Fans of the gangster film genre will undoubtedly name certain motion pictures as must-see viewing, including Francis Ford Coppola’s The Godfather and Martin Scorsese’s Goodfellas. Interestingly enough, this latter film is now at the epicenter of a fascinating lawsuit filed 25-years to the day of its original release.
The lawsuit in question was filed by famed Hollywood producer Irwin Winkler against Warner Brothers, the studio that helped put Goodfellas on the silver screen, and alleges both fraud and breach of contract.
According to the complaint, which seeks a minimum of $18 million in damages, Warner Brothers unlawfully concealed over $140 million in income derived from home video receipts generated by the film, and in doing so excluded “that vast sum from the computation of plaintiff’s contingent compensation” otherwise set forth in a 1981 contract.
The complaint goes on to state that this massive understatement and concealment of income was only uncovered after the release of a studio report last year, and accomplished by having a subsidiary, Warner Home Video, comingle the income generated by Goodfellas with other funds so as to be virtually untraceable.
“Warner withdrew from its subsidiary an amount equal to 20 percent of that [home video] revenue, which it reported to plaintiffs as the ‘total’ such revenue,” reads the lawsuit. “Later, having complete and absolute control of its wholly owned subsidiary, Warner withdrew from that subsidiary an amount equal to the remaining 80% balance of such video revenue, less video costs. That balance, although received by Warner, was concealed and went unreported.”
As if these allegations of “studio accounting on steroids” weren’t shocking enough, the lawsuit goes on to contend that Winkler, who helped make such hits as Raging Bull, The Right Stuff and the Rocky films, received less than half of this 20 percent as the studio subtracted substantial costs and distribution fees.
Experts have indicated that while the breach of contract claim revolves around the 2014 discovery of the allegedly illegal conduct by Warner Brothers, it’s likely that Winkler’s legal team included the fraud claim in the event the statute of limitations on the contract claim is found to have run.
Stay tuned for updates on this fascinating case.
If you have questions or concerns related to a potential breach of contract or other business dispute, it’s imperative to consider speaking with an experienced legal professional as soon as possible.