Tuesday, January 24, 2017

Who Owns Superman? - Part V

 This is the fifth in my series of posts on the fight over the rights to Superman. You can find the previous posts herehere, here, and here.   

(Note: All references to DC may also refer to its parent companies, Warner Bros. or Time Warner. Due to the complications of corporate ownership, I will attempt to simplify things by referring to DC only unless necessary.)

The battle for Superman got interesting in the 2000s. As I mentioned in the last post, after Siegel and Shuster lost their lawsuit in the 1970s it looked as if the question of who owned Superman was answered. However, changes to the Copyright Act allowing authors to terminate previous transfers of copyright ownership gave Siegel's heirs – and after another change in the law, Shuster’s estate – another opportunity to attempt to regain control of Superman.
            In 1997, Siegel’s heirs, his widow and daughter, sent notices of termination to DC in an attempt to terminate the transfer of numerous works relating to Superman.[1] The termination date was listed as April 16, 1999.[2] As a court noted, “A flurry of settlement discussions between the parties quickly ensued, but just as quickly fizzled out. Nearly two years then passed without much discussion between the parties.”[3]
            The day before the termination date DC sent a letter to Siegel’s attorney denying “‘the validity and scope’ of the termination notices.”[4] The parties then reentered into settlement negotiations and signed an agreement to delay taking action on the termination notices as long as the agreement was in effect and the parties were attempting to resolve the matter.[5]
            In October 2001, the attorney for the Siegel heirs sent a letter to DC setting forth an outline of a settlement agreement the parties had reached. Terms of the settlement, which also included rights to Superboy, called for the Siegel heirs to receive “a $2 million advance, a $1 million non-recoupable signing bonus, forgiveness of a previous $250,000 advance, a guarantee of $500,000 per year for 10 years, a 6% royalty of gross revenues, and various other royalties.”[6]
A week later, DC’s general counsel sent back “‘a more fulsome outline’” of what DC believed they had agreed to and stated they were also working on a more detailed draft of the agreement.[7] In February 2002, DC’s outside counsel sent over a 56-page draft agreement for the Siegel heirs to review.[8] This prompted Siegel’s widow to write a letter to Time Warner’s chief operating officer in May 2002 in which she said she felt “‘stabbed in the back’” by “‘new, outrageous demands.’”[9] She concluded by stating that after four years of negotiating, the parties had failed to reach a deal, and it was unlikely there would ever be a deal based on the contract sent to them.[10] Siegel’s letter prompted Time Warner’s CEO to respond that they didn’t expect the agreement to be the final one and negotiations would continue on it, the company felt the main points previously agreed to were in the agreement, and DC still believed an agreement could be reached based upon the previously agreed to negotiations.[11]
            The Siegel heirs rejected a redrafted agreement submitted to them by their attorneys in September 2002, fired their attorneys, and sent a letter to DC’s president and publisher ending all negotiations with DC and its parent companies over the rights to Superman.[12] In October 2004, the Siegel heirs filed a lawsuit seeking to enforce their termination rights to Superman with help from their new attorney, Marc Toberoff.[13]
            In our next post, we’ll discuss the most recent lawsuits over the rights to Superman.

[1] Siegel v. Warner Bros. Ent., Inc., 542 F.Supp.2d 1098, 1114 (C.D. Cal. 2008).
[2] Id.
[3] Id.
[4] Id.
[5] Id. at 1115.
[6] Larson v. Warner Bros. Ent., Inc., No. 2:04-cv-08776, at page 9, (C.D. Cal. April 18, 2013).
[7] Siegel, 542 F. Supp.2d at 1114.
[8] Id.
[9] Id.
[10] Id. at 1115-16.
[11] Id. at 1116.
[12] Id.
[13] Id.