Golden Globes Rights Dispute: HFPA Says

The long battle over the rights to the Golden Globe Awards went to a federal appellate court on Wednesday, as the Hollywood Foreign Press Assn. argued that a lower court erred in ruling that Dick Clark Prods. could produce the HFPA’s lucrative awards telecast for as long as they secured a commitment from NBC.

The HFPA sued Dick Clark Prods. in 2010, claiming that the company wrested away control of the show when they made a long-term agreement with NBC to broadcast the ceremony without first seeking the HFPA’s approval.

The attorney for the HFPA, Daniel Petrocelli, argued that a district court judge was mistaken when he concluded in 2012 that Dick Clark Prods. didn’t need the HFPA’s OK to enter into new deals with NBC.

“We are now a hostage to this interpretation,” Petrocelli told a three-judge panel of the 9th Circuit Court of Appeals in Pasadena.

The case centers on an “extensions clause” that was part of a 1993 agreement between the HFPA and Dick Clark Prods. HFPA says that DCP’s reading of the clause would mean that it would have rights to the show in perpetuity, something that Petrocelli said would be “unprecedented” in the industry and essentially binds the HFPA to its long-term producer.

But Dick Clark Prods. argues that the language of the agreement was reasonable. By giving DCP options to produce the show as long as it secured the Peacock, the company could be sure that they would not be a “victim of (its) own success” and frozen out if the HFPA were to just make its own deal with the network. The show now commands a $21.5 million license fee from NBC, and DCP contends that the language ensured that it was not being “cut out of the equation.”

“DCP was astute to obtain what many parties obtain in entertainment, which is end of the deal protection,” argued Martin Katz, the lawyer for Dick Clark Prods.

U.S. District Judge Howard Matz ruled in favor of DCP after a lengthy trial in 2012, supporting their interpretation of the agreement.

Petrocelli argued that because the 1993 agreement did not specifically say that DCP needed to obtain approval from the HFPA before making new deals with NBC, the HFPA still retained such authority. Judge Matz, however, made a “fundamental legal error” by concluding that lack of such language instead meant that DCP did not need to obtain permission, he said.

But Katz argued Matz was correct, bolstered by a long factual record as well as the weighing of extrinsic evidence.

The case was heard by Judges Stephen Reinhardt, John T. Noonan and Mary Murguia. They gave little indication of which way they were leaning, although Murguia at one point queried Katz on whether the extensions clause was the kind of “perpetual agreement” that California laws disfavor.

Katz said that such agreements happen “all the time,” pointing to certain studio deals for book rights, or the agreement that DCP has for the Academy of Country Music Awards.

He said that the 1993 agreement had to be put into context. At the time, the HFPA was seeking to score another broadcast network, after losing such distribution following the Pia Zadora scandal of the early 1980s. Dick Clark Prods. secured the new NBC deal but wanted to be sure that it was kept in the loop.

“Remember, the object wasn’t just to make sure to get a show on a network, it was to maintain it on a network,” he said. While Dick Clark Prods. had informed the HFPA of another license agreement it made with NBC in 2001, it was not seeking approval, Katz said.

The litigation dates to 2010, but it has continued even though Dick Clark Prods. was sold by Red Zone Capital Partners to Guggenheim Partners and other investors in 2012.

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