Studios Spar in Court on ‘Dungeons & Dragons’

LOS ANGELES (CN) - A federal judge heard opening arguments Tuesday in a case that could decide which of two major Hollywood studios gets to make a movie based on the fantasy role-playing game "Dungeons & Dragons."

Hasbro sued Sweetpea Entertainment in May 2013, to halt Warner Bros. production of a "Dungeons & Dragons" movie, " Chainmail ."

Sweetpea filed counterclaims against Hasbro four months later.

Sweetpea's founder is Courtney Solomon. He was a 19-year-old "Dungeons & Dragons" fan when he inquired about movie rights to the game 24 years ago.

After Solomon discovered that no one had snapped up the rights, Sweetpea entered into a 1994 license agreement with the original "Dungeons & Dragons" owner, TSR.

Wizards of the Coast bought TSR three years later.

In 1998, TSR claimed that Sweetpea had failed to commence production on the first movie under the terms of the license. That resulted in mediation and a twice-amended rights agreement. Those amended rights are at the center of the current dispute.

Hasbro acquired Wizards of the Coast a year later. "In 2000, the first "Dungeons & Dragons" movie, starring Jeremy Irons, was released and flopped.

In 2012, Sweetpea and Hasbro entered into separate talks with major studios to make new "Dungeons & Dragons" movies. Sweetpea negotiated with Warner Bros. to make a project called "Chainmail." Hasbro meanwhile had entered into talks with Universal.

The studios are not parties to the dispute.

Hasbro claimed the amended agreement gave movie rights back to TSR if Sweetpea failed to make another theatrical or non-theatrical movie based on the game within five years of the first "Dungeons & Dragons" film.

Two more movies followed the original: "Wrath of the Dragon" in 2005 and "The Book of Vile Darkness" in 2012.

Hasbro claimed that the second and third movies were only TV movies, so sequel rights to the movie reverted back to Hasbro. It later dropped its claims about "Wrath" to focus its attention on "Vile."

On Tuesday morning, Hasbro's attorney Maura Wogan, with Frankfurt Kurnit Klein + Selz, of New York, told U.S. District Judge Dolly M. Gee that Sweetpea had failed to "take care" of the movie rights and had "squandered" them by making three poorly received movies.

"Sweetpea was a terrible steward of Hasbro's valuable 'Dungeons & Dragons' brand," Wogan told the court.

The attorney said that in order for Sweetpea to satisfy the so-called "use it or lose it" clause in the 1998 amended agreement, Sweetpea had to start principal photography on a new non-theatrical or theatrical movie within five years of "Wrath of the Dragon."

"The Book of Vile Darkness" is a television movie made for the SyFy channel and did not qualify as a sequel under the agreement, Wogan said.

Sweetpea was required to make a rights payment to Hasbro on the day principal photography commenced, on Oct. 1, 2010, Wogan said. Otherwise, she said, rights to the movie reverted back to the toymaker.

The court was shown highlighted emails between Solomon and Silver Pictures producer Steve Richards, who produced the last two movies. An email on the eve of production on "Vile" demonstrated that both men were aware that a rights payment was due, Wogan said.

Solomon wrote to Richards in an Oct. 1, 2010 email that Hasbro executive Mike Jaffa had inquired about the rights payment, which at that point had not been made, Wogan said.

Richards supposedly emailed back and told Solomon to tell "'him [Jaffa] the payment was made. Unless you disagree.'"

Wogan said that showed that "both men were prepared to lie to Hasbro about the rights payment having been made."

"That willingness to lie is very strong evidence that they believed that the payment should have been made at that time," the attorney told Judge Gee.

A rights payment of $20,000 was made on Oct. 7, 2010, exercising television rights, not sequel rights, under the amended agreement, according to Wogan.

Sweetpea knew that that it was exercising television rights rather than sequel rights when Silver Pictures sent the payment, the attorney said. She said that presented the clearest evidence that Sweetpea knew that it was making a television movie and not a sequel to the first "Dungeons & Dragons" film.

"You have seen the smoking gun," Wogan said. "What you say and what you pay to the licensor determines what rights were exercised. What you pay and what you say is the best evidence of intention."

But attorney Patty Glaser, with Glaser Weil Fink Howard Avchen & Shapiro, accused Hasbro of rewriting the agreements to suit their argument.

"'History is not history, unless it's the truth,'" Glaser said, citing Abraham Lincoln. "You should not allow Hasbro in our view to rewrite history and the agreements."

Glaser said "The Book of Vile Darkness" was a sequel. It had been released non-theatrically on DVD before it was sold to the SyFy channel, and SyFy did not finance the movie and had bought it "after the fact," the attorney said.

Nothing in the amended agreement tied rights payments to reversion rights, the attorney added.

"This lawsuit is a desperate, last-ditch attempt to capture rights," Glaser said. "It's time to put an end to this shameful conduct."

Glaser said there are several similarities between the three Sweetpea movies that make "Vile" a sequel. All movies include a quest for a magical artifact, and other common elements, including portals, fire-breathing dragons, elves, dwarves and orcs.

The fact that there were no recurring characters in "The Book of the Vile Darkness" was consistent with the theme and rules of the game, where characters are killed off and players create new characters, Glaser said.

For Solomon, the D&D movies had been a "labor of love," Glaser said. The fact that they didn't turn out so well was just "noise" that the court should ignore, the attorney said.

"Hasbro should not be allowed to come to the party late, attempt to change history and attempt to make a mockery of the negotiating history, and to make a mockery of the actual language of the three agreements," the attorney said.

The trial is expected to last six days. Hasbro president Stephen Davis attended the first day of trial. Solomon was also in court.

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