It's full steam ahead after copyright decision
Analyst: Ruling is huge victory for Disney
By Richard Verrier
Sentinel Staff Writer
January 16, 2003
LOS ANGELES -- The legislation may have been called the Sonny Bono Act, but it had Disney's name written all over it.
The Burbank, Calif.-based entertainment giant wasn't party to the case in which the U.S. Supreme Court on Wednesday upheld a 1998 law extending copyright protection by 20 years. Yet it had every right to savor victory in what it saw as a life-and-death struggle over the most cherished gods in its corporate pantheon: Mickey Mouse, Donald Duck, Pluto, Goofy and Dumbo, among others.
With those core characters on the line, Disney had flexed every bit of its considerable lobbying muscle in pushing the Bono Act through a wary Congress. Had that law failed before the Supreme Court, the company, according to analysts, would likely have lost at least a billion dollars in revenue in coming years, and almost certainly have seen its just now improving stock price plummet this morning.
The campaign to avoid just such a debacle began more than a decade ago, when Disney President Frank Wells -- who died in a 1994 helicopter crash while on a skiing trip -- asked his legal team how to keep the core icons created under founder Walt Disney from slipping into the public domain as they aged.
Disney's chief inhouse lawyer at the time, Sandy Litvack, compiled a freewheeling set of options, including a search for legal grounds to protect the characters regardless of a copyright expiration. Not until 1996, however, did Disney firmly decide to fight for a new law, rather than searching for salvation in the old ones.
The catalyst for a legislative approach was a decision by the European Union to extend its copyrights for 20 years. With that precedent behind them, Disney officials became convinced they could weather an expected storm of opposition to any copyright extension. They could now argue that not only were their properties at stake, but that U.S. musicians and other artists would be at a competitive disadvantage to the Europeans.
The heavy lifting in Disney's fight fell to Preston Padden, Disney's longtime Washington lobbyist. An affable, yet wily, operator, Padden has built a reputation as one of the most powerful in a legion of industry representatives.
In the campaign, Padden worked closely with Jack Valenti, head of the Motion Picture Association of America. For companies such as AOL Time Warner and Metro-Goldwyn-Mayer were no more eager than Disney to lose their grip over trademark properties in their aging film libraries. Warner Bros.' Casablanca and MGM's The Wizard of Oz would have quickly followed Mickey Mouse into the public domain.
Perhaps the key connection, brokered by Padden, was a 1998 meeting between Disney Chairman Michael Eisner and then Senate Majority Leader Trent Lott, R-Miss. Despite heavy pressure from librarians, Internet publishers and others who argued for the virtues of public domain, Lott threw his support behind what eventually was dubbed by one critic "The Mickey Mouse Protection Act."
Bono, the Palm Springs, Calif., entertainer-turned-Republican congressman, had become the law's sponsor shortly before he died in early 1998. When the law finally passed, insiders considered it a personal coup for Padden. "Preston absolutely delivered the goods," said a source familiar with the effort.
Disney had considerably more to lose than its corporate rivals, because so much of its identity -- from its theme parks to its cable television programs to the logo on corporate documents -- is invested in the character of Mickey Mouse. "This gives them some breathing room for another 15 or 20 years, said Dave Davis, a banker at Houlihan Lokey Howard & Zukin in Los Angeles. Davis estimated the financial stakes at more than $1 billion.
"This is a huge victory for Disney," seconded David Miller, an analyst with Sanders Morris Harris Group in Los Angeles. "Disney's stock price would have taken it on the chin if it went otherwise."
Critics of the ruling weren't particularly concerned about Disney's future profitability on Wednesday. Stanford law professor Lawrence Lessig, who helped lead a group that opposed the extension, said: "If there is any good that might come from my loss, let it be anger and passion that now gets to swell against the unchecked power that the Supreme Court has."
But Hollywood cheered its own win.
"It was a big victory for us, but not unexpected on my part," Valenti said. "I thought it was going to be a slam dunk."
Richard Verrier can be reached at 1-800-528-4637, Ext. 77936 or richard.verrier@latimes.com.
Copyright © 2003, Orlando Sentinel
http://www.orlandosentinel.com/busi...6,0,5283157.story?coll=orl-business-headlines
Analyst: Ruling is huge victory for Disney
By Richard Verrier
Sentinel Staff Writer
January 16, 2003
LOS ANGELES -- The legislation may have been called the Sonny Bono Act, but it had Disney's name written all over it.
The Burbank, Calif.-based entertainment giant wasn't party to the case in which the U.S. Supreme Court on Wednesday upheld a 1998 law extending copyright protection by 20 years. Yet it had every right to savor victory in what it saw as a life-and-death struggle over the most cherished gods in its corporate pantheon: Mickey Mouse, Donald Duck, Pluto, Goofy and Dumbo, among others.
With those core characters on the line, Disney had flexed every bit of its considerable lobbying muscle in pushing the Bono Act through a wary Congress. Had that law failed before the Supreme Court, the company, according to analysts, would likely have lost at least a billion dollars in revenue in coming years, and almost certainly have seen its just now improving stock price plummet this morning.
The campaign to avoid just such a debacle began more than a decade ago, when Disney President Frank Wells -- who died in a 1994 helicopter crash while on a skiing trip -- asked his legal team how to keep the core icons created under founder Walt Disney from slipping into the public domain as they aged.
Disney's chief inhouse lawyer at the time, Sandy Litvack, compiled a freewheeling set of options, including a search for legal grounds to protect the characters regardless of a copyright expiration. Not until 1996, however, did Disney firmly decide to fight for a new law, rather than searching for salvation in the old ones.
The catalyst for a legislative approach was a decision by the European Union to extend its copyrights for 20 years. With that precedent behind them, Disney officials became convinced they could weather an expected storm of opposition to any copyright extension. They could now argue that not only were their properties at stake, but that U.S. musicians and other artists would be at a competitive disadvantage to the Europeans.
The heavy lifting in Disney's fight fell to Preston Padden, Disney's longtime Washington lobbyist. An affable, yet wily, operator, Padden has built a reputation as one of the most powerful in a legion of industry representatives.
In the campaign, Padden worked closely with Jack Valenti, head of the Motion Picture Association of America. For companies such as AOL Time Warner and Metro-Goldwyn-Mayer were no more eager than Disney to lose their grip over trademark properties in their aging film libraries. Warner Bros.' Casablanca and MGM's The Wizard of Oz would have quickly followed Mickey Mouse into the public domain.
Perhaps the key connection, brokered by Padden, was a 1998 meeting between Disney Chairman Michael Eisner and then Senate Majority Leader Trent Lott, R-Miss. Despite heavy pressure from librarians, Internet publishers and others who argued for the virtues of public domain, Lott threw his support behind what eventually was dubbed by one critic "The Mickey Mouse Protection Act."
Bono, the Palm Springs, Calif., entertainer-turned-Republican congressman, had become the law's sponsor shortly before he died in early 1998. When the law finally passed, insiders considered it a personal coup for Padden. "Preston absolutely delivered the goods," said a source familiar with the effort.
Disney had considerably more to lose than its corporate rivals, because so much of its identity -- from its theme parks to its cable television programs to the logo on corporate documents -- is invested in the character of Mickey Mouse. "This gives them some breathing room for another 15 or 20 years, said Dave Davis, a banker at Houlihan Lokey Howard & Zukin in Los Angeles. Davis estimated the financial stakes at more than $1 billion.
"This is a huge victory for Disney," seconded David Miller, an analyst with Sanders Morris Harris Group in Los Angeles. "Disney's stock price would have taken it on the chin if it went otherwise."
Critics of the ruling weren't particularly concerned about Disney's future profitability on Wednesday. Stanford law professor Lawrence Lessig, who helped lead a group that opposed the extension, said: "If there is any good that might come from my loss, let it be anger and passion that now gets to swell against the unchecked power that the Supreme Court has."
But Hollywood cheered its own win.
"It was a big victory for us, but not unexpected on my part," Valenti said. "I thought it was going to be a slam dunk."
Richard Verrier can be reached at 1-800-528-4637, Ext. 77936 or richard.verrier@latimes.com.
Copyright © 2003, Orlando Sentinel
http://www.orlandosentinel.com/busi...6,0,5283157.story?coll=orl-business-headlines