Producer learns lesson in Chaos theory

IF Michael Derbas had listened to Aesop, he might have avoided becoming mired in one of the most business-challenged productions ...

IF Michael Derbas had listened to Aesop, he might have avoided becoming mired in one of the most business-challenged productions ever to hit Vancouver. But the Vancouver producer admits, against the advice of the Greek thinker, that he leapt before he looked when he signed on as the day-to-day producer on the US$30-million action thriller Chaos, after the first of what was to be four production shutdowns.

‘When we came on board, we had no idea it was as bad as it was,’ says Derbas, who runs the Vancouver company Avrio Filmworks, better known for producing $2-million video features such as the recently shot Sub Zero. ‘But when you are rolling it is much harder to pull out.’

Chaos, a U.K. coproduction between Rampage Entertainment of Vancouver and Huw Penallt-Jones in London, began production Mar. 24 in Vancouver, just as the British government clamped down on certain tax shelter programs, including those set up by Grosvenor Park, the film’s main production funding source.

As Rampage owner Gavin Wilding says, it was like turning off the fuel in a plane already barreling down the runway for take off.

The funding crunch had an immediate impact on production, which had already committed many millions. Mobius International, the international distributor, forwarded some ‘thin’ advances that were not enough to keep cast and crew paid. Payroll was a continuous challenge. Emotions ran high.

When Chaos wrapped a few weeks late at the end of May, there were 280 unpaid creditors. The unions, for one, were owed payroll of $1.4 million. The lengthy accounts payable roster was worth a collective $1 million, including about $120,000 to Alpha-Cine/Toybox and $176,000 to PS Northern Lights, says Derbas.

While getting the budget back on track, Derbas ended up digging into Avrio’s own credit lines, even though the company is credited as a service producer.

Derbas says star Wesley Snipes didn’t show up for work on the final day of shooting because his entourage was still owed $60,000 in back pay and per diems. Derbas cut a cheque. When the production needed more film stock, Avrio anted up $200,000, plus another $40,000 as a ‘good faith’ gesture to actor Jason Statham, who was also owed back pay. Avrio ended up paying $350,000 out of its own pocket.

‘If the film stopped, I’d loose money and fees,’ says Derbas.

To make matters worse, someone stole the plates off Derbas’s car and threats were made that his Avrio office would be burnt down.

Coincidentally, two Chaos locations – a Vancouver alley and a house in Surrey – burned down just prior to production.

In order to keep the production on track, Derbas kept the script unchanged, but shifted more work to less expensive second unit production because, despite the funding crisis, production was already over budget. He says director Tony Giglio was cooperative and that performers Snipes (Blade), Ryan Phillippe (Antitrust), and Statham (The Transporter), with expensive pay-or-play contracts, ‘did terrific jobs under the circumstances.’

Lit and in focus was good enough

The lab developed just enough of the dailies to convince the director and cinematographer Richard Greatrex (Shakespeare in Love) that scenes were lit and in focus.

The fact that Chaos was completed at all is a testament to the local film community’s capacity to rally, Derbas says, and the realization that a movie’s only real value is in the completed print.

‘It’s a real tribute to this town,’ adds Wilding, ‘pulling together in a difficult circumstances. We came up with mutually beneficial solutions. I was blown away.’

The last of the unpaid creditors received full payment on July 21. The picture is fully financed by completion guarantor Film Finances and Comerica Bank, and editing is underway in the U.K. Reshoots are expected in Vancouver in September, Derbas says.

While many suppliers worked through the production on good faith, other creditors were tough but accommodating, such as the BC Council of Film Unions.

The unions secured a letter that allowed them to control rights over access to the Chaos negative if the producers failed to meet payroll – which the unions invoked until the debt was paid and they released their interest in June.

‘What we were able to do was find solutions,’ says Tom Adair, executive director of the Council. ‘The only intrinsic value was a finished film. The producers had invested $10 million in production and they weren’t going to walk away from that. It provided a high degree of likelihood that the picture would get made.’

Derbas says he paid an aggravation penalty to the unions of $100,000 for late payment, but otherwise paid little in interest. He kept creditors in the loop with regular updates and agonized about who got paid first.

Ultimately, the reward was worth the risk, says Derbas. Having made a business on small-budget genre films, Derbas suddenly has a US$30-million action feature on his resume and interest from the studios to do more larger-scale service jobs.

‘I realized the people who make $50-million features are no giants and they are not more passionate [than smaller producers],’ he says.

Chaos is scheduled for an early 2005 theatrical release. Along with Mobius, TVA is the Canadian distributor, and Warner Bros is the leading candidate to handle U.S. distribution. *