I still recall how groundbreaking it was for Hamilton to be released on Disney+ when I was in quarantine in my childhood home with my family last summer. I remember several conversations in which we discussed what such a release might mean for the future of Broadway, especially in the midst of a global pandemic. At the time, Broadway theaters were not the only places to shut their doors—I hadn’t seen a movie in theaters in months—but because streaming services had made movies accessible to me from the comfort of my home even prior to the pandemic, I never stopped to ponder the future of film.
Until the Black Widow lawsuit.
In July of this year, Scarlett Johansson sued Disney for breach of contract regarding her compensation for their film, Black Widow. According to her complaint, Disney had promised her that Black Widow would have a “wide theatrical release,” meaning that Disney was supposed to wait the “standard” 90-120 days after releasing the film in theaters before releasing it on their streaming service, Disney+. Her lawyers maintained that her participation in the film was based on the premise that she would receive this period of exclusivity. However, Disney released the film on their streaming service the same day it went to theaters. She alleges that because of this early release, Disney robbed her of $50 million dollars in pay.
In response to the lawsuit, Disney’s attorneys denied the allegations of breach, stating that Johansson’s suit showed a “callous disregard for the horrific and prolonged global effects of the COVID-19 pandemic.” Essentially, their aggressive rebuttal alluded to their defense being grounded in that of necessity—that because of the pandemic, they had to breach her contract. Typically, this is a defense that can be established by a “force majeure” clause in a contract. If included in the contract, a “force majeure” clause would relieve Disney of its contractual promise to Johansson, on the basis that circumstances beyond their control—COVID-19—made performance “inadvisable, commercially impracticable, illegal, or impossible.”
Gabrielle Carteris, the president of the Screen Actor’s Guild, has said, “Scarlett Johansson is shining a white-hot spotlight on the improper shifts in compensation that companies are attempting to slip by talent as distribution models change.”
It is likely, however, that no such clause existed in the contract because last week, the parties settled the lawsuit and have since made public statements regarding their eagerness to work together on future projects moving forward.
But what will “working together moving forward” look like? Johansson’s suit has stirred many doubts and ideas in Hollywood as to how to protect actors and performers from “falling victim to surprise reductions in expected compensation” when companies like Disney are still trying to resolve the interaction between streaming services and the box office in an ongoing pandemic environment. Many have regarded Johansson’s suit as a guiding force in navigating this new age of entertainment negotiations. In fact, following Johansson’s lawsuit, rumors began circulating that the next to file would likely be Emma Stone for Cruella and Emily Blunt for Jungle Cruise, but so far, neither have come to fruition. Gabrielle Carteris, the president of the Screen Actor’s Guild, has said, “Scarlett Johansson is shining a white-hot spotlight on the improper shifts in compensation that companies are attempting to slip by talent as distribution models change.”
The biggest takeaway from Johansson’s suit should be that to avoid this kind of legal battle in the foreseeable future, companies and actors need to negotiate compensation terms ahead of time that anticipate a continuation of streaming service releases in the wake of COVID-19. In addition to protecting actors and performers, preliminary negotiations could benefit the production company by saving them from unsubstantiated payouts. For example, even though Johansson alleged $50 million in losses, these losses were entirely speculative.
Disney+ made $30 for every “premier access viewing” they received on the film. The company priced these releases here to consider that some viewings would be for entire families, while some were single-user viewings. In other words, they were trying to account for the profits that would be lost at the theater by pricing their release at an estimated average. However, there’s no way to truly know if this was effective because Disney simply cannot be certain of how many viewers there were behind the screens of peoples’ homes. Moreover, there is no way for Disney to guarantee that had the film not been available on the streaming site, the same number of viewers would have visited the theater, because even as COVID-19 restrictions technically loosen in communities, there will likely still be people taking precautions and choosing to stay home instead of visiting the theaters.
In this case, there was no way for either party to go back in time and say, “This is how much Johansson would have made if Disney hadn’t released this on Disney+ when they did.” Yet, the company was forced to settle based on these speculations.
This could have been avoided entirely if either party had been more proactive in their negotiations. Despite Johansson and Disney’s seemingly positive outlook on their professional relationship going forward, it’s impossible to imagine that similar suits will all have such a happy ending—nobody wins when you know a matter is going to end in court. In the future, it would be mutually beneficial for actors and production companies to include the probability of streaming service viewers in their payment terms. If they don’t, I’m sure that Black Widow won’t be the last controversy on the subject.
Alessandra L. Deiorio
Alessandra is a second-year, first-generation law student from central Florida. She graduated from the University of South Florida in 2019 with degrees in Accounting and Health Sciences. During law school, she has garnered interests in health, intellectual property, and corporate/entertainment law. Along with writing as a staff member for UNC’s Journal of Law and Technology, she is an active member of the Carolina Health Law Organization, Women in Law, Carolina Intellectual Property Law Association, Sports and Entertainment Law Association, and UNC Pro Bono.