The lawsuit alleges that Vivendi and its French subsidiary StudioCanal engaged in fraud to hide revenues from the movie’s theatrical and video releases and income from its music and merchandising to avoid paying the creators.
According to the complaint, This Is Spinal Tap generated millions of dollars across various revenue streams for Vivendi, its subsidiary companies, and their licensees.
The music and merchandise that the film and band have spawned, earned tens of millions of dollars in revenue through re-releases, album and singles sales, merchandise sales, and distribution of the film in various formats across the globe over the course of the last 32 years, the complaint continues.
However, these profits were allegedly not fairly shared with the four co-creators, cast, or crew.
The French conglomerate claims that the four creators’ share of total worldwide merchandising income between 1984 and 2006 was a mere $81.
Likewise, total income from soundtrack music sales between 1989 and 2006 was reported by Vivendi as only $98.
The lawsuit claims Vivendi and its agents, including StudioCanal executive Ron Halpern, engaged in anti-competitive business practices by manipulating accounting between Vivendi film and music subsidiaries and engaged in fraud to deprive Shearer and his fellow co-creators of their stake in the production’s profits.
The claim continues, “Vivendi has engaged and is continuing to engage in anti-competitive and unfair business practices and has abandoned its obligations to enforce intellectual property rights in This Is Spinal Tap, unlawfully depriving Plaintiff of substantial revenues. Vivendi has also failed, and continues to fail, to account honestly for income actually received from This Is Spinal Tap.”
With Guest, McKean and Reiner’s participation, the revised complaint now seeks $400m in compensatory and punitive damages from Vivendi.
Commenting on the lawsuit, Guest said, “The deliberate obfuscation by Vivendi and its subsidiaries is an outrage. It is vital that such behavior is challenged in the strongest way possible.”
Reiner added, “Fair reward for artistic endeavor has long been raised by those on the wrong end of the equation. What makes this case so egregious is the prolonged and deliberate concealment of profit and the purposeful manipulation of revenue allocation between various Vivendi subsidiaries - to the detriment of the creative talent behind the band and film. Such anti-competitive practices need to be exposed.”
“This is Spinal Tap was the result of four very stubborn guys working very hard to create something new under the sun. The movie’s influence on the last three decades of film comedy is something we are very proud of. But the buck always stopped somewhere short of Rob, Harry, Chris and myself. It’s time for a reckoning. It’s only right.” McKean said.
Shearer welcomed his co-creators’ decision to join, “Their participation will help demonstrate the opaque and misleading conduct at the heart of this case. We’re even louder now.”
The amended complaint, which also incorporates Spinal Tap Productions (owned in equal share by all four co-creators), as a joint plaintiff alongside the co-creators and their service companies, details Vivendi’s alleged manipulation of certain accounting data, while ignoring contractually obligated accounting and reporting processes, to deny the plaintiffs their rightful stake in the production’s profits.
This lawsuit will determine several key matters in respect of the exploitation rights to This Is Spinal Tap, including breach of contract, fraud and fraudulent concealment, breach of an implied covenant of good faith and fair dealings and intellectual property rights.
The lawsuit raises particular concerns over the alleged anti-competitive effects of non-arms’ length transactions among Vivendi subsidiaries in managing This Is Spinal Tap.
For its part, Vivendi said it will not comment on an ongoing litigation.