March 21, 2013 4:17pm PT by Eriq Gardner
Judge Confirms Warner Bros. Owns Superman Rights
Warner Bros. scored another win in the war over Superman rights Wednesday when a federal judge confirmed the enforceability of a 2001 agreement between DC Comics and the estate of Superman co-creator Jerome Siegel.
The decision follows a Ninth Circuit Court of Appeal decision in January that held that, contrary to the Siegel estate's pursuit of terminating a copyright grant, the Siegels made a deal 12 years ago to settle a war over rights.
However, the decision by U.S. judge Otis Wright to confirm the continued enforceability of the agreement points to a lawsuit that seems likely to come from the Siegels and their lawyer, Marc Toberoff.
After the Ninth Circuit handed down its blockbuster decision, the heirs attempted to stave off Wednesday's ruling on the enforceability of the 2001 agreement.
Toberoff argued that after the studio agreed to a deal in 2001, "DC anticipatorily breached by instead demanding unacceptable new and revised terms as a condition to its performance; accordingly, the Siegels rescinded the agreement, and DC abandoned the agreement."
Judge Wright admits, "Subsequent events may have affected the present enforceability of that contract, as by a material breach followed by an effective rescission of the deal."
But he adds, "The Siegels’ breach and repudiation defenses do not affect the enforceability of the agreement, but rather constitute grounds for termination or a breach-of-contract action."
The judge notes that, up until now, the Siegels haven't attempted a rescission. Such an event can only happen if the rescinding party gives proper notice, and here the judge finds "as a matter of law" that letters sent in the months of 2002 "do not constitute proper notices of rescission" as "neither letter even recognizes a contract at all, much less expresses the intent to rescind the contract."
But that doesn't foreclose the option of the Siegels now attempting it.
The judge further notes that the heirs might make a proper case by arguing in a separate breach-of-contract lawsuit that Warners failed "to provide a royalty statement to the Siegels by March 31, 2001, as agreed in the October 19, 2001 Letter, and failed to pay or offer to pay the Siegels their royalties.”
Such a claim might have big statute-of-limitation hurdles, but given the stakes and the never-ending madness over Superman rights, it wouldn't be surprising to see such a lawsuit filed soon.
Judge Wright doesn't entirely dispense with the case because he says there is still the "lingering issue of what to do with Superboy and the early Superman ads."
Warners is safe as it prepares to release its big-budget Superman reboot Man of Steel, directed by Zack Snyder and produced by Christopher Nolan, but there may be more fussing on works like the TV series Smallville before the case is firmly wrapped up.
Warner Bros. had no comment. We've also reached out to Toberoff, and we'll provide any comment he offers.
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