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Entertainment Marketing: Movies, TV, Music and Gaming StudioCanal Media

This is Spinal Tap co-creator taps StudioCanal, producer Ron Halpern for $125m in lawsuit

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By Laurie Fullerton, Freelance Writer

October 20, 2016 | 5 min read

Harry Shearer, renowned worldwide for his voicing of 23 characters on the long-running animated television series The Simpsons, is seeking $125m in damages in a lawsuit filed this week citing fraud in the management of the cult-classic film This is Spinal Tap.

Shearer, who co-created the film, co-wrote the soundtrack and starred as the Spinal Tap band's bassist, Derek Smalls claims the French conglomerate, Vivendi S.A, which includes StudioCanal, Universal Music Group and famed American producer Ron Halpern as a co-defendant has engaged in anti-competitive and unfair business practices, as well as fraudulent accounting related to its management of the film.

The action seeks $125m in compensatory and punitive damages.

"Almost 40 years ago, Christopher Guest, Michael McKean, Rob Reiner and I created the somewhat legendary band Spinal Tap," said Shearer. "We thought there was something real and really funny about the characters, and between that inception and the theatrical release of This Is Spinal Tap in 1984, we poured ourselves into nurturing and perfecting the paean to rock loudness that has entertained so many people, even today. But despite the widespread success of the film and its music, we've fallen victim to the same sort of fuzzy and falsified entertainment industry accounting schemes that have bedeviled so many other creators. In this instance, the fraud and negligence were just too egregious to ignore. Also, this time, it was personal."

In 1982, Reiner, Shearer, Guest, and McKean signed an agreement with Embassy Pictures, for the production, financing and distribution of This Is Spinal Tap. The agreement ensured profit participation payments, at the rate of 40% of net receipts, to the creators based on all sources of revenue, including merchandise and music.

After two years of production, the film was released in 1984. It soon became a cult favorite and its reputation as one of the 20th Century's most enduring comedies has increased exponentially in the ensuing years. The film's accolades include being named in the New York Times Guide to the Best 1,000 Greatest Movies Ever Made list, Total Film's 100 Greatest Movies of All Time list, and achieving the coveted Number One spot on Time Out London's 100 Best Comedy Movies list. In 2002, the film's lasting appeal led the U.S. Library of Congress to designate it as a culturally, historically, or aesthetically significant film.

The film's ongoing critical success was likewise matched by its financial success. It was produced on a shoestring budget of $2.25m. Yet This Is Spinal Tap and the music and merchandise that it and the band have spawned, earned tens of millions of dollars in revenue, according to the complaint – 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. However, these profits were not fairly shared with the four co-creators, cast, or crew.

When Vivendi acquired the rights to This Is Spinal Tap in 1989, through its subsidiary Canal, the lawsuit alleges it began a concerted and fraudulent campaign to hide, or grossly underreport, the film's revenues in order to avoid its profit participation obligations. Vivendi's financial reporting of income has been woefully inconsistent at best. Performance of its duties to the film's creators dropped off entirely in 2014, the 30th anniversary of the film's initial theatrical release. In the past two years, Vivendi has altogether failed to produce an account of any Spinal Tap revenue, according to the complaint.

The complaint alleges that This Is Spinal Tap has generated millions of dollars, across various revenue streams, for Vivendi, its subsidiary companies, and their licensees. The French conglomerate asserts that the four creators' share of total worldwide merchandising income between 1984 and 2006 was $81. Between 1989 and 2006, total income from soundtrack music sales was reported by Vivendi as $98, according to the complaint.

"This is a simple issue of artists' rights," added Shearer. "It is stunning that after all this time, two cinema releases, all the various home video format releases, all the records and CDs, and all the band-themed merchandise still widely available worldwide, the only people who haven't shared Spinal Tap's success are those who formed the band and created the film in the first place."

"Vivendi and its subsidiaries – which own the rights to thousands and thousands of creative works – have, at least in our case, conducted blatantly unfair business practices," Shearer continued. "But I wouldn't be surprised if our example were the tip of the iceberg. Though I've launched this lawsuit on my own, it is in reality a challenge to the company on behalf of all creators of popular films whose talent has not been fairly remunerated. I am just one person seeking redress for blatant injustice, but I hope this lawsuit will, in its own way, help set a new precedent for faithful and transparent accounting practices, and fair artistic compensation, industry-wide."

Entertainment Marketing: Movies, TV, Music and Gaming StudioCanal Media

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