By Samuel J. Daheim
“[Sylvester] Stallone is one of the greatest American talents of the last and present century,” explains a complaint filed in Los Angeles County Superior Court by Rogue Marble Productions Inc., Stallone’s “loan out company.” Stallone has achieved critical acclaim “as an actor, filmmaker, producer, director and screenwriter, but is most well-known for his Hollywood action roles.” Stallone is suing Warner Bros. Entertainment over allegations that the film company breached its contract with Stallone and Rogue Marble for the former’s work in the 1993 science-fiction film “Demolition Man” (the Film).
According to the complaint, Warner Bros. was to pay Rogue Marble a certain percentage of the revenue generated by the Film. The complaint further alleges that Warner Bros. has continued to receive revenue generated by the Film, but had failed to provide Rogue Marble with information regarding the Film’s profits since December 1997, until recently. Rogue Marble contends that in May of 2014, it reached out to Warner Bros. regarding the profits from the Film, to which Warner Bros. replied in January of 2015 with a short, one-page financial summary of activity on the film which claimed that it had a deficit of over 66 million dollars. After Rogue Marble contested the accuracy of this one-page financial summary, Warner Bros. provided Rogue Marble with a “cumulative profit participation statement,” accompanied by a check for nearly 3 million dollars. The complaint states that “[t]he profit participation statement was one page and did not contain any detail for the figures presented, nor did it contain any detail covering the reporting period since the last statement.”
Rogue Marble is bringing five causes of action against Warner Bros. arising out of these events, including fraud and unfair business practices. The complaint argues that by failing to provide Rogue Marble with profit statements between 1997 and 2015, Warner Bros. “affirmatively represent[ed] that Rogue Marble was not entitled to any contingent compensation.” Additionally, the complaint claims that the January 2015 summary, which stated that the Film was $66 million in the red, constituted an affirmative misrepresentation regarding the contingent compensation owed to Rogue Marble.
The complaint further argues that Rogue Marble is entitled to an award of punitive damages under the California Civil Code because Warner Bros.’ conduct “was done with a conscious disregard of the rights of Rogue Marble [and Stallone], with the intent to vex, annoy, and/or harass.” Such conduct, according to the complaint, “constitutes oppression, fraud, and/or malice” under California law.
“The motion picture studios are notoriously greedy,” one line of the complaint reads. In bringing these claims, Stallone and Rogue Marble seek not only the monetary damages they believe they are owed, but also wish to shed light on what they believe are common, unfair practices of Hollywood studios. They claim they are bringing this lawsuit to put “an end to this practice for all talent who expect to be paid by [Warner Bros.] for the fruits of their labor.” Although it is difficult to determine whether Warner Bros’. actions were malicious without having uncovered evidence through discovery, it will be interesting to see what kind of information comes out in this trial, and whether it leads to similar claims by others who feel they’ve been wronged by the studio.
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