Superman Movie Rights Weren’t Undervalued

(CN) - The widow and daughter of Superman co-creator Jerome Siegel lost a lawsuit accusing Warner Bros. of selling the film rights to corporate sibling DC Comics for under fair market value, because the terms of the sale are comparable to other comic book franchises.

In March 2008 a federal district court ruled that Joanne Siegel and Laura Siegel Larson had successfully terminated a grant made by Jerome Siegel in 1938, conveying to Detective Comics the copyright to Superman material printed in the comic book "Action Comics No. 1."

The sole remaining issue in that dispute concerned Siegel's and Larson's claim that a "sweetheart deal" was struck between Warner Bros. Entertainment and DC Comics, Detective Comics' successor-in-interest, for the movie rights to the Superman franchise.

A 10-day bench trial ensued.

Before addressing the merits, U.S. District Judge Stephen Larson made it clear he was not happy with either side's expert film industry witnesses, noting that "each film industry expert attempted to couch or shape answers to benefit the party paying their fees." Judge Larson took particular exception to plaintiffs' expert Mark Halloran, whose opinion "is, at worst, largely malleable, bent and shaped to produce pre-determined results to help his client."

Nevertheless, the judge found that the deal between Warner Bros. and DC Comics was comparable to other big-name comic book franchises during the time in which the deal was negotiated, in the late 1990s. Specifically, the court compared the Superman deal to the movie rights sold for the franchise X-Men, the most popular comic book at the time of the dispute.

The court pointed out that DC Comics was not required to obtain the absolute best price for the Superman rights. "Significantly, market valuation is not tied to finding what was the best price ... but what a reasonable price would have been paid for it by a willing buyer" (emphasis in original).

Judge Larson also noted that the plaintiffs do not own the entire copyright to Superman, yet spent most of the trial focusing on the overall value of the franchise. "This court sits in equity in this case, but that does not license the court to increase the assignment of that which plaintiffs own. At present, plaintiffs are the co-owners to the copyright in the Superman material published in 'Action Comics No. 1.'

"They are not the owners of the entirety of the Superman copyright."

Judge Larson pointed out that plaintiffs cannot "piggyback" off 70 years of development in the Superman franchise, simply because they are co-owners of the rights to the very first comic book that Superman appeared in.

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