The City of Absurdity Lynch suit nets record $6.5

By Dana Harris
The Hollywood Reporter,
Tuesday, August 18, 1998

In one of the largest judgments ever given to a director for breach of a "pay or play" agreement, a U.S. District Court has awarded David Lynch more than $6.5 million over French film company CIBY 2000's failure to finance three films.

Lynch and CIBY division Three Picture Prods. made a three-picture deal in 1993, but only one of those films, "Lost Highway," was produced. The remaining two pictures were to have been financed at $30 million total, with Lynch receiving $3 million in compensation for the first picture and $3.5 million for the second.

On Nov. 5, CIBY claimed that their contract with Lynch was nullified by his failure to meet a deadline, but the plaintiffs said that late CIBY founder Francis Bouygues had previously waived that requirement in writing. On Nov. 10, Lynch filed his lawsuit claiming that CIBY was liable for "at least $6.5 million in compensation along with consequential damages caused by its years of deception and breach."

"This is a great victory not just for David but for all directors," Lynch attorney George Hedges said. "What the court has said is that companies have to honor their production commitments."

A Los Angeles Superior Court came to a similar conclusion last month when a jury trial resulted in filmmaker Francis Ford Coppola and his producing partner, Fred Fuchs, winning $60 million in punitive and $20 million in compensatory damages in their suit against Warner Bros. The studio was found liable for interfering with Coppola's efforts to make a live-action feature of "Pinocchio" for Columbia Pictures. Warner Bros. said it plans to appeal.

Lynch's lawsuit, which was filed in November, also claimed fraud and intentional interference and requested punitive damages against other defendants, including construction giant Bouygues, CIBY 2000's parent company. Trial on those claims is expected by the end of the year.

"This is Round 1 and we still have Round 2 to go," Lynch attorney John Meigs Jr. said. "In the Coppola trial, $60 million was a percentage of net value for (Warner Bros.). Bouygues is worth billions, so the potential is high."

While CIBY 2000 has curtailed its production activities, Bouygues remains one of Europe's largest construction firms.

back to main page

© Mike Hartmann