Note: The opinions mentioned in this article are solely that of the author, who is not a lawyer but a student studying Entertainment Industry Management at Carnegie Mellon University.

No News is Bad News

There is ongoing legal debate around Quentin Tarantino's latest project, an exclusive behind-the-scenes NFT collection based on the 1994 Miramax blockbuster hit "Pulp Fiction," published in December 2021 on Opensea by SCRT Labs. A California lawsuit will determine whether Tarantino's plan is too cavalier, and whether Miramax should receive a cut of the sale.

Regardless of the settlement, the lawsuit has diminished interest surrounding Tarantino's NFT auction. Seven of Tarantino's NFTs provide access to archival and never-before-seen Pulp Fiction footage, which Miramax technically owns. It is important to mention that NFT ownership does not imply intellectual property ownership, so Tarantino is not selling media, but selling access to this media, which Miramax may have the right to deny. In other words, instead of confiscating the entire NFT collection, Miramax could simply deny the owners' access to the archival footage. The NFTs include access to more than just video clips, but the inclusion of these archival clips may prove costly for Tarantino and SCRT Labs.

A Non-Consensual Campaign

In November, without Miramax's consent, Tarantino launched a media campaign announcing an upcoming public auction of Pulp Fiction NFTs. At the NFT NYC conference on November 2, 2021, without using Pulp Fiction-related media or signage, Tarantino announced his collaboration with SCRT Labs (the Secret Network) to digitally copy seven scenes from the original handwritten Pulp Fiction screenplay, mint each copy as a "Secret NFT," and sell them each on Opensea to the highest Ethereum bidder.

This was a big moment for Tarantino fans. The screenwriter/director/producer was offering access to a copy of his personal handwritten screenplay for an iconic, successful movie. The NFTs were said to include “secret” audio commentary and hand-drawn sketches from Tarantino. CNN Business claimed the NFTs offer access to never-before-seen clips from the film. The official @TarantinoNFTs account quickly gained 20,000 twitter followers.

Tarantino's Reserved Rights

Almost thirty years ago, when Miramax bought Tarantino's Pulp Fiction screenplay in 1993, the original option agreement stipulated that Tarantino retained a limited series of reserved rights. These production rights include:

Most crucially, reserved rights give Tarantino the option to publish the screenplay, the “making-of” book, and the director’s commentary. There is no mention of digital NFT publishing rights, but Tarantino does have the right to publish “without limitations” in “electronic formats.” Tarantino published print and digital copies of the Pulp Fiction screenplay before (see below), but never before has he displayed or published his handwritten copy of the script.

This lawsuit may change the definition of U.S. copyright and trademark infringement. Notice the credit to Miramax in the lower left corner of Figure 1. In the past, Tarantino gave credit to Miramax for the use of copyrighted materials, giving public notice of its consent. This credit creates an assumption that Miramax was notified of the creation of these works as well. Today, Tarantino’s ambiguity may lead the public to mistakenly believe Miramax was involved with the NFT drop. This misconception could be ample ground for trademark infringement.

According to the 1993 option agreement, Tarantino may have the right to mint and market NFTs that make reference to the movie [Exhibit A, p.24]. Tarantino maintains the “right to use the title of the film in connection with the exploitation of the Reserved Rights.” While exercising reserved rights, Tarantino “… may include literary or character elements used in the film.” While this allows Tarantino to market his NFTs using the Pulp Fiction name and implicit Pulp Fiction references, the agreement does not explicitly grant the use of clips, still frames, or any media or archival video footage, all of which Miramax owns and manages.

Lawsuit SpoilS Demand For "Tarantino NFTs"

Court decisions take a few months to produce (the case was filed mid-November). Meanwhile, investors remain skeptical of these “Secret NFTs.” The terms of sale are unclear. A haughty NFT collector could get stuck paying full price for an attenuated product.

Negative press coverage might be beneficial for a traditional public memorabilia auction, but today's NFT marketplace is so risk-averse that big fish buyers may not bite at all. Most garish is a Pulp Fiction "Milkshake Scene" NFT priced at more than $200,000 USD (50 eth). After one week of auctioning, the milkshake scene NFT listing had just 14 views, zero bidders and minimal public interest. At the end of 2021, the 13-part Tarantino NFT collection had raised only $22,000.

likely outcome = settlement

The original option agreement grants Tarantino the right to publish his thoughts and opinions on the making of Pulp Fiction, but Miramax has the right to 25% of any merchandising revenue raised by Tarantino’s use of copyrighted film material [Exhibit A, p. 26]. Miramax also claims the legal right to “develop, market and sell NFTs relating to its deep film library” [M v T; p. 3 line 14]. This places Tarantino’s actions in direct competition with Miramax, even though Miramax does not yet sell Pulp Fiction NFTs.

But is Tarantino selling merchandise? Does an NFT count as memorabilia? Functionally, an NFT is a one-of-a-kind digital asset – a collector’s item. Ownership gives a token holder exclusive access to the token’s underlying media. NFT ownership could include IP rights to digital files, but these NFTs do not mention them.

Tarantino’s lawyer, Bryan Freedman, argues that the NFT collection is not merchandise, but a limited digital print publication. Miramax counters that the NFT sale cannot be considered a publication because it is marketed as a one-time transaction. Miramax is suing Tarantino and SCRT Labs for a breach of contract, copyright infringement, trademark infringement, and unfair competition [M v T; p. 1 lines 20-24].

If the media auction was brokered through a personal website instead of an NFT transaction, Tarantino would probably still have to mention Miramax’s involvement somewhere on the site. He might even have to add a disclaimer watermark onto the digital copies of the screenplay, so as to protect the integrity of Miramax’s trademark. Miramax would likely deserve a portion of the proceeds as well.

Will Tarantino make more NFTs?

So what about Tarantino’s other movies? Does he own any of them? As announced on November 2, 2021 at NFT NYC, Tarantino will begin to regain copyright ownership of his films, a new movie regained every two or three years, one-by-one, starting with Jackie Brown in 2024. Once he owns those copyrights, expect to see a flood of multimedia Jackie Brown NFTs.

Today’s NFT world is governed by crude and antiquated laws surrounding copyright and trademark ownership. Hopefully this lawsuit establishes new legal boundaries and guidelines for future cases. In the meantime, NFT collectors should stay wary of ambiguous claims and unclear terms.

UPDATE: ONLY 1 TARANTINO NFT Sold

As of February 11, 2022, there has only been one Pulp Fiction NFT sold publicly. The “Royale with Cheese” script sold for $1.1 million in Ethereum to an anonymous NFT collective @anonDAO. This transaction was not hosted on Opensea as originally planned, but on the Secret Network, an anonymous NFT trading platform created by SCRT Labs. After the sale, the remaining 6 NFTs were scheduled for auction in late January, but were cancelled shortly after. SCRT Labs cited unstable crypto market concerns and Ethereum volatility in their decision. The official @TarantinoNFTs account posted this statement on Twitter on January 28th:

It is undetermined whether the sale of these NFTs were cancelled due to volatile market conditions or due to the impending Miramax-Tarantino lawsuit expected to go to court later in February. It is equally unclear if, or when, these sales will resume.
[For more on blockchain adoption in the film industry, check out this article on Smart Contracts and Distribution Waterfalls.]