BREAKING NEWS! 2ND UPDATE 12:40 PM: The subject of today’s Warner Bros/DC Comics lawsuit, Los Angeles copyright attorney Marc Toberoff, just gave me his response. (See below)

Original Post Filed 10:26 AM. Updated Writethru 11:30 AM:
superman comic 30Today there’s been a shocking development in the Superman copyright litigation. Warner Bros has gone up against and in some situations lost too many such rights cases against its arch-nemesis, lawyer Marc Toberoff. So recently the studio hired Daniel Petrocelli to come up with a new strategy to prevent the studio from possibly losing a portion of the copyright to Superman in 2013 as a court has previously ruled, and Petrocelli has obliged. His newest tactic? To get rid of Toberoff entirely. This morning, Warner Bros’ new outside counsel is filing has filed a lawsuit in federal court in Los Angeles against Toberoff raising questions about his alleged role as a financial participant in the Superman copyright and not as the attorney for the Shuster and Siegel families litigating their Superman cases. But the purpose of the lawsuit is obviously to put Toberoff in a position where he might have to resign as the Siegel and Shuster attorney.

It’s a hardball and some might say also despicable tactic by Petrocelli and the studio’s new general counsel John Rogovin (hiding behind DC Comics), especially because it hinges on documents stolen from Toberoff’s office by a Toberoff employee. (I’ve learned that Warner Bros claims the documents mysteriously “arrived” on its doorstep and that the employee was a lawyer in Toberoff’s firm and a “whistleblower”. Toberoff has indicated that something much more nefarious may have happened. (See his response below.) What’s also ironic about Petrocelli’s tactic is that, when he defended Disney against the Slesinger family’s Winnie The Pooh underpaid royalty claims, he was able to get the entire case thrown out of court by alleging that the Slesinger’s were basing some of their documentation on paperwork “stolen” from a dumpster on the Disney lot. Oh, how the worm has tuned. (Full Disclosure: Petrocelli, on behalf of Disney in the Pooh case, once gave a media interview that defamed me.)

Here is what Marc Toberoff just told me after he was sued:

“Having substantially lost the Superman copyright, Warner Bros and DC Comics and their new counsel Daniel Petrocelli now resort to gutter tactics and personally libel me rather than just litigate the remainder of the case on the merits. Even before filing this lawsuit, Warner Bros launched a well cordinated media campaign to defame me. Warner Brothers and Mr. Petrocelli are well aware that their frivolous allegations in the complaint will never prevail. However, that’s not the purpose of the lawsuit against me. The purpose is to defame me or potentially conflict me out of the case and thereby pressure my clients to sell back the Superman and Superboy copyrights they’ve recaptured at a distress sales price.

Warner Bros, DC Comics, and Mr. Pertocelli disingenously claim that I have a financial interest in the lawsuits when they know full well that the only interest I have is a contingent legal fee. And the last time I checked, a lawyer working on a contigent fee basis is legal in the State of California. The goal here is to muddy the waters and avoid litigating on the merits. As further proof of that, Warner Brothers, DC Comics, and Mr. Petrocelli attach to their complaint an anonymous letter spewing unsubstantiated and unattributed accusations — and time will tell whether Warner Bros itself had a hand in that letter. Such unethical thug tactics are nothing short of deplorable. Warner Bros and Mr. Petrocelli should be ashamed of themselves.

In recognition of the inferior bargaining power of authors who seek to get their works published, the termination provisions of the Copyright Act specifically allow authors and their heirs the right to recover their copyrights by terminating, with an emphasis on terminating, prior grants of copyrights. Ridiculously, Warner Brothers/DC Comics is alleging that the exercise of this termination right is the basis for their frivolous claim of tortious interference with an existing contract. The Siegels, Shusters, and I will vigorously defend against these baseless accusations, and my clients remain undeterred in their efforts to protect their Superman and Superboy copyrights.

Warner Bros has to be careful, very careful, not to piss off the Superman fans who are steadfastly in the Shuster and Siegal corners. The studio recently put Warner Bros veteran executive Diane Nelson as the head of DC Entertainment Inc, that new company founded to fully realize and integrate the power and value of the DC Comics brand and characters across all media and platforms into Warner Bros Entertainment’s content and distribution businesses. Nelson especially was charged with suping up Superman again in a way fans like because it’s way too valuable a property  to leave dormant like this.

Besides, the clock is ticking. Toberoff, who keeps suing Warner Bros on behalf of creative rightsholders, has warned the studio that, in 2013, the Jerome Siegel heirs along with the estate of co-creator Joe Shuster will own a portion of the original copyright to Superman — “and neither DC Comics nor Warner Bros will be able to exploit any new Superman works without a license from the Siegels and Shusters”. He’s also pointed out that, if Warner Bros does not start production on a new Superman sequel or reboot by 2011, the Siegels could sue to recover their damages on the grounds that the deal should have contained a clause in which the rights returned to the owners after a given time if no film was in development. The heirs of Siegel have already been awarded half the copyright for Superman. And in 2013 the heirs of co-creator Joe Shuster get the remaining half. After that, neither DC Comics nor Warner Bros will be able to use Superman without a financial agreement with the heirs. There are also stipulations on what parts of the origins story can be used in future Superman movies and which require re-negotiations with the creators’ heirs or estates.

Today’s lawsuit alleges these talking points:

– DC Comics filed suit today in the federal court in Los Angeles to protect its longstanding rights in the Superman franchise.  During the past 70 years, DC and Warner Bros. have brought together many of the finest writers, artists, television producers and filmmakers to continue to popularize Superman, chronicle his new adventures in all media, and maintain him as one of the world’s best-loved characters.  The untold millions invested in the property by DC has resulted in an unbroken 70-year history of consistent success with Superman, equaled by no other fictional hero.

– During their lifetimes, Superman co-creators Jerome Siegel and Joe Shuster never tried to exercise any right to terminate and recapture DC’s copyrights to Superman. They worked constructively with DC to arrive at mutually beneficial agreements, and after their deaths, so did their families.  These agreements provided both co-creators and their families lifetime compensation and assured DC’s ability to continue developing and exploiting the Superman property in movies, television, and other media.

– The lawsuit alleges that changed when Los Angeles-based Marc Toberoff and companies under his control learned of WB’s agreements with the families and sought to gain control of DC’s Superman rights.  As alleged in the lawsuit, Toberoff caused the Shuster and Siegel families to repudiate their agreements and relations with DC, enter into a web of new agreements with his companies, and terminate and seek to recapture DC’s Superman copyright interests. The complaint alleges this was done to position Toberoff and his companies to secure a controlling financial interest in the families’ collective claims — leaving him as the largest financial stakeholder (47.5%), while relegating the Siegel heirs (27.5%) and Shuster heirs (25%) to minority status.

– At issue is the future generation of Superman movies, television programs, and comics would be placed at risk.  The lawsuit asks the Court to confirm DC’s ownership of Superman rights, put an end to Toberoff’s activity allegedly interfering with the rights, and clear the way for all new Superman productions in the future. DC claims it filed this lawsuit only after exhaustive attempts to resolve these matters failed.

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