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California District Court Grants Motion to Compel Arbitration in Dispute Involving Film Adaptation of Hogan's Heroes

Wednesday, March 28, 2012
Laura McQuade | Bloomberg Law Rysher Entertainment, Inc. v. Writers Guild of America, West, Inc., No. 11-CV-09298, (C.D. Cal. Mar. 19, 2012) The U.S. District Court for the Central District of California granted defendants' motion to compel arbitration in a dispute with plaintiffs over the right to produce a motion picture based on the television series Hogan's Heroes.

The Parties' Dispute Relating to Hogan's Heroes

Defendants Albert Ruddy and Bernard Fein wrote the literary work, The Heroes, in 1963. In 1964, Bing Crosby Productions, LLC ("BCP") purchased The Heroes pursuant to a letter agreement by which Ruddy and Fein assigned "all of their right, title, and interest" to the work (the "Assignment Agreement"). Rysher at 3. BCP subsequently developed the television series, Hogan's Heroes, based on the work. On the same day that the writers executed the Assignment Agreement, they also entered into an employment agreement with BCP by which the writers would assist with the writing and revision of The Heroes. Shortly thereafter, the writers entered into a second employment agreement with BCP by which the writers would assist with the writing and revision of a related pilot script entitled The Informer. Both employment agreements expressly incorporated the terms of the 1960 Writer's Guild of America Television Film Minimum Basic Agreement (the "Independent Agreement"), a collective bargaining agreement to which both BCP and defendant Writers Guild of America, West, Inc. ("WGA") were parties. On October 21, 2011, WGA served a request for arbitration on plaintiffs Rysher Entertainment, Inc., Qualia Capital, LLC, and BCP, seeking a declaration that, pursuant to the terms of the Independent Agreement, the writers held so-called "separated rights" in Hogan's Heroes. Separated rights are contractual rights in literary material that may be held by a writer even where a producer owns the copyright. In response, plaintiffs filed the instant action against WGA, Ruddy, and the heir to Fein's estate, seeking a declaration that: (1) the rights conferred by the Assignment Agreement were not subject to arbitration; (2) BCP was the owner of The Heroes and any derivative works (including the Hogan's Heroes television series); and (3) defendants had waived any arbitrable claims under the Independent Agreement by failing to follow certain procedural requirements. Defendants, in turn, filed this motion to compel arbitration.

Court Grants Motion to Compel Arbitration

Noting that federal law favors arbitration of private labor disputes, the court explained that its role here was limited to determining: (1) whether a valid arbitration exists; and (2) whether that agreement encompasses this dispute. Because the first question was uncontested, the court turned to the second question of whether the writers had acquired separated rights in Hogan's Heroes pursuant to the Independent Agreement. Plaintiffs claimed that this dispute was not subject to arbitration because the Assignment Agreement, unlike the employment agreements, did not contain an arbitration clause, nor did it reference the Independent Agreement. WGA conceded that BCP owned the copyright in The Heroes pursuant to the Assignment Agreement, but argued that the writers acquired separated rights to the film adaptation pursuant to Article XX of the Independent Agreement. According to the court, because the resolution of this issue required, at least in part, an interpretation of the Independent Agreement, the dispute fell "squarely" within that agreement's arbitration clause, which encompassed "[a]ny difference between the Union and the Producer concerning the interpretation of any of the terms of this Agreement and its application and effect as determined by such interpretation." Rysher at 8-9. The fact that the dispute may also require consideration of the Assignment Agreement did not render the dispute nonarbitrable. The court explained that plaintiffs' remaining arguments all went to the merits of their claim, not to the arbitrability of the dispute. Similarly, the court concluded that plaintiffs' argument that defendants had procedurally waived arbitration was best left for the arbitrator to decide. Finally, the court reasoned that to the extent that plaintiffs would argue that this matter should be stayed as to certain parties pending the arbitration, it would not exercise its discretion to do so, due to the interrelatedness of the parties and their claims. The court thus granted defendant WGA's motion to compel arbitration. DisclaimerThis document and any discussions set forth herein are for informational purposes only, and should not be construed as legal advice, which has to be addressed to particular facts and circumstances involved in any given situation. Review or use of the document and any discussions does not create an attorney-client relationship with the author or publisher. To the extent that this document may contain suggested provisions, they will require modification to suit a particular transaction, jurisdiction or situation. Please consult with an attorney with the appropriate level of experience if you have any questions. Any tax information contained in the document or discussions is not intended to be used, and cannot be used, for purposes of avoiding penalties imposed under the United States Internal Revenue Code. Any opinions expressed are those of the author. The Bureau of National Affairs, Inc. and its affiliated entities do not take responsibility for the content in this document or discussions and do not make any representation or warranty as to their completeness or accuracy.©2014 The Bureau of National Affairs, Inc. All rights reserved. Bloomberg Law Reports ® is a registered trademark and service mark of The Bureau of National Affairs, Inc.

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