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Globes’ value in trial spotlight

Friday testimony centers on what NBC paid and what the HFPA thought it could get for kudocast from another network

The courtroom battle over the rights to the Golden Globes delved Friday into the question of just how much the kudocast is worth.

One of the arguments that the Hollywood Foreign Press Assn. is making in its suit against Dick Clark Prods. is that its longtime producer, in securing a new rights deal for the show with NBC without the HFPA’s consent, prevented the HFPA from fetching higher offers from other networks. Already, in questioning of witnesses, attorneys for the HFPA have suggested that CBS Corp. CEO Leslie Moonves was willing to offer $25 million or more per year.

Dick Clark Prods. and the HFPA have a 50-50 partnership in the Globes telecast, but DCP contends that it could secure a broadcast deal with NBC and didn’t need the HFPA’s permission. DCP cites an “extensions clause” in a 1993 amendment to an earlier rights agreement that its lawyers say gives the company options to produce the telecast as long as it landed a deal with NBC.

The testimony Friday offered a glimpse into the gamesmanship at work when high-stakes deals are done in Hollywood.

Marc Graboff, former prexy of West Coast business operations for NBC Entertainment, testified in U.S. District Court about the 2010 negotiations that led to the Peacock network paying an average of $21.5 million annually for the show from 2012 to 2018.

“I feel we paid a little too much for it,” Graboff said.

He admitted that he had earlier said that NBC’s “butts were kicked” in the negotiations with Dick Clark Prods.

Graboff said he was told by Mark Shapiro, the CEO of DCP, that he had to secure the approval of the HFPA to do a deal. Graboff said he was under the impression that the HFPA was “intimately involved” in the negotiations, even though the org’s representatives were not present at meetings or in on phone conversations.

Graboff said that on “one or more occasions,” Shapiro or Ari Emanuel, the agent for DCP, told him that CBS’s Moonves was “prepared to offer more.””That is something you hear in every negotiation,” he said. “Les Moonves is everyone’s favorite stalking horse.”

When the broadcast deal was signed on Oct. 29, 2010, Graboff said, Shapiro told him that he still had to take it back to the HFPA membership for approval but that it would be a “rubber stamp.”

In Graboff’s mind, that came on Nov. 9. According to one of his notes from that date, Shapiro called him and Graboff thought that everything was OK. “HFPA had the meeting and we’re all good,” Graboff’s note read.

In fact, it was near the end of October that Shapiro first informed the HFPA of the NBC deal and that it was done, triggering the latest litigation.

Shapiro, testifying again on Friday, once again said that telling Graboff that he needed the HFPA’s approval (even though he believed he did not) was all part of a “negotiating strategy.” His rationale was to get extra leverage in the negotiations, giving the sense that there was a “higher authority” that he had to answer to that was much less likely to budge on things like the rights to the pre-show and flexibility on the show’s date. As it turned out, NBC didn’t get anything more than an extension of its existing deal — but for more than double what it had been paying.

Graboff said that had he ever known there was a conflict between the HFPA and DCP over the “extensions clause,” he would have halted negotiations.

At points in 2010, the HFPA and DCP were talking about altering the terms of their deal, one that may have indeed settled the entire issue of the “extensions” clause, but nothing ever materialized. Shapiro said that during that time he told the HFPA only that he was “talking” to NBC.

Dick Clark, who sold the company in 2002, is not expected to testify. Over the weekend, attorneys were to try to come to an agreement on how Moonves will offer testimony in the case — in the courtroom, via videoconference or by written sworn statement.

The trial is to resume on Tuesday, with testimony expected to wrap up by the end of the week.

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