The Walt Disney Company was ordered by a Los Angeles County jury to pay nearly $270 million in damages to a British production company who created the hit game show “Who Wants to Be a Millionaire.”
The production company, London-based Celador, alleged that Disney hid revenue owed from “Millionaire,” and the jury agreed, ordering the Los Angeles-based entertainment giant to pay a stunning price for breech of contract.
Disney said in a statement that the verdict “is fundamentally wrong” and added it “will aggressively seek to have it reversed.”
The trial, which began six years after the production company filed suit, was held in Riverside and had law experts buzzing.
The case was said to have offered a rare look inside Hollywood accounting: the allocation of expenses and revenue on a film or television project, an all-to-frequent area of dispute between studios and their partners.
The attorney for Celador, Roman Silberfeld, argued that the “Millionaire” case was a consequence of vertical integration within media giants like Disney, because its subsidiaries were responsible for both producing and distributing the show.
Silberfeld said in an interview with the New York Times that the Disney subsidiaries, ABC and Buena Vista, “colluded in artificially depressing the network license for ‘Who Wants to Be a Millionaire’ so that there would be no profits to share with Celador.”
Celador had asked for a minimum of $202 million and a maximum of $395 million, Silberfeld said. Celador also received about $21 million in executive producer fees for the show.
Disney claimed the show was in the red more than $75 million.
Disney also said that there was nothing unusual about the way the revenue from “Millionaire” was allocated and pointed to William Morris, who negotiated the original contract more than a decade ago.
The show was on the air from August 1999 to May 2002,came back in syndication in late 2002 and has been on the air since.
Celador sought profits from the show from August of 1999 through the day the original complaint was filed in May 2004, Silberfeld said. An auditing of books and records is continuing, he added.
