Testimony in the legal fight between the Hollywood Foreign Press Assn. and Dick Clark Productions over which controls the television rights to the Golden Globes awards show wrapped up Tuesday with the judge imploring the two sides to settle.
"The framework to a settlement is not difficult to envision," said U.S. District Judge A. Howard Matz, who added that both sides have taken "their best shots" and now it's time for the lawyers to go back to their respective clients and try to reach a peace agreement, ideally before closing arguments Friday.
At issue is a 2010 deal that Dick Clark Productions (DCP) made with NBC to keep the Golden Globes on the network through 2018 at a price tag of $150 million. The Hollywood Foreign Press Assn. (HFPA), which owns the Golden Globes, sued DCP soon after the NBC agreement was announced, alleging that DCP signed the deal without proper authorization. The HFPA, comprising about 80 journalists who write about entertainment for foreign publications, said the NBC pact was part of an overall plot by DCP to steal control of the glitzy awards ceremony.
DCP, owned since 2007 by Red Zone Capital Management Co., a private-equity firm controlled by Washington Redskins owner Dan Snyder, countered that a 1993 amendment to its almost 30-year-old agreement with HFPA to produce the show gave it the right to renegotiate with NBC without the association's approval.
Matz, who praised both sides for their presentations, said he has been "puzzled" by why the two sides don't try to negotiate a settlement. He added that, if he rules, there's "not going to be a compromise."
The tensions between HFPA and DCP have existed long before the 2010 NBC contract. Dagmar Dunlevy, a former president of the HFPA, testified that the relationship between the association and DCP started to sour almost a decade ago, long before the two sides ended up in court.
Dunlevy said she first raised questions about the fairness and legality of the arrangement in 2002, about a year after DCP had first renewed its deal with NBC. Dunlevy confirmed that in a deposition she gave before the start of the trial she called the partnership a "lousy deal" for the HFPA and acknowledged problems with a perpetuity clause that DCP believes gives it control of the TV rights.
"We're not Elvis and Col. Parker," she cracked.
When DCP and the HFPA first teamed in 1983, the awards show had lost much of its credibility. The Federal Communications Commission had chastised the HFPA for how it handed out its awards in the late 1960s, resulting in the program being dropped by network television for several years.
When it returned briefly in the 1980s, it wasn't long before another embarrassment — an award given to entertainer Pia Zadora — once again had the networks running from the show.
DCP soon struck a deal with the TBS cable channel and in 1993 NBC entered an agreement to become the show's home in 1996. The return to a broadcast network was considered a major breakthrough for the HFPA. A few years later the association began to wonder, Dunlevy said, whether its deal with DCP was fair.
"The starlet had become a star," Dunlevy said.
The HFPA started scrutinizing the relationship soon after DCP was sold to Mosaic Media in 2002 (Red Zone acquired it in 2007). Dunlevy added that the agreement with DCP was complex and "way over and above the understanding of a group of journalists."
In 2010 the HFPA told DCP that it wanted to renegotiate the terms of its partnership. Although there were some initial talks between the two, little progress was made. Later that year, DCP started negotiating a new extension with NBC.
DCP President Mark Shapiro previously testified that he renewed the deal with NBC in 2010 while keeping the HFPA in the dark because of his belief that the agreement between the two did not require him to get the association's approval.
In its case, the HFPA is trying to establish that not only is the interpretation of the 1993 amendment incorrect by DCP, but that even if DCP did have the TV rights in perpetuity as long as the Globes remained on NBC, it still needed the approval of the association before a renewal could occur.
Although Dick Clark did not take the stand, parts of a deposition he gave in May were read into the record. Clark, who is ailing, said at one point while being questioned by counsel from the HFPA that he "assumed" the HFPA had to agree to the 2001 renewal with NBC. Later, when questioned by lawyers for DCP, he said he had "no idea" whether HFPA approved of the 2001 extension other than through the 1993 amendment.