October 04, 2011 6:42am PT by Eriq Gardner
Paramount Acknowledges Screwing Up Tommy Lee Jones' Pay on 'No Country for Old Men'
At a trial to determine whether Paramount Pictures wronged an investor by passing along part of Tommy Lee Jones' big $15 million bonus pay-out on the 2007 Oscar best picture winner No Country for Old Men, a lawyer for the studio acknowledged on Monday that a big error was made when drafting his contract.
Karen Magid, a Paramount lawyer, testified that Jones' agreement to star in the film mistakenly made it easier for the bonus provisions to be triggered. Paramount meant to have Jones receive money when worldwide box office receipts reached twice a designated target, but instead let Jones receive bonus money when receipts reached half that target.
The mistake meant that Jones got four times as much as he should have gotten for the film, Magid told a judge, according to a recap by The New York Times.
After the screw-up, Jones went after his bonus money, and when Paramount resisted, the actor sued. The dispute landed in arbitration, where Jones was awarded $15 million, which Paramount then attempted to somewhat off-set by issuing a profit participation statement to investor Marathon Funding that included an unusual $3.75 million deduction. Marathon got 25 percent of net distribution revenue, so Paramount charged its investor by calculating 25 percent of the $15 million loss
The odd chain of events then led Marathon to sue Paramount for a breach of fiduciary duty.
Los Angeles Superior Court Judge Mark Mooney decided to hear the case himself at a bench trial with no jury.
Paramount says that regardless of the error, the deduction was proper and it doesn't owe Marathon anything. The studio points out that Jones' contract was executed before financiers got on board and that these investment agreements required those putting up money to pay losses.
In turn, Marathon believes that Paramount is attempting to off-set responsibility for the "gross and inexcusable blunders" to the studio's former attorneys, and even if the financing contract allowed deductions, Paramount owed larger responsibilities to manage investor money wisely.