Capítulo 336: Chapter 336: Holmes
The money Miramax owed Murphy was primarily the final box office proceeds and other directorial dividends from "Sin City," along with a smaller portion from the later profits of "Planet Terror," totaling around four million dollars.
For the Murphy of the past, four million dollars was a considerable sum, but after receiving high fees and profit shares consecutively, this amount was no longer significant. However, he wouldn't easily give up on it; it was his rightful earnings and a chance to show his resolve to the outside world.
He wasn't the type of director or investor to swallow a loss quietly.
Hollywood is fundamentally a business circle where profits are paramount. If he let this unpaid debt slide, other companies might follow suit.
Just like Murphy himself, he would never overestimate the moral standards of Hollywood professionals.
As Walt Disney took full control of Miramax, Murphy, under the name of Stanton Studios, sent a demand letter which ended up like a stone sunk in the ocean—no response, not even a splash. The new management at Miramax seemed utterly uninterested in dealing with this claimant.
Bill Rossis also made calls on Murphy's behalf as his agent and was told to keep waiting.
Like all unpaid individuals, you can never expect capitalists to have an epiphany. Without proactive action, you might end up waiting forever without a satisfactory outcome.
Thus, without hesitation, Murphy had his accountant, David, list out the details, which were included in a legal notice drafted by his lawyer, Robert, and sent to the higher-ups at Miramax.
It might be that Miramax didn't want to deal with a director who no longer had value to them, or perhaps they were overwhelmed by debts, or maybe they genuinely hadn't sorted through Miramax's chaos. The demand letter, including principal and interest totaling five million dollars, once again went unanswered.
When normal approaches failed, there was only one option left.
Of course, this method wasn't about getting rid of Michael Eisner or using underhanded tactics to threaten Miramax's management. Things hadn't reached such a stage, and as a person of status, Murphy knew the risks of such actions wouldn't be proportionate to the rewards.
After consulting with Bill Rossis and Robert, Murphy chose the most standard approach—legal action!
This was a common method in Hollywood for recovering wages, as evidenced by Peter Jackson, who was suing New Line Cinema for fifteen million dollars in earnings from "The Lord of the Rings" trilogy.
Many Hollywood companies had a poor reputation in this regard. Not only Peter Jackson but also actors from the crew and the Tolkien estate accused New Line Cinema of hiding substantial box office revenues from "The Lord of the Rings" trilogy to avoid paying higher royalties. The actual revenues from these films were much higher than the public figures suggested.
Robert filed a lawsuit on Murphy's behalf against Miramax and its actual controller, Walt Disney, in the Delaware Court of Chancery. Both Stanton Studios, Miramax, and Disney were registered in Delaware.
Murphy learned from the Delaware Court of Chancery that he was not the only one suing Disney; many of Disney's shareholders had also filed lawsuits.
The shareholders accused the management team, led by Michael Eisner, of bypassing normal procedures and making staggered payments of nearly two hundred million dollars in severance to Michael Ovitz when he left the CEO position.
Over the next few days, Murphy learned more about the situation. The Disney shareholders' lawsuit against management wasn't just about the severance issue. They were targeting Michael Eisner.
Simply put, there was a powerful faction within Disney dissatisfied with Michael Eisner's domineering style and recent actions, looking to replace him.
Now that even the parent company Disney was in internal turmoil, it seemed plausible that Miramax hadn't yet sorted things out. Murphy considered that Miramax and Disney might not genuinely intend to default on payments, as internal strife could severely delay their operational efficiency.
But despite these considerations, Murphy didn't intend to withdraw the lawsuit. There's no taking back an arrow once it's released, especially since Miramax had indeed defaulted on paying his due share.
However, the embattled Disney management, particularly under Michael Eisner, didn't want to add the trouble of dealing with Stanton Studios. Robert's filing of the lawsuit seemed also to remind them, preoccupied with their internal battles.
Miramax's management reached out to Murphy through Bill Rossis, hoping to settle out of court. After consulting various parties, Murphy began negotiations with Miramax. If they could reach an out-of-court settlement, he wasn't interested in dragging out a lengthy and tedious lawsuit.
Such lawsuits could drag on for half a year or even longer, consuming vast amounts of time and energy.
Moreover, the high cost of legal fees was another significant reason why Murphy considered settling out of court.
Even though all of Hollywood's lawsuits handled by Robert had never failed, Murphy still preferred an out-of-court settlement.
Hollywood's attorneys often boast perfect track records
because many disputes end in confidential settlements. Indeed, from the time Murphy hired him, Robert had been a very professional and ethical lawyer. However, he was part of the Myer Law Firm, one of the top law firms in the U.S. as rated by "The American Lawyer," which had substantial control over its attorneys. If they had other ideas and dragged out the case, only the lawyers would profit from the prolonged dispute, potentially exceeding the five million dollars Murphy was seeking.
This was no exaggeration.
Nevertheless, entertainment lawyers are an indispensable part of the mature Hollywood industry, providing services that indeed facilitated life for clients like Murphy.
As Bill Rossis was busy with awards season tasks, Murphy delegated Grace to work with Robert on negotiating the out-of-court settlement with Miramax's representatives.
Neither party wanted to prolong the boring lawsuit: Murphy was eager to get back to work, and Miramax's new management, eager to consolidate power, didn't want to be distracted. The negotiations went exceptionally smoothly, and within three days, they had agreed on terms. Under the supervision of a representative from the Delaware Court of Chancery, they signed a formal settlement agreement.
At the core of the out-of-court settlement was the directorial dividends Miramax owed Murphy. They agreed on a settlement of 4.5 million dollars. In addition to this sum, to avoid future complications, Miramax also paid an additional 500,000 dollars to buy out Murphy's future royalty rights for "Planet Terror" and "Sin City."
Since the royalties stipulated in the original director's contract were low, Murphy readily signed the out-of-court settlement.
From then on, apart from the minimum dues defined by the union, Murphy had virtually no financial ties to "Planet Terror" and "Sin City."
In reality, after paying the ten percent legal fee to lawyer Robert, the settlement Murphy received from Miramax was roughly equal to the original amount plus standard interest.
This out-of-court settlement not only avoided high legal fees but also spared Murphy the hassle of repeated court appearances, which can be incredibly tedious.
Likewise, this is why many Hollywood lawsuits opt for out-of-court settlements.
Murphy didn't want the lawsuit to distract him from more important matters, such as preparing for awards season and starting the production of "Game of Thrones."
This would be no less demanding than producing any major film.
Having already reached a joint production agreement with 20th Century Fox's film and television production department, and confirmed the series would air on the Fox cable network, Murphy planned not to shoot a pilot first like typical American series. Instead, he would shoot the entire first season of ten episodes at once.
Both parties had also agreed on investment and rights: they would each invest fifty percent. The rights purchase cost for Stanton Studios would be directly converted into Stanton Studios' investment, with the first season's production budget tentatively set at 60 million dollars.
Additionally, Murphy had several discussions with David Ellison, and their representatives began negotiations. At this point, Murphy realized that David Ellison's previously controlled funds were not as vast as rumored, only about forty to fifty million dollars.
Only after the success of "Gone Girl" did David get real control over his foundation's funds from Larry Ellison, now holding an enviable large sum of money.
This fund was enough for him to invest in two to three non-super productions and still recover even if all failed.
Life can be so unfair—while some might fall into hell with one wrong step, others continue to find opportunities even after repeated failures.
Stanton Studios once again accepted a loan from David Ellison's foundation, totaling 15 million dollars, which nearly solved Murphy's funding issues for producing "Game of Thrones."
As before, David needed to prove himself with successes, and Murphy appreciated such interest-only loans. Both sides got what they needed.
But after David Ellison's funds were secured, Murphy encountered trouble and ended up firing the writer who had been assisting George Martin.
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