Goldman Sachs slams Joel Silver lawsuit as 'implausible,' 'absurd'
EXCLUSIVE: Now it's a real Hollywood-vs.-Wall Street smackdown. Goldman Sachs has fired back at superproducer Joel Silver's bold $30 million lawsuit, trying to toss his claims out of court for being "implausible" and "absurd."
In a motion to dismiss filed in U.S. District Court in Los Angeles, the investment bank powerhouse says Silver has invented legal theories and ignored the terms of written contracts to mask his dissatisfaction with a deal that went south with the rest of the economy during the global financial crisis of mid-2008.
As we first reported, the man behind "Die Hard," "The Matrix" and "Sherlock Holmes" sued Goldman and its Alliance Films and Momentum Pictures in May claiming that Goldman agreed orally to pay Silver $35 million (later reduced to $30 million) in exchange for a share of profits from films produced under his Dark Castle genre label, a division of Warner Bros.-based Silver Pictures. The producer says Goldman then used his connections to find funding to buy a stake in Canada-based Alliance, which then entered into a series of written agreements with Silver in April 2008 that promised him the $30 million -- but only if Alliance raised money to finalize the transaction within 90 days. (Silver also claimed he was orally promised $2 million even if a deal fell through.)
Flash forward a few months to summer of 2008. As the world economy circled the drain, so did Alliance's ability to raise money, and Silver's $30 million was never paid. Silver's suit says he's still owed the cash based on the prior oral arrangements and Goldman's failure to use its best efforts to fund his deal despite being able "to make profits in the billions and to pay its own executives bonuses in the billions."
Now, after months of silence and a shift from state to federal court, Goldman's lawyers at Boies Schiller & Flexner have come out guns blazing, saying the Goldman companies owe Silver nothing based on the written deal.
"That these sophisticated parties would enter into a series of oral agreements unconditionally requiring payment of millions of dollars and transfer of significant rights to valuable entertainment assets is entirely implausible," the defendants argue. "That some of these parties would then enter into a detailed written agreement for the transfer of the same assets to a different party without so much as mentioning any of the prior oral agreements is absurd."
Silver attorney Bert Fields said he is confident in his theory that Silver's oral deals with Goldman will be honored under California law.
"Let me put it this way," Fields said. "Oral agreements are completely enforceable in California. Perhaps Goldman Sachs doesn’t know that yet, but I think a jury will educate them.”
Goldman's lawyers referred calls to a spokesperson, who said only that "the claims in the lawsuit are implausible and completely without merit."
Besides pitting East Coast vs. West Coast and one of Hollywood's heaviest hitters against perhaps the most powerful financial institution in the country, the case highlights how much the film business has changed since before the financial meltdown, when Wall Street money flowed freely into Hollywood.