October 06, 2011 7:25am PT by Eriq Gardner
Judge Keeps Filmmakers' 'Sabotage' Lawsuit Against Weinstein Co. (Exclusive)
One of the most vicious lawsuits in entertainment this year is a $50 million claim filed in March by two filmmakers who accuse The Weinstein Company of botching the release of computer-animated movie Escape from Planet Earth.
The lawsuit has a little bit of everything -- Harvey and Bob Weinstein are called "a real life version of Bialystock & Bloom" and alleged to have paid $500,000 in "hush money" to keep the dispute quiet on the eve of the Academy Awards; The filmmakers are labeled "vindictive Hollywood talent" whose complaint includes a "plethora of irrelevancies and uncontrolled rantings"; the Weinsteins' famed attorney, David Boies, even gets hit with charges of unethical behavior and possible malpractice.
The hot emotions have now met a cool-blooded New York state judge, who on Wednesday, refused to dismiss some claims, transfer the case, or disqualify Boies in his role as lawyer for the company.
The plaintiffs in the case are writer/director Tony Leech and film producer Brian Inerfeld, who were in the midst of making Escape from Planet Earth, about an alien prison break from Area 51.
Leech and Inerfeld had worked with the Weinsteins before on the 2005 hit Hoodwinked, and expected their follow-up to be a huge success. The two signed a deal whereby they were to receive at least 20% of Escape's adjusted gross profit, which they estimated would be worth close to $50 million in back end participation alone.
But the film languished in development.
In the lawsuit, Leech said that the Weinsteins repeatedly unlocked the script and forced him to rewrite it no less than 17 times, "eviscerated" the movie's budget by keeping 200+ animators on payroll to essentially sit on their hands, and paid Kevin Bacon to walk away from a voice-over role.
The film went over budget so the Weinsteins went outside for fresh capital, securing new funding by mortgaging TWC's copyright to Escape. In turn, TWC allegedly advised the plaintiffs that if they wanted their past due money, they would have to relinquish their right to gross profit participation.
In sum, the filmmakers allege the Weinsteins "sabotaged" their film.
Soon, both sides were accusing each other of extortion.
The brothers were in the midst of an Oscar campaign on The King's Speech, so they then handed over $500,000 to the filmmakers in a purported effort to hush them up. The payment was supposedly on the advice of Boies, who told the Weinsteins they could send over the money and then recover it on a subsequent economic duress claim. (This legal ethics of Boies' advice became a point of contention later.)
The lawsuit was filed anyway, which led to many summer months of fighting in court.
Now, in his first big decision in the case, New York state judge Paul Feinman has rejected all of the pre-trial motions before him.
The Weinsteins wanted to at least get the case transfered, arguing among other things, that California was a more convenient forum where more knowledgeable experts would be on hand to testify about the workings of the entertainment industry. Plus, TWC said that most of the events at issue in the case happened outside of New York.
Judge Feinman rejects all this, saying that many events happened in NY, including the movie pitch, initial meetings, payments, and script development. And the judge sticks up for the NY film industry, pointing to an article in Crain's New York Business which reported 63,000 people were employed by the film and TV production industry in the state. The judge decides to keep the case for himself.
But at least the Weinsteins will have their preferred lawyers.
Judge Feinman has dismissed without prejudice an attempt to disqualify the Boies, Schiller & Flexner law firm. The plaintiffs argued that David Boies had become a material witness in the case because he could testify about the Weinsteins' state of mind when they made the "hush money" payment.
The judge says that since no economic duress counterclaim has yet been made, disqualifying Boies would be premature. That said, he refuses a TWC motion to sanction the plaintiffs for attempting to push Boies away from representation as well as turning down requested sanctions against the plaintiffs for breaching a confidentiality agreement.
Finally, the judge has refused to dismiss claims against some of the other defendants in the case, including Canadian-based animation outfit Rainmaker Entertainment, Escape Productions, and JTM Escape Company Ltd, the company which provided funding to the movie. There's enough in the allegations where each of these parties will need to continue to fight to defend their part in this affair.