9:14am PT by Eriq Gardner
AMC Says 'Walking Dead' Profits Dispute Should Go to Jury Trial
AMC has never outright said this before, but it appears that it is preparing for the massive profits dispute with Walking Dead creator Frank Darabont and CAA to go to trial. And should that happen, AMC won't be bringing one of the country's most famous lawyers with it.
Back in July 2017, both sides publicly filed summary judgment briefs in a case that's most importantly about whether by contracts, this vertically integrated corporation — AMC has both a production studio and a cable network — must book a fair market value for its highest-rated show when calculating profit participation. The details are complicated and the arguments are highly technical, but both sides have different interpretations when it comes to the "imputed license fee" (the amount that AMC Networks "paid" AMC Studios for the right to air The Walking Dead) and a contractual provision where AMC agreed to conduct its transactions with affiliated companies "on monetary terms comparable to the terms" made with non-affiliated companies.
In pushing for summary judgment, AMC wanted the judge to favor its interpretation that the affiliate transaction provision is irrelevant for purposes of calculating contingent compensation — which would mean no trial on an issue worth hundreds of millions of dollars. AMC would simply win.
But perhaps in a sign that AMC doesn't think that's going to happen, the network spent a good deal of a supplemental brief filed on Wednesday arguing why New York State Supreme Court Justice Eileen Bransten should at least reject the other side's summary judgment motion.
Here's the full brief, which the judge allowed after a back-and-forth about delay and relevancy. In sum, AMC argues that the second lawsuit the plaintiffs filed conflicts with the first by being at odds over the validity of its imputed license fee formula.
"Plaintiffs now have competing complaints that create two material fact disputes about the meaning of the contract," states AMC's new brief. "In this situation, New York law is clear: The material fact disputes must be resolved by a jury, not a judge."
A footnote caveats how the judge could still grant AMC's summary judgment motion and how there would then be no need for a trial. But a public comment upon the filing by AMC attorney Orin Snyder, a partner at Gibson & Dunn, isn't so careful as to include the fine print.
"CAA's new complaint has thrown their entire case into disarray," says the partner at Gibson & Dunn. "Today's filing shows that CAA's two lawsuits are based on contradictory and convoluted claims that must be decided by a jury."
Darabont's side will now provide a response brief. Already, they've presented how AMC's argument rests on a misreading of their own allegations.
"This is just another desperate attempt by AMC to take Judge Bransten out of the equation and push this case even further into the future," says Chad Fitzgerald, one of the Kinsella Weitzman attorneys representing the plaintiffs. "It is a retread of old arguments, and we are confident Judge Bransten will see through AMC's tactics."
Meanwhile, Wednesday's filing comes with another noteworthy development. It's the first AMC brief without the names of attorneys at Kasowitz Benson Torres including star litigator Marc Kasowitz, now famous for his representation on behalf of President Donald Trump, who earned extra attention last year for profane emails after he made a stink about Darabont's own emails. In this case, Bransten has repeatedly indicated displeasure with the performance of the firm ("If I hear Mr. Spielberg's name one more time, I will hold you in contempt," she exclaimed at one point). The Hollywood Reporter has confirmed that Kasowitz will no longer be representing AMC in this five-year-old lawsuit.