California court dismisses suit against Warner Bros. involving home video royalties

By Gabriel Neves | Nov 28, 2018

LOS ANGELES (Legal Newsline) – Entertainment giant Warner Bros. has obtained a victory in court as its request for dismissal of a class action lawsuit was granted.

Justice Elizabeth Grimes, on the bench of the California Second District Court of Appeal, issued a 41-page ruling on Nov. 20, reversing the Los Angeles County Superior Court decision in the lawsuit filed by Larco Productions Inc. and other plaintiffs against Warner Bros. Entertainment.

Those plaintiffs filed the class action suit alleging that Warner Bros. failed to properly compensate royalty participants in distribution of motion pictures on home video formats.

The first complaint was filed on Jan. 29, 2013, with Hal Needham and Stuntman Inc. being the first plaintiffs.

As stated in the ruling, "the complaint asserted defendant engaged in the systematic practice of accounting to and crediting profit participants based on 20 percent of home video revenue, while it should have done so based on 100 percent of that revenue."

Other film studios, such as Paramount, Universal and Sony, had similar suits filed against them over allegedly similar practices.

Needham died on Oct. 25, 2013, and an amended complaint was filed naming Larco Productions and Michael Elias as new plaintiffs.

After discovery, on March 26 the lower court denied Warner's motion to dismiss the case and granted Larco a motion for trial preference.

Subsequently, on April 2, Warner filed for a writ of mandate and for a motion to dismiss the lawsuit, “clarifying that proceeding with the lawsuit would violate the five-year rule and that trial preference was improperly granted," the ruling said.

In her ruling, Grimes stated that "we find the trial court’s grant of trial preference under the circumstances presented to it inexplicable," adding that the lower court " offered no explanation at the hearing, and the factual considerations and conclusions the court stated at the hearing uniformly supported the opposite conclusion."

California 2nd District Court of Appeal, Division Eight case number B289109

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