A mini-trial that began Monday morning in downtown Los Angeles over profits from the hit series The Walking Dead produced sparks but few real surprises.
AMC Networks’ lawyer Orin Snyder of Gibson Dunn sparred with eminent entertainment attorney Ken Ziffren, who was serving as an expert witness for the plaintiffs, Walking Dead comic book creator Robert Kirkman and executive producers Gale Anne Hurd, David Alpert, Charles Eglee and Glen Mazzara, who are suing the cable company and its affiliates over their share of profits from the zombie series.
The most unexpected note came at the beginning of the two-and-a-half hour hearing, when Ziffren, described in court as the dean of entertainment lawyers, seemed momentarily unsure as to where he was supposed to sit until he was guided to the witness chair by a bailiff. He then raised a southpaw as his swearing-in began, before switching to the requested right hand. The confusion was understandable: Ziffren soon disclosed that in over 50 years of practice, he had never served as an expert witness before.
“Why now?” was a question that went unasked, but Snyder did elicit that plaintiff Hurd was a client of Ziffren’s firm — his former Ziffren, Brittenham partner David Nochimson had represented her in the Walking Dead deal — and that a win for the plaintiffs would benefit Ziffren’s firm monetarily. Whereas, “you get nothing if the defendants win?” asked Snyder.
“Except the experience,” quipped Ziffren in the first of many rejoinders that put Snyder increasingly on edge, as the witness frequently objected to the premise or wording of a question. That led to Snyder more than once withdrawing a query, and in one case remarking, “The Dean is telling me the question is bad.”
But that crack proved a misfire, as it led Los Angeles Superior Court Judge Daniel J. Buckley to chime in: “Here, I get to tell you that.” That didn’t deter Ziffren, however. “He wants to speechify,” complained Snyder to little avail.
In an unusual procedure, Ziffren’s direct testimony was delivered in the form of a written declaration, and so the hearing began with cross-examination. If that was intended to promote efficiency, the goal was undermined by some of Snyder’s questioning — including a whole sequence on apparently marginal things the parties could easily have stipulated to: Are reversions important? Why? And what are they, anyway?
Other questions included: Why are publishing rights retained? “Why not?” Ziffren impishly responded, before adding that it was “almost natural” that a writer such as Kirkman would want to retain them. How about merchandising, video game and theme park rights? Next came basic definitions of such terms as “purchase price” and a discourse on “shall” versus “will” before the first of two morning breaks that allowed the judge to handle other matters.
But Snyder did appear to make some headway when he grilled Ziffren on whether he had considered various assertedly applicable principles of New York case law in coming to his opinion that AMC had improperly attempted to dictate a definition of modified adjusted gross receipts 18 months after the parties had signed their agreements absent the MAGR definitions — and that AMC’s definition improperly featured an implied license fee rather than an actual license fee. Ziffren said he had considered such principles, but didn’t elaborate. (Nor was he asked to.)
And why weren’t the MAGR definitions proffered more promptly? Apparently because AMC, new to in-house producing, didn’t have the contractual forms ready. “The AMC entities were inexperienced,” asserted Ziffren. “For reasons that escape me, the AMC side of it botched it. … The inexperience of the production company and the channel was evident in that they didn’t have [a MAGR definition] to hand over.”
Later, on redirect questioning by the plaintiffs’ attorney Ron Nessim of Bird Marella, Ziffren said he himself had written MAGR definitions for Paramount, MTM and DreamWorks, and that it had taken him from “three days to three months” to do so.
But if that sounds bad for AMC, Snyder got Ziffren to acknowledge that when contract amendments offering higher advances were later signed, none of the plaintiffs reserved their rights regarding the MAGR definitions or offered any protest.
Questioning then turned to another clause in the contracts, a so-called affiliate transaction provision requiring that deals be done, in essence, at fair market value. Each side held its ground, with Snyder insisting that such provisions only apply to exploitation after the first window (here, AMC’s cable broadcast of the series) and Ziffren steadfast that ATPs apply to all exploitation by affiliated entities.
Nessim had Ziffren point out that two housekeeping provisions of the agreements — “this Agreement consists of” and “Other Documents” — both omitted any mention of the MAGR definitions that AMC later supplied and insists are part of the agreements.
Ziffren’s testimony will continue Tuesday morning, followed by several other witnesses in what is expected to be a one- or two-week hearing. Depending on how the judge rules, the implications could significantly impact the scheduled jury trial and the original Walking Dead profits dispute filed in New York by Frank Darabont and CAA against AMC.
Both sides declined comment.