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Judy Sheindlin might be the highest paid star in television, but her $47 million-per-year salary isn’t so outrageously high, according to a real judge.
In a big win for CBS, Los Angeles Superior Court Judge Joanne O’Donnell has dismissed a claim that Sheindlin’s compensation was purposely structured so as to deny the talent agency that originally packaged Judge Judy in the 1990s its fair share of profit participation from the hit syndicated show.
Rebel Entertainment Partners filed its lawsuit in March 2016 against CBS and Big Ticket Television. The agency headed by Richard Lawrence asserted that it was entitled to a five percent share of net profits, but accounting statements were showing the syndicated show running a deficit since February 2010 largely because Sheindlin’s mammoth salary was being deducted as an expense. Rebel Entertainment challenged this state of affairs by alleging that once Sheindlin’s salary doubled nearly a decade ago, it wiped out profits.
In response to the lawsuit, CBS argued that the talent agency couldn’t challenge production costs and that “the salary paid to Judge Sheindlin was the salary necessary to keep Judge Judy on the air, and, ironically, the salary necessary for Rebel to continue to earn millions of dollars in upfront commissions that would disappear were the show to end.”
Sheindlin gave a notable deposition in the case where she addressed her long-running grudge with Lawrence, talked about how Judge Judy made it onto the air and discussed why she was paid so much.
According to the star, every three years, she sits down for a renegotiation with CBS and brings along a card with her demands.
Once, she testified, John Nogawski, former president of CBS TV Distribution, brought along his own envelope.
“And I said, ‘I don’t want to look at it,'” said Sheindlin. “He said, ‘Why not? Maybe it’s more than what’s in your envelope.’ And I said, ‘Well, John, if I look at your envelope, it’s a negotiation. This isn’t a negotiation.’ And he put his envelope away and they gave me what I wanted; not a whole thing, not 30 pages, three things, whatever it was, done. So to suggest that the largest profit participant, which is CBS, would pay me willingly more money is so ludicrous. Their back’s to the wall.”
According to Sheindlin, she’s happy with a grand salary even if others have told her she’s leaving $20 million a year on the table by not producing Judge Judy herself. “How much can you eat?” responds Sheindlin.
Judge O’Donnell is satisfied that CBS is doing what it considers to be best for the show. According to a tentative ruling issued at a hearing earlier this week, since adopted, the judge said plaintiffs hadn’t presented sufficient evidence that Sheindlin’s salary is counter to industry custom. The judge heard from one expert who testified otherwise, but it didn’t sway things.
“Her present salary was the result of arms-length negotiation and Judge Sheindlin’s final ‘take-it-or-leave-it offer,” she writes in the ruling, which is posted in full below. “Plaintiff has presented no evidence that the salary was negotiated in bad faith or is unreasonable in light of the undisputed ‘resounding success’ of Judge Judy and the fact that without its namesake star the show could not continue.”
But Rebel Entertainment isn’t completely losing the case.
The plaintiff also complained about how it was shut out of Hot Bench, which Rebel saw as a spinoff that demanded compensation for the talent agency under the original deal. CBS disputed this. While dismissing the big claim over profit participation from Judge Judy, O’Donnell isn’t ready to dispense with the Hot Bench profit claim just yet.
Writes O’Donnell, “The Court cannot conclude as a matter of law that Hot Bench is not an ‘episodic television series’ which is ‘based upon or derived from’ Judge Judy.”
Rebel attorney Bryan Freedman sent The Hollywood Reporter a statement Thursday in response to the decision: “All 3 causes of action will proceed to trial and we are pleased that the court denied CBS’s attempt to eliminate Rebel’s substantial interest in Hot Bench. We disagree that paying Judy 45 million dollars upfront which caused the profit participant’s interests to be eliminated is the custom and practice in the television industry and based upon our expert’s testimony, Rebel will never let go of that claim. Whether in the superior court, the appellate court or the court of public opinion, no one will determine that CBS has the right to deny profit participants their rightful bargained for share of profits.”
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