WBD_Sky (original) (raw)

0% found this document useful (0 votes)

0 views

WBD_Sky

0% found this document useful (0 votes)

0 views

43 pages

© © All Rights Reserved

Available Formats

PDF, TXT or read online from Scribd

Share this document

Did you find this document useful?

Is this content inappropriate?

0% found this document useful (0 votes)

0 views43 pages

WBD_Sky

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK SKY UK LTD., SKY ITALIA S.R.L., AND SKY DEUTSCHLAND FERNSEHEN GMBH & CO. KG, Plaintiffs, v. WARNERMEDIA DIRECT, LLC, Defendant. Civil Action No. __________

COMPLAINT

Plaintiffs Sky UK Ltd. (“Sky UK”), Sky Italia S.r.l. (“Sky IT”), and Sky Deutschland Fernsehen GmbH & Co. KG (“Sky DE,” and collectively with Sky UK and Sky IT, “Sky”), by and through their undersigned attorneys, allege against defendant WarnerMedia Direct, LLC (“Warner”) as follows:

NATURE OF THE ACTION

Sky brings this action seeking damages and specific performance to redress Warner’s multiple material breaches of a 2019 agreement regarding the co-funding and co- production of exclusive premium television shows for Sky viewers. As set forth further below, Warner has repeatedly failed to offer Sky the annually required minimum number of contractually qualifying series for its consideration. Specifically, Warner was obligated to present Sky with at least four shows per year across 2021, 2022, and 2023 but undisputedly fell far short of that mark, in certain years offering barely a

single

qualifying series while also withholding critical, contractually required information necessary for Sky to evaluate any

Case 1:24-cv-07335 Document 1 Filed 09/27/24 Page 1 of 36

2 potential options that it did receive. This misconduct has deprived Sky of its bargained-for opportunity to co-fund, co-produce, and subsequently exploit exclusively in U.K. and European territories all manner of top-end Warner content. If all that were not enough, Warner has now even brazenly denied Sky its right to partner on Warner’s highly valuable decade-long, tentpole television series adapting J.K. Rowling’s iconic

Harry Potter

novels, set to premiere in 2026 or 2027. Instead, Warner has largely disregarded the parties’ agreement and sought to keep the

Harry Potter

content for itself so that Warner can use it as the cornerstone of the launch of its Max streaming service in Europe. 2.

Sky and Warner are parties to a valid, binding contract, dated September 20, 2019, by which Warner is required to annually offer Sky certain original content from HBO Max (“HBO Max,” or, as since rebranded, “Max”) for Sky’s consideration as co-funding and co- production opportunities (the “Co-Funding Agreement”). Among other things, the Co-Funding Agreement obligates Warner to offer “all . . . (and not less than four (4) in any event)” Max original series meeting certain contractually specified qualifications to Sky during every calendar year from 2021 to 2025, each of which Sky would have the option to co-fund and co-produce. Each co-funding candidate must be “formally submitted” to Sky executives as soon as Max “is prepared to order a first season” and must include “all relevant information related to the Series,” as soon as such information is “available,” to enable Sky to make a decision on which series to co-fund and co-produce. Sky is required under the Co-Funding Agreement to select from among the qualifying offers at least two series per year but has complete discretion to pick any two from the slate and is entitled, at its sole option, to select any number of series beyond that contractual minimum.

Case 1:24-cv-07335 Document 1 Filed 09/27/24 Page 2 of 36

3 3.

The Co-Funding Agreement further provides that Warner shall assign to Sky “all media rights” for each selected series in the geographic territory covered by the contract, which includes the U.K. and multiple countries in Europe, for a period of twenty years from delivery of the last episode of each season in any given series. Sky is entitled to “retain all revenue generated from exploitation of [these media rights].” 4.

Warner has never upheld its end of the parties’ bargain. Despite claiming, at least during the initial years of the Co-Funding Agreement’s term, that it had dozens of potentially qualifying series in development, Warner undisputedly failed to offer Sky the required minimum four qualifying series during each calendar year from 2021 through 2023 (i.e., Year 1 through Year 3 of the contractual term). To the extent Warner formally offered Sky

any

purportedly qualifying series during that timeframe, it failed to timely provide—or wrongfully withheld altogether—critical, contractually required information about the series in question necessary for Sky to confirm that it in fact qualified under the Co-Funding Agreement or meaningfully evaluate the series’ appeal as a co-funding opportunity. 5.

Sky has frequently learned more about potentially qualifying series from public information and Warner’s own press releases than from anything Warner has shared with Sky under the Co-Funding Agreement. Warner’s conduct in disclosing key series details to the public without disclosing them to Sky violates Warner’s obligations under the Co-Funding Agreement and substantially deprives Sky of the contractual benefits for which it bargained. 6.

Warner’s actions have made it manifestly clear that: (i) Warner has no intention of ordering the four qualifying series per year that it committed to offer Sky; (ii) Warner intends to keep solely for itself any potentially lucrative qualifying series that it

does

order in an effort to boost the performance of its own Max streaming service in Sky’s contractual territories as a

Case 1:24-cv-07335 Document 1 Filed 09/27/24 Page 3 of 36

Reward Your Curiosity

Everything you want to read.

Anytime. Anywhere. Any device.

No Commitment. Cancel anytime.