MONDAY AM UPDATE: I told you last night that the blaxsploitation spoof Black Dynamite was “an instant cult hit” at Sundance following the cheering at its packed midnight screening at the Library last night. Now it sold to Sony for $2M — the second purchase at the film festival and the first overnight sale. As the film premiered, I hear Sony Picture’s Worldwide Acquisition Group led by Peter Schlessel, and Endeavor Independent’s Graham Taylor, Alexis Garcia, Mark Ankner and Liesl Copland repping the producer, negotiated in multiple rooms back at the agency’s condo the rest of the night. Not only does the pic have a North American theatrical release commitment for this year, but also franchise expectations. “Astounding in a tough market for a little film without high-profile cast. It’s a cinderella story,” an insider tells me.

Also, an entertainment lawyer emailed me that Wolf Films (i.e. Law & Order Dick Wolf) When You’re Strange “was a truly amazing doc on The Doors, with never-before-seen footage covering the entire 54 months of the band. It started with Jim and Ray in film school, with a lot of concert and in-studio footage. A remarkable trip down memory lane for those of us who experienced the ’60 firsthand.  John Densmore was at the Q&A!”

PMK/HBH emailed me: “Wanted to make you aware that the famously press-shy musician Jack White came to Sundance to support his new Sony Classics film It Might Get Loud, an electric guitar documentary that also stars Jimmy Page and The Edge. The doc was directed by Davis Guggenheim (the Academy Award winning director of An Inconvenient Truth) and is due out in theaters in August.”

Agency sources are telling me from Sundance that the end of the first weekend “feels a little slow and there seems to less emphasis on partying. For instance, Harry O’s on Main Street usually has parties stacked up but is in the hole this year. But the people here are doing business. No one knows whether it’s the inauguration or the economy, but there is less focus on the Paris Hiltons of the world [who shamelessly walked out with 30 Whiting & Davis bags from the gifting Hollywood Life House at Sundance, according to a PR email sent me] and more on the film and business people. Which is a good thing.”

Here are some films generating a lot of buzz: Cold Souls written and directed by Sophie Barthes with Paul Giamatti and David Straithern, The Greatest from director Shana Feste received a standing ovation.”It has award potential for Pierce Brosnan who stars and is just brilliant. Not a dry eye in the house,” one source tells me. Lymelife about two families living on Long Island starring Alec Baldwin and Timothy Hutton dreaw raves. And the two documentaries Passing Strange by Spike Lee which is a filmed performance of the Tony award winning rock musical. And Thriller In Manila from John Dower about the relationship between world heavyweight boxers Muhammad Ali and Joe Frazier during the racial tensions of the 1960s.

Hot Tickets: sales agents are saying Peter And Vandy will be the Once of this year’s Sundance. People are clamoring to get tickets to 500 Days Of Summer. Jim Carrey’s I Love You Philip Morris, and the spoof of blaxsploitation movies Black Dynamite showing at midnight tonight followed by a 1 AM party. “There were 300 people in Black Dynamite T-shirts standing and cheering the screening like a rock concert. Instant cult hit,” one Industry attendee emailed me afterwards.

Falco Ink emailed me: “In Sundance, Jonathan Liebesman is the director of The Killing Room, and he was hoping the film is on your general radar. MTV just posted a review, and he asked me to pass it along.” But others tell me the pic recalls the disgusting Saw franchise. Nevertheless, the MTV reviewer calls the pic, starring a barely recognizable Nick Cannon, plus Chloe Sevigny and Timothy Hutton, “by far the best film I’ve seen so far … brutal, daring and utterly unpedictable – three qualities quite rare in movies these days… Liebesman pulls off a rare feat: Setting an entire film predominantly in one room. All focus is on the eyes, actions, and betrayals of these characters – and the finale comes out of left field, in the best way possible. It’s Cube with better actors. Reservoir Dogs without the hipness. Lifeboat with a modern spin on war-time paranoia.”

Kahn Media Strategies emailed me that NY entertainment law firm Gray Krauss LLP this year “arrived at the 2009 Sundance Film Festival in force. The firm’s attorneys are attending as production counsel to 9 films selected for this year’s festival — including 4 of the 16 in the Dramatic Competition — and as counsel to the producers of 3 more films premiering at the festival.” The firm helped guide the diverse roster of Sundance films from development to distribution, with founding partner Jonathan Gray and Evan Krauss leading the practice’s Sundance team. The indies being repped are: Big Fan, written and directed by Robert Siegel (writer of The Wrestler); Dare, directed by Adam Salky; Don’t Let Me Drown, directed by Cruz Angeles and written by Angeles and Maria Topete; Push: Based on the Novel by Sapphire, directed by Lee Daniels, starring Mariah Carey and Lenny Kravitz; Lymelife, directed by Derick Martini; The Missing Person, written and directed by Noah Buschel; Against the Current, written and directed by Peter Callahan; Dear Beautiful, directed by Roland Becerra; The Young and Evil, directed by Julian Breece; producer Susan Leber for Toe to Toe; producers Gia Walsh and Kara Baker for The Winning Season; producer Mynette Louie for Children of Invention.

The ACLU and Rights/Camera/Action held a Sundance panel on Film And Gay Rights today smack in the heart of Proposition 8-pushing Utah and against the backdrop of a threatened Sundance boycott because of the locale. The Queer Lounge hosted the discussion about the integral role film and filmmakers have played in the LGBT movement and how filmmakers, artists and activists can further the civil liberties dialogue about gay rights together. peakers were Matt Coles, director of the ACLU LGBT Project; John Cooper, director of Sundance Festival Programming; Rob Epstein, director of The Times of Harvey Milk and Celluloid Closet; Rashad Robinson, senior director of GLAAD Media Programs: Dayna Frank, co-founder of HOMOtracker & F.A.I.R. Cooper, for one, disagreed with the call for Sundance to leave Utah. “We haven’t spent years and years building a community here only to leave it. I like the subversive nature of it. Personally, I like coming here to Utah.”

More as it comes in… By identifying who’s telling me what here, I’m just being more honest than most media outlets who regurgitate the Sundance PR without telling readers.