Commentary: Two contract spats raise the question: What ever happened to the dotted line?
EmptyWelcome to "Deal or No Deal." Only this version has nothing to do with Howie Mandel or people yelling at briefcases.
Today, we attempt to resolve what has become an increasingly perilous situation for Hollywood execs. As the recession reduces moneymaking opportunities and adds pressure to play hardball for the most favorable terms possible, many are forced to ask:
Is there a deal, or is there no deal?
Say hello to our first contestant, Harvey Weinstein. He thought he had sewn up a deal to buy "Push: Based on the Novel by Sapphire" (since renamed "Precious") last month at Sundance. Three days later, Lionsgate announced its own deal to acquire the film and release it with the support of Oprah Winfrey and Tyler Perry. Harvey rarely gets upset, but now he has hired Bert Fields and David Boies, two $900-an-hour litigators, to sue Lionsgate, sales agency Cinetic and a producer of the film for backing out of the agreement.
Sure, festival negotiation spats are nothing new: We all remember Paramount Classics and Fox Searchlight tussling over "Thank You for Smoking" at Toronto a few years back (Searchlight emerged with the film). But this one has ended up in court, so let's look for clues as to who's right in the lawsuits filed by both the Weinstein Co. and Lionsgate.
The documents describe a series of detailed, back-and-forth negotiations followed by an e-mail from Weinstein's David Glasser to Cinetic's Bart Walker "accepting" the terms and requesting paperwork to document the agreement. Walker responded that he was "explaining every sentence" to the filmmakers, which prompted more requests for paperwork from Glasser, including one sent at 2 a.m. saying he "cannot understand why that documentation has been delayed."
It sounds like the major terms had been hammered out during meetings and phone calls, but unlike the Weinstein Co., "we have a signed deal," says Patti Glaser, Lionsgate's lawyer. "They never had a deal. And if you transfer a copyright interest, it has to be in writing."
So, did Harvey make a deal or not?
Don't give your final answer until we bring
out Contestant No. 2. Rick Nicita heads Morgan Creek, the production company that sued the estate of Tupac Shakur last week over a deal it says it closed to buy life rights to make a movie about the slain rapper. According to the lawsuit, Nicita's staff told the estate to name its price and in December was given a "Counter-Proposal" that included the precise details the estate needed to seal a deal. Morgan Creek then waited a month during the holidays and sent back an acceptance in late January -- right around the time "Notorious," a biopic about Tupac rival Christopher Wallance, aka the Notorious B.I.G., hit theaters.
By then, though, the deal was off the table, according to the Shakur estate, which is headed by his mother, Afeni. She had been negotiating with other potential buyers, and now she says Nicita and his crew are trying to use litigation to bully the estate into honoring a deal that never was finalized. "They have scared away Paramount, Fox and others, and we're going to sue them and recover millions (in damages)," says the estate's lawyer, Skip Miller.
"Not true," says Glaser, who also is Morgan Creek's lawyer. "We said, 'Give us your bottom line,' they did, and we confirmed and accepted -- then they said no."
(Ironically, Glaser represents the alluring second suitor in one case while advocating for the girl allegedly left standing at the altar, though in both instances she's arguing that she has signed contracts in place. She's no stranger to these types of disputes, having famously held Kim Basinger liable for an unsigned agreement to star in "Boxing Helena" during the early 1990s.)
"Do we think they were shopping the offer? Yeah," Glaser says. "It's certainly not appropriate."
Perhaps not appropriate, but illegal? That's a tough question considering the few rock-solid rules governing the fast-and-loose negotiations that often happen in Hollywood. Besides vague requirements that parties agree on material terms and come to a "meeting of the minds," lessons from one situation to the next are few and fact-specific.
So do Weinstein and Nicita have deals, or can Lionsgate and Tupac's mom shout "no deal!"?
Maybe they should just resolve things by picking briefcases.