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A referee ordered Fox to pay $ 179 million to participants in the long-running "Bones" television series, saying the top executives had cut back on their income and gave false testimony.
In his ruling, referee Peter Lichtman specifically criticized several Fox executives, including Dana Walden, Gary Newman and Peter Rice, claiming that they had "given false testimony in an attempt to conceal their unlawful acts" . Lichtman concluded that Fox had committed "intentional acts of fraud and malice" and had demonstrated a "cavalier attitude" towards the wrongful acts of the company.
The case is the latest in a long series of lawsuits in which profit participants say the networks have not paid market rates for issuance of emissions allowances because they have been produced by a sister company, 20th Century Fox Television.
Lichtman awarded $ 128 million in punitive damages, finding that the high amount "was necessary to punish Fox for his reprehensible behavior and deter him from any subsequent unlawful conduct".
21st Century Fox has firmly denied the charges brought against his rulers by Lichtman and has declared that he would appeal the decision.
"The decision of this private arbitrator is categorically wrong on the merits and exceeds his powers of arbitration," said the company. "Fox will not let this flagrant injustice, fraught with mistakes and gratuitous attacks of character, defend itself and vigorously challenge the decision in court."
Rice and Walden are about to play a leading role at Disney after the merger with Fox. In a statement following this decision, Disney's general manager, Bob Iger, said that he still had "complete trust" in the leaders.
"Peter Rice and Dana Walden are highly respected leaders in this sector and we have full confidence in their character and integrity," said Iger. "Disney has no involvement in arbitration, and we understand that the decision is being challenged and we will let the courts decide the case."
If this decision were upheld, the award would be one of the most important judgments in favor of for-profit participants in Hollywood history. In 2012, Disney lost a call for $ 319 million to the producers of "Who Wants to Millionaire".
"Bones" aired on Fox from 2005 to 2017. The stars of the series, Emily Deschanel and David Boreanaz, sued Fox in 2015. They were accompanied by Kathy Reichs, the author of the novels on which the series was based, and Barry Josephson. , the executive producer. The plaintiffs alleged that the 20th Century Fox TV studio had agreed to give rights lower than those of the market by granting a broadcast license to Fox, then to Hulu, for reruns. Participants say they have been cheated by tens of millions of dollars in profit sharing through these modest deals.
Fox has moved to handle the case through private arbitration.
In his decision, Lichtman also accuses Fox of conceding a generous production contract to former Fox executive Peter Liguori shortly before the arbitration hearing in order to guarantee his testimony. favorable.
"If we juxtapose the agreement at first sight with the testimony of Mr. Liguori at the hearing … it seems that it is a coincidence that Mr. Liguori disappears for 9 years ( from Fox's radar) and that it magically reappears with a 7 month first-time agreement testifying in this proceeding with an agreement in hand that most producers in Hollywood have been striving to have their entire career of entertainment, "wrote Lichtman.
Sources close to FX have described this claim as "scandalous" and false.
Liguori was Fox's head at the time the show started in 2005. In 2009, he wrote a memo that might describe Fox's efforts to avoid any responsibility for free trade. Fox was planning to give "Bones" a three-season renewal in 2009. Quotes from what is described as the "Legal Action Plan" memo are heavily redacted in the arbitration procedure. Liguori stepped down as president of Fox Broadcasting in 2009 when the television division was upset.
Lichtman also concluded that Fox executives had misrepresented the process for determining license fees for "Bones".
"The testimony of Mr. Newman and Ms. Walden regarding" market information "is not only disturbing but extremely disconcerting," said the arbitrator. "The more these people testified, the more incredulous their testimony is."
Lichtman made the decision on February 4th. Lawyers for profit participants filed a petition Wednesday to confirm the award.
Boreanaz issued a statement in which he said: "I enjoyed working on Bones with such an incredible team and actors – and I will not let this legal process detract from those wonderful memories." But if you look at the decision, he It was clear that what we were saying was everything, it was true: we were entitled to additional compensation for our work, and now I can only hope that Fox is obliged to fulfill its obligations to us without further delay. . "
Deschanel also issued a statement: "We are so proud of the hard work we have done on Bones for 12 seasons and we only want to honor the promises and contractual obligations of Fox.I am grateful that a referee also respected has examined the facts I am looking forward to seeing the legal system continue to hold Fox accountable for his actions so that we can all go ahead. "