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NBC Settles Up with Will & Grace Creators
After much finger-pointing and even more hours logged in court, NBC Studios and the minds behind Will & Grace have decided to bury the hatchet.
An undisclosed settlement was reached Friday in the two sides' dueling lawsuits, kicked off when W&G creators David Kohan and Max Mutchnick sued the studio in 2003 for fraud and breach of contract for allegedly cheating them out of millions of dollars in revenue from the hit series, which ran for eight seasons on the Peacock Network.
Kohan and Mutchnick, the namesakes of KoMut Entertainment who had a contract entitling them to share in the sitcom's profits, claimed that NBC Studios and the network cut themselves a $300 million "sweetheart deal" by charging tens of millions below fair-market value for the show when negotiating its licensing fee as part of a long-term renewal deal.
The studio had promised the KoMut partners that it would attempt to maximize revenue from the show, thereby preventing the duo from accepting a deal from Warner Bros. in 1999.
"While [NBC Studios] purported to engage in arm's length and good faith negotiations with NBC, NBC in fact effectively sat on and controlled both sides of the 'bargaining' table," the plaintiffs' lawsuit alleged.
NBC denied the accusations and then countersued in 2004, stating that Kohan and Mutchnick made millions over the years in proceeds from the Emmy-winning show and had undermined negotiations by not participating in talks when the licensing fee was being hammered out.
A verdict was actually reached late Wednesday after six days of deliberations (and two months of testimony), but before the decision could be read Thursday, NBC's legal camp raised the question of bias when it pointed out that the jury foreman ran a Website that criticized corporations, including NBC.
The judge, who had already snuck a peek at the sealed verdict, said that, for the case to go forward, the foreman—who was removed from the case yesterday for failing to disclose his Website—would have to be interviewed and NBC would have to bring its financial documents to court, all of which suggested that the jury had sided with Kohan and Mutchnick.
NBC Studios attorney Henry Shields Jr. admitted after court Friday that the judge's statements "may have been an impetus" in the decision to settle. The studio's camp filed a motion Thursday asking for a mistrial in light of the potential jury bias, but that point became inconsequential after the two sides reached an agreement.
"We are very satisfied with the settlement," the plaintiffs' attorney, Ronald Nessim, said outside the courtroom Friday. His clients had been asking for $55 million.
Shields said that the deal was fair to both sides.
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