Will & Jada Pinkett Smith battle with film financier heads to arbitration

By Matthew Belloni

Will and Jada Pinkett Smith's aggressive lawsuit against the financier of her directorial debut will be decided behind closed doors.

Lawyers for the Smiths and Overbrook Entertainment have agreed with attorneys for Tycoon Entertainment and principal David Grasso to move the case to arbitration, avoiding a messy public spat. The parties submitted a stipulation today to Los Angeles Superior Court Judge Edward Ferns, who is expected to sign it.

As you'll recall, the Smiths and Overbrook filed a preemptive declaratory relief claim (read the lawsuit here) on Feb. 5 over the film "Human Contract," which Pinkett Smith wrote and directed via her production company 100% Womon. According to the lawsuit, the film didn't perform as planned and Tycoon and Grasso were threatening to sue to recoup their investment.

Grasso told us last month that he invested $5 million of the $6 million-plus budget and recouped only $1 million from a foreign sales deal he negotiated himself. "It's an unfortunate situation but I’m sure we’ll work something out," he said.

Now it looks like they're work it out fairly soon. We hear the arbitration will be expedited, meaning depositions could start in a matter of weeks.

"The parties have worked cooperatively to move the lawsuit out of the Superior Court and into private arbitration where it belongs," Tycoon's lawyer Glen Rothstein tells us. "No one has claimed that Tycoon Entertainment or Mr. Grasso have done anything wrong.  Rather, in a somewhat unusual turn of events, the Smiths preemptively asked that a judge declare that they and their companies were innocent of any wrongdoing, in advance of my clients filing an anticipated lawsuit of their own. The parties' claims against each other will now be resolved sensibly in arbitration wherein my clients will be seeking substantial monetary damages." 

The Smiths are repped by Allen Grodsky at Santa Monica's Grodsky & Olecki, who did not immediately return our call.