Warner Bros., NBC Conclude ‘Southland’ Divorce

Network and studio reach settlement on the John Wells deal, paving the way for a possible move to TNT.

NBC and Warner Bros. have reached a deal releasing the Peacock from any further commitment to "Southland"– and clearing the way for the show to move to TNT.

TNT has long been considered a likely home for the canceled John Wells drama. The Los Angeles Times and Hollywood Reporter, among other outlets, have both written stories noting the logic of such a move. TNT even gave THR a statement confirming it was mulling the idea.

But no deal with TNT could be made until Warner Bros. and NBC had figured out how to deal with the costs of breaking up.

The studio had leverage over the Peacock because of so-called "shutdown" costs. But if it wanted to, NBC could have played hardball and made it tough for Warner Bros. to set up "Southland" at another network (at least in the short-term).

Earlier this afternoon, however, the two sides came to an agreement figuring out the whole mess, an insider familiar with the matter said.

Assuming another network buys the already produced episodes of "Southland," Warner Bros. has agreed not to insist on NBC paying all of the so-called "shutdown costs"– the fees associated with the network cutting back its 13-episode order on season two of "Southland," the source said. The studio will also pay NBC a small fee upfront — believed to be between 20 to 30 percent of the network's roughly $10 million investment in the second season of the show.

In exchange, Warner Bros. is free to sell all 13 produced episodes of "Southland" wherever it wants (very likely TNT). If another network ends up making more episodes of "Southland," NBC will get more money for each episode– but only until its total compensation reaches the roughly $10 million it's already spent. After that point, Warners Bros. and NBC will have no more dealings on "Southland."

Earlier in the week, there had been rumblings that NBC was holding up Warner Bros.’ ability to make a deal by insisting on breakup terms some in the Well/Warner Bros./CAA camp interpreted as too stringent.

It's unclear how much give and take went on between the two parties, but in the end, Warner Bros. seems to have accepted a deal that gives NBC a measure of face-saving should "Southland" end up becoming a success elsewhere. Executives at the studio, which is known for its passionate support of creatives, apparently decided that it was more important to support Wells in his efforts to save the show than to drive the hardest possible bargain with NBC.

The agreement between Warner Bros. and NBC this afternoon is no doubt behind a new spate of speculative stories eyeballing TNT as a likely new home for "Southland." But people familiar with the matter insist the studio and cable network don't yet have a signed deal for such a move.

Another big question: Will TNT immediately order more episodes of "Southland," or simply agree to put on the existing 13 and decide later whether to move forward? Logic would suggest TNT will want to see some ratings before forking over the money needed to produce more episodes– but cable networks do the darndest things sometimes.

Reps for Warner Bros. TV and NBC couldn't be reached for comment late Friday.