In April a Texas jury decided Big Idea Productions, creator of the popular values-laden VeggieTales series, breached a contract with a distributor. The judge in the case has not yet issued a final ruling, but the jury said Big Idea must pay more than $11 million in lost compensation.
Texas-based Lyrick Studios, producer of Barney & Friends, claims the two companies had an unsigned contract starting in 1997. Lyrick began distributing Big Idea videos and CDs the next year. According to court documents, Lyrick paid Big Idea more than $40 million from the profits in four years, saying it had exclusive rights to sell VeggieTales products in North America.
But in December 2001, Big Idea terminated the relationship and announced a new distribution deal with Warner Home Video. Lyrick filed suit in January 2002.
Lyrick’s lawyers argued that the companies had a binding, though unsigned, agreement. They cited verbal assurances and a number of memos. Two actions in particular, Lyrick argued, showed that Big Idea assumed Lyrick and Big Idea had a binding contract: In 1998, court documents say Big Idea bought back “plush rights” from Lyrick to produce stuffed VeggieTales toys. Lyrick also said Big Idea touted its distribution deal with Lyrick as collateral for a $24 million bank loan.
“We believe this case is simply about keeping commitments,” Lyrick attorney Thomas Williams told the jury. “The parties did make a commitment to one another. Big Idea made those commitments, and we believe that Big Idea should be held to that commitment.”
Big Idea’s defense said the drafted agreement only laid out terms to guide the companies. Merely working together, attorneys said, does not imply or create an exclusive contract.
Mark Litwak, entertainment lawyer and author of Contracts of the Film and TV Industry, said an unsigned exclusive rights contract is extremely rare.
The jury, in the Northern District of Texas Court, determined that Big Idea owed Lyrick compensation for the six years left on the contract. Big Idea declined to comment, pending the judge’s decision.
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Related Elsewhere
Other coverage of the lawsuit includes a January 21, 2002 article in the Dallas Business Journal, “Lawsuit over verbal pact pits Lyrick Studios, VeggieTales.”
Past CT articles on Big Idea include:
Big Idea Responds to CT Article | Phil Vischer, CEO and founder, issues a statement regarding company’s financial status. (Oct. 4, 2003)
Big Trouble at Big Idea | Former workers worry that Jonah could sink the company. (Oct. 4, 2003)
The Top Tomato | Phil Vischer’s tenacious campaign to dominate family entertainment. (Oct. 4, 2003)
Runaway Asparagus | Big Idea’s Jonah is both wholesome and hip. (Oct. 4, 2003)
(The Voice of) Larry the Cucumber Speaks | “Nobody thinks growing up that they’re going to be a cucumber.” (Oct. 4, 2003)
The Serious Business of Silly Songs | The director of music for the VeggieTales talks about bringing musical depth to the score. (Oct. 4, 2003)
The Big Idea corporate site has more information on the company.
Christianity Today sister publication Books & Culture discussed Big Idea’s video series in “What’s Cooking When Martha Stewart Meets the VeggieTales?”
