MPH breaks out 'Wedding' suit

'Greek' lawsuit

Gregg Kilday
MPH Entertainment, the production company that first optioned Nia Vardalos' screenplay for "My Big Fat Greek Wedding" in 1997, has filed suit against the writer-actress, HBO, Gold Circle Films and Playtone, claiming that it has seen no profits from the hugely successful film.

In a complaint filed Tuesday in Los Angeles Superior Court, Jim Milio, Melissa Jo Peltier and Mark Hufnail, the three principals in MPH, contend that they are owed 3% of the actual profits from the picture but have received nothing to date save for an accounting statement for the $5 million film that claimed it had lost $20.6 million as of March 31 -- even though, they assert, the movie has grossed more than $600 million worldwide.

According to the accounting statement that Gold Circle and HBO provided to MPH, the film's producers had received only $77.4 million out of the movie's overall gross as of March 31. But, the statement continued, the movie had accrued $71.7 million in distribution expenses plus another $19.3 million in distribution fees. Placing the movie's budget plus interest at $6.95 million, the account added up to a net loss of $20.6 million.

Although the statement would seem a dramatic example of Hollywood's creative accounting, a source close to the situation said that by that point in its rollout, the film had yet to bring in its DVD/VHS take -- it was released on home video Feb. 11 -- but an aggressive home video ad campaign already had been credited to its distribution costs. "There's a naive understanding of what's going on here," the source added.

MPH attorney Henry Gradstein of Gradstein, Luskin & Van Dalsem took a different view, saying: "My clients gave up practically everything to help the picture get made -- their ownership of the script and their right to produce and direct -- and all they asked for in return was a small share of the real profits and proper credit. What they received was a big fat Greek tragedy."

Elaborating in an interview, Gradstein added: "We're not talking about monkey points here but real points. They were not net profit participants -- their profits were to be determined by the same formulas as those of the other producers."

Gold Circle, speaking for itself and the other producing entities involved, issued a statement, saying: "We haven't seen the complaint, but we stand by the integrity of our accounting. It's ludicrous to suggest that this film will not be profitable. MPH Entertainment will see their appropriate participation in due course."

"Nia has done absolutely nothing wrong," said Vardalos' attorney, Jonathan Moonves of Del, Shaw, Moonves, Tanaka & Finkelstein. "Nia has nothing to do with the issues that MPH has sued about. This is a participation dispute between MPH and Gold Circle/HBO. Nia has nothing to do with the distribution of profits and should not have been named as a party in this dispute. We are looking at all of Nia's possible actions in response to being inappropriately named."

Although declining comment on the suit, Gary Goeztman, one of the partners in Playtone, which, like Vardalos, is itself a profit participant in the film, said, "We have no reason to expect there will be any problems in receiving profits or participation from the picture."

In the breach-of-contract lawsuit, MPH is seeking more than $20 million in compensatory damages for its role in bringing "Wedding" to the screen.

The biggest independent hit of all time, "Wedding" was released April 19, 2002, and established itself as a grass-roots hit, eventually grossing $241 million domestically. The complaint places its worldwide theatrical grosses at $366 million and adds in U.S. DVD/VHS sales and rentals of $220 million and a U.S. television sale of $20 million to bring its worldwide gross to $606 million.

As outlined in the suit, Vardalos, who played a supporting role in the 1997 MPH-produced film "Men Seeking Women," optioned her "Wedding" script to MPH that same year for $500. MPH subsequently exercised its option, paying her $60,000 for the screenplay.

When producers Rita Wilson and Tom Hanks became interested in the property for Hanks' Playtone production company, MPH amended its contract with Vardalos and her loan-out company, My Penzatta, which is also named as a defendant in the suit. Under the amended agreement, Vardalos was free to set up the project elsewhere, but MPH was to be paid $115,000 if she sold the project to a third party and another $85,000 when principal photography began.

In exchange, MPA agreed to dilute its participation in the picture's profits, settling for 3% of the contingent compensation from the film, using the same profit definition of "contingent compensation" as would apply to the active producer or production entity. The three MPH execs were also granted co-executive producer status and a guarantee that they would be invited to "all major awards ceremonies, film premieres, festivals, etc., at which the picture has been nominated for or will receive any award or at which the picture is exhibited or is under consideration for an award."

Once the picture was set up at HBO and Gold Circle, HBO did pay MPH its $115,000 pay-or-play fee, and the limited-liability company established to produce the film paid MPH another $85,000 when shooting began.

But as "Wedding" shot to success, the MPH trio allege they were excluded from the spotlight, that many ads in support of the film omitted their names and that of 17 awards ceremonies to which they should have been invited -- including the Golden Globes and the Academy Awards -- they were invited only to the People's Choice Awards.