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[PROFILES]

February 2005

The Woman Of Steel

By Robert Vosper

Anybody of any importance in Supermans life has the initials L.L. His best friend as a kid and archenemy as an adult was Lex Luther; his high-school sweetheart was Lana Lang; the love of his life in college was Lori Lemaris; his romantic interest on the planet Krypton was Lyla Lerrol; and his wife is Lois Lane. It seems fitting, then, that Supermans legal protector in the real world is 54-year-old Lillian Laserson, senior vice president and general counsel of DC Comics Inc.

Laserson didnt get the job as head lawyer of the New York-based publisher because her initials are L.L. She got it because she is, as one of her colleagues put it, a damn good lawyer. But the L.L. connection certainly didnt hurt.

We hired Lillian because she had the background for the job, says DC Comics CEO Paul Levitz. The fact that her initials were L.L. and she was familiar with Superman lore may have helped a little.

DC is going to need Lasersons legal skills in the coming years. The family of one of the original creators of Superman filed a request in 1998 to regain control of 50 percent of the copyright to the character; the family of the other creator recently asked DC to return the remaining portion by 2013. That means that by 2013, the company may no longer own the copyright to one of the most recognized heroes in American pop culture.

The kryptonite that is draining DC of its most prized intellectual property is a number of amendments to the Copyright Act. When Congress extended the life of copyrights in 1976 and 1998, it also gave creators and their heirs an opportunity to regain ownership of older copyrights. The idea was to allow them to profit from these extensions and also rectify any bad deals they may have entered into. In the comic book industry, many creators during the Golden Age of comics (19301950) assigned their copyrights to publishers for next to nothing. The creators of SupermanJerry Siegel (the writer) and Joe Shuster (the artist)fall into that category. In 1938 the two handed over the Superman copyright to the predecessor of DC for $130.

Nobody on either side, including Laserson, is willing to talk about the issue. However, rumors have been flying around the comic book industry for years that DC and the two families had negotiated a settlement. That now seems far from the truth.

In October 2004 the Siegel heirs filed suit in a California district court against Warner Brothers Entertainment Inc. and Time Warner Inc., which owns DC Comics and Warner Brothers, for refusing to abide by the termination notice and compensate the Siegels for their fair share of profits from the Superman copyright. In addition both the Siegel and Shuster families have teamed up with Los Angeles lawyer and movie producer Marc Toberoffan indication the families may be shopping around for a new home for the Man of Steel. Obviously, DC isnt going to hand over its most valued asset without putting up one hell of a legal battle. And if you were going to take on a Hollywood producer and some angry heirs, then the 5-foot, 2-inch tall lawyer from DC Comics just might be the right person for the job.

Lillian approaches people and problems in a much less overtly aggressive way than most lawyers, says Carol Simkin, who was a partner at Cowan, Liebowitz & Latman when Laserson was an associate there from 1986 to 1987. Rather than feeling that she has to go in with two arms punching, she will find solutions that are holistic. She has this ability to come up with solutions and put things together. For her it is like making breakfast in the morningits easy.

Happier Days

Perhaps the reason Lasersons approach is different from that of most lawyers is because law is her second career.

After graduating from Syracuse University in 1972 with a degree in drama, Laserson, a native of Scarsdale, N.Y., headed for the Big Apple. There she took classes at the renowned Herbert Berghof Studio under the watchful eye of director and actor Austin Pendleton. Students from the studio have gone on to become some of the best talent in HollywoodAl Pacino, George Segal, Faye Dunaway, Matthew Broderick and Anne Bancroft, to name just a few. Among the aspiring actors in Lasersons class were Linda Hunt, who starred in Dune among other film and TV roles, and Christopher Reeve, who, ironically, went on to star in the two Superman movies. At the time, Reeve was a regular on the now-defunct CBS soap opera Love of Life.

While taking classes and auditioning for commercials and plays, Laserson held down a number of part-time jobs, most of which were none-too glamorous. For instance, she once walked around low-income neighborhoods in New York trying to persuade retailers, hotels and restaurants to display credit-card applications at cash registers.

I schlepped around a Willy Loman-style salesmans case filled with papers, she says.

She also made a few bucks acting. For instance, she starred in a radio commercial for Clairol Herbal Essence Shampoo and a TV spot for Carrols Hamburgers. She also played a revolutionary in an off-Broadway play titled The Co-Op by Barbara Garson. One of her fellow actors in the play was Estelle Harriswho played George Costanzas mother on Seinfeld.

New York, however, wasnt the ideal place for Laserson to launch her career. Most of the acting jobs available in the city at the time were commercials and musicals, and Laserson had no shot at the latter because she couldnt sing. So in 1976 she moved to Los Angeles. Within a few weeks of moving there she met Garry Marshall, the producer of Happy Days, Mork and Mindy and Laverne & Shirley. Marshall asked Laserson to try out for a role on Happy Days, starring Ron Howard as Richie and Henry Winkler as Fonzie. She aced the audition and was rewarded with a feature role on Episode 99, Bye Bye Blackball.

The episode, which aired during the fifth season of the show, featured Laserson as Darlene, a local waitress who agrees to accompany Richies friend, Potsie, to a fraternity pledge formal. Potsie then gets kicked out of the frat for bringing a floozie to the dance.

It was a lot of fun and everyone was so supportive of us, she says. It was filmed in front of a live audience so it almost was like being in a play, which was my background.

Happy Days represented the pinnacle of Lasersons acting career. Her hope was that Marshall would recognize her talents and create a spinoff based on her character (that is how Laverne & Shirley got started). But it never happened.

There was some talk about putting me on as a regular, but it didnt come to be, she says. Thats Hollywood for you.

After Happy Days Laserson spent the next couple of years acting in commercials and plays, as well as working as a publicists assistant at Pickwick/ Maslansky/Koenigsberg a secretary to the president of Continental Services Co. and a sales associate at B. Dalton in Beverly Hills. Although she was receiving a regular paycheck, Laserson was making little money. So in 1979 she called it quits.

The short answer to why I left acting is that I wanted to make a living, she says. I had no control over my life. I could never plan on any type of income. It was an exciting way to live because you always were on the brink of something big.

But it wasnt exciting enough to keep her going, and Laserson thought lawyering was a much better and more lucrative way to make a living.

On Stage

Because her father was suffering from lymphoma at the time, Laserson moved back East and enrolled at the Benjamin Cardozo School of Law at the Yeshiva University in Greenwich Village. Although Cardozo isnt a high-profile law school, it has a great reputation for taking a hands-on approach to legal education. And Laserson took full advantage of that.

As a third-year student, she participated in the schools Criminal Law Clinic, which provides help to clients of the Bronx Legal Aid Society. The clinic was run by Barry Scheck of OJ Simpson trial fame. Scheck asked Laserson to help defend a man who was charged with speeding, drunk driving and resisting arrest. The man claimed he was innocent and that the cops had roughed him up.

According to Laserson, the police picked up a speeder on their radar gun and gave chase. However, it was a foggy night and the cops pulled over the wrong car. When they approached the driver, he reached into the glove compartment for his insurance and registration cards. The cops thought he was going for a gun and, in the process of arresting him, they beat him up. The officers then administered a breathalyzer, which he failed. The man, however, had just finished painting a house, and Laserson believed that might have skewed the results. Because the police destroyed the ampoule after administering the test, Laserson had no way of testing her theory. As a result, she filed a motion to suppress the evidence.

I was very nervous because my client could have gotten up to a year in jail, she says. And prosecutors had offered him a deal to plead to a traffic violation. He refused because he believed, as did I, that he was innocent. And knowing he could face a year in jail, he went through with the trial, which was very brave.

Although Scheck sat at the table with Laserson, she and a fellow student tried the case. The man was acquitted and Laserson realized litigation was her calling.

It was a lot like writing, producing, directing and starring in your own production, she says.

It was the last time she would ever experience that as a lawyer.

After graduating in 1983, she took a job as an associate at Phillips Nizer in New York. Although Laserson was working in the firms litigation department, she rarely saw the inside of a courtroom. And instead of representing the poor and underprivileged, she spent her time helping Occidental Petroleum Corp. resolve contract disputes.

Then one day a partner gave her the following pep talk: Once an oil and gas litigator, always an oil and gas litigator. Only three years into the job, Laserson knew it was time to move on.

Lasersons next job was at Cowan, a boutique firm that specializes in copyright and trademark cases. She handled everything from litigation to transactions for a client base that included Columbia Pictures and Calvin Klein. She loved the job and the firm loved her work. In fact, everything was going well until 1987 when Carol Simkin stepped in.

Muppet Bound

One of Simkins clients at Cowan was The Jim Henson Co., the company behind the Muppets. The general counsel of Henson, Harriet Yassky, was looking for an associate GC to join her three-lawyer staff. The problem, though, was she couldnt find the right person for the job. Simkin knew exactly where to look.

I thought my partners would kill me because everyone loved Lillian, and we had paid a headhunter to get her from Phillips Nizer, says Simkin, who now works as a mediator in New York. But her talents would have been completely lost as a partner, which she could have become. I thought her natural place if she was going to practice law was the entertainment field.

After interviewing Laserson, Yassky agreed.

Basically, her intelligence came through, says Yassky, who is now retired. Also, this is a very small organization, so this person had to fit in. And Lillian did. She is very smart, funny, witty and a warm human being.

Lasersons job at Henson was part lawyer and part dealmaker. On any given day, she would provide Jim Henson, the companys founder, with legal advice, negotiate movie and TV deals and hammer out licensing agreements. Some of the projects she worked on while at Henson included a six-series home video project for Lorimar Studios, promotional deals with McDonalds, licensing deals for the Sesame Street Muppets, union negotiations with the American Federation of Television and Radio Artists, and contracts with NBC for the Jim Henson Hour, a variety show hosted by Kermit the Frog. She worked long hours, but the payoff was huge.

We worked really hard and played equally hard, she says. We had these fantastic office partiesfrom holiday parties to masquerade balls.

She also got to work with arguably one of the most important creative minds in the entertainment field.

Jim was a sage, Laserson says. He was kind, generous, soft-spoken and, of course, uniquely talented.

His unique talents and creativity also permeated the workspace. Lasersons office was in Muppet Centrala 40-foot-wide, 70-year-old, five-story red brick townhouse at 117 East 69th Street, almost spitting distance from Central Park. The place was a magical intersection of business and art.

My office was furnished more like a living room than a place of business, Laserson says. When you entered the lobby, immediately to the left was a mural of the Muppet characters sitting in a theatre looking out toward the unseen stage ... to the right was a magnificent red-carpeted spiral staircase, and at the top, hanging several stories down, was a whimsical Muppet mobile. It was a fantastic environment in which to work.

It also was a place where lawyers felt they were helping Henson fulfill his vision.

The community there was very creative and trusting, Yassky says. The people who worked there felt that we were doing things for their benefit. You dont always get that kind of feedback as a lawyer.

For Laserson it was a perfect way to transition to an in-house career.

The environment at Henson was so dynamic and creative, Laserson says. The department and the company were small, but we got to do so many things. It was an excellent opportunity. It allowed me to transition from litigation into business affairs. And best of all? No time sheets.

Unfortunately, it was a short-lived opportunity.

After just three years on the job, Laserson learned that Jim Henson had decided to focus on new challengeschallenges that didnt include running a business. In 1989 Jim Henson began negotiating a sale to The Walt Disney Co. Ltd., the only organization he felt could nurture his Muppet family. Sadly for Laserson, Disney had no use for Hensons business-affairs department. Yassky encouraged her team to begin looking for new jobs. She put Laserson in touch with DC Comics, which had never had a legal department.

For years, DC had been part of Warner Publishing and used their in-house lawyers in New York. However, after the Time merger with Warner Communications in 1989, DC became a division of Warner Brothers Entertainment. Although Warner Brothers had more than 100 lawyers, most were stationed in California. DC executives decided they needed someone close by who could work on entertainment deals, understood IP and knew how to work with creative people. Laserson seemed the ideal match.

The interesting thing about DC is the tremendous diversity of things we work on, says Levitz, who was executive vice president when he interviewed Laserson for the job. You are balancing back and forth between the comic book business, the licensing business and the entertainment field. On any given morning, Lillian will field a question about toy distribution in the European community, then handle a print contract and then an IP issue. We thought Lillian would do well here, especially because of her previous life as an actress.

Albino Worms And Such

Soon after Laserson accepted the position, Jim Henson died of pneumonia when Group A Streptococcal, an invasive bacteria, ravaged his lungs and respiratory system. His death was a shock to everyone, especially Disney, which pulled out of the deal. For Laserson it was too late to go back to Henson, and she was already settling into her new position.

DC Comics is very similar to the Muppets, Laserson says. It was very creative and appealing.

Besides publishing Superman, DC Comics is the mastermind behind a slew of profitable books, magazines and movie projects, as well as an army of famous charactersBatman, Catwoman, Wonder Woman, Plastic Man, Green Arrow, Green Lantern and Flash, to name a few. It also publishes MAD Magazine and a total of 80 comic book titles a month.

Although Laserson had never worked for a publisher beforeor managed a legal departmentshe wasnt flying blind. The in-house lawyers at Warner Brothers handle most of the DCs labor and real estate issues, as well as trademarks and anitpiracy matters. Lasersons job is to provide general legal advice, and work on contracts and licensing agreements for comic books, films and videos. Some of the movie deals she has worked on include upcoming films based on DC characters Batman, Flash and Shazam!, as well as Constantine, starring Keanu Reeves. She also spends a lot of time acquiring copyrights from independent artists, writers and contractors.

One of her more time-consuming duties is managing litigation. Although DC is a fairly litigation-free organization, the suits the company does get involved in seem to attract a lot of media attention. For instance, in 1996 Johnny and Edgar Winter, two albino blues musicians from Texas, sued DC after the company published a 1995 comic-book miniseries titled Jonah Hex: Riders of the Worm and Such.

The comic featured two villains, the Autumn Brothers, who were hunted down and killed by Hex, a disfigured gunslinger. The creators of the two characters were fans of the two musicians and decided to use them as the inspiration for their villains. The Winters werent happy, and for good reason. The Autumns, both of whom were albinos, looked strikingly similar to the Winters with just a few minor differences. For one, the villains were half human and half wormthe offspring of a woman who was raped by as supernatural worm creature. In addition, both had green tentacles dangling from their chests. The Winters sued for, among other things, defamation, invasion of privacy, appropriation of their names and likenesses and intentional infliction of emotional distress. DC wasnt impressed.

We didnt make any statements about Johnny and Edgar that a reasonable person could believe were statements of fact, Laserson says. So the statements couldnt be libelous. This was parody.

The comic book industry watched the case with great interest because it called into question whether the First Amendment protects comic books. It was a long and torturous wait. For eight years the case bounced around the judicial system. But DC finally claimed victory in 2003.

It was a tough win, she says. We had a small legal department. Thankfully, it never went to trial. But it was worth it. The case confirmed that comic books are protected. We won on summary judgment, but it took about three trips to the California Court of Appeals and two to the California Supreme Court before the case was finally laid to rest.

The Winters case isnt the only significant piece of litigation Laserson has handled. For instance, she recently took on Procter & Gamble Co. subsidiary, Wella, for selling a green hair gel called Kryptonite. She also sued Ingersoll-Rand Co. Ltd., which makes Kryptonite bicycle locks, for using the Kryptonite name on non-bicycle merchandise, in violation of an agreement the two companies had hashed out in 1983. In that case, a federal judge refused to grant Kryptonites request to toss out the suit, ruling that DC owns a valid trademark in Kryptonite and that it can be protected from dilution and infringement. The case is now pending.

Another frequent area of litigation for DC Comics is suits filed by individuals who claim the publisher stole their ideas. In one recent case, a Pittsburgh man claimed he had mailed the company a story idea that examined what Superman would have been like had he been born on Earth and raised on Krypton. A few years after submitting the story, DC Comics explored a similar plot line. The court dismissed the suit.

We get a fair amount of these suits and we have won them all on summary judgment, Laserson says. Because the cost of defending these suits is so high, we no longer encourage people to send in their material.

But these infringement cases may be childs play in comparison to what DC faces with the copyright termination issue.

Super Trouble

In 1997 Jerry Siegels wife and daughter shocked the comic book world when they filed a notice of termination of transfer with the Copyright Office. The termination allows them to regain Siegels portion of the Superman copyright for the remaining 19 years of its life. [see The Math Behind The Superman Copyright, below]. The termination became effective April 16, 1999.

Siegel died in 1996 of heart failure. He had led a pretty tough life, and was nearly destitute in the early 1970s. Shuster, who died of heart failure in July 1992, wasnt much better off. In fact, by the 1970s he not only had very little money, but also was legally blind. Fortunately, the two didnt die dirt poor. In 1978, DC allegedly began paying the Superman creators $10,000 each a year as well as medical payments, but not out of the goodness of the executives hearts. Right before the release of the first Superman movie in 1978, a huge outcry erupted about the plight of Shuster and Siegel. To quell the bad press, DC decided not only to offer them a pension and benefits, but also to give them a created by credit in the Superman comics.

That generosity, however, didnt stop the Siegels from filing a notice of termination. As for Shuster, he had no heirshe never married and had no kids. When the window of opportunity came to file a termination to take advantage of the 1976 extension, nobody from the Shuster family could legally file the paper work. As a result, DC has retained ownership of the Shuster portion of the copyright for the 19 years.

But in 1998, the second amendment to the Copyright Actthe Sonny Bono Copyright Termination Extension Acttacked on another 20 years to the life of older copyrights. This amendment not only gave the Siegels another two decades to profit from Superman (giving them a total of 39 years), but also changed the requirement as to who could file a termination. It now allowed the authors executor to file noticeas well as his or her administrator or personal representativein the absence of a widower, children or grandchildren. So in November 2003, Shusters nephew, Mark Warren Peary, filed a notice to terminate. That termination will become effective in October 2013 (because Peary missed the first deadline, he will only will get 20 years).

Most copyright experts assumed DC was actively negotiating or had negotiated a settlement with the Siegel family and Peary. After all, it isnt easy to effectively terminate all the rights to a character as old as Superman. For one, DC still owns the trademark. And second, it still can distribute derivative works that were made during the term of the grant. There also are some questions as to whether DC shares a percentage of the copyright.

I would think DC would argue that this character has evolved over time and that they own a piece of it, says Michael Kahn, a partner at Blackwell Sanders Peper Martin in St. Louis It is like a person who creates a painting and then sells the copyright to it. The new owners then add to that painting and modify it. So the second person would own a portion of the copyright in the modified painting.

In addition, anyone who decides to take legal action against DC Comics is not only taking on the publisher, but also the entire Time Warner media empire and its vast legal resources. Most likely, there would be few winners in such a battle.

I would think it is in everyones interest to negotiate, says Kenneth Levin, a Chicago lawyer who represents comic book creators. I have been in trial for 20 years and have yet to see anyone win in court, even in cases where I have slaughtered the other side for millions of dollars. There always is a better solution.

Apparently, the Siegel family is willing to take that chance. They recently hired Marc Toberoff to represent them in a copyright infringement suit filed against Time Warner and Warner Brothers in U.S. District Court in California (Siegel v. Warner Bros. Entertainment). Throughout his career, Toberoff has successfully acquired the IP rights from creators and then turned them into movies and merchandise. In addition, he has bankrolled a number of movies, including I Spy, My Favorite Martian, Sons and Zombie High.

Toberoff filed suit against the Time Warner empire in October 2004, but both he and the defendants declined requests for interviews. The suit claims Warner Brothers has refused to honor the termination notice and hasnt compensated the plaintiffs for their share of profits from the Superman copyright since the termination became effective. In addition, the complaint states that when Warner Brothers received the notice of termination of transfer, its general counsel, John A. Schulman wrote a letter to the Siegels stating, As to the Notices of Termination, I wasnt surprised at their arrival After the effective date of the termination, there will still remain 14 years of copyright protection left to the joint copyright holders of the original Superman elements. Those are what we should share.

A few months later, according to the complaint, Paul Levitz dispatched a letter to the Siegels and wrote, The [Superman] rights involved are non-exclusive; they are shared with DC. Since both you and DC would have these rights, we would each have the obligation to pay the other for using those rights if you did not re-grant them to DC.

Then DC changed its mind.

The day before the termination became effective, outside counsel for DC allegedly sent a letter to the Siegels attorney stating [Y]ou are hereby put on notice that DC Comics rejects both the validity and scope of the notices and will vigorously oppose any attempts by your clients to exploit or authorize the exploitation of any copyrights, or indeed, any rights at all, in Superman.

The Siegels claim that the defendants owe them and continue to owe them an undivided fifty percent copyright interest in and to each and/or all the Works for their extended renewal terms as of the effective date of the termination. In addition, they are requesting punitive damages because the defendants allegedly threatened to take action against plaintiffs if they attempted to exploit any of the Recaptured Copyrights. Toberoff also has filed suit against Time Warner for similar violations relating to the character Superboy, which Siegel created in 1938. Superboy is the basis for the hit WB show Smallville, which chronicles Supermans life as a kid growing up in Smallville, Kan. The Siegels filed a notice of termination for that character in 2002.

One source close to the matter said, There has been no settlement with any party. That is a fact. And this is going to be a huge issue for DC Comics.

That means both sides will either be engaged in a long and bitter battle, or DC will end up settling to avoid the possibility of losing the copyright. The latter, though, will cost them dearly.

Superman is the cream of the crop of the companys comic book characters, and they are not going to give it up without making some lucrative offer, says Marc Cooperman, a copyright expert and partner at Banner & Witcoff in Chicago. A lot of creators had no leverage when they signed over their rightsthey were individuals who came up with some great ideas and had to negotiate against the 10,000-pound gorilla company. So having apparently ridden on the coattails of Shuster and Siegels Superman character for 40 years and making untold millions, the company is now faced with having to negotiate in light of that history.

If DC loses the Superman copyright, nobody is sure what that would really mean. The most likely result is that they wouldnt be able to create any new comic books, license any new movies and collateral material, such as video games and toys. But what about money coming in from old projects? Would DC have to share those profits? And what kind of impact would it have on the marketability of Superman if DC still owns the trademark? In addition, how would it affect movie and TV projects that are currently in the making, such as Superman Returns, which is in preproduction and expected to be released in 2006? It will be up to Laserson, the Time Warner lawyers and the courts to figure this one out. And that is not good for the parties involved or, perhaps more importantly, for the fans of Superman.

You really dont want two people trying to control the same franchise, Levine says. It will not work, and it will work to the determinant of both parties.

Taking Sides

Unfortunately for Laserson and DC, the termination issue may not be limited to Superman. Many of the Golden Age comic book characters werent created for work for hire. DCs Golden Age portfolio includes such high-profile characters as Batman, Captain Marvel, Green Lantern, Wonder Woman and Plastic Man. And because there is little case law in this area, nobody is quite sure how this will play out and how much of an impact the Siegel suits will have. One possible result is that everyone and their mother will claim they are the rightful owners of these copyrights. DC and the courts will not only have to sort out who owns these copyrights, but also whether or not these characters were created as work-for-hire.

These new statutes have created this nightmare window of opportunity for these old creators to regain their copyrights, Levin says. It is a niche area of law and one that Lillian knows inside-out and backward.

Laserson refused to comment about this matter, which CLT uncovered after the interview with Laserson.

Although Lasersons job is to ensure that DC comes out on top, she most likely has some sympathy for the creators. After all, she is a creative soul, who spent most of her childhood and early adulthood pursuing her dream of becoming an actress. In addition, her husband is a fulltime inventor. He currently is working on a prototype for a small, fuel-efficient engine for cars and planes.

Finally, Laserson also understands how difficult it is for creatives in the comic book world to get good representationwhich is especially important today as so many older comic book characters are making a lucrative comeback on the silver screen. For instance, Spider-Man (2002) grossed $403 million in the United States; Batman (1989) $251 million; and Superman (1978) $134 million. Comics are big business, and creators often dont understand how valuable their works are until it is too late.

There is a real need for good representation of comic book writers and artists, Laserson says. There arent too many lawyers and agents in this business.

But dont expect Laserson to switch sides just yet. Like Superman, she would never leave the people she has sworn to protect, especially when they need her most. And second, she loves her job and company.

It is a terrific company with terrific ethics and a philosophy that I am proud of, Laserson says.

As for acting, she is done. Her only involvement in the dramatic arts is as a board member to the New Group, a non-profit off-Broadway theater company in New York. Although she might be tempted to test her skills on stage, Laserson is more than comfortable playing a behind-the-scenes role.

I have no regrets about leaving acting, she says. I gave it a long try.

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