For decades Hollywood studios have found creative and controversial ways of dividing profits among industry professionals. One specific area where actors, writers and directors have taken issue is in the division of profits from home video revenue.
In 2013 Paramount Pictures, Sony Pictures, Warner Bros, 20th Century Fox and Universal were all sued for allegedly underpaying talent for their share of home video profits. Most of the class actions were brought over royalties from films that were made in the 1970s.
Universal recently agreed to settle a royalty-related class action lawsuit by paying class members $26 million. If approved, the proposed settlement will create two $13 million funds to compensate actors, writers, directors and others for royalties owed to them.
Director Colin Higgins filed the lawsuit, arguing that profit participation amounts from home video revenue should be based on 100 percent of the revenue, not the 20 percent that has been the industry standard.
In its defense, Universal argued that it didn't violate any royalty contracts because it was only following standard practice.
A hearing for possible approval of the settlement has been scheduled for July.
If you have questions about issues similar to the ones discussed here, then don't hesitate to speak with an attorney with experience in representative and collective litigation. Class actions allow individuals to band together to take on much larger opponents, and the class action lawyers of Shepherd, Finkelman, Miller & Shah have experience in representing clients on both sides of class action litigation.
To learn more, please see our collective litigation overview.