'Godzilla' Producers' Lawsuit Settles on Eve of Trial

Dan Lin, Roy Lee and Doug Davison claimed they were being booted from the monster movie by Legendary Pictures.

Just weeks before a trial was scheduled to begin, Legendary Pictures has settled a lawsuit with three producers who were dumped from Godzilla.

On Thursday, the parties filed papers to end the legal dispute, which began in January 2013 when the studio preemptively filed claims against Dan Lin, Roy Lee and Doug Davison, aiming to get a declaration that under the terms of a contract, the studio was only required to use the three on Godzilla if they were "deemed to be engaged" to produce the film. Within days, the producers had filed counterclaims against Legendary for allegedly breaching an oral agreement and demanded "substantial punitive damages to make an example of Legendary so that it and no other studio will in the future treat their producers in this outrageous manner."

After many months spent figuring out whether the litigation belonged in arbitration, the three producers landed a victory when an L.A. Superior Court judge rejected Legendary's contention that a clause in an unsigned contract required arbitration.

Lin, Lee and Davison prepared to introduce evidence at trial that they were responsible for bringing the Godzilla project to Legendary from Toho Co. amid a rights bidding war, and that the studio orally agreed to a $25,000 developmental fee, fixed compensation of $1.3 million and 3 percent of the first-dollar gross receipts of the film. The three say they continued to work on Godzilla and were assured in an email by Legendary's chief creative executive, Jon Jashni, that they would "be well-treated throughout."

Nearly three years after Godzilla rights were secured, the three were taken off the project. Jashni "concocted a plan" to remove them, according to Lin's lawyer Larry Stein.

The dispute was closely watched in Hollywood because it's rare that producers who are involved in early development efforts and generate material are given the cold shoulder. Godzilla was released in 2014 and was a big hit, with more than $500 million gross worldwide. A sequel is in the works.

In the battle, Legendary, led by attorney Dale Kinsella, disputed there was any fraud involved.

"In disputes such as this, whether a Hollywood film producer has been 'well-treated' is overly subjective, it is a matter of opinion, and it cannot serve as a basis for a promissory fraud claim," stated Legendary's earlier court papers. "A jury would have no rational basis for concluding whether [Lin, Lee and Davison] were 'well-treated.' Permitting a fraud claim to proceed on such a nebulous and indefinable representation would open the floodgates to promissory fraud claims in an industry known for differing — and often clashing — opinions on quality, contribution, and appreciation."

The terms of the settlement haven't been publicly revealed.

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