Court hears appeals on Coppola case

Little indication how ruling will be made in 'Pinocchio' project

The California Court of Appeal gave little indication how it will rule in Francis Ford Coppola’s “Pinocchio” case, but questions from the three-judge panel Friday certainly indicated its concerns.

Oral argument centered on whether the litigation privilege applied to a letter Warner Bros. sent to Coppola and Columbia Pictures informing them that it had a legal claim against Coppola’s “Pinocchio” project.

Warner attorney Fred Cohen argued the studio had a reasonable belief it had a right to any Coppola “Pinocchio” project, and it wrote the letter to Columbia as a prelude to litigation. The trial judge, Cohen said, should have ruled that the Warner letter was privileged and barred Coppola’s suit.

But Coppola’s attorney, Robert Chapman, argued there was no litigation privilege, and if there were, Warners waived that defense by failing to raise it at the proper time.

After two years in development at Warners, Coppola took a revised script for a live-action “Pinocchio” to Columbia in 1993. When the Col deal fell apart a year later, Coppola sued Warners, charging that it had interfered with his attempt to have the film made at Columbia.

In 1998, an L.A. Superior Court jury awarded Coppola $20 million in compensatory damages and $60 million in punitive damages. The trial judge set aside the punitives, finding there was no evidence of malice. Warners appealed the $20 million verdict, and Coppola appealed the judge’s rejection of the $60 million verdict.

On Friday, the appellate panel seemed particularly concerned about the waiver issue. At one point, Warner’s Cohen was told, “Mr. Chapman has argued forcefully that if you had a privilege, you waived it. Please explain why there was no waiver.”

As for Coppola’s appeal, the panel questioned Chapman on whether there was sufficient evidence of malice to support the punitive damage award of $60 million. This prompted him to recount the history of alleged animus between Coppola and former Warner heads Bob Daly and Terry Semel.

The Court of Appeal has many options. It could leave the judgment alone — affirm the jury’s award of $20 million and the trial judge’s rejection of $60 million in punitives; it could either restore all to or take away everything from Coppola; or it could send all or part of the case back to the trial judge.

The appellate court must rule within 90 days of oral argument.

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