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Tuesday, Feb 7, 2023

SPECIAL REPORT: Royalties Make Partner a King at New Firm

Partner, Miller Kaplan Arase LLP, North Hollywood Years at firm: 6 months Residence: West Hills Vincent Leoni is the newest partner at Miller Kaplan Arase, the San Fernando Valley’s largest accounting firm as ranked by the number of local CPAs. He joined last November after more than two decades at Moss Adams LLP in Los Angeles, where he headed the royalty-compliance group and established an enviable track record. Leoni’s licensing audits have uncovered hundreds of millions in outstanding royalties for movie producers, musicians and sports figures. But he’s not naming names – or spending weekends rubbing shoulders with Hollywood’s glamour set. “I am generally not working with the creative folks,” Leoni said, adding that his free time is more likely to involve a movie and dinner with his wife, or travel to the East Coast where two of their three children are attending college. But while he may not be on a first-name basis with his celebrity clients, he has spent 28 years working on behalf of artists, producers, software developers and trademark owners who have licensed their intellectual property for myriad uses, such as in the apparel, home goods or video-game industries. “What excites me about my work is that it’s a value-add for my clients. There’s a tangible result in the form of the additional money they receive,” Leoni said. In fact, he boasts that once clients select him to audit their licensing agreements, 99 out of 100 get significantly more money than it costs to hire him. His compliance reports only rarely uncover out-and-out fraud. Usually they find differing interpretations of licensing contract language or accounting systems that don’t capture every instance in which an image or other property has been used. His work usually prompts his clients to approach their licensees and negotiate a settlement for the money they are owed. “Our report may find there’s been under-reporting of $6 million and the clients might settle for $2 million, for example,” he said. “On occasion, tens of millions has changed hands.” If settlements can’t be reached, the cases go to arbitration or result in lawsuits. Leoni has often been called into court to testify on behalf of his clients or as an expert witness in licensing cases. And he has traveled the world performing contract compliance exams. Miller Kaplan specializes in entertainment and business management, which are good fits for Leoni’s expertise. And what convinced him to make the switch was Miller Kaplan’s focus on licensing and royalty compliance. Partner Michael Kaplan said Leoni has been an excellent addition. “He has brought his wealth of knowledge and experience to our flourishing licensing and royalty audit practice, and is a seamless fit with our collaborative partnership,” he said. Miller Kaplan specializes in entertainment business but over the years has broadened its practice areas to include succession planning and estate and trust planning, giving it the ability to stay with its high-net-worth clients throughout all phases of their lives. In the near future, the firm plans to expand the partners and staff at its Seattle location. In addition to its North Hollywood headquarters, the company has offices in San Francisco, Portland and Las Vegas. The company is considering adding niche practice areas in forensic accounting, litigation support and business valuations. In addition, the firm has recently amped up its technology skills to better serve its digital music practice and other clients who receive royalties related to online click-tracking and impression-advertising. Over the years, Leoni has had to stay on top of new technology, though he recalls working on traditional 13-column accounting paper at his first job out of Loyola Marymount University, at Gelfand Rennert & Feldman LLP of Los Angeles. And he blames a tech snafu for the worst day of his career: “I realized I inadvertently hit ‘reply all’” he joked.

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