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‘Smallville’ Lawsuit Could Cost Warner Bros. Millions

Amended suit says Warner ‘paid itself’ for rights to once popular CW series

If only Superman were real, maybe he could go to law school and help sort out the mess that is surrounding his property.

Warner Bros. has found itself fighting a two-front war when it comes to Superman. First, Warner Bros. is tied up with lawsuits from the families of Superman’s creators over who actually owns the rights to the iconic character. But now, the producers in charge of The CW’s “Smallville” have won a small victory that could eventually pay huge dividends: A judge is allowing them to claim Warner Bros. essentially paid itself for rights to use the Superman character in “Smallville.”

And if a judge ends up agreeing with Miles Millar and Al Gough, it’s possible Warner Bros. might be shelling out at least $13.4 million the two claim the self-dealing cost them.

Essentially, Millar and Gough claim that in an effort to keep money away from them, Warner Bros. paid to DC Comics — the owner of the Superman rights pending the creator lawsuit — 5 percent of “Smallville’s” gross revenues, or just under $14 million for 10 seasons. While everyone involved in the creation of a property should get paid, the problem with this deal is that DC Comics is owned by Warner Bros. So it was essentially remitting money to itself, and removing those funds out of the pool of profit sharing that Millar and Gough claim they were cheated of.

Warner Bros., however, said the two were well aware of the licensing deal between the studio and the comics subsidiary, and it wasn’t until the two had filed other lawsuits against Warner Bros. — including some which had charges from the plaintiffs dismissed — that Millar and Gough started to complain about it, according to The Hollywood Reporter.

With the judge allowing this claim to move forward, Warner Bros. will have a chance to at least open a new door of discovery to try and gather evidence in its defense. Because of that, it appears the October trial start date is now in jeopardy, and everything could be pushed into 2013.

Major media conglomerates like Warner Bros., the Walt Disney Co., and others are finding themselves on the wrong end of lawsuits with claims that the studios did not conduct arms-length agreements in distributing television shows, thus cutting out producers and actors who were promised a piece of the profits. One of the early such cases was actually filed by David Duchovny against Twentieth Century Fox over lost profits for “The X-Files.”

More often than not, the plaintiffs in these kinds of cases are winning. And as THR pointed out, they are winning big — like the $270 million verdict against Disney in favor of the Celador production company over distribution of the game show “Who Wants to be a Millionaire?”

With the rights to Superman still under legal review (and in the appeals process), and now the moving forward of this lawsuit from the former “Smallville” showrunners, it’s amazing Warner Bros. is even able to prep a new Superman movie at all.

Yet, it’s happening. Zack Snyder’s “Man of Steel,” starring Henry Cavill in the title role, is expected to hit theaters next year.

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Could they be a Rut-ro! Shaggy
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