
DeLorean vs NBCUniversal: A fight over lost royalties from the Back to the Future franchise
Introduction
It looks like the DeLorean Motor Company is taking a trip back to the future, but this time it’s not to change the outcome of events but to settle a legal dispute from the past, with proceedings recently filed in Los Angeles over alleged lost royalties, not only from the Back to the Future series but also from other films.
“Wait a minute. Wait a minute Doc, uh, are you telling me you built a time machine … out of a DeLorean” ... and you didn’t foresee this court case coming? 🙂
…Obviously not, as the current owner of the DeLorean trademark has filed a lawsuit against NBC Universal, 40 years after the film’s release, alleging that the company has not paid the agreed-upon 5% of royalty revenue generated from “Back to the Future” merchandise and commercial agreements.
DeLorean Motor Company is claiming that the 1989 agreement made between Universal Studios and John DeLorean, the original founder and carmaker, stated that the DMC was entitled to a portion of these royalties that had not been fully paid out.
At the behest of the DMC, NBCUniversal was asked to provide accurate accounts for what was owed to them in royalties, however, NBCUniversal has refused their requests and declined to disclose the scope of the license granted to them. Instead, NBCUniversal has evaded and avoided providing this information, allegedly denying the existence of such a deal had been made.
A previous trade mark dispute
The Back to the Future trilogy, which was released in the mid-1980s, was a box office hit, reportedly earning more than $AU580 million in revenue. Its success helped turn the DMC DeLorean into an iconic cult classic. The car-maker, which was based in Belfast, Northern Ireland, went bankrupt in 1982 before the first film even hit the big screen. Its stock and intellectual property were initially sold to a holding company, and then in 1997, the entire stock of car parts, publications, rights and trade marks was purchased by Texas-based businessman, Stephen Wynne.
This is not the first time Wynne’s company, the DeLorean Motor Company, has been involved in legal disputes over the use of the DeLorean name and trademarks. In 2014, John DeLorean’s widow, Sally Baldwin, sued the DMC for misuse of trademarks, and the case was settled in 2018, with Ms Baldwin receiving an undisclosed payout and the Texas-based DeLorean Motor Company obtaining the rights to use the name, trademarks, and logos.
The legal settlement in 2018 included provisions allowing Wynne’s DeLorean Motor Company to also receive a share of royalties generated by the Back to the Future franchise. So although the DeLorean Motor Company is not affiliated with the estate of John DeLorean, the inventor of the original car, it did acquire some assets after the collapse of the original carmaker.
The DeLorean Motor Company’s legal case showcases the longstanding impact the DeLorean brand and its significance had on the franchise. And because of this, the DMC is seeking an unspecified amount in damages from NBCUniversal, which will be determined during the trial. We will have to watch this space to see how the dispute moves forward and will keep you updated.
final thoughts
Unfortunately we don’t have a DeLorean to take us back to the future to fix any mistakes we’ve made along the way. Experience tells us that a proactive company is better than a reactive one, especially when it comes to handling matters of legal importance. With foresight, you can anticipate and address potential issues before they become problems, while hindsight only allows you to react to things that have already happened.
A proactive company can avoid costly legal issues that may emerge down the track, protecting itself, its shareholders and its employees from unnecessary pain. So if you have any questions, seek out legal advice and guidance before the preverbal sh#t hits the fan, especially when it comes to your trade marks and/or commercial law contracts, which can be complex and confusing.
Our professional legal team here at Lazarus Legal can provide you with the expertise and support you need to navigate these issues and achieve a successful outcome.
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Mark Lazarus
Mark Lazarus, the visionary behind the business and the fresh blood of the Lazarus Legal team, Mark (or Laz as he is often known) owes much of his success to his past experiences. And he’s made it his personal goal to bring that wisdom and formula to the firm.