KHIKS partner Chad Fitzgerald was quoted in Ted Johnson’s article in Variety on British production company Celador’s major court victory over the Walt Disney Company, confirmed on appeal, regarding profits from the hit show Who Wants to Be a Millionaire.
The gist of the verdict was that Disney had brought its sister company Buena Vista Television into the deal with an agreement whose terms redirected most of Celador’s profits to Buena Vista. Disputes like this are well-known in entertainment circles, where the creator of a show claims the studio camouflaged profits with “Hollywood accounting.”
Chad says the result of this case and others like it is that more contracts will be structured to allow for a studio to partner with sister companies. “If history is any indication, it is getting more difficult to pursue a vertical integration claim. I think Celador will only accelerate that trend.”
Beyond that, Chad believes that studios will now be more careful to include contract language making clear that profit participants are not partners.
Chad knows first-hand about this kind of litigation as he is currently representing the producers and creators of the hit show Smallville in their dispute over profits with Warner Bros.
Read the Full Article. Chad’s comments begin in the ninth paragraph from the end.