Attorneys for Paramount Pictures and Art Buchwald sparred over the enforceability of profit participation provisions in film contracts during closing arguments on damages in Buchwald's long-running suit against the studio.
Los Angeles Superior Court Judge Harvey Schneider is expected to decide shortly what damages Paramount has to pay Buchwald and producer Alain Bernheim in the suit. Schneider previously ruled that the studio based "Coming to America," a hit film that starred Eddie Murphy, on a story by Buchwald.
Arguments in the case have turned heavily on whether Paramount's standard profit participation provisions--which closely resemble those used by other major studios--are "unconscionable" and should be overturned or modified by the court.
The columnist, who attended Thursday's hearing, has argued that a clear victory in the case would bar studios from writing participation clauses that pay little or nothing to participants until after the company has reaped major profits from a film through distribution fees and other devices. "If the judge rules they can't write contracts like this, that affects everybody," Buchwald said after the hearing.
On Thursday, attorney Charles Diamond of O'Melveny & Meyers, which represents Paramount, repeated his argument that the Buchwald and Bernheim contractual provisions are fair and were negotiated with help from a sophisticated representative from the William Morris Agency.
Pierce O'Donnell of Kaye, Scholer, Fierman, Hays & Handler, which represents Buchwald and Bernheim, continued to argue that the contract terms are "oppressive." They should be modified by the court to pay the writer and producer more than they would receive if the deal were strictly enforced, O'Donnell said.
In questioning the attorneys, Judge Schneider appeared to leave open a wide range of possible decisions. He repeatedly grilled the lawyers, for instance, as to whether they believed that Buchwald might be entitled to damages even if Bernheim were to receive nothing, assuming that his rights as a producer had expired long ago. Such a course might sharply diminish damages in the case, since Bernheim was entitled to a 40% cut of net profits under his contract with Paramount, while Buchwald was to receive only 1.5% of the profits.
A decision by the judge appeared unlikely before next week, since he asked the lawyers to submit further documents over the next several days.