Appeals court sides with NBC Universal in 'Ghost Hunters' idea theft case

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Appeals court sides with NBC Universal in 'Ghost Hunters' idea theft case

Thu Jun 03, 2010 @ 10:11PM PST

By Eriq Gardner

Ghost_hunters_31 EXCLUSIVE: NBC Universal has won an important appellate court victory over two individuals who claimed to have come up with the concept for the hit Syfy reality show "Ghost Hunters."

In 2006, Larry Montz, a parapsychologist, and Daena Smoller, a publicist, filed a lawsuit against Syfy owner NBC Universal, producer Pilgrim Films & Television, and others claiming they conceived the idea of a show about a team of paranormal investigators who go into haunted locations. The two claimed to have presented screenplays, videos and other materials to NBCU execs between 1996 and 2003.

The duo pursued an interesting legal theory all the way to a 9th Circuit Court of Appeal decision. If successful, Montz and Smoller could have forged a path for many others who try to work around the constraints of copyright law and pursue allegations of idea theft against studios.

Over the years, it's almost paranormal how often Hollywood studios have been accused of ripping off ideas. These cases are rarely successful because copyright law only protects the expression of ideas —not the ideas themselves. It's tough to prove breach of contract or breach of an implied contract, and these state law claims are often preempted by federal copyright law.  

Originally, Montz and Smoller sued for copyright infringement, breach of implied contract and breach of confidence. A district court knocked the latter two claims out but let the copyright claim survive.

However, in an interesting move, the plaintiffs agreed to let a court dismiss the copyright claim with prejudice — perhaps with knowledge they wouldn't ultimately win on that. Instead, they appealed the district court's rejection of the breach of implied contract and breach of confidence claims.

They then argued that they presented their idea for "Ghost Hunter" to NBCU in confidence for the express purpose of offering to partner with the conglom. By agreeing to hear the concept, NBCU implicitly agreed not to "disclose, divulge or exploit the Plaintiffs' ideas and concepts without compensation and without obtaining the Plaintiffs' consent."

In analyzing the case, the 9th Circuit essentially had to decide whether the plaintiffs' claims were copyright claims in disguise (and thus preempted by federal law).

The duo's argument might sound like a reach, but in a 2004 case, Grosso v. Miramax (involving an idea theft claim over the movie "Rounders") the 9th Circuit found that a lower court erred in concluding that a screenwriter's claim for breach of implied contract was preempted by federal copyright law because the plaintiff had an element that transformed the case sufficiently. That ruling was heralded by plaintiff-side Hollywood lawyers while some on the studio side have loathed the decision and have been waiting for an opportunity to overturn it — or at least, to narrow it.

Today the 9th Circuit concludes that the difference between Grosso and the "Ghost Hunters" case is that in Grosso, there was an implied promise to pay for use of the idea, and in this one, the promise was for partnership. NBCU allegedly violated the exclusive right to use the work of Montz and Smoller — which makes it a copyright claim, not distinguishable enough to make it a contractual one. Thus, the appeals court affirms the lower court's judgment in favor of NBCU.

The defendants were represented by Gail Migdal Title at Katten. Here's the full decision.

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The Hollywood Reporter
The Hollywood Reporter, Esq. blog focuses on how the entertainment and media industries are impacted and influenced by the law. It is edited by Matthew Belloni with contributions from veteran legal reporter Eriq Gardner and others. Before joining The Hollywood Reporter, Belloni was a lawyer at an entertainment litigation firm in Los Angeles. He writes a column for THR devoted to entertainment law. Gardner is a New York-based writer and legal journalist. Send tips or comments to Matthew.Belloni@thr.com

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