Katzenberg settlement typical of Hollywood suits.

Movie executive Jeffrey Katzenberg's $250 million lawsuit against Walt Disney Co. may have captured the imaginations of media-watchers the world over, but for Hollywood's entertainment attorneys, the conflict was nothing more than business as usual.

"There's an old saying that war is diplomacy through alternative means,' " said Daniel J. Coplan, an entertainment litigator with the Pasadena law firm Sheldon & Mak. "In the context of Hollywood, litigation is negotiation through alternative means."

That ethos permeates the entire entertainment industry' food chain, Hollywood lawyers say.

Small vendors routinely sue production companies for not paying their bills; screenwriters often file intellectual property suits, alleging that their ideas have been stolen by unscrupulous studio execs; and top directors, executives and stars regularly turn to the courts when they believe they are due a greater share of a successful project's profits.

"There is probably a lawsuit filed every day about something that happened somewhere on a movie or a television show," said Coplan, an 11-year veteran of Hollywood's legal trenches.

Indeed, the Eisner-Katzenberg tussle had barely left the front pages when a new conflict made news: Allegations against Dreamworks SKG of plagiarism in connection with Steven Spielberg's upcoming release, "Amistad." Ironically, Katzenberg is one of the founders of Dreamworks.

Despite their volume, such suits rarely make it to a jury trial, or to the public eye.

Katzenberg and Disney settled their 19-month-old dispute last week for an undisclosed amount, pulling the plug on a widely anticipated courtroom fight that would have pitted two of Hollywood's most powerful moguls - Katzenberg and Disney chief Michael Eisner - against one another beneath the full glare of the international media.

While that dispute was remarkable for the large amount of money at stake and the lofty stature of the players involved, the nature of the claim itself was fairly common, according to Hollywood litigators.

In his suit, Katzenberg argued that Disney had reneged on a promise to give him 2 percent of the profits of films and television shows put into production or acquired during his 10 years as the studio's top movie executive. That includes such animated hits as "The Lion King" and "Aladdin," both of which generated billions of dollars at the box office as well as in sales of related merchandise.

The settlement reportedly calls for Katzenberg to get a minimum guaranteed sum of money as an advance against the eventual overall payout he will receive, an amount to be decided at an arbitration proceeding.

"That dispute in a lot of ways was a basic contract dispute relating to the terms of compensation," said Jeffrey B. Valle. an attorney in the entertainment division of the law firm Skadden Arps Slate Meagher & Flom LLP. "There is nothing precedent-setting about that kind of claim."

While lawsuits are a fact of life. Hollywood is not necessarily any more litigious than any other industry, says Patty Glaser, co-head of the litigation department of the Century City law firm Christensen Miller Fink Jacobs Glaser Well & Shapiro.

But there is a key difference between Tinsel Town and the rest of the world, Glaser added. In Hollywood, she says. "the stakes are very high. And when the stakes are high, you are going to see people willing to put things on the line."

Glaser, who has a reputation as one of Hollywood's toughest litigators, recently won her own case against Disney - in which she represented a European animator in a contract dispute with the entertainment giant. A judge awarded the animator $10.4 million plus attorney fees, but the legal battle is far from over; Disney is likely to appeal the decision, Glaser said.

But that's an exception, added Glaser, who also successfully represented Mainline Pictures in a multi-million dollar dispute with actress Kim Basinger. "Most cases settle," Glaser said. "There is too much at stake."

That was the case with Katzenberg and Eisner. A jury trial would have forced the two moguls to undergo harsh grilling on the witness stand. Eisner likely would have been called upon to reveal Disney's top-secret business practices; Katzenberg, for his part, would have been forced to account for the rocky start experienced by Dreamworks.

In general, Hollywood attorneys agree, successful projects generate more litigation than bombs.

"People wait and see if a film does well before deciding if they're going to make a claim," said Coplan, who in the late 1980s represented a screenwriter who claimed that Universal Studios Inc.'s television division had stolen his idea for the hit television series, "Northern Exposure." Like most such disputes, the case settled out of court.

"Most of the rest of the business world gets the contract signed before they proceed to invest millions of dollars," said Valle. In Hollywood, on the other hand, "it is commonplace to be litigating a case over all kinds of contractual obligations and nothing is signed by anyone."