January 02, 2013 10:36am PT by Eriq Gardner
Appeals Court Refuses to Award Attorneys Fees in 'Sahara' War
The seemingly never-ending legal battle between novelist Clive Cussler and Philip Anschutz's Crusader Entertainment over the 2005 box office bomb Sahara has had many chapters without any dénouement. In late December, a California appeals court attempted to write one.
At issue is who actually won the legal case. At stake was some $20 million in attorney fees.
Even before Sahara was released in 2005 to financial losses estimated at $80 million, the two sides were fighting.
In 2004, Cussler filed a lawsuit claiming more than $100 million in damages from Crusader (now Bristol Bay) for allegedly breaching a licensing agreement and failing to properly include him in the development of the film starring Matthew McConaughey.
In reaction, Crusader filed counterclaims seeking some $65 million in damages for allegedly acting irrationally and destructively in regards to his consultation and approval rights, for disparaging the film's boxoffice prospects by telling his fans not to see it, and for defrauding the film company by stating that over 100 million copies of his book had been sold.
A 14-week trial gained widespread attention thanks to its focus on Hollywood accounting and a famous author's allegedly unreasonable behavior. Afterwards, the outcome was less than clear-cut. Both sides claimed victory -- Crusader because a jury awarded $5 million for breaching an implied covenant of good faith and fair dealing and Cussler because the jury had potentially left open the possibility that he was due $8.5 million for payments for a second film under the agreement.
An appellate court's decision to take away the $5 million award, more claims filed, and further controversy between the parties only added to the confusion about who was victorious. Both Bert Fields, the attorney for Cussler, and Marvin Putnam, Crusader's main attorney, both crowed about gaining the advantage. The scorecard wasn't merely about hubris since the prevailing party was entitled to a significant attorney fee award over a hard-fought case.
In late December, the Second Appellate District for California's Appeals Court weighed in with its own assessment. The ruling notes that "after years of litigation both sides recovered nothing -- not one dime of damages and no declaratory relief."
The judges disagree with Crusader's contention that it is the prevailing party because it "won the entitlement" of $8.5 million.
"Crusader never sought to recover $8.5 million in damages from Cussler as a result of a breach of the contract," says the ruling. "Rather, it sought to prevent Cussler from recovering $8.5 million in damages. Thus, Crusader was successful on its defense against an $8.5 million claim. But the same is true with respect to Cussler's defense against Crusader's numerous breach of contract claims. In the end, neither party obtained any affirmative relief."
Thus, the appellate court ruled that the trial court was proper in determining there was no prevailing party for purposes of attorney fees.
Consider them both winners. Or deem them both to be losers. The ruling strongly suggests that the outcome was about even.
As a result of the ruling, Cussler affirms he can recover nearly $21 million he deposited to Crusader in 2009 as the result of a previous determination of attorney fee awards. He'll also be getting the money back with 7 percent interest, which Crusader argued was excessive and a "windfall" far greater than a reasonable market rate, but the appellate court deems to be fine. Cussler won't be getting back about $500K in court costs that was awarded to Crusader. The author argued he had obtained his litigation objective -- the termination of Crusader's option rights to a third novel, but the appeals court says there was an independent reason Crusader backed down on this one.
The original Sahara bombed. There obviously was no interest in making another film.
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