Lorre could feel pinch from 'Dharma' suit
EmptyLawyers for 20th Century Fox Television and profit participants on the sitcom "Dharma & Greg" were back in court Friday in a case that could cost the studio $15 million or more in revenue from ABC's hit 1997-2002 series.
In a strange twist, the outcome of the litigation also could take a big chunk of money from "Dharma" co-creator Chuck Lorre.
In October 2007, a lawsuit was filed in Los Angeles Superior Court by several creative forces behind "Dharma," including star Jenna Elfman, co-creator Dottie Dartland, director James Burrows, executive producer More-Medavoy Management and talent agency Slessinger & Associates.
The plaintiffs claimed that 20th TV, which produced the show, was underpaying them in part by improperly deducting Lorre's considerable backend interest before calculating what was owed to them under their own deals.
In April, Judge Joseph Biderman ruled that the studio's Modified Adjusted Gross Receipts payments to Lorre's Meshuggenah Prods. and Dartland's 4 to 6 Foot Prods should not have been deducted because they were in fact advances against net profits, and the plaintiffs' agreements with Twentieth allowed the deduction of any backend except net profits.
"Despite the parties' labeling the payments as MAGR payments, they were in fact Advance Net Profit payments in the form of MAGR," Biderman wrote.
The judge then set a hearing to determine the specific damages owed, with lawyers for the plaintiffs claiming more than $15 million in damages and interest.
Lorre, one of TV's top showrunners with "Two and a Half Men" and "The Big Bang Theory" currently on CBS, had a rich deal for "Dharma" that included a hefty MAGR interest and an additional net profits interest if the show, which was a modest hit on ABC and in syndication, ever reaches that level (it hasn't).
But Biderman's ruling would put Lorre's MAGR interest back into the pot for all participants to share, potentially boosting their payouts at his expense. In response, Lorre's agent, Bob Broder at ICM, sent a terse letter May 13 to Fox executive vp Howard Kurtzman complaining that the net profits interest, which was supposed to be an added benefit to Lorre, was turning into a liability.
"As we understand the current situation, dollar amounts of Meshuggenah's MAG participation will not be deducted in computing dollar amounts due to other third party participants," Broder wrote. "The result is that third party MAG participants will receive a higher dollar value for their MAG participation, and when those increased costs are deducted in computing Meshuggenah's MAG it will further reduce the dollar value of Meshuggenah's participation.
"We believe that these computations will result in a real dollar reduction in Meshuggenah's MAG in excess of $2.6 million dollars (sic) and will grow as additional participations are paid in the future," Broder continued.
In an unorthodox move, Broder concluded the letter by "severing, rescinding and renouncing" Lorre's net profits interest in the series, indicating that he intended the action to be retroactive to the inception of Lorre's deal.
The same day, Fox attorneys Anthony Basich and David Singer submitted a new brief to Biderman arguing that the judge should reconsider his decision given that Lorre had turned down the net profits interest that gave rise to the ruling.
In court on Friday, Biderman ordered the lawyers to submit additional arguments on the issue by June 5.
Neither Fox nor its lawyers would comment on the case. The plaintiffs' attorney, Michael Plonsker, also declined to comment.