Scotia sues claiming breach of contract, fraud, unfair practices

German distributor Scotia Intl. sued Miramax Film Corp. Tuesday, claiming the filmmaker breached its license agreement by overpricing and failing to deliver acceptable films.

The suit, filed in L.A. Superior Court, alleges breach of contract, fraud and unfair practices. It seeks in excess of $13 million in damages.

Miramax had taken Scotia to arbitration in April, claiming the distributor did not pay for a slate of pictures including “Holy Smoke,” “Rounders” and “My Life So Far.”

Along with its lawsuit, Scotia sought a temporary restraining order halting the American Film Marketing Assn. arbitration. That motion was denied, but a hearing on the arbitration issue has been scheduled for June 28.

The crux of Scotia’s complaint is that over the years the packages of films Miramax sent did not include the most important films for the German territory.

The distrib had licensed a total of 29 films from Miramax between 1994 and 1998 in exchange for fees totaling more than $26 million.

Describing it as bait and switch, Scotia alleges that in the February 1997 package, Miramax did not include a promised Wes Craven film “Bad Moon Rising” because the company decided to have Craven direct two “Scream” sequels instead. Miramax then went on to license “Scream II” and “Scream III” to another distributor. Scotia similarly alleges that Miramax did not honor its obligation to license “Shakespeare in Love.”

According to the complaint, Miramax president Harvey Weinstein admitted the company’s wrongdoing on “Shakespeare” by telling Scotia head Sam Waynberg during the 2000 Cannes Film Festival that he and his brother Bob would personally give Waynberg $100,000 to atone for their misconduct. Waynberg ignored the offer.

Miramax Tuesday issued a statement saying, “Miramax is confident that the arbitration claims it asserted against Scotia in April for breach of contract and for non-payment will succeed. Scotia’s lawsuit and its request today that the Court stop the arbitration was a misguided attempt to avoid responding to Miramax’s claims against it for substantial damages. We are pleased that the Court denied Scotia’s effort to block the arbitration, and we are looking forward to presenting the case to the arbitrator and to receiving a prompt decision on the merits.”

Scotia is represented by Larry Stein and Karen Dillon at Alschuler Grossman Stein & Kahan.

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