Entertainment & Sports
Jul. 30, 2002
$30 Million Arbitration Award Boosts Moviemakers' Lawyer
Patrick Cathcart, whose practice often focuses on insurance coverage litigation or professional liability, has proved he can strut his stuff in Hollywood, as well.
Patrick Cathcart, whose practice often focuses on insurance coverage litigation or professional liability, has proved he can strut his stuff in Hollywood, as well.
Cathcart of Hancock Rothert & Bunshoft just won a $30.5 million arbitration judgment for his clients, two Hollywood producers who said Village Roadshow Pictures had reneged on a bargain to make movies with them.
That bargain was the settlement of another lawsuit, from 1994, in which the producers said that Village Roadshow had misappropriated one of their projects and spoiled a five-year distribution deal with Orion.
Under the agreement, Village Roadshow was supposed to make at least two movies with the producers, with a budget for each of at least $6 million. Lance Hool and Charles Meeker would pitch projects to Village Roadshow, and if the company rejected all of their projects, it would give Hool and Meeker two movie scripts to produce.
The arbitrator who gave the producers, Meeker and Hool, the $30.5 million decided that they had lived up to their half of the bargain but that Village Roadshow had not - especially after 1998, when the company sent Hool and Meeker a letter saying it was no longer in the business of doing "low-budget" movies like the ones it was supposed to make under the settlement agreement.
To figure out the damages amount, the arbitrator took one of Cathcart's suggestions and added up $18 million in budgets and fees that the producers would have had if Village Roadshow had made their movies. Then, the arbitrator looked at the profit increase that Village Roadshow reported and handed 30 percent of it to Hool and Meeker.
Village Roadshow executives were none too thrilled with the award.
"He has failed to take into account the fact that, even if VRP USA had produced these films, the producers would have received only a fixed fee plus a profit participation," says Graham Burke, managing director of Village Roadshow's Australian parent, Village Roadshow Limited, which was not part of the arbitration. "Of all theatrical films produced in this budget range, only a minuscule number actually achieve a theatrical release and turn a profit."
Village Roadshow Pictures has brought in Marc Marmaro of Jeffer, Mangels, Butler & Marmaro to work as co-counsel with Alschuler Grossman Stein & Kahan's Samuel Pryor. Marmaro is co-chair of Jeffer Mangels' litigation department and a 25-year veteran of Los Angeles courts.
"We obviously disagree with the award, and we're looking at all options, and we will take all steps to attempt to have the award vacated," Marmaro said.
Katherine Gaidos
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