October 01, 2012 1:41pm PT by Eriq Gardner
Don Johnson's $50 Million 'Nash Bridges' Award Cut to $15 Million on Appeal
A California appellate court has upheld a big win by Don Johnson against Rysher Productions over compensation from TV's Nash Bridges. But Johnson's multimillion-dollar score is being drastically trimmed due to juror misconduct and a judge's error.
Two years ago, Johnson raised eyebrows in Hollywood by persuading a jury to give him more than $23 million, which a judge increased to $50 million after factoring in interest. Now, he'll only have to live with $15 million for being stiffed out of his 50 percent copyright interest in the hit 1996-2001 CBS cop show.
The 2nd Appellate District in California reviewed the case on appeal by Nash Bridges studio Rysher. In an attempt to escape paying Johnson anything, the company told the appellate court that the lawsuit should have been dismissed because Johnson's claims were barred by the statute of limitations.
In 2002, Rysher signed an indefinite tolling agreement with Johnson, but Rysher argued that under a 1951 law (Section 360.5), such an agreement had to be renewed every four years. Appellate Judge P.J. Turner rejected that assessment, saying the law only applied to a "waiver of the right to assert statute of limitations," not the necessity to keep getting written confirmation that the statute of limitations was suspended.
Additionally, Rysher attempted to argue that the tolling agreement it signed was with Johnson and not the actual plaintiff, Don Johnson Productions. Turner didn't buy that argument either, ruling, "There is substantial evidence the parties negotiated the tolling agreement on behalf of plaintiff and Mr. Johnson."
Johnson also gets a win on the interpretation of his contract with the studio. His theory of damages arose from the 50 percent ownership of copyright rights. Rysher, on the other hand, pointed to another portion of his contract for Johnson's work on the series, which entitled the actor to "adjusted gross receipts" or the licensing profits that Rysher attained for the series after certain distribution fees and production costs.
Rysher claimed in defense of the lawsuit that Nash Bridges was a very expensive show to produce and that it actually was in the red. And if the judge had not found the agreement ambiguous and left it to the jury to decide, the amount of damages would have turned out differently, Rysher argued. The company told the trial judge that the cost of the series was $40 million more than the gross receipts, so essentially there were no "profits" to divide with Johnson.
But the appellate court agrees there was ambiguity in the contract and that the trial judge rightfully left it to the jury.
"Substantial evidence supports plaintiff's view of the contract," writes Turner. "There was testimony: Mr. Johnson knew there would be little payout under the adjusted receipts provision … in a prior successful series, Mr. Johnson received no adjusted gross receipts compensation; there was extensive negotiation of the copyright ownership provision; during the negotiations, Rysher Entertainment, LLC resisted granting plaintiff the copyright rights."
But Johnson's big $50 million verdict win nevertheless was trimmed substantially.
After the jurors heard testimony, they decided that Johnson should win, and then they went about calculating how much he was owed. They decided on $15 million. But the jurors also decided to award $8.2 million in prejudgment interest, bringing the total to more than $23 million. The judge then was asked to add his own interest, which ultimately brought the total to $50 million.
On Monday, the appellate court unwound all of that interest.
The appellate court ruled that the jury's decision to award interest is "misconduct requiring reversal," and thus snipped $8.2 million from the total. Judges, not jurors, are supposed to come up with interest.
The appellate court refused to go so far as reversing the base $15 million award, though, ruling that "no misconduct issue has been raised concerning" it.
But the judge's own interest calculations also don't survive appellate review.
Johnson only asked for prejudgment interest after the jury made its decision. His attorneys asked the trial judge to set aside the partial judgment and instead go with one that would factor in interest. In doing so, Johnson's attorneys said it didn't want a new trial, only a judge's own award of interest.
The judge granted the request and soon came up with $27 million more for Johnson, but now the appellate court has decided that the trial judge was not in compliance with certain procedures (section 657). "The failure to state the grounds for granting a new trial motion requires the order at issue be reversed," Turner ruled.
Essentially, Johnson's attorneys should have made their motions for prejudgment interest before the trial, and because they didn't, the trial judge couldn't determine prejudgment interest based on any trial testimony.
As a result, a $50 million award becomes $15 million -- and now the litigation looks primed to head to the California Supreme Court as both sides fight losses.
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