Shrewd copyright lawyer gives studios a headache

By Matthew Belloni

LOS ANGELES (Hollywood Reporter) - You'd think Marc Toberoff had leaped a tall building in a single bound.

The mild-mannered attorney was showered with accolades after last week's ruling granting his clients, the heirs of Superman co-creator Jerry Siegel, a share of the U.S. copyright to the character.

But Toberoff isn't a Man of Steel. He's more like a diligent Jimmy Olsen, tirelessly exploiting a tiny window in copyright law that most entertainment litigators aren't willing to pursue through years of tough legwork. That's not a knock on him; in fact, it says more about the insular and risk-averse nature of entertainment law that Toberoff is nearly alone in his willingness to take on challenging contingency cases against well-financed studios -- and, every once in a while, to win one.

"Termination rights" is the legal concept currently fueling Xanax sales near the Warner Bros. lot in Burbank. For works created before 1978, authors or their heirs have a five-year window to "terminate" assignments of copyrights 56 years after the date the copyright was first secured.

"Congress wanted to give creators a second bite at the apple," Toberoff explains, "to participate in the financial success of their creations even though they had to make a one-sided deal to get the work published."

The law seems tailor-made for Siegel, who in 1938 sold the Superman character he created with Joseph Shuster to Detective Comics for an un-super price of $130. With Toberoff's friendly assistance, the Siegel heirs claim they exercised their termination rights in 1999 and are thus entitled to half of all Superman profits earned since then. That totals more than $50 million, Toberoff says, including profits from 2006's "Superman Returns" and any future adventures.

Warners, which has a long history of tangling with Toberoff, claimed the termination was invalid based on a previous settlement agreement, but Judge Stephen Larson's detailed, 72-page opinion rejected that argument. (The studio has declined to comment on the decision beyond a statement noting it maintains its international rights in the character and that several issues must be resolved by a November trial, including what, if anything, the Siegels might be owed.)

Because a recent change in copyright law allows the Shuster family -- also, surprise, surprise represented by Toberoff -- to bring a similar claim in 2013, so the co-creators' heirs could end up controlling Superman's destiny for years.

That result would be a vindication for Toberoff's somewhat controversial legal practice. He is known to court potential clients aggressively, sometimes sending letters to the widows of creators of well-known properties. He then finances litigation, which can last years and often results in no recovery. When he wins, he takes as much as a third of proceeds and will partner with clients to exploit their rights, as he did with "Fantasy Island" (he'll take a producer fee if a planned movie is made).

It's an entrepreneurial strategy, but only if you've got the legal skills and tenacity to pull off major wins against the most well-lawyered studios. That hasn't been too big a problem. In 2005, Toberoff created every studio general counsel's worst nightmare by convincing a judge to issue an injunction against Warners' "Dukes of Hazzard" just weeks before its scheduled release. The case settled for $17.5 million. Similar claims have been settled on Warners films from "It's Alive" to this summer's "Get Smart."

The studios call it ambulance chasing. Toberoff calls it a smart and lucrative business. They're both right.

Reuters/Hollywood Reporter