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January 22, 2010 6:12 PM

Tragedy and Triumph: Conan Characters Caught in Contract Drama

Posted by Brian Baxter

NBC Universal and Conan O'Brien finally reached a deal that will allow the talk show host to depart The Tonight Show. But, as has been widely reported, the late night comic will relinquish the intellectual property rights to several characters created during his 17 years at the network.

The agreement calls for O'Brien to receive roughly $32.5 million in severance for the remaining two-and-a-half years on his guaranteed contract, with an additional $12 million going to settle the contracts of his staff, including $4.5 million to longtime executive producer Jeff Ross.

GettyImages_Triumph Still, we've been particularly concerned about the legal fate of characters like The Masturbating Bear, Pimpbot 5000, and Triumph the Insult Comic Dog (pictured here).

NBC Universal has stated that it will retain the rights to many of O'Brien's characters, including Triumph. The network claims it co-owns the cigar-smoking dog with O'Brien's former writer and longtime friend Robert Smigel. (Click here to view some of Triumph's greatest hits.)

Los Angeles entertainment lawyer Larry Zerner--he of Friday the 13th fame--told Above the Law that Triumph stands out because Smigel likely created the pooping puppeteer outside of his role as a writer employed by NBC. Zerner said the character's official Web site is owned by Warner Records, producer of Triumph's Come Poop With Me CD. (Numerous calls by The Am Law Daily to representatives at various Warner companies were not returned by the time of this post.)

Another shocking revelation comes courtesy of The Smoking Gun, which reported on Friday that music accompanying appearances by The Masturbating Bear and Pimpbot 5000 is outside NBC's grasp. According to The Smoking Gun, two members of O'Brien's house band, drummer Max Weinberg and guitarist Jimmy Vivino, took out copyrights in 2004 on theme music for those characters and recurring sketches like "In the Year 3000."

At the moment, lawyers for NBC aren't talking. Gibson, Dunn & Crutcher partner Scott Edelman, who advised NBC on the O'Brien negotiations, declined to comment on the agreement. An e-mail to NBC Universal executive vice president and deputy general counsel Andrea Hartman seeking clarification on character ownership was not returned by the time of this post.

Calls to O'Brien's lawyers also didn't yield any answers. A call to O'Brien's lead contracts lawyer, Leigh Brecheen from entertainment firm Bloom Hergott Diemer Rosenthal LaViolette Feldman & Goodman, wasn't immediately returned. A secretary for Patricia Glaser, O'Brien's lead litigator from L.A.'s Glaser, Weil, Fink, Jacobs, Howard & Shapiro, told us that Glaser was attending the taping of O'Brien's final show on Friday night and wouldn't be available for comment. (Hopefully Triumph won't poop on any legal documents.)

O'Brien's lawyers should take the time to celebrate, as some Am Law lawyers following the late night television shenanigans believe that the talk show host got a great deal from his soon-to-be-former employer.

"It's not a good deal for NBC because those characters are so tied to Conan, they really don't fit with anybody else," says Bassam "Sam" Ibrahim, an IP partner at Buchanan Ingersoll & Rooney. "The only goal [NBC] can hope to achieve is to somehow hinder Conan's ability to compete with [Jay] Leno at another station. They don't want Conan to go to another network with the identical show that NBC has paid for, so they want him to create a new show."

Ibrahim says the IP portion of O'Brien's severance package with NBC surprised him.

"There's usually a decision on the front end over who's going to own IP assets," he says. "It's usually part of the initial agreement. Take [David] Letterman. He owns all of the rights to the skits, the names of characters, and the overall format of his show, so if he ever leaves he can recreate that show at a competitor."

Letterman's ownership rights are structured through his production company, Worldwide Pants Incorporated, and Ibrahim says that it appears that O'Brien's production company, Conaco, did not have a similar agreement with NBC.

That's likely because O'Brien and Letterman were at different stages of their careers when they inked their respective deals--Letterman went through tortuous negotiations to get out of his deal with NBC in the early nineties when he switched to CBS, while O'Brien was happy a few years back to be named Leno's successor on The Tonight Show.

This time around, O'Brien will be able to take a page from Letterman's book almost two decades ago, when his Late Night predecessor subtly tweaked certain characters he was contractually obligated to leave behind.

"Conan will tweak his characters so they are clearly distinguishable, although the underlying concept is the same, because NBC can't prevent him from going out and making a living by creating competing characters," Ibrahim says. "They can only prevent him from using substantially identical characters, which he can get around by creating new names."

Some possibilities--such as the self-pleasuring peacock--have already been bandied about. Ibrahim says that any court will give the comedian wide latitude because of First Amendment rights to expression.

"At the end of the day it's going to have little to no affect on Conan's success in the marketplace," says Ibrahim, who admits to being a fan of O'Brien's. "He'll be able to go to a competitor and create a new show with new characters. And that's what he's going to do--take his money and run."

If the bear doesn't get him first.

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