With DreamWorks Animation reaching a multi-million deal today, it is now really just Disney who hasn’t settled with animation workers in the long running class action suit over wage-fixing and anti-poaching allegations. On Monday, the now NBCUniversal owned home of the How To Train Your Dragon franchise filed paperwork to start ending its part in the over two-year long action with a proposed $50 million settlement – up to 30% of which could end up going to lawyers.
“The settlement here was reached after arm’s length negotiations, drawing on the expertise of informed, experienced counsel who have been deeply involved in this litigation since its inception, and it reflects the risks associated with both parties continuing to litigate this case,” said the motion for preliminary approval put forth in federal court in San Jose Monday (read it here). “In particular, counsel have been informed and guided by the rulings and settlement valuations deemed fair and reasonable in both this action and the High-Tech litigation,” the 16-page document from lawyers for original plaintiffs Robert Nitsch Jr., David Wentworth and Georgia Cano added.”
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A January 19, 2017 hearing has been penciled in for Judge Lucy Koh’s courtroom on the motion, which essentially covers animation workers who were at the ‘toon studios from around 2004 to 2010. Fox’s Blue Sky Studios was the first defendant to break ranks back on March 31 and reach a nearly $6 million settlement in the potentially sprawling case and Sony Pictures Imageworks Inc. and Sony Pictures Animation Inc. came to a $13 million settlement in May. A hearing on the final approval of the Sony settlement is set for November 11 in front of Judge Koh.
That means with DWA’s deal today, all that is left is the Walt Disney Company and its Lucasfilm and Pixar divisions plus the Robert Zemeckis founded ImageMovers – which begs the questions, are they getting ready to settle too or fight to the last appeal, as is the House of Mouse way?
This all started when ex-DWA visual effects artist Nitsch first filed his case on September 8, 2014 with Wentworth and Cano putting their paperwork before the courts soon afterwards. “The Defendants themselves have explained the purpose of the conspiracy and in doing so, articulated the harm and injury caused by it to their workers. George Lucas explained under oath that the purpose of the non-solicitation agreement was to suppress wages and keep the visual effects industry out of “a normal industrial competitive situation,’” alleged Nitsch’s highly animated 27-page filing in the fall of 2014. “The agreement was explicitly intended to avoid ‘a bidding war with other companies because we don’t have the margins for that sort of thing.’”
With wide ranging implications for the animation industry and a pulling back of the veil of the way business is conducted, the matter has been pursued, tossed, revived and consistently opposed since Nitsch first took action in the fall of 2014.
The animation studios involvement in this antitrust behavior came out of the corporate depths in the Judge Koh overseen and now settled $415 million Department of Justice investigation into tech companies Apple, Google, Intel, Adobe and Intuit. They all had an agreement to not pluck each others employees and to keep wages at a certain level – one replicated in the ‘toon world.
With one defendant after another abandoning their once united front and contention the case was “meritless,” DWA just made Disney the last ‘toon house standing – for now.
Daniel A. Small of DC’s Cohen Milstein Sellers & Toll PLLC; Steve Berman of Seattle’s Hagens Berman Sobel Shapiro LLP; and Marc Seltzer of LA’s Susman Godfrey LLP are the main lawyers for Wentworth, Nitsch and Cano in the case.
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