Creative Accounting

Guess what these Blockbusters share in common. They all were all Box Office Failures. Most of them paid no tax, in fact they raked in a lot of Tax Credit. In fact there is street term for Cooking the Books in Hollywood, known as Hollywood accounting. Surprisingly the victims in these cases are not just the Tax collectors, but often of the cast and crew involved in the filming. In many of the examples mentioned above various Hollywood studio’s nefarious accounting practices came to light when they faced various lawsuits from the film’s various stakeholders who were promised payouts based on the films profitability. Examples are Producers Michael Uslan and Benjamin Melniker filed a Lawsuit against Warner Bros as 1989 film Batman and its sequels. The highest grossing franchise of the 90s ( with revenues exceeding $ 2 Billion USD). Did not turn a profit. The case was closed with an out of court settlement. (Reference) Winston Groom also filed a lawsuit against Paramount Pictures for his 3% profit from sales for the onscreen adaptation of his novel Forrest Gump. Paramount claimed the movie was a loss of $62 million in spite of raking in $660 million in Ticket sales.(Reference) Stan Lee the co-creator of Spider Man filed a lawsuit against Marvel comics for his 10% profit from sales for Spiderman (2002). Which the movie allegedly didn't generate in spite of earning $800 million in revenue. (Reference) Peter Jackson, 15 actors and the Tolkien estate bought a lawsuit against New line Cinema. Which claimed the Lord of the Rings Trilogy was a horrendous loss despite the gross receipts earning $6 Billion USD. (Reference) Similarly dubious accounting practices by major American corporations has placed a major strain on the American Economy which has National Debt of $ 20.46 trillion.