[1][2] A number of cases of creative accounting have been successfully pursued in court and have resulted in hundreds of millions of dollars in awarded damages.
[4][5] Actress Lynda Carter on The Late Show with Joan Rivers commented "Don't ever settle for net profits.
This practice reduces the likelihood of a project showing a profit, as a production company will claim a portion of the reported box-office revenue was diverted directly to gross point participants.
The court found Paramount's actions "unconscionable", noting that it was impossible to believe that Eddie Murphy's 1988 comedy Coming to America, which grossed $288 million, failed to make a profit, especially since the actual production costs were less than a tenth of that.
[9][10] Uslan and Melniker claimed to be "the victims of a sinister campaign of fraud and coercion that has cheated them out of continuing involvement in the production of the 1989 film Batman and its sequels.
Total revenues of Batman have topped $2 billion, with Uslan claiming to have "not seen a penny more than that since our net profit participation has proved worthless".
[16] The case was settled in January 2005, with Marvel paying $10 million to "finance past and future payments claimed by Mr.
[19] Peter Jackson, director of The Lord of the Rings (2001–2003), and his studio WingNut Films, brought a lawsuit in 2007 against New Line Cinema after an audit.
[20] Fifteen actors sued New Line Cinema, claiming that they have never received their 5% of revenue from merchandise sold in relation to the movie, which contained their likenesses.
[21] Similarly, the Tolkien estate sued New Line, claiming that their contract entitled them to 7.5% of the gross receipts of the $6 billion hit.
[25] A Warner Bros. receipt was leaked online in 2010, showing that the hugely successful movie Harry Potter and the Order of the Phoenix (2007) ended up with a $167 million loss on paper after grossing nearly $1 billion.
The Walt Disney Company lost a $270 million lawsuit in 2010 to Celador over accounting tricks used to mask profits on the Who Wants to Be a Millionaire (1999–2007) licensed franchise in the United States: "ABC artificially deflated fees the network should have paid the production company BVT and Disney-owned Valleycrest, which in turn decreased Celador's share of revenue.
[30] 21st Century Fox was found guilty of using Hollywood accounting practices to defraud the producers and stars of the procedural drama Bones (2005–2017) and ordered to pay $179 million in missing profits, with the arbitration ruling made public in 2019.
[35] In July 2021, a lawsuit brought by developer and executive producer Frank Darabont along with Creative Artists Agency against AMC Networks over profits from TV series The Walking Dead was settled for $200 million, plus sharing of certain future revenues.