Paramount appeals Buchwald case verdict - after wait of two years.

After a two-year delay, Paramount Pictures, which in a much-publicized case lost its legal battle with writer Art Buchwald and producer Alain Bernheim over the genesis of the megahit "Coming to America" as well as the studio's Byzantine accounting methods to determine the "net profits" due the pair, has finally filed its official appeal of the verdict.

Humor columnist/author Buchwald wrote a bitter letter to the judge seven months ago complaining about the "unconscionably slow process" of compiling court documents so the appeal could proceed. And industry insiders say that the studio was offered another opportunity to settle the case in the interim but instead Paramount's strategy has been to wear the opposition down and swamp the court with paperwork.

Perhaps Buchwald's attorney, Pierce O'Donnell, was prescient when he joked during closing arguments two years ago that the film should be renamed "From Here to Infinity."

In March 1992, Los Angeles Superior Court Judge Harvey Schneider awarded Buchwald and Bernheim a combined total of $900,000, after a two-year, trial in which he ruled that Buchwald's three-page treatment "King for a Day" -- which Paramount had optioned -- served as the unauthorized basis for "Coming to America." The film starred Eddie Murphy as an African prince who came to this country searching for a wife.

Schneider also held that the net-profit contract Paramount had signed with Bernheim was "unconscionable" and "unduly oppressive." In his decision on damages, the judge said that he wanted a "fair and equitable" judgment that wasn't oppressive to either Paramount or Buchwald and Bernheim.

Despite the fact that as the trial progressed the film grossed $145 million domestically and $350 million worldwide -- and actor Murphy earned $20 million -- Paramount carried the film on its books as having no net profits. The film's co-screenwriter, Barry Blaustein, testified during the trial that he and his partner, like Buchwald and Bernheim, "have not yet received a dime" of net proceeds from "Coming to America."

The studio stipulated during the lengthy trial proceedings that it had earned tens of millions in gross profit, but the judge ruled that its accounting formula limited the likelihood that this or any film production would return net profits, and that it was unfair for the studio to dictate such contract terms on a "take-it-or-leave-it" basis.

Even before the judge's final ruling awarding dollar damages, Paramount vowed to appeal, presenting evidence at the end of the trial that all sides conceded was introduced in anticipation of later legal maneuvers.

In the official appeal, filed March 31 with the California 2nd District Court of Appeals, Paramount argued against two key aspects of Judge Schneider's rulings. The 86-page brief contends that the judge inappropriately applied the phrase "based upon" in regard to Buchwald's "King for a Day" treatment. According to Paramount attorney Bertram Fields, "Coming to America" was not based on the Buchwald idea, which originally involved a despotic, ruthless African king.

During the original trial, plaintiffs Buchwald and Bernheim presented evidence of a development script which Bernheim commissioned that had toned down the character. The judge explicitly ruled in the trial that both sides' definition of "based upon" was wanting; the Paramount appeal asks the court to reconsider the definition of the phrase.

The second thrust of the appeal, which was filed with 37,000 pages of clerks' and court reporters' transcripts, was to argue that Paramount was not "unconscionable" in its story option contract with the pair. That pact gave Buchwald $65,000 and 1.5 percent of net profits for the story and Bernheim $200,000 and 17.5 percent of net profits for producing. Paramount states it spent $500,000 to develop Buchwald's treatment before shelving it.

Paramount contends in the appeal that Buchwald and Bernheim used professional negotiators -- lawyers and agents -- to help create their deal, so a rule of unconscionability does not apply. Moreover, according to Fields, Bernheim and Buchwald themselves pushed "fervently" for a net profits provision in their contract.

During the trial, actor Murphy testified that he, like many in the industry, considered net profit points "monkey points." In Hollywood, net profit is the cash left after every charge a studio can think up is accounted against it, said other witnesses.

In the case of "Coming to America," the studio didn't have to reach far: It cost $115 million just to produce, Paramount contended. But plaintiffs' attorney O'Donnell calculated that Paramount paid itself some $50 million to $60 million in distribution fees as part of that cost.

O'Donnell, who worked for Buchwald and Bernheim on a contingency basis and racked up an estimated $2.5 million to $3 million tab in legal costs during the first three years of the legal battling and trial, characterized Paramount's appeal as a "rehash" of arguments the studio made during trial and which were rejected by the judge. O'Donnell's response to the appeal is expected by July 1.

Paramount attorney Fields said the two-year delay in filing the appeal was a result of court delays in assembling the many thousands of pages of evidence, attorneys' filings, court reporters' transcripts and related documents for the appeal court.

And in fact, though the court reporters were notified in October 1992 to prepare their transcripts, the trial proceedings weren't completed until last February because of the "unavailability" of one of the reporters. The court had to work out procedures to prepare that reporter's transcripts, and other court reporters for subsequent court dates were forced to wait.

Although industry critics also point to Paramount's decision to replace trial attorney Charles Diamond with Fields as a move to buy time on the appeal, Paramount actually filed within the 30-day statutory time period after the law firm was notified that the court's transcripts were complete on March 1. Fields' law firm did not request any extension related to the appeal filing.

Entertainment industry attorneys not involved in the case have long questioned Paramount's strategy to appeal the case decision, reasoning that as long as this is just one lower-court case it doesn't serve as a negative legal precedent for other contracts.

"At some point it would have been better for them to settle," said attorney Peter Dekom. If the studio loses the appeal, he said, it could encourage other writers, producers or other net participants to sue studios in similar situations.

"The appeal itself, if they publish it, will be precedent," Dekom explained. Other courts might rule that net profit definitions are "inherently suspect."

Entertainment attorney James Tierney agreed. "This was a unique case, and so many legal scholars have said it was wrong. How many plaintiffs' attorneys would want to go through a lawsuit with a $2.5 million legal cost when it's only one judge's decision and not the law of the state?" he said. "But what happens if that decision is affirmed?" Then Paramount could be buying trouble for itself and other studios, said Tierney.

Plaintiffs' attorney O'Donnell also said Paramount may be misstepping with this appeal. "I think that Paramount has upped the ante for itself and other distributors by filing the appeal," he said. "They've heightened the risk. A prominent attorney told me it's foolish to put an important business practice at risk in the court system."

Tierney also viewed the case as a victory for Paramount, though Paramount itself obviously does not. "The plaintiffs wound up getting a lot less than they demanded," he noted.

A former Paramount executive sees it a little differently. "The final decision by Judge Schneider was: a pox on both your houses. He didn't give anybody a clear victory.

"The question now, really, is whether Sumner Redstone (chairman of Viacom Inc., which recently acquired Paramount) will see the importance of this case the way (former Paramount Chairman) Martin Davis did. Davis' attitude was, we should drag it out forever. He was afraid otherwise we'd open the doors to many other disgruntled writers."

O'Donnell agreed: "Davis was the motivating force for perpetuating this case. Whether Redstone and company will pursue this is yet to be seen."

But O'Donnell takes exception to the characterization that the case was a draw, or even a small victory for Paramount.

"The truth of the matter is that $900,000 -- which has grown to $1.3 million with interest -- is an enormous sum for 2.5 pages of writing. It only appears a paltry sum when you consider the years of wrangling," he pointed out. "Note that we haven't appealed the judgment on damages."