Following the lawsuit filed last year by The Walking Dead creator Frank Darabont, who is seeking a whopping $280 million in profits from the show that he wasn't paid by the network, four more executive producers have filed a similar lawsuit, which could force the network to pay out even more, with damages that could potentially reach $1 billion. Executive producers Robert Kirkman, who creates the comic books the show is based on, Gale Anne Hurd, David Alpert and former showrunner Glen Mazarra have filed their own lawsuit against AMC, in what could potentially be the biggest profits case in TV history. Here's an excerpt from the opening of the complaint, which was filed in Los Angeles Superior Court yesterday.
"This case arises from a major entertainment conglomerate's failure to honor its contractual obligations to the creative people, the 'talent,' in industry jargon, behind the wildly successful, and hugely profitable, long-running television series The Walking Dead. The defendant AMC Entities exploited their vertically integrated corporate structure to combine both the production and the exhibition of TWD, which allowed AMC to keep the lion's share of the series' enormous profits for itself and not share it with the Plaintiffs, as required by their contracts."
The Hollywood Reporter reports that the lawsuit's claims are breach of contract, tortious interference and unfair or fraudulent business acts under California business code. The case is quite similar to Frank Darabont's lawsuit, which questions how much the AMC network "pays" its studio arm, AMC Studios, for the "right" to air the show. These licensing fees are all "imputed," meaning that money actually doesn't exchange hands between the AMC Network and AMC Studios. During the first four seasons of Walking Dead, this imputed fee was $1.4 million per episode, and while it is now $2.4 million, that number is still much lower than the actual licensing fees AMC has to pay to Sony Pictures for Better Call Saul, or to Lionsgate for Mad Men, which were both hits, but still pulled in a fraction of the ratings The Walking Dead pulls in. Here's another statement from the lawsuit below.
"There can be no question that, if AMC Studio[s] and AMC Network were not part of the same conglomerate, the story would be very different. Those substantial license fees for Mad Men and Breaking Bad continued in seasons five and beyond, even though their ratings were a fraction of TWD's. And while the AMC Network only obtained a limited number of playdates for those series as part of the comparatively-higher license fees it paid for them (both on television and its affiliated websites), the AMC Entities unilaterally took for themselves the right to run an unlimited number of runs of TWD in perpetuity on all AMC platforms."
In the Frank Darabont lawsuit, his agents at CAA and financial experts are claiming that, based on The Walking Dead ratings, the AMC Network should be imputing a fee of $30 million per episode, which, over 99 episodes thus far, with the Season 8 premiere marking the 100th episode, is quite a massive amount of money. This new lawsuit doesn't list any specific monetary damages yet, but the plaintiffs also claim that AMC takes deductions on payments to other profit participants, and that the network turned down an offer for international rights to the hit zombie series, only to accept a "related-party deal" for much less, that would keep the profits within the conglomerate and not passing them through AMC Studios and the profit participants like the plaintiffs. Here's what an AMC spokesperson had to say about this lawsuit, adding that this will not affect their creative involvement in the hit series.
"These kinds of lawsuits are fairly common in entertainment and they all have one thing in common, they follow success. Virtually every studio that has had a successful show has been the target of litigation like this, and The Walking Dead has been the No. 1 show on television for five years in a row, so this is no surprise. We have enormous respect and appreciation for these plaintiffs, and we will continue to work with them as partners, even as we vigorously defend against this baseless and predictably opportunistic lawsuit."
As for the Frank Darabont lawsuit, a New York City judge will hold an oral hearing next week about the summary judgment motions. Based on what Darabont's lawyers have come up with, the damages for this new lawsuit could potentially reach $1 billion, but no details on the damages that Robert Kirkman, Gale Anne Hurd, David Alpert and Glen Mazarra are seeking. This comes as AMC prepares for The Walking Dead Season 8, which kicks off with the show's 100th episode Sunday, October 22 at 9 PM ET on AMC. Hopefully we'll find out more about this lawsuit from the producers of The Walking Dead, which may have reverberations in terms of studio deal-making and accounting for years to come.