Fight Over Netflix Release of 'Atlas Shrugged'
5/31/2012 8:50:00 AM,
(CN) - The producer behind "Atlas Shrugged: Part I" says Netflix and Relativity Media released the movie for home viewing without clearing a $1.5 million license fee.
Atlas Productions sued Netflix, Relativity Media and RML Acquisitions III in Los Angeles Superior Court on Wednesday. Atlas claims Relativity and RML paid the first installment of the license fee, but neglected the second half of the agreement, totaling $750,000, saying they lacked the funds.
"Defendants RML and Relativity Media represented to plaintiff that they lack the financial ability to pay the license fee without obtaining a loan from a third party to pay the debt represented by the license fee," the complaint states.
Though Relativity and RML received more than $1.5 million from Netflix for the film, the duo never relayed the money to Atlas Productions, according to the lawsuit.
"Based on information and belief, defendant Netflix has paid defendant RML and Relativity a sum in excess of $1.5 million for the film and defendants RML and Relativity have been unjustly enriched in that amount. Based upon information and belief, defendant Netflix has generated income by exploitation of the rights in the film on its website and has been unjustly enriched in that amount," the complaint states.
"Atlas Shrugged: Part I," released in 2011, was adapted from Ayn Rand's 1957 novel touting free market capitalism. The film, intended to be the first in a trilogy, was widely panned by critics and took in $4.6 million, less than a quarter of its production budget.
Atlas Productions seeks $1.5 million in general damages for copyright infringement, breach of contract and fraudulent misrepresentation.
It is represented by John Jahrmarkt of Jahrmarkt & Associates in Los Angeles.