The impending trial between Robert Kirkman and other producers of The Walking Dead and AMC over profit-sharing of the hit TV series saw a major shakeup on Friday when Los Angeles Superior Court Judge Daniel Buckley tentatively ruled against Kirkman and the other producers on the major foundation point of their entire case, that their contracts with AMC were inherently unfair, perhaps leaving them with little ground on which to rely on at trial.
Kirkman and his fellow producers Glen Mazzara, Gale Anne Hurd and David Alpert are arguing that they are victims of what is colloquially referred to in the entertainment industry as “Hollywood Accounting.” With The Walking Dead, AMC decided to produce the series through its own studio, rather than license the show from an outside studio, which the network did with its previous hit shows like Breaking Bad and Mad Men. Kirkman and the producers argue that doing so has led to unfairly low profit-sharing for them as part of their deals with the network.
In 2020, Buckley ruled that Kirkman and the producers could not argue that the contract language in their deals with AMC were misleading, but then last year, the judge gave the case new life when he allowed them to amend their suit to try two new theories. One of them is an alleged breach of the implied covenant of good faith and fair dealing. Under this theory, AMC did have the right to determine the profit-sharing formula, but that it perhaps intentionally worked out a formula specifically to avoid having to pay reasonable profits to the producers. The other is tortious interference, suggesting that the two AMC sister companies (AMC Networks and AMC Studios, who produced the show itself) shared information and conspired to take advantage of the producers with the contract.
On Friday, though, Buckley tentatively made a summary judgment ruling that would dismiss both of those theories, as well. AMC was able to demonstrate to the Judge’s satisfaction that the contracts that it used with Kirkman and the other producers were standard contracts, and thus that the company did not intentionally manipulate the contracts to take advantage of Kirkman and the others. Similarly, if the contracts were standard, then there was no tortious interference, as well.
When the summary judgment ruling becomes official, Kirkman and the producers will be left with just some general audit claims that AMC didn’t properly account for all of the profits. However, that is relatively minor compared to these larger theories, which is why Kirkman and the other producers will likely simply appeal Buckley’s order when it becomes official.
Source: The Hollywood Reporter
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