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Studio claimed Marc Toberoff interfered with settlement talks

A federal judge has rejected an effort by DC Comics to have the court impose sanctions on the attorney to the heir to “Superman” co-creators Jerry Siegel and Joseph Shuster, as they are engaged in a bitter and protracted legal battle over the rights to the Man of Steel.

In an order issued on Friday, U.S. District Judge Otis Wright said that the efforts by DC Comics, a unit of Warner Bros., were “just a rehashing of the tortured course of discovery in these Superman matters.”

DC Comics, represented by attorney Daniel Petrocelli, claims that attorney Marc Toberoff interfered with settlement negotiations that Warner Bros. was engaged in back in 2001 and 2002 with the Siegel heirs. DC contends that after Toberoff approached the heirs to express interest in purchasing the Superman rights, the heirs repudiated a settlement agreement and took Toberoff on as their attorney.

DC Comics filed suit against Toberoff in 2010, and has since claimed that he was concealing information in the discovery process in the way that his firm logged correspondence as attorney-client privileged information.

But Wright wrote that he was “skeptical of DC’s contention that any perceived deception here caused it any real prejudice, as the letters at issue here actually serve more to discredit DC’s cries of intentional interference than they do to bolster them.”

He noted that a Nov. 2, 2002 letter from Laura Siegel to Michael Siegel “unambiguously reveals that Joanne and Laura Siegel fired Kevin Marks,” who had been representing them, upon “their ‘dissatisf[action]’ with ‘the revolting offer from DC’ in February, 2002.

But that was six months before they first learned that Toberoff had made an offer to Marks in August 2002, Wright wrote.

Wright wrote that while he was “admittedly deeply troubled” by “Toberoff’s repeated failure to update his privilege logs” to reflect some of the correspondence between Michael Siegel and half sister Laura Siegel Larson, the “record does not support a clear inference that this logging inaccuracy was the result of a deliberate attempt to mislead the Court of DC Comics; rather, it appears more likely the result of a misplaced reliance on the attorney client-privilege and the related joint-litigation privilege.”

The litigation centers on the heirs’ termination of certain DC Comics’ rights to Man of Steel under a provision of the Copyright Act that gives creators and their families the ability to reclaim the works after a certain period of time and under certain conditions.

In January, the 9th Circuit Court of Appeals held that an Oct. 19, 2001 letter between DC and Siegel’s daughter, Laura Siegel Larson, was an agreement by the Siegel heirs to grant their reclaimed rights to DC in exchange for millions of dollars. DC and Warner Bros. claim that this essentially means that the case is over and it has the rights, while the Siegel heirs argue that there is still a dispute as to the meaning of the 2001 agreement’s terms, whether it really transferred the rights of the character from the heirs to DC and whether DC later breached the pact.

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