War Over 'The Conjuring': The Disturbing Claims Behind a Billion-Dollar Franchise
Illustration by Clay Rodery

War Over 'The Conjuring': The Disturbing Claims Behind a Billion-Dollar Franchise

by Kim Masters , Ashley Cullins
December 13, 2017, 6:00am PST

A legal spat reveals the real-life demonologists in the $1.2 billion-grossing horror movies may not have been nearly as pious as they're portrayed.

Fans of The Conjuring horror movie franchise will be familiar with the romantic tale of Ed and Lorraine Warren, real-life married demonologists who claimed their Catholic faith helped them fend off the forces of evil. In the trailer for the first film, Warner Bros.' New Line division sold The Conjuring as "based on the true story of the Warrens," but according to legal filings and recordings obtained by The Hollywood Reporter, it's possible that even the simple depiction of the Warrens as a devoted and pious couple might have stretched the truth past the breaking point.

It appears that top studio executives were made aware just weeks after the first film opened in 2013 of allegations that, in the early 1960s, Ed Warren initiated a relationship with an underage girl with Lorraine's knowledge. Now in her 70s, Judith Penney has said in a sworn declaration that she lived in the Warrens' house as Ed's lover for four decades. It is unclear whether Warner Bros. took any action in response to these allegations, but the sequel continued to portray them as a happy couple in a conventional marriage. Warners declined to comment, but an attorney for the studio has asserted in court papers that a disgruntled author and a producer suing the studio over profits from the franchise are pushing the story of the Warrens' personal lives as part of a vendetta. Ed Warren died in 2006, and Lorraine Warren's attorney, Gary Barkin, says the family has no knowledge of the alleged conduct and his client, now 90, is in declining health and unable to respond to the allegations.

Movie marketers long have found value in claiming that films are based on fact, but there are no explicit rules governing how far filmmakers can deviate from the truth while still including "based on a true story" in advertisements. When challenges have arisen in the past, courts have given the studios a lot of latitude. Sometimes there is backlash against a film when its accuracy is questioned, as happened with Norman Jewison's The Hurricane or Kathryn Bigelow's Zero Dark Thirty. (Both obviously are more serious "fact-based" films than The Conjuring.) Given the supernatural elements of the Conjuring films, it's fair to assume that not every fan believed everything shown on the screen was literally true. Skeptical or not, audiences flocked to the movies: The Conjuring and its spinoffs have grossed $1.2 billion for Warners — profits that have spawned a veritable horror show of litigation over who owns the rights to the Warrens' stories. Another spinoff is in postproduction, and a second sequel is in development.

Ed Warren was a self-taught ghost hunter, while Lorraine put herself forward as a medium who could communicate with spirits. The Warrens didn't take fees for their work, but they enjoyed immense financial success nonetheless thanks to nine books, a busy lecture schedule and consulting on films based on their exploits — including the 1979 and 2005 versions of The Amityville Horror.

The original Conjuring film, set in the early '70s, tells the tale of the Warrens' dramatic rescue of a family residing in a Rhode Island farmhouse supposedly inhabited by the spirit of a long-deceased witch. From the start, the Warrens' romantic relationship is central, with Patrick Wilson playing Ed and Vera Farmiga as Lorraine. "Do you remember what you said to me on our wedding night?" Lorraine asks Ed at one point. "You said that God brought us together for a reason."

But materials obtained by THR suggest that in real life, the Warrens' relationship was far from divine. Among them is a sworn declaration from Penney, who maintained that Ed — with his wife's knowledge — initiated an "amorous" relationship with her when she was 15. Penney, who has not been a party to any of the litigation over The Conjuring movies, declined to comment.

Ed Warren was in his mid-30s when he allegedly met 15-year-old Penney. Having not yet gained enough fame as a self-trained demonologist to pay the bills in the early 1960s, Ed was working as a city bus driver in Monroe, Connecticut. Penney was a student at Central High School in the nearby town of Bridgeport who rode his bus. The two began an "amorous relationship," Penney said in a legal declaration she gave in November 2014. According to that document, as well as newly obtained recordings of Penney's recollection of events, by 1963 she had moved into the Warrens' home. For the next 40 years, she said, she had a sexual relationship with Ed with Lorraine's knowledge. At first, Penney stayed in a bedroom directly opposite the one occupied by the married couple, but eventually she moved into an apartment built for her above the home. "One night he'd sleep downstairs," she said in a recording. "One night he'd sleep upstairs."

Even in 1963, a teenage girl did not move in with a married man without attracting notice. That year Penney was arrested after someone reported her relationship with Ed to local police. According to her November 2014 declaration, she spent a night in the North End Prison in Bridgeport while police tried to persuade her to sign a statement admitting to the affair. After Penney refused to cooperate, she was ordered by the court to report to a delinquent youth office for the next month. According to Penney's account, Ed picked her up from school every week and drove her to the mandated meetings.

Penney has said Ed told her many times that she was the "love of his life." The Warrens, according to her, presented her variously as a niece or poor girl whom they had taken in out of charity. In May 1978, in her 30s, Penney became pregnant with Ed's child, she has said. In the declaration, she said Lorraine persuaded her to have an abortion because the birth of a child could become public and any scandal could ruin the Warrens' business. Though Lorraine has claimed to be a devout Catholic, Penney said her "real god is money." In a tearful recording obtained by THR, Penney recalled: "They wanted me to tell everyone that someone had come into my apartment and raped me, and I wouldn't do that. I was so scared. I didn't know what to do, but I had an abortion. The night they picked me up from the hospital after having it, they went out and lectured and left me alone."

Penney also has claimed Ed was sometimes abusive to Lorraine. Early on, she said, she witnessed him backhand his wife so hard she lost consciousness. "Sometimes Ed would actually have to slap her across the face to shut her up," Penney said in one recording. "Some nights I thought they were going to kill each other."

Penney has said she helped Ed maintain his reputation as a ghost hunter. He claimed to have captured the "white lady" — a ghost who supposedly haunts Union Cemetery in Easton, Connecticut — on tape in the summer of 1990 after camping out in the graveyard for a week. Penney claims Ed wanted to make a video that would show what the white lady would look like if she were spotted, so she took a page from every grade-schooler's Halloween playbook and donned a white sheet for the filming.

Lorraine's attorney Barkin tells THR that Judy and Tony Spera, the Warrens' daughter and son-in-law, never saw any of the alleged conduct during the decades they spent with Ed, Lorraine and Penney. "The Warrens opened their home to Ms. Penney when she was 18 and had nowhere else to live following a childhood of neglect," writes Barkin in an email. "During much of their career, Ed and Lorraine were on the road, working on cases and giving lectures — and Ms. Penney lived at and watched their house." They also say Penney had a long-term boyfriend for much of that time, whom she eventually married, and the couple spent holidays with their family. The Speras believe Penney is now being manipulated.

But Lorraine seems to have been intent on preventing any sordid aspects of her story from being portrayed onscreen. Her deal with New Line to serve as a consultant on or model for The Conjuring includes unusual restrictions: The films couldn't show her or her husband engaging in crimes, including sex with minors, child pornography, prostitution or sexual assault. Neither the husband nor wife could be depicted as participating in an extramarital sexual relationship. Talent attorney Jill Smith says she has never seen specific language barring such depictions, though individuals selling rights to their stories sometimes restrict portrayals. "I have done deals which prevented depictions of certain specific types of odious behavior which are not relevant to the underlying story and [in] which, typically, the person is not known to have participated," she says.

Soon after the original Conjuring movie opened, producer Tony DeRosa-Grund sent an email informing top Warners and New Line executives that the film was a far cry from the advertised "true story of the Warrens." DeRosa-Grund — now locked in a legal battle with Warners over profits from the movie after he claims he was unfairly shut out of the sequels and spinoffs — said in his September 2013 email that a woman close to the Warrens had seen the movie and was "mortified as to the inaccurate portrait of the relationship between Ed and Lorraine Warren." Among those copied on the email were Warners chairman Kevin Tsujihara and marketing chief Sue Kroll as well as Toby Emmerich, then-president of New Line (now president of Warners' film studio); outside counsel Michael O'Connor; and in-house attorney Craig Alexander. It is unclear whether Warners responded. (A JAMS arbitrator interpreted DeRosa-Grund's communication to New Line about Penney as a threat that undermined his credibility. New Line is currently pursuing sanctions against the producer in another pending litigation.)

Not only was the Warrens' marriage a far cry from the one portrayed onscreen, DeRosa-Grund wrote in his email, but their daughter — also named Judy and portrayed in the original film by Sterling Jerins — had lived not with her parents but with Lorraine's mother. Penney said she was the only young girl living in the Warrens' house.

"Ed was a pedophile, a sexual predator and an [sic] physically abusive husband," wrote DeRosa-Grund. "Lorraine enabled Ed to do this, she knowingly allowed this illegal (read criminal) relationship to continue for 40 years. They lied to the public." That email was sent after the first film, but 2016's The Conjuring 2 only amplified the loving relationship between the Warrens. At one point, Ed adoringly sings "Can't Help Falling in Love" to Lorraine, and the film ends with a callback to that moment as Lorraine puts the record on and the two slow dance in their living room. "The Warrens' straightforward earnestness fuels the film, more so than their Catholicism," wrote Sheri Linden in THR's review of The Conjuring 2. "Amid the chills and thrills, the childhood anxieties and vulnerability, [director James] Wan has made a celebration of the demonologist duo's marriage."

In his September 2013 email, DeRosa-Grund wrote that he had assured Penney he could "temper" the romantic relationship shown between Ed and Lorraine in the sequels. He warned the executives that Penney might tell her story to the media. "Once this comes out, do you think Patrick Wilson or Vera Farmiga would knowingly play Ed and Lorraine ever again?" he asks. "The answer is no one would. … No amount of spin from any crisis PR firm can ever 'fix' this once the truth comes out." (Neither actor commented.)

Penney has never told her story to the media, but it nearly surfaced as part of the sprawling legal fight over the films. Author Gerald Brittle claims in a pending lawsuit that the Conjuring franchise rips off his 1980 book, The Demonologist. Brittle is suing Warners and New Line for a staggering $900 million.

The studio has argued that its films are protected from copyright claims because "no one has a monopoly to tell stories or make movies about true-life figures and events." But Brittle counters that the studio is aware that the portrayal of the Warrens in his book turned out to be far from truthful. Brittle claims he believed the stories the Warrens told him but later found out they were concocted.

Explosive allegations about the Warrens' relationship were included in an October 2015 letter to New Line outside counsel O'Connor from attorney Sanford Dow. (It is unclear which party Dow was representing in this matter, and he did not respond to repeated inquiries from THR.) "Mr. Warren has been accused of being cut from the exact same cloth as convicted Penn State football child molester Jerry Sandusky and the accused sexual predator Bill Cosby," wrote Dow. "Mrs. Warren, in both condoning and covering up these heinous acts, is as complicit as her husband."

Dow threatened to add these claims in litigation against New Line unless the studio agreed to a settlement. The proposed deal suggested terms to resolve not only Brittle's and DeRosa-Grund's issues with the studio but also Penney's, though she was not a party to the settlement discussions. According to the letter, Penney would transfer her life rights to New Line and sign a confidentiality agreement in exchange for $150,000 — the same amount Lorraine initially received for The Conjuring.

The settlement didn't happen, and explicit allegations have not been included in any litigation against the studio. But buried in a 355-page lawsuit that Brittle filed in March was a claim that Penney was ready to testify about the "epic falsity" of the family dynamic in the films. The lawsuit said Penney would disclose "the absolute charade of this family dynamic as told by the Warrens, and as depicted as 'fact' in all of the Defendant's movies. The true family dynamic was known at the highest executive levels of both New Line and Time Warner." The suit said the studio ignored the truth "to protect [its] billion-dollar franchise."

Reached by THR, Brittle declined to comment on the matter or share his knowledge of Penney — whom he has known of for decades. The author even referenced her in his book in a chapter about a 1974 haunting of Peter Beckford's family home in Vermont. Beckford's 19-year-old daughter, Vicky, invited a demonic spirit into the family's life through a Ouija board, the story goes, and he was referred to the local ghost hunters. "Pete telephoned the Warrens and spoke with Judy Penney, a young woman who works as a liaison when Ed and Lorraine are out of town," Brittle wrote. "Judy has heard some hair-raising tales over the phone, but this one in particularly scared her. 'The Warrens are out West,' she told Pete Beckford, 'but I'll relay the message to them.' "

In a countersuit against Brittle filed in September, New Line attorney Benjamin Rottenborn dismisses Brittle's claims as part of an attempt to sabotage the Conjuring franchise, in league with DeRosa-Grund, who has been admonished for his conduct in at least two judicial proceedings. "For years, Brittle and his cohort, Tony DeRosa-Grund, have conspired to strip New Line of [its] rights, constantly changing positions and concocting new theories with complete disregard for the truth," he said in court papers.

Legal experts say that Warners and New Line did not necessarily do anything wrong by allowing so heavily a fictionalized portrayal of the Warrens' relationship. (At the end of each film, Warners includes a standard disclaimer reading, "Dialogue and certain events and characters contained in the film were created for the purposes of dramatization.") "I do think the public understands that 'based on' means that some liberties with storytelling have been taken," says attorney Lincoln Bandlow, who specializes in legal clearance for productions. "It's a less enjoyable film if the ghost hunters are a bunch of assholes no one likes. You have to have your protagonists be likable." He adds that because these films are ghost stories and not strictly historical, audiences are even more likely to expect fictionalization: "There's a giant sense of 'Take some of this with a big grain of salt' to this whole project."

Still, if he were representing the studio, he'd advise caution with respect to misleading fans, even though he doubts a false foundation would spark any viable legal claim.

Attorney Lisa Callif, an adviser to independent producers, agrees that the problem is more a matter of public relations than law. Filmmakers could easily argue that the relationship is not material to the story and justify sticking with the happy Hollywood version. "So what if people believe they have a good relationship?" says Callif. "If I were in this mix and the filmmakers knew all about this other woman, I don't think I'd tell them that it was necessary to make any changes or to adjust the story."

As for Penney, now in her 70s, it seems she has never received a cent from the Conjuring movies. Though she clearly has no love for Lorraine, she still seems to have fond feelings for Ed. Though their relationship ended in 2003 and she subsequently married, she remained friendly with Ed until his death in 2006. She still seems to be pondering her past and wondering about Lorraine's role as well as her own. "As I'm older now, I can't even fathom why Lorraine let me stay there," she said in an October recording. "Lots of times I think about, 'Why did I do this? Why did I screw up my life like this?' Sometimes I get angry thinking about it, how so much was taken away from me."

A version of this story first appeared in the Dec. 6 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.