×
You will be redirected back to your article in seconds

Lawsuits challenge studio homevid accounting practice

Helmers claim they were shortchanged by Fox, Par, Sony and U

Challenging a long-standing profit participation practice, a clutch of filmmakers and the estate of Charles Bronson have filed a class-action lawsuit against four studios over homevideo accounting.

The films at the center of the suit — 1978’s “Foul Play,” 1982’s “The Best Little Whorehouse in Texas,” 1975’s “Hard Times” and 1975’s “Lucky Lady” — were all released before the practice of using 20% of a film’s homevid revenue to account to profit participants became standard practice in the 1980s.

But the profit participants, including “Foul Play” and “Whorehouse” director Colin Higgins and “Lucky Lady” helmer Stanley Donen, allege that they made their respective deals based on 100% of homevideo grosses, and are therefore entitled to profits based on a larger share of the revenue pie.

Higgins sued Paramount and Universal, Donen sued 20th Century Fox and the trustee of Bronson’s estate, Larry Martindale, sued Sony over “Hard Times.”

While the 20% figure has been standard practice in talent deals and guild residual formulas since the ’80s, studios have accounted for older films in much the same way. A source with knowledge of the matter said the plaintiffs had no idea that their royalties were based on the 20% revenue pool.

“(Paramount’s) misconduct offends public policy and is immoral, unscrupulous, unethical, and offensive, and causes substantial injury to consumers,” the complaint against Par alleges.

The outcome of the class-action suit could influence the current discussion surrounding digital platforms, as an ongoing debate brews over whether digital re-use revenues from film and television should be classified as home entertainment.

“This comes up every time there’s a new media,” said Schuyler Moore, a partner at Stroock, Stroock and Lavan. Moore noted that Wednesday’s case had much to do with the wording of the plaintiff’s original agreements, regardless of what may have happened in the 1980s.

“Contract interpretation is not governed by standard practice that develops after the contract is signed,” he said.

The law firms in Wednesday’s case — Johnson and Johnson, LLP; Kiesel and Larson, LLP; and Pearson, Simon, Warshaw and Penny — have experience with profit participation litigation. All three are currently involved in class-action suits against record companies over profits from digital downloads.

More Film

  • AMC theater

    AMC Stubs A-List Becomes No. 1 Movie Subscription Service

    AMC Theatres’ Stubs A-List program, which allows customers to see three movies a week for $19.95 a month, has hit 800,000 subscribers. That figure is well ahead of the original projection, announced last June, for 500,000 subscribers by the end of its first year. According to AMC, the program is now the No. 1 moviegoing [...]

  • Millie Bobby Brown on Her Feature

    Millie Bobby Brown Calls Her Film Debut in 'Godzilla' 'Kind of Unreal'

    Millie Bobby Brown is no stranger to stardom thanks to “Stranger Things,” but she still can’t believe she’s making her feature film debut in the monster reboot “Godzilla: King of the Monsters.” “It’s kind of unreal,” Brown told Variety at the premiere. “I’m like, ‘What is happening right now?’ It’s so bizarre and unreal, and [...]

  • Dakota Johnson Tracee Ellis Ross

    Dakota Johnson, Tracee Ellis Ross Co-Starring in Comedy 'Covers'

    Dakota Johnson and Tracee Ellis Ross will co-star in “Covers,” a comedy set in the music scene in Hollywood. “Late Night” director Nisha Ganatra is helming from a screenplay by Flora Greeson. Focus Features is partnering with Working Title Films on the movie. Working Title’s Tim Bevan and Eric Fellner will produce with Alexandra Loewy [...]

  • Sony Interactive Launches Film, TV Studio

    Sony Interactive Launches Film, TV Studio to Adapt Video Game Projects

    Sony Interactive recently launched PlayStation Productions, a studio tasked with adapting the company’s video game properties into films and television shows, according to The Hollywood Reporter. PlayStation Productions is headed by Asad Qizilbash and overseen by SIE chairman of Worldwide Studios Shawn Layden. It’s reportedly already working on its first slate of projects on the [...]

  • Breaking Glass Takes U.S. on Female

    Breaking Glass Takes U.S. on Mexican Female Empowerment Pic 'Tatoo of Revenge' (EXCLUSIVE)

    Philadelphia-based indie distributor Breaking Glass Pictures has acquired North American rights to Mexican director Julian Hernandez’s female empowerment thriller “Tattoo of Revenge” in a deal closed with Italy-based company The Open Reel at the Cannes film market. “Tatoo” is the latest feature by the prolific Hernandez who is known on the festival circuit for films [...]

  • Thierry Fremaux Cannes

    Thierry Fremaux Says 'Cannes Will Always Side With Artists' at Alain Delon's Tribute

    Thierry Fremaux, the artistic director of the Cannes Film Festival, delivered a heartfelt homage to Alain Delon at a ceremony on Sunday during which the French actor received the honorary Palme d’Or. Alluding to the controversy that Delon has triggered with his past declarations, Fremaux said the actor was entitled to have his own convictions [...]

  • Joseph Gordon-Levitt's '7500' Sells to Amazon

    Joseph Gordon-Levitt's Thriller '7500' Sells to Amazon Studios

    Amazon Studios has acquired global rights to Joseph Gordon-Levitt’s terrorist drama “7500.” The deal, announced Monday at the Cannes Film Festival, excludes Germany, Switzerland, and Austria. Universum will distribute the film in Germany. In “7500,” Gordon-Levitt plays the co-pilot of a plane that has been hijacked by terrorists. The title references the code 7500, which [...]

More From Our Brands

Access exclusive content