Wicked Wins Arbitration Award in Cable Broadcast Dispute

NEW YORK CITY—In a legal dispute stretching back more than a year, Wicked Pictures has won an arbitration award against its former cable partner Trans Digital Media (TDM) for non-payment of fees based on the contract—the "Exclusive Distribution and Co-Production Agreement"—that existed between the two parties.

According to that contract, which was first entered into in 2006, Wicked appointed TDM as its exclusive VOD television and worldwide cable TV pay-per-view distributor for Wicked's movies, including both the company's catalog and any new features produced during the contracted period. The contract also called for at least two adult-oriented co-productions between Wicked and TDM per year, with the costs for same to be shared equally by the parties.

Under the contract, TDM was to pay Wicked royalties in varying amounts for the Wicked product it used—which according to the award entered by the arbitrator came to over $1 million annually. However, in roughly October of 2009, TDM began to fall behind in its minimum payment obligations, and after extensive discussions and further contract negotiations, Wicked was forced to take its complaints to arbitration.

"The only conclusion is that [Wicked] fulfilled the terms of the written Agreement, as amended, while TDM did not," wrote arbitrator Robert B. Davidson on August 28, 2012. "Accordingly, TDM has breached the Contract, and [Wicked] is entitled to damages."

Those damages, according to the Final Award entered by Davidson on October 2, included arrearages in the amount of $210,000; unpaid monthly royalties of $1,034,600; $600,000 that was agreed to as part of the 2010 amendment to the contract; attorney fees of $150,000; and costs of just over $32,000, for a total of $2,026,884.97 due from TDM. Since this was a pre-agreed arbitration, TDM will not be able to appeal that ruling.

On October 10, Wicked filed with the state of New York a Verified Petition to Confirm Arbitration Award, a copy of which was served on DM by Wicked's attorney a week later.

"We had this dispute," summarized Wicked owner Steve Orenstein. "TDM didn't want to honor its contract with us anymore, didn't want to pay the money the contract called for. We took them to arbitration over it. It was a long, grueling process but we're happy it's over and that we won, which we couldn't imagine we wouldn't, and now we're just looking to get back out there and get our content back up on all the cable providers and let them see what the reality of the situation was."

"We’re looking forward to a very successful future in the cable space with our new partners Pure Play Broadcasting," he added. "But now we've got to collect our award from TDM. We just filed the paperwork to do that in New York, but sadly, the arbitration only gives you the award; it doesn't give you the tools to collect the money."

A copy of the Final Award in the arbitration can be found here.

Pictured: Wicked's newest contract performer Samantha Saint