Date set for 'Watchmen' mediation

Attorneys for Warner Bros., Larry Gordon to meet in May

Warner Bros. and producer Larry Gordon have set a date to figure out who's responsible for the legal fracas that led to Fox owning a piece of "Watchmen." But given the pic's lackluster boxoffice performance, there might not be much loot to fight over.

Attorneys for the two sides have agreed to meet May 13 in a confidential, nonbinding mediation before showbiz mediator Daniel Weinstein. At issue is how much, if anything, Gordon owes Warners after a judge ruled that Fox -- which initially developed the property with Gordon -- owned a distribution right to the superhero pic.

Heated chain-of-title litigation between Fox and Warners ended in a January settlement that gave Fox a cash payment and up to 8.5% of the film's proceeds, depending on how well it did. The $138 million-budgeted pic has grossed $180 million worldwide after a heavy marketing campaign.

While Warners certainly isn't celebrating the weak boxoffice haul, one bright spot is that the studio likely will owe Fox only about 5% of the film's proceeds, according to multiple sources familiar with the settlement.

Who ends up actually paying Fox, however, is yet to be hashed out.

Warners, who will be repped at the mediation by attorney Steven Marenberg, is said to be seeking a full reimbursement from Gordon for failing to secure proper rights to "Watchmen" from Fox before setting it up at Warners.

Gordon's attorneys, led by Dale Kinsella, likely will counter that he is blameless because Warners was on notice of Fox's claims on the property and decided to go ahead with the pic anyway.

Gordon also has argued that his transactional attorneys at Jake Bloom's law firm are in part at fault for the chain-of-title issue. During the Warners-Fox litigation, Gordon's attorney admitted that he negotiated the producer's 1994 separation from Fox without knowing about a 1991 agreement on which Fox based its lawsuit.

The Bloom firm is said to have a $15 million insurance policy that both Warners and Gordon likely will seek to tap for the settlement. Given the film's performance -- and the fact that sequels and derivative works are likely dead -- that amount could cover everything that will be owed to Fox. Some believe, however, that a global settlement will require Warners, Gordon and his attorneys all to contribute.

Considering "Watchmen" has not turned into the global franchise many thought it might, the stakes are certainly lower.