More than two years after AMC booted him from its runaway hit zombie series, former The Walking Dead showrunner Frank Darabont is going after the network for a huge cut of the show's profits that he claims he was owed all along.
Darabont and his representatives at the Creative Arts Agency (CAA) just hit AMC with a massive lawsuit claiming they're owed "tens of millions" of dollars in profits from the show, all stemming from a promised profit-share agreement that AMC avoided with an in-house licensing scheme that, the suit alleges, allows the network to claim the show is actually operating at a deficit.
The suit claims that AMC agreed to contractual stipulations way back in September 2009 that the show would be produced by an outside production company like, say, Warner Bros., and that Darabont would get up to 12.5 percent of any profits that outside studio earned from the show. Then, when Darabont turned in scripts for the first season, AMC changed its mind, deciding to produce the show itself. Darabont and his representatives agreed “after gaining assurances from AMC that Darabont would obtain protections against improper self-dealing." According to the suit, AMC promised to pay its own production studio a license fee similar to what it would have paid an outside production house, and that Darabont's profit share would remain essentially the same.
The problem came when, as Darabont pressed the network for details of his participation in the show's profits, AMC put off answering, waiting to see how The Walking Dead would do. When the series became a hit, the suit alleges, AMC proposed “an unconscionably low license fee formula” that was capped in perpetuity and dramatically lowered the potential profits the show would see (from an accounting standpoint, anyway). Since Darabont's percentage of the show's profit would come from this licensing fee, the formula AMC proposed meant he might never see a cent. It's called "vertical integration," and it's something producers of everything from The X-Files to Smallville have had to deal with in litigation.
"Because of AMC's outrageous and improper formula, the profits pool in which [Darabont and CAA] participate may always be in deficit no matter how long-running and successful the series is," the suit alleges.
Furthermore, the suit claims that the network "fired Darabont without cause shortly before Season 2 aired precisely in order to avoid its contractual obligation to pay him increased profits (which vested fully at the conclusion of Season 2) and to avoid its obligation to negotiate to hire him as showrunner for Season 3."
As a result of all of this, Darabont and CAA are claiming tens of millions of dollars owed, plus unspecified damages, a share of the profits from the Talking Dead post-show and a cut of any other Walking Dead-related material the network produces in the future (that means that spinoff series).
AMC has not commented yet on the suit, but this is likely only the beginning of a showdown between the network and the fan-favorite showrunner. We'll keep you posted on where this battle goes next.