TF1 D.A. sentenced to pay €32m to On My Own and Spike Lee
Italian/US co-production Miracle at Santa Anna, unveiled at Toronto in 2008, could prove very expensive for French company TF1 D.A., TF1 group’s subsidiary for audiovisual rights acquisition and distribution in France and abroad. According to French press agency AFP, the Paris district court has indeed sentenced the company to pay almost €32m for failing to honour its contractual obligations to market Spike Lee’s film.
Produced by On My Own (at that time headed by Roberto Cicutto and Luigi Musini) and Lee, Miracle at Santa Anna [+see also:
film profile] was acquired in October 2007 by TF1 International for a MG (minimum guarantee) of $11m with the opportunity to sell the film throughout the world (apart from the United States, Canada and Italy).
When Miracle at Santa Anna was delivered, TF1 International found it didn’t meet their expectations and they backtracked, trying to terminate the contract. There followed a legal battle that has just concluded with a clear decision: "no contractual breach can be invoked against the company On My Own and the company TF1 International had no valid reason to refuse the film’s delivery".
As a recap, TF1 International operated at that time as a 100% subsidiary of TF1: the company then went into partnership with UGC whilst keeping its name (see news). This explains why it’s now up to parent company TF1 D.A. to pick up the pieces.
The court has sentenced TF1 D.A. to pay €20m in damages to On My Own to compensate for its financial loss considering the "catastrophic effects" of TF1 International’s decision on the international distribution of a film that “no longer had any commercial value for the producer because it is preceded by a negative reputation".
TF1 D.A. will also have to pay €2.7m in moral damages (€1.5m to Lee, €1m to On My Own and €200,000 to screenwriter James McBride) and the $11m in MG initially promised (plus charges, i.e. €9m in total) to BNP Paribas.
TF1 Droits Audiovisuels plans to appeal against the decision, considering that the estimated loss is "manifestly disproportionate in view of the film’s performance, notably on the US market where theatrical admissions generated only €5.5m in takings". Watch this space for further developments…
(Translated from French)
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