$20 million Lawsuit Drags Paramount Into War Between Film Producers

Six years ago, Paramount Pictures was informed of a dispute between two production partners involved in making nearly a dozen films together. The studio was warned that it would be subject to a copyright infringement lawsuit if it continued to distribute some of those films. Now, Paramount has been hit with a $20 million lawsuit for allegedly continuing to do so.

The movies involved include Rules of Engagement, An American Rhapsody, The Believer, Who is Cletis Tout? and Onegin.

The films were created more than a decade ago by production partners CineVisions and FireWorks Entertainment, which have been battling over rights to these films ever since. CineVisions maintains it has registered the copyright on the screenplays and/or films, while FireWorks believes they were created as works made for hire.

In the decade since the dispute first erupted, both of these companies have been acquired by others -- Seven Arts Filmed Entertainment now is the successor to CineVisions; Content Media Corporation is now the successor to FireWorks.

In February, Seven Arts got the Ontario Superior Court to affirm its copyright over these films. Since then, Content's motions to set aside that decision have been denied.

Now Seven Arts has turned its attention to Paramount, which it accuses of infringing copyright on the films despite warning letters sent in 2005 to the company's former deputy general counsel David Friedman.

According to those letters, Paramount was informed that FireWorks had no right to the pictures and there was no agreement in place for continued distribution of the pictures. Paramount is said to have considered getting indemnity from an intermediate successor of FireWorks and was warned against such an action. 

Nevertheless, Paramount allegedly continued to distribute the pictures.

Now, Seven Arts is suing Paramount for failing to comply with those demands sent six years ago. On Thursday, it filed a $20 million copyright infringement lawsuit against the studio in U.S. District Court in California and also says that it is in the process of filing a companion lawsuit in the UK against the studio.

Paramount was not a party to the Canadian litigation and the enforceability of the Canadian judgment is questionable. It's likely that Seven Arts will need to reprove their copyright claims.

A Paramount spokesperson declined to comment on a pending legal matter.

E-mail: eriqgardner@yahoo.com

Twitter: @eriqgardner