Prospect Park Networks may have filed for Chapter 11 earlier this week, but ABC still wants every dime it says it is owed from licensed soaps All My Children and One Life To Live. “ABC sues to recover all unpaid Series Fees owned up to and through the date of the trial of this action as a result of Prospect Park’s failure to pay in breach of the License Agreement,” the network said in a cross-complaint filed last week (read it here). That could end up taking a hefty chunk out of Prospect Park, which started this legal arms race with its own multimillion-dollar licensing suit against ABC last April. In Friday’s filing, ABC claims that the multi-season series fees arrangement entitles the network to more than $145 million in payments but argues that it was paid only for a few months on the first seasons of AMC and OLTL, which PPN launched online last spring. It later ceased production after around 40 episodes. In its Chapter 11 filing, Prospect Park listed ABC as being owned $1.7 million.
The network also says the total Season 1 series fees for the now seemingly shuttered AMC and OLTL were $4.5 million and $4 million each, most of which it hasn’t seen. “As a direct, legal and proximate cause of Prospect Park’s breach of the License Agreement, ABC has suffered damages of not less than $5 million,” adds the 27-page cross-complaint. ABC is seeking compensatory damages, pre- and post-judgment interest, and legal fees from PPN. “We value the history and the legacy of both All My Children and One Life To Live. They are television institutions,” an ABC spokesperson said of the filing. “Prospect Park has the exclusive rights to these programs. It was their decision to discontinue producing new episodes online thereby disappointing fans. Prospect Park has not honored their agreement with ABC.”
The cross-complaint and the answer to PPN’s amended complaint comes after ABC failed on February 10 to have Prospect Park’s amended complaint tossed out. The network had filed the motion to strike on January 13, two months after Prospect Park filed its amended version of the initial April 2013 complaint seeking “at least $30 million in out-of-pocket losses and/or at least $95 million in lost profits” from the network.
PPN’s November 13 amended complaint alleges that ABC shattered the licensing agreement, claiming the network inked long-term agreements with OLTL actors, killing off OLTL characters on loan to General Hospital and deliberately attacking Prospect Park’s efforts to continue AMC and OLTL online. In its dismissive March 7 answer, ABC says that’s garbage. Asserting that most of PPN’s claims are barred, the network says it “fully performed all obligations required of it” under the Licensing Agreement and “any purported damages suffered by Prospect Park were not proximately caused by any conduct of ABC, but by other third parties or by Prospect Park’s own conduct.”
So, looks like an already messy situation is about to get a lot rougher.
Prospect Park is represented by a mix of LA- and Houston-based attorneys led by trial lawyer James Edward Maloney of Texas’ Andrews Kurth. Susan Klein, Jeffrey Valle and Nuritsa Ksachikyan of LA’s Valle Makoff are repping ABC.
Deadline's Dominic Patten - tip him here.