A New York judge on Monday denied AMC’s motion to throw out one of two profit-participation lawsuits filed by “The Walking Dead” creator Frank Darabont, and set a trial on the long-running case for November.
Darabont — who was fired after the first season of the show, back in July 2011 — has filed two lawsuits accusing AMC of shorting him out of hundreds of millions of dollars in profits. The first suit, filed in 2013, argues that AMC owes him $280 million. Darabont and his co-plaintiff, CAA, filed a second lawsuit in 2018, alleging that further evidence had shown that AMC owed him at least $10 million more.
AMC filed a motion for summary judgment on the second suit in December, arguing that the cable network had calculated Darabont’s profits correctly and his suit should be thrown out.
But in a ruling on Monday, Justice Joel M. Cohen denied the motion, ruling that the issues should be determined by a jury. The dispute centers on the definition of “modified adjusted gross receipts.” Darabont’s attorneys have alleged that AMC failed to negotiate the definition in good faith, and instead unilaterally presented their definition to Darabont as the last word on the matter.
AMC has argued that its definition was unambiguous and in keeping with industry norms, and that therefore the suit should be dismissed. Cohen did not buy that argument.
“In view of the significance of the MAGR definition, and the inconsistent language used throughout the agreements, AMC’s contention that the parties intended Plaintiffs to be bound by AMC’s post hoc definition sight unseen, without negotiation, is not the only reasonable conclusion to be drawn from the record,” the judge wrote. “Moreoever, contrary to Defendants’ protestations… there are disputed issues of fact as to whether AMC engaged in ‘good faith negotiations.'”
A consolidated trial on both lawsuits was supposed to begin in June, but Cohen has now set the trial to begin on Nov. 2. The New York court system has largely shut down due to the coronavirus pandemic, and all civil trials have been postponed.
Dale Kinsella, Darabont’s attorney, applauded the judge’s ruling.
“Plaintiffs are pleased that the court has soundly rejected AMC’s final effort to keep plaintiffs’ case from being heard by a jury,” he said. “We look forward to the trial in November and the vindication of Mr. Darabont and CAA’s claims.”
Orin Snyder, AMC’s attorney, said in his own statement that the ruling was anticipated.
“Today’s ruling on the accounting portion of the CAA litigation confirms what all parties have been expecting for many months – this case will be tried in front of a jury and we look forward to that happening later this year,” Snyder said. “We believe the facts are clearly on our side and that a jury will agree that the most sophisticated and experienced deal-makers in the entertainment business should not be able to turn to the courts to renegotiate valid agreements they entered into years ago just because ‘The Walking Dead’ became a bigger hit than anyone anticipated.”