Here’s Why Fox Could Win ‘Bones’ Arbitration Appeal – And Why It Couldn’t

More than $128 million in punitive damages is at stake in a case about profit participation with series stars and executive producers

Last Updated: February 28, 2019 @ 1:59 PM

Fox is fighting a $179 million judgment against the company — one of the largest rulings of its kind in television history — over profit participation on the 2005-2017 series “Bones.” But it isn’t fighting the entire judgement.

In a ruling made public on Wednesday, arbitrator Peter Lichtman said Fox violated a profit participation agreement with stars David Boreanaz and Emily Deschanel, executive producer Barry Josephson and Kathy Reichs, the forensic anthropologist whose books inspired the show, and accused three Fox executives of perjury.

In addition to a finding of actual damages, the arbitrator awarded more than $128 million in punitive damages, which he called “reasonable and necessary to punish Fox for its reprehensible conduct and deter it from future wrongful conduct.”

Fox seeks to void these punitive damages, and says the ruling is a “flagrant injustice, riddled with errors and gratuitous character attacks.”

But does Fox have a chance of voiding the punitive damages? It depends on who you ask.

According to one prominent entertainment lawyer in Los Angeles, who requested anonymity because they have business dealings with Fox, the company really doesn’t have a leg to stand on. The arbitrator’s opinion here “is exceedingly well reasoned, exceedingly comprehensive and well-detailed, and not incited by bias or anything like that. But is instead incited by just callous disregard for the truth,” the attorney told TheWrap.

But an individual with knowledge of the arbitration told TheWrap that, while the chances of getting an arbitration ruling thrown out are very slim, Fox has a good shot in this case because it can argue that the arbitrator “exceeded his arbitration powers.” The individual says that at no point during this litigation, which dates back to 2015, did Fox agree the arbitrator could award punitive damages.

That’s the argument the company made in a statement Wednesday, and it hired top defense attorney Daniel Petrocelli, who filed a motion today in Los Angeles advancing the same point. Attorneys for Josephson, Boreanaz, Deschanel, and Reichs filed a motion backing the damages.

However, according to another individual familiar with the arbitration, both parties agreed on what issues would be brought into this arbitration and what the arbitrator would have the jurisdiction to decide on — and one of those points was that the arbitrator could rule on punitive damages. This insider says Fox and the “Bones” team outlined their plans in a document that went to Lichtman before arbitration began.

Lichtman, for his part, said in his ruling that the availability of punitive damages was an “issue raised by Fox for the first time during its closing argument and in its Post-Hearing Brief” and “argues that the Agreements expressly bar Participants’ claim for punitive damages.”

He added that Fox “overreaches with its argument” and the language from its agreements “does not apply to prevent an award of punitive damages against the non-Studio Claimants for intentional torts and against TCFTV for fraud.”

Attorneys for Fox, and for Josephson, Boreanaz, Deschanel, and Reichs, did not respond to TheWrap’s request for comment.

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