Philip K. Dick estate sues Media Rights Capital over profit allocation

The estate of Philip K. Dick has filed a new suit against Media Rights Capital, claiming that the producers have failed to pay them their share of the returns from “The Adjustment Bureau” or even to come to the table to hash out net profit allocations.

Their suit in Los Angeles Superior Court follows litigation that the Philip K. Dick trust filed in U.S. District Court in October contending that MRC, director George Nolfi and producer Michael Hackett reneged on an agreement for a share of the returns for the movie by claiming that the short story on which “The Adjustment Bureau” was based was in the public domain. But U.S. District Court Judge Otis Wright dismissed the contract claims, ruling that they were the jurisdiction of the state courts, and the Philip K. Dick Trust dropped the copyright claim.

The new suit, filed by Laura Archer Dick Coelho, trustee of the Philip K. Dick Trust, claims that after an MRC subsidiary paid $1.4 million to the estate for the rights to “Adjustment Bureau,” and after the heirs assisted in the creation and marketing of the movie, they failed to provide further payments from the movie’s box office and other returns.

One clause in the contract, the suit states, calls for the Philip K.

Dick Trust to receive $500,000 once “initial actual breakeven” is achieved. That is defined as the point when net profits are first available for distribution, provided that there is no distribution fee charged. A clause states that “net profits” are subject to good faith negotiation, but the Trust claims that MRC and the other defendants have refused to engage in such discussions, or provide relevant documents.

The Trust claims that other payments were due in $100,000 installments, triggered once the picture breaks even. MRC and other defendants have not issued accounting statements, and “have affirmatively repudiated any obligation” under the agreement. In fact, the suit states, MRC has threatened litigation to recover prior payments.

The suit, filed by Justin Goldstein and Jay Handlin of Carlsmith Ball, seeks compensatory and monetary damages.

A spokeswoman for MRC had no immediate comment.

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