'Narcos' Producer Gaumont Can't Get Ex-CEO's Severance Back Over Undeleted Files

Ariel Sierra, Wagner Moura, Diego Catano
Courtesy of Netflix

Ariel Sierra, Wagner Moura, Diego Catano in Narcos.

Gaumont Television has convinced an L.A. judge it may have been damaged when its former CEO didn't wipe her laptop after she was terminated — but it can't get a declaration that said violation means she has to return her severance payment and it can avoid paying her a share of profits from now on.

Veteran TV exec Katie O'Connell Marsh in January 2018 sued Gaumont claiming that she hadn't been paid her share of profits from hit series including Narcos, Hannibal, Hemlock Grove and F is for Family.

The company filed a cross-complaint in June 2019, alleging that she divulged trade secrets in violation of her exit agreement, which mandated that she'd return the company's property (along with credit cards, keys and computer equipment), not talk to the press and not disparage the company. Gaumont argues that because of these alleged breaches, it doesn't have to pay Marsh a share of profits from the series.

After a Sept. 4 hearing, L.A. County Superior Court Judge Holly Fujie took the matter under submission and on Sept. 8 she issued a split decision on Marsh's motion for summary judgement. Much of the discussion centers on allegedly unreturned property.

Marsh paid $600 to keep her work laptop as part of her exit negotiations and says no one from the company asked her to wipe any information or turn it over to IT so they could remove anything. But Gaumont argues that because she was physically keeping the equipment, the section of the agreement that said she must return the company's property should have been met by deleting the information on it. During discovery, Marsh has produced confidential documents like employment agreements and financial statements, some of which contain trade secrets. When Gaumont realized that, it demanded she hand over the laptop so the company can see what's on it and Marsh refused.

Fujie found Gaumont has shown a triable issue of fact with regard to damages by presenting evidence that Marsh didn't comply with the termination agreement and the company has been damaged as a result. So, she denied Marsh's motion for summary judgment on that claim.

But Gaumont's request for a declaration that because Marsh allegedly breached the deal it doesn't have to continue paying her a share of profits from the series and she should have to return her more than $600,000 severance and other bonuses she's been paid was shot down.

In granting Marsh's motion for summary adjudication with regard to that claim for declaratory relief, Fujie pointed to an Aug. 14 ruling. “The obligations of Plaintiff and Gaumont are clearly independent based on the language of the Termination Agreement," writes Fujie. "Thus, Gaumont is still required to pay Plaintiff her MAGR bonus and other agreed-upon compensation pursuant to the terms of the Termination Agreement. Based on the Court’s reading of the Termination Agreement, the intention of the parties was not to base Plaintiff’s compensation thereunder on Plaintiff’s compliance with returning the Computer and the Property of Gaumont.”

Fujie found Marsh's motion moot with respect to the other four causes of action because she's already sustained a demurrer without leave to amend after finding them defective.