Bluebird Films, Private Media Face Off in Countersuits

LOS ANGELES—A lawsuit filed in May in the Superior Court of California by Bluebird Films parent company Eyeworld charges Private Media Group umbrella corporation Fraserside Holdings Ltd. with continuing to claim worldwide distribution rights for Bluebird's content despite a mutual dissolution of the agreement earlier. Bluebird seeks approximately $1 million in damages,

In a statement from Eyeworld, chairman Paul Chaplin commented, "Several months ago, we terminated the joint venture based upon the numerous breaches of Fraserside. In response, Fraseside also terminated the relationship. However, we understand that they are out there trying to claim that they still have the right to distribute Bluebird content. We talked to Ilan Blundervitz—Private's CEO—about all this. His stance was, 'I want Bluebird content—I need it.' We agree that Bluebird's content is the best content around, but we do not agree that Private can come back after the termination and claim to have distribution rights to Bluebird's content."

Fraserside, meanwhile, claims that no mutual termination of the two companies' agreement took place. A statement from Private legal counsel James Moran counters, "Termination is 'wishful thinking' by Bluebird's owner Paul Chaplin. On February 25, 2010, Bluebird itself sent an unsigned letter, not on letterhead, purporting to terminate the agreement. Any such termination was contrary to the terms of the agreement and was ineffective.

"Fraserside sent a formal letter on March 16," Moran's statement continues, "and specifically stated, 'Notwithstanding your comments made in previous correspondence, we maintain that the Joint Venture Management Agreement and all terms of the Output Agreement and the Exploitation Agreement that place specific duties on the relevant parties, remain in full force and effect.'

"Bizarrely, Bluebird has claimed in a legal complaint filed in San Francisco and in a press release issued today, that Fraserside's March 16 letter 'terminated' the parties' agreement. This is the complete opposite of the clear words of the letter."

On the basis of these counterclaims, Fraserside has filed its own suit in Los Angeles against Bluebird for Breach and Anticipatory Breach of Contract.

Calling this countersuit "baseless and inadequate," Chaplin stated, "We are confident that both Eyeworld and Bluebird will prevail in this litigation, and Fraseside's baseless claims will be dismissed."

Nicholas Steele, CEO of Bluebird America, added that "Bluebird is now handling worldwide distribution on all platforms directly," and AVN has learned that veteran industry salesman Drew Dixon was recently named Bluebird's vice president of sales in order to handle distribution in-house. These developments will be covered further by as details become available.

A copy of Private Media's complaint is here.