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Court of Appeal:
Developers of ‘Judge Judy’ Get No Share of Payment to Star
Plaintiffs Sought $4.95 Million—Five Percent of $99 Million Paid by CBS Subsidiary to Judith Sheindlin to Relinquish Her Right Under a 2015 Agreement to Receive Library of Episodes as Compensation
By a MetNews Staff Writer
Summary judgment has been affirmed in favor of the company that produced the “Judge Judy” television show, its star, Judith Sheindlin, and others in an action by a developer of the series and the trust of another developer, now deceased, seeking at least $4.95 million on the theory that a lump sum was payable to them, under a 1999 settlement agreement, upon sale of the episodes.
There were actually two sales, according to assertions of Kaye Switzer, a developer and early producer of the courtroom show—which aired from 1996-2001—and the trust of the late Sandi Spreckman, also a developer and producer, at the outset.
No sale actually took place, the defendants argued in trial court proceedings, before Los Angeles Superior Court Judge Kristin S. Escalante, and in Div. Two of the Court of Appeal for this district. In an unpublished decision filed Thursday, Justice Brian M. Hoffstadt said that even if there were two sales, Escalante made the right call.
1999 Agreement
Under a settlement agreement reached in 1999 between Switzer and Spreckman, on one side, and Big Ticket Pictures Inc., which produced the series, the developers would receive residuals in perpetuity—in the form of a percentage of the gross receipts—but, if a sale were effected which did not entail a continuing obligation to make those payments, they would receive five percent of the sale price.
In 2015, Big Ticket—which had become a subsidiary of CBS Studios Inc.—and Sheindlin and her company, Her Honor, Inc., amended an agreement under which the star was to receive a boost in salary. Instead, she was to become owner of the episodes as of Sept. 1, 2017, upon execution of documents transferring rights and “subject to all financial obligations to third-party participants,” which included Switzer and Spreckman.
Then, there was a change in the plan. In 2017, Big Ticket and Sheindlin agreed that Big Ticket would retain the episode library and Sheindlin would be paid $99 million.
In 2018, Switzer and the trust sued for five percent of what they contended was the sale price. The defendants insisted that the sale to Sheindlin was never consummated and her relinquishment in 2017 of her right to the episodes under the 2015 agreement was not a sale.
Escalante’s Ruling
In her March 28, 2022 order granting summary judgment, Escalante said:
“[T]he court finds that, regardless whether the 2015 Amendment effected a sale of the Library to Sheindlin and CBS’s re-acquisition of rights to the Library constituted a second sale, the undisputed evidence establishes that any sale by Sheindlin to CBS was ‘subject to the rights of the Participant.’ Thus, Plaintiffs are not entitled to a percentage of the $99 million, but instead are entitled to participation on the same terms and conditions as before the transaction, i.e., based on Big Ticket’s and/or CBS’s gross receipts.”
Agreeing, Hoffstadt wrote:
“We independently agree with the trial court’s grant of summary judgment for defendants because, even if we assume that the Library was sold twice (from Big Ticket to Sheindlin and from Sheindlin back to Big Ticket), the undisputed evidence establishes that each of those sales was ‘subject to’ plaintiffs’ rights to continue receiving an income stream (rather than a sale that “included” plaintiffs’ rights and thus entitled them to a lump sum cash-out payment).”
Hoffstadt Explains
He explained:
“The 2015 Amendment specifies that Big Ticket’s sale to Sheindlin shall vest Sheindlin with rights in the Library ‘subject to all financial obligations to third-party participants’ (like plaintiffs); the August 2, 2017 letter specifies that the sales from Big Ticket to Sheindlin and from Sheindlin to the unnamed buyer will be ‘free and clear’ of ‘obligations’ ‘other than...participation obligations to each person...entitled’ to participate in the show’s receipts; and the August 4, 2017 Agreement effectively identifies the unnamed buyer as Big Ticket, but does so by eliminating the pertinent provisions of the 2015 Amendment and August 2, 2017 letter—thereby placing plaintiffs in precisely the position they were in prior to any sale, which is as recipients of an income stream.”
The case is Switzer v. Big Ticket Pictures, Inc., B320513.
Switzer and the trust were represented by Erik L. Jackson and Thomas W. Casparian of the downtown Los Angeles firm of Cozen O’Connor and by Richard A. Schonfeld of the Las Vegas firm of Chesnoff & Schonfeld. James A. Curry and Daniel J. Friedman of the Los Angeles office of Loeb & Loeb acted for the defendants.
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