Fox Ordered to Pay $179 Million to ‘Bones’ Actors, Producers

Twenty-First Century Fox Inc. was ordered to pay $179 million in a case brought by four “Bones” actors and producers who claimed they were cheated out of their share of profits from the hit TV series.

FILE - In this May 16, 2016 file photo, David Boreanaz and Emily Deschanel attend the FOX Networks 2016 Upfront Presentation Party in New York. An arbitrator has ordered 21st Century Fox to pay $179 million in a dispute over profits with the stars of the long-running Fox TV show “Bones.” Boreanaz and Deschanel, the stars of “Bones” from 2005 through 2017, sued Fox in 2015, saying it denied them profits by licensing the show to Fox’s TV division and to Hulu for below-market rates. (Photo by Evan Agostini/Invision/AP, File)Read moreEvan Agostini / Evan Agostini/Invision/AP

by Lucas Shaw, Bloomberg

Published Feb. 28, 2019, 3:00 p.m. ET

(Bloomberg) — Twenty-First Century Fox Inc. was ordered to pay $179 million in a case brought by four “Bones” actors and producers who claimed they were cheated out of their share of profits from the hit TV series.

Actors Emily Deschanel and David Boreanaz and two producers alleged that Fox deflated the profitability of the show by licensing it at artificially low fees to Fox’s broadcast network and the streaming service Hulu, which Fox co-owns.

Fights between studios and producers are common now that consolidation and streaming TV have upended the economics of TV shows. Many companies are producing and selling shows for sister networks and streaming services instead of selling them.

“Bones,’’ which ran on Fox’s broadcast network from 2005 to 2017, was always a well-rated show though never one of TV’s biggest hits. The judge criticized senior Fox executives, including Peter Rice, Gary Newman and Dana Walden. Rice and Walden are both joining Walt Disney Co. once that company completes its acquisition of some of Fox’s entertainment assets.

The Feb. 4 arbitration award includes $129 million in punitive damages to “punish Fox for its reprehensible conduct and deter it from future wrongful conduct.”

“The ruling by this private arbitrator is categorically wrong on the merits and exceeded his arbitration powers,” Fox said in a statement. “Fox will not allow this flagrant injustice, riddled with errors and gratuitous character attacks, to stand and will vigorously challenge the ruling in a court of law.”

Disney wasn’t involved in the arbitration. Chief Executive Officer Bob Iger issued a statement in support of the two Fox executives.

“Peter Rice and Dana Walden are highly respected leaders in this industry, and we have complete confidence in their character and integrity,” Iger said.

Lawyers for the actors and producers filed a petition to confirm the arbitration award Wednesday in California Superior Court in Los Angeles. Fox filed a request to either correct or vacate the award.

The cases are: Wark Entertainment Inc. v. Twentieth Century Fox Film Corp., BC602287, and Temperance Brennan LP v. Twenty-First Century Fox Inc., BC602548, California Superior Court, Los Angeles County.

(Adds statement from Disney in seventh paragraph.)

To contact the reporters on this story: Edvard Pettersson in Los Angeles at epettersson@bloomberg.net;Lucas Shaw in Los Angeles at lshaw31@bloomberg.net

To contact the editors responsible for this story: Elizabeth Wollman at ewollman@bloomberg.net, ;Nick Turner at nturner7@bloomberg.net, Steve Stroth, Peter Blumberg