'Tree of Life' Judgment Reveals Nasty Legal Fight Over Oscar Contender (Exclusive)

"The Tree of Life"
Fox Searchlight Pictures

Mark Yoshikawa, editor: "There was a beautiful, well-written script, but it was shot in a very experimental style. Once all the images came in, we reconstructed the feeling of what the script was. The feeling was in the script, but not the plot-ordered scenes. That was manufactured in the editing."

Terrence Malick's Tree of Life has grossed $54 million worldwide and continues to enjoy strong Oscar buzz. But beneath the good vibes, the film has endured a messy dispute over its distribution in the UK.

Much of the legal proceedings have been conducted in secret. But we've obtained a copy of a Nov. 30 arbitration decision that discusses the rocky delivery of the film starring Brad Pitt and orders UK-based Icon Film Distribution to pay $1,277,835 for failing to make good on a distribution guarantee. The award has come to light because Icon is now accusing arbitrator Jack Freedman of bias, an allegation that has the potential to shed some light on the often shadowy world of entertainment arbitration.

For rights to distribute the film in the UK, Icon agreed to pay Cottonwood Pictures, through its sales agent Summit International, an advance of $2.25 million plus certain contingent overages. The first payment for $450,000 was to be made upon the execution of the agreement and the second payment for the $1.8 million balance was to be made within 14 days of the delivery of the film materials.

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On July 30, 2010, Summit sent a "Notice of Delivery" as required by the agreement. However, it was mistakenly sent to Icon's former executive, David Miercort, instead of to Icon.

Miercort forwarded the notice to Icon, and Summit also re-sent the notice, but it didn't arrive to Icon until August 4, a few days after a July 31 deadline. After the delivery was made, Summit expected payment of the balance, but got none.

As the film headed to the Cannes Film Festival the following year, confusion reigned over whether and when Icon would be distributing the film. The parties revealed that a dispute had gone to arbitration with few details about what happened. Some observers believed at the time that Icon had taken a look at the film and was having second thoughts. Others raised an eyebrow over a report that Icon wanted to release the film before Cannes.

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Here's what really happened: 

For nine months after the August delivery of the notice, the parties fought each other over whether the delivery of the film happened properly. Part of the dispute was whether Summit successfully had made the deadline and whether Icon had made the right moves under the agreement to give Summit an opportunity to effectuate delivery before terminating the agreement. But equally important was the question over whether a "finished film" was given to Icon.

Initially, Icon had been shown a 2 hour, 45 minute cut. At Cannes, Tree of Life ran for 2 hours, 19 minutes.

Icon asserted that the longer version of the film was still being edited in late 2010, and that producers were at odds with Malick, trying to "cajole" him into a shorter film. The UK distributor argued that the picture had to be approved by the producer, director, and star before being considered complete, but according to arbitrator Freedman's decision, Malick might not have truly enjoyed bona fide "final cut" rights:

"In fact by the specific terms of the Director's contract his final cut rights might have been eliminated for a number of reasons. However, even if he retained his final cut rights and had not approved the Longer Version, the Director would not have been entitled to prevent [Icon] from the free exercise of its rights under the Agreement. The Director's claim, if any, would be solely against [Cottonwood] and furthermore, the Director's contract does not allow him to rescind said contract, enjoin or otherwise impair [Cottonwood's], and therefore [Icon's], exploitation of the Picture. Additionally, it was not established that [Brad Pitt] had approval rights over any cut of the Picture."

Ultimately, the arbitrator ruled that Cottonwood and Summit had done what they needed to do, and that Icon had to pay the unpaid balance of the money due.

But Icon isn't letting this decision stand unchallenged.

The distributor has now filed a lawsuit in California federal court that seeks to vacate the arbitration award on grounds that Freedman demonstrated bias in his refusal to hear pertinent evidence from one of its experts, in his refusal to allow Icon the oportunity to conduct discovery, and in permitting Cottonwood to introduce hearsay evidence.

And the basis for such bias?

According to the complaint , "Prior to the Arbitration, the Arbitrator had solicited the assistance of Icon's counsel, a partner at Quinn Emanuel Urquhart & Sullivan, LLP, to help his son get a summer associate position at Quinn Emanuel, but Quinn Emanuel declined to offer him a job."

E-mail: eriqgardner@yahoo.com

Twitter: @eriqgardner