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At a court hearing earlier this month, attorneys representing The Walking Dead creator Frank Darabont and his agents at CAA got a New York judge to order AMC Network to produce license agreements governing two of AMC’s other hit shows: Mad Men and Breaking Bad. Although the decision was merely one in the discovery stage of the lawsuit, it marks a positive sign for the plaintiffs on how Darabont’s contract will eventually be interpreted.
In an increasingly consolidated entertainment industry where many networks are producing content in-house, Darabont’s bombshell lawsuit filed last December was noteworthy. The fired showrunner alleges the cable channel breached his contract and deprived him of tens of millions of dollars in profits from the hit series by making a sweetheart deal licensing the show to itself.
Although AMC hasn’t yet brought a motion to dismiss or substantively discussed why it believes Darabont’s claims must fail, the defendant did bring forward an argument last month that addressed what it saw as the fatal defects of the suit. Specifically, AMC believes that the deal that Darabont made allowed it to “specify an imputed license fee,” that those negotiating for Darabont knew this because, among other things, AMC had to promise that it would not charge any distribution fees in connection with the imputed fee.
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As such, AMC labeled Darabont’s push for information about Mad Men and Breaking Bad “irrelevant for the same reasons Plaintiffs’ underlying claims fail: the Parties’ Agreements contradict Plaintiffs’ claim that Defendants were obligated to meet some nebulous ‘fair market value’ standard in connection with licensing the Series to AMC Channel.”
New York Supreme Court Justice Eileen Bransten doesn’t see it as irrelevant at this juncture.
“I consider that based on the complaint and the request in the complaint, I consider the request made by plaintiff to have AMC’s license agreements with unaffiliated studio Sony and Lionsgate as it concerns two events, Breaking Bad and Mad Men, I consider that to be a proper discovery request and I’m going to permit documents to be released for that purpose.”
As a result, Darabont’s attorneys will see the documents in their attempt to bolster their claim that the deals struck by AMC on Mad Men (with Lionsgate) and Breaking Bad (with Sony) weren’t “comparable to” the imputed license fee set up on Walking Dead. The plaintiffs’ claim that AMC had a contractual obligation to arrive at a fee as if it was reaching a deal with an unaffiliated entity.
Judge Bransten did say during the hearing (here’s the transcript) that her decision didn’t come on a summary judgment motion — judicial-speak for “don’t overreact,” although that note did come amid a wink-and-nod to AMC’s lawyer that he would only get one shot at summary judgment and that he might want to “think that over” before taking his one chance to kill the lawsuit now.
Two weeks later, AMC hasn’t yet filed any summary judgment motion. Instead, it now wants to do its own prying, seeking the judge’s blessing to explore other cable TV contingent compensation agreements handled by CAA establishing that the profits deal that Darabont got “actually exceeded industry standards.”
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