Despite bringing in former solicitor general Seth Waxman to plead its case on appeal, The Walt Disney Company has failed to reverse a jury’s finding that it duped the creator of “Who Wants to Be a Millionaire?” out of $320 million in royalties.
In a unanimous opinion issued on Monday, the U.S. Court of Appeals for the Ninth Circuit upheld a 2010 jury verdict that Disney subsidiaries ABC Television, Buena Vista Television, and Valleycrest Productions breached a contract to share the show’s U.S. profits with its creator, the British production company Celador International. The ruling is a win for Celador’s lawyers at Robins, Kaplan, Miller, & Ciresi and Greines, Martin, Stein & Richland.
“Who Wants to be a Millionaire?” originated in Britain in 1998. A year later, ABC bought the licensing rights from Celador and adapted the show for a U.S. audience. In its prime the program helped made ABC the top-ranked network, yet the network claimed that “Millionaire” ran a $73 million deficit. Celador brought suit in U.S. district court in Riverside, Calif., in 2004, alleging that the Disney subsidiaries were hiding the show’s profits through some dodgy accounting. The British company said it was owed as much as $380 million.
After hearing testimony from Disney higher-ups, including CEO Robert Iger, a jury returned a $269 million verdict in Celador’s favor in July 2010, as we reported here.
Disney’s lawyers at Sheppard Mullin Richter & Hampton offered a slew of arguments to try to persuade U.S. District Judge Virginia Phillips to aside the verdict. For one thing, they said Disney should have prevailed as a matter of law, because the licensing contract at issue precluded Celador’s claims. They also attacked Celador’s expert’s damages calculation.
Judge Phillips not only denied Disney’s post-trial motions, but also later tacked on $50 million in prejudgment interest. The National Law Journal spotlighted the case, and we named Roman Silberfeld of Robins Kaplan Litigator of the Week for Celador’s win.
For its Ninth Circuit appeal, Disney turned to Waxman of Wilmer Cutler Pickering Hale and Dorr to try to undo the damage. Robin Meadow of Greines Martin represented Celador at the appeals court. As our sibling publication The Recorder reported, the Ninth Circuit panel sent strong signals at oral argument in October that it would affirm the verdict.
Sure enough, the appeals court ruled Monday that Phillips didn’t commit clear error in affirming the verdict and denying the Disney affiliates’ motion for judgment as a matter of law. “Although the Disney affiliates advanced a persuasive case at oral argument for their interpretation of the contract, Celador’s reading is also plausible,” the three-judge panel ruled. It added that Celador’s expert evidence was “not inherently improbable.”
Waxman didn’t immediately return a call seeking comment. Disney’s press office sent us this statement: “We are extremely disappointed with the decision, as ABC and Buena Vista Television continue to believe that they fully adhered to the ‘Millionaire’ agreement.
Robins Kaplan’s Silberfeld and Bernice Conn said in a statement that they are “exceptionally gratified” by the Ninth Circuit’s decision. “Both the trial judge’s and an attentive jury’s thoughtful and careful assessment of the law and facts were upheld today,” they said.