Disney loses $320M Who Wants to Be a Millionaire lawsuit

Michelle Clancy | 05-12-2012

The eight-year US breach-of-contract lawsuit stemming from the popular game show Who Wants to Be a Millionaire may finally be put to rest: a three-judge panel of the United States Court of Appeals for the Ninth Circuit issued a Memorandum of Disposition affirming the jury verdict in favor of Celador International against Disney for $320 million.

The lawsuit, filed in 2004, arose over a dispute regarding profits from "Millionaire," which became a smash hit in 1999 and took ABC, now owned by Disney, from No. 4 to No. 1 in network rankings. The show was created by British company Celador International, which licenced the rights to ABC Television and Buena Vista Television for North America. In return, Celador was to share half of the expected profits from the show.

Disney however said that according to its numbers, the show never turned a profit despite being a ratings phenom for ABC for three years and being in syndication for 10 years. In fact, Disney maintained that it generated more $70 million in losses—an allegation that Celador heartily challenged.

After a litigation trial, in July 2010, a federal jury awarded Celador $269.4 million in damages after unanimously finding that Disney subsidiaries − ABC, Buena Vista and Valleycrest Productions − had breached their contract with Celador to share profits. The nine member jury also unanimously found that the defendants breached the implied covenant of good faith and fair dealing that they owed to Celador. The court awarded $50 million in prejudgment interest to Celador on that score, bringing the total to $320 million in damages.

The saga drew on: On 21 December 2010, the trial court denied Walt Disney Co.'s bid to overturn the jury verdict. And now, the Court of Appeals affirmed the jury's verdict today in a brief six-page decision.

"Our litigation objectives − to receive what we were fairly entitled to under our contract and to be made substantially whole − were realised by the jury's verdict and today by the Court of Appeals' decision," said Paul Smith, chairman of Celador. "I am pleased that justice has been done."

Celador's trial lawyers, Roman Silberfeld and Bernice Conn, partners with Robins, Kaplan, Miller & Ciresi LLP in Los Angeles, said: "Both the trial judge's and an attentive jury's thoughtful and careful assessment of the law and facts were upheld today."