Photo by Tima Miroshnichenko on Pexels
Meena Alnajar is an IPilogue Writer, IP Innovation Clinic Fellow, and a 2L JD Candidate at Osgoode Hall Law School.
American actress Scarlett Johansson, known for playing the Black Widow in Disney & Marvel’s The Avengers franchise, took action against Disney on July 30, 2021 for an alleged breach of contract involving the recent Black Widow film’s distribution. According to Variety, Johansson’s contract read that Black Widow would be guaranteed a ‘wide release’, meaning that “the film would be shown on at least 1,500 screens.” The caveat here in the streaming service age is the term ‘screens.’ Johansson’s legal team argues that ‘screens’ means movie theatre screens exclusively. This implies a theatrical release, where a movie cannot be available on other platforms until after 90 to 120 days. Disney countered the argument, stating that Black Widow received a theatrical release, but that this release does not imply an exclusive release to theatres only. As such, Disney was within their rights to simultaneously launch the film on their streaming service, Disney Plus.
Experts argue that this may be a case of ambiguity with the phrase ‘wide release.’ In contract law, ambiguity is addressed in several ways. Absent fraud or misrepresentation, the court may choose to examine parol evidence—verbal agreements made between parties, usually in the negotiation stage. Johansson’s legal team stated that they have email evidence from 2019 between them and Marvel’s Chief Counsel, Dave Galluzzi. In the email, the studio attorney promised a release “like our other pictures” and that if plans should change, they would be “discussed with [Johansson’s legal team].” Further, even without the email, courts generally resolve ambiguity against the party who drafted the contract, which in this case is Disney. Therefore, Johansson is likely to win in court.
On August 21, 2021 Disney responded to Johansson’s suit with a motion to move the suit to private arbitration. Arbitration is a method of private dispute resolution whereby parties choose a sole arbitrator and venue of arbitration to settle a dispute. The arbitrator’s ruling is final and enforceable. Hollywood dispute lawyer Chad Fitzgerald predicted Disney would make this move back in July. Moving this issue to arbitration helps Disney keep their business strategies and contract drafting out of the public eye and protects their public image from damage. But Disney’s representatives counter this view, stating that they simply wish to exercise the arbitration clause that was agreed upon between both parties to the contract. Disney also argues that the company made good on its contract by displaying the movie on more than 30,000 screens.
Additionally, instead of coming after Marvel, as the party involved in the contract, Johansson’s team is pushing for a public suit against the parent company Disney. Disney suggests that Johansson is participating in “gamesmanship” by making Johansson’s compensation Disney’s responsibility, rather than carrying out the dispute in arbitration with Marvel. Gamesmanship is a dubious technique where lawyers create additional expense or agitate the other side to put them in a tough position where they must either settle or abandon the case. Since arbitration is often a cheaper, faster alternative dispute resolution than a public lawsuit, Johansson’s team may indeed be partaking in gamesmanship with the constant push for a public lawsuit.
Whether the parties decide to settle the dispute confidentially or publicly, this contractual disagreement emphasizes the new contractual landscape for actors and production companies. With the rise in streaming services and decline of theatre capacity during the COVID-19 pandemic, movie production companies should work to be more explicit in their compensation plans and in their definition of ‘wide release.’ 30,000 movie theatre screens versus 30,000 users on Disney Plus can make millions of dollars of a difference.