Suit calls Warners' pic profit reports a fraud
A computer financial systems specialist has sued Warner Bros. as a private attorney general, claiming the company wrongfully fired him after he blew the whistle on errors he found in profit participation statements on 140 films, including the 1973 horror classic, “The Exorcist.”
Making the case potentially significant is the fact that Ruben Mellado alleges that Warners’ participation statements perpetrate a fraud on profit participants. As a result, the suit seeks to enjoin Warners from representing that those statements are accurate.
The complaint, filed last week in L.A. Superior Court, alleges that Mellado was asked to review the participation statements on “The Exorcist” in July. When he informed his superiors that there were errors related to the years 1973 and 1974 and he could not represent that the statements were accurate, he was told the company had known about them since 1999 and had not attempted to correct them. Mellado also informed his superiors that errors existed on at least 140 other films that are unnamed in the complaint.
In July, “Exorcist” director William Friedkin and author William Blatty settled a suit over the film’s profits for an undisclosed amount on the day trial was set to start.
Despite the timing, there is no apparent connection between Mellado’s review and the lawsuit. The suit was over profits on the 2000 re-release of “The Exorcist.” It was the second biggest re-release ever, grossing nearly $120 million in worldwide box office. While Friedkin and Blatty also skirmished with Warners on accounting for profits on the original film, those disputes had long since settled.
Warner spokeswoman Barbara Brogliatti said the company doesn’t comment on pending litigation. Mellado attorneys Wasserman, Comden, Casselman & Pearson had no comment.