Warner Bros. Gets to Arbitrate 'Mad Max' Director George Miller's Bonus

George Miller - Getty - H 2016
Getty Images

George Miller - Getty - H 2016

Warner Bros. won't have to be in open court to defend a claim of short-changing Mad Max: Fury Road director George Miller. On Tuesday, an Australian appeals court reversed a lower judge by deciding the helmer's deal for the celebrated 2015 film incorporated an arbitration clause.

Miller brings two primary contentions in his litigation over a film that grossed more than $375 million worldwide. First, the director alleges he was promised a $7 million bonus if the final net cost of Mad Max: Fury Road didn't surpass $157 million. Warners is pointing to certain costs (which Miller objects to) should be included in the calculation as meaning the film went over budget. Second, Miller accuses the studio of breaching a provision of the contract that provided that if a co-financier was sought (as was the case when Ratpac Entertainment jumped aboard), Miller's company would have first opportunity to provide co-financing.

Before getting to the merits of these claims, however, Warner Bros. attempted to enforce an arbitration provision.

In November, a judge ruled that the short-form agreement that Miller's loan-out company had with Warner Bros. Feature Productions Pty Ltd, the Australian subsidiary, hadn't incorporated the studio's standard terms for A-list directors and producers, including an arbitration provision.

The court of appeals believes the judge erred when considering the parties' intentions when negotiating the agreement. While Miller argued that the longer agreement was subject to good faith negotiations and that he was never presented with the studio's terms for A-list directors, the panel of appellate judges considering the dispute nod to the studio's customary practices, the language of the letter agreement that specifically addressed incorporation and how other "critical provisions" ranging from merchandising to credits were similarly incorporated.

As a result, Miller appears headed to a JAMS proceeding in California with his lawsuit in Australia being paused. The opinion (read here) does leave open the possibility that Miller may be able lift the stay with respect to his claim against WB Entertainment — the parent company that allegedly induced a contract breach but wasn't a party to the deal — but Warner Bros. will likely argue such claim is "related" to the contract dispute.