louie”) and Hank Ballard (“The Twist”) regain royalty rights and collect royalty payments--said it is often easier for the heirs of an artist to collect their due. In the music business, he said, it was common for early rock ‘n’ roll artists to have sold their rights for immediate cash--only to come to regret it later.

“I believe that the estates or heirs of the writer or artists have more rights than the artists themselves; they usually stand in better shoes,” Rubin said. “They usually have representation; they usually are able to get better respect from publishers or record companies because of their unique status. They have unusual rights that may or may not have been possessed by the songwriter. They are almost able, in essence, to alter the original [contract] terms of the now-deceased person.”

Since many residual payments now go on in perpetuity, dealing with residual distribution after divorces and deaths has become a logistics problem for the guilds, said WGA West’s director of residuals, Eugene C. Brown.

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“It’s getting to the point where, as each beneficiary passes away, they leave four or five or six,” Brown said. “The problem is intensifying now because residuals began in 1960, so you have more deceased. It’s a big headache for both the guild and the production company.” (The production companies or distributors of the product pay the residuals; the union keeps track of payments due, collects and mails them.)

The various residual formulas also call for the unions to process huge volumes of small-dollar checks--sometimes the postage is higher than the check. A Studio City bar called Re$iduals, which opened about nine years ago, used to take residual checks of less than one dollar in trade for a drink. So many mini-checks materialized that owner-manager Craig Tennis recently had to stop the practice because he was losing money.

In television and movies, residuals have only gotten sweeter through the years. In 1960, a TV writer, actor or director was paid residuals for only the first six airings of an episode. It went to 10 runs in the late ‘60s, then to 12 in the mid-1970s. Post-1977, writers, actors and directors are paid for each run in perpetuity, on a diminishing scale.

A writer who has both a writing and story credit for a half-hour episode earns about $15,000; that figure drops with each run until it hits a low of $400 a run, which stays constant as long as the show continues to be rerun. That amount may also end up being shared by more than one writer. Directors’ residuals may also be split. Actors receive a set per-actor residual.

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In feature films, the actors, writers and directors receive residuals only for “non-theatrical use” of their films--mostly television. During the 1960 Screen Actors Guild and Writers Guild strikes, Ronald Reagan, then president of SAG, negotiated a deal by which production companies could release or sell motion pictures made before 1960 to free TV without paying residuals (the Writers Guild also settled for this plan, and the Directors Guild adopted it as well). Some hailed Reagan’s action as a win for Hollywood talent; others saw it as Reagan’s selling out the actors of his own generation in favor of the studios.

Do not assume that the more often you have seen a show or movie, the more the actors, writers and directors are earning. Morelikely, it depends on when the show first aired or when the movie was produced. In TV, earlier shows lost out, but “there was a lot of post-1977 production that ran and ran and ran,” said the Writers Guild’s Brown. “ABC’s ‘The Love Boat’ is close to the leading show in the maximum number of runs.” (“Love Boat” is also scheduled to become a feature film next year, further lining the pockets of creators Aaron Spelling and Leonard Goldberg.)

While “Gilligan’s Island” has become a huge franchise for creator Schwartz, and the show repeats ad nauseam in syndication, many of the actors no longer earn a dime.

There are only 99 episodes of “Gilligan’s Island,” and under union guidelines of the early 1960s, residuals were paid only on the first six runs. (On the other hand, profit participation for the creators continues.)

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“We were paid off within two years,” said Dawn Wells, who portrayed Mary Ann on the show. “I think we’re in the 200th run or something. . . . Everybody else is reaping some kind of benefit from the fact that it’s so successful--except the actors. Now, any kind of new, mechanical thing is covered. But with what was going on at the time, you can’t say: ‘Why wasn’t I smart enough to negotiate this?’ ”

Residuals have been a hot button for the creative unions through the years.

“I can’t say this is a real detailed analysis, but I don’t think there has been a major strike over anything but residuals,” said the WGA’s Slocum. “In 1987, the DGA [Directors Guild of America] struck for 15 minutes--it was the only strike the DGA ever had, and it was over residuals.” (The strike actually lasted three hours and 15 minutes on the East Coast, because of the time difference.)

Residual and royalty payments are not to be confused with profit participation . Usually star writers, actors and directors negotiate some type of ownership rights over a project to give them some return at the so-called back end. The Schwartzes, who have engaged in some legendary squabbles with studios over the profits of some of their shows, say that back end better refers to what a studio usually presents to them when they try to collect their due.

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“There is a great line in this business--the only positive is the negative,” said Robert Wagner, who besides starring in TV series including “It Takes a Thief” and “Hart to Hart” became a profit participant in the highly successful “Charlie’s Angels” series by providing some of the development money with his late wife, Natalie Wood, in partnership with Aaron Spelling and Leonard Goldberg for ABC.

Even in the recording industry, where “mechanical royalties” from the sale of records constitute the largest profit for the artist, songwriter and music publisher, most stars today have figured out a way to get more from their work than mere royalties.

“The people who make the most money in the music business, the creative people, are the ones who write their own songs, publish their own songs, produce their own songs,” said Barry Mann, 56, who with wife Cynthia Weil wrote a collection of mostly ‘60s and ‘70s hits including “On Broadway,” “You’ve Lost That Lovin’ Feelin’,” “We Gotta Get Out of This Place” and “Sometimes When We Touch.”

“Some of them have their own record labels.”

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Representatives of creative unions such as the Writers Guild of America, the Screen Actors Guild and the Society of Stage Directors and Choreographers stress that while residuals may look like money for nothing, those payments keep the entertainment industry afloat--especially in the case of the smaller players.

For a major star in a feature film, said Jay Roth, an attorney who represents the Screen Actors Guild, the original compensation for playing the role, as well as profit participation, is likely to far exceed his or her residuals.

But it can be different for an actor in a supporting role, who divides the residuals--3.6% of the film’s non-theatrical gross in the current SAG contract--with the other actors in the film.

“Let’s look at the numbers,” Roth said. “Assume you have a picture that grosses $100 million in non-theatrical use. That is a lot of money, but the top-echelon pictures do that every year. That’s $3.6 million in [actors’] residuals. These are very important dollars for people--and for the actor who may do only one or two pictures, it’s quite substantial.”

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Said Slocum of the Writers Guild: “It’s a unique solution to the free-lance nature of this industry; if the Hollywood studio system were still in place, it would be less necessary. Residuals maintain the talent pool, because it is a critical source of revenue between work. It’s even more important for actors, who are more chronically unemployed because there are so many of them. So many people would have to change careers were it not for this structure.”

Unlike film, TV and theater, when it comes to music royalties, it’s not a business of dollars but of pennies, industry representatives say. A few cents for each record sold, a few cents for radio airplay. But those pennies add up.

Randall Wixen, president of Wixen Music Publishing, which administers music catalogues owned by Mann and Weil, Tom Petty, Kenny G and Neil Young, said that while recording artists tend to keep mum about their personal income, it’s fairly easy to figure out what a fictional hit might be worth.

“Joe Songwriter writes a tune, and he is 100% the writer and 100% the publisher,” Wixen said. “He hasn’t made a deal with anybody--he’s it .

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“The song gets put on an album; it also gets put out on a single from that album. The single starts doing very well. It gets some good radio airplay on the Top 40 stations, and it makes it to the Top 10. It also starts doing what we call crossing over , meaning it ends up being played on multi-format stations. It ends up on adult contemporary radio; maybe it gets a little R&B.;

“Now, with our theoretical writer--who is now in the Top 10 and has crossed over--his performance income could theoretically be $300,000 for that Top 10 record, in a time period of nine to 12 months. If you had a monster hit like ‘I Will Always Love You'--something like that could easily get $600,000 to $1 million. But average Top 10 is going to be $300,000.

“Say the writer-publisher has a song on a single and on an album. The [royalty] rate is fixed at 6.6 cents per record, per song under five minutes. The single sells 250,000 copies, and the album sells 750,000 copies--a grand total of 1 million copies are sold. A million units at 6.6 cents is $66,000. If you end up with a song on, say, ‘The Bodyguard’ album, which sold 14 million copies in the United States alone . . . it wouldn’t be out of the realm to earn $4 million worldwide.”

Joe would also probably have what is called “sundry” income, Wixen said, coming from overseas channels, TV commercials, synchronization rights for use in movies and TV shows, sheet music and even karaoke. For a major motion picture, a sync scene might pay $30,000--a onetime fee that is not a royalty. Some major artists receive royalties for videocassette sales of the picture, but such deals are rare and certainly would not be offered to Joe Songwriter. Joe’s sundry income total: $50,000.

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So, the grand one-year total for Joe Songwriter, with a Top 10 hit and one sync scene: $416,000.

While, in retrospect, royalties and residuals may mean a lot to an artist’s income, and unions continually battle for the artist’s share, composer Mann and others say that promised income somewhere far down the road is not what usually motivates creative people. The concept of living off old hits while young artists make the new ones, he said, is more horrifying than comforting.

“I never knew back then, when I was writing, that the songs were going to become standards--I’ve been in the business for at least 30 years,” said Mann, who with his wife has written six songs for an upcoming Muppet movie but misses the recognition he got in the early days of his career.

“If you wrote a hit 25 years ago, maybe you made $20,000. Now, you write a hit and it’s published, you make half a million dollars. It’s like the Groucho Marx bit, only a little perverted--it’s not that I don’t want to join a club that would have me as a member, it’s a club that I don’t give a damn whether I’m a member of--but I think I should be. I’ll call up a secretary and she’ll say: What is this in reference to? They don’t know who the hell I am.

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“We are very fortunate--we have written an incredible number of intelligent, soulful songs. We’re always going to get residuals on that. But that doesn’t mean we want to retire.”

And, across the board, entertainment industry representatives advise actors, directors and writers not to rely on potential residuals. Get what you can up front, because most creative projects, unfortunately, fail.

Said Slocum of the Writers Guild: “If a show doesn’t repeat--no residuals. End of story.”


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