In the wake of Black Widow finally arriving in theaters after multiple delays, star Scarlett Johansson is suing the Walt Disney Company for breach of contract over the movie’s simultaneous release on Disney+ Premier Access.
This dual approach to movie releases has been implemented by several studios as a compromise during the ongoing COVID-19 pandemic. It allows moviegoers to see films on the big screen if they feel safe to do so, or to watch them in their own homes if they are vulnerable, self-isolating, or in an area with high infection rates. However, it has also opened up studios like Warner Bros. (which is releasing all of its 2021 movies simultaneously in theaters and on HBO Max) to criticism and threats of legal action from theater chains, stakeholders, production companies, and movie talent.
Black Widow‘s release has become the centerpiece of a new battle in this war over dual theatrical and streaming releases, and could become a bellwether for how future lawsuits play out. Here’s a breakdown of Johansson’s lawsuit, Disney’s response, and the impact it could have on Hollywood.
Why Scarlett Johansson Is Suing Disney Over Black Widow
Actors’ contracts often stipulate that they’ll be paid a combination of an upfront fee and either a percentage of the box office profits, or bonuses based on hitting certain benchmarks (known as a back end deal). This is beneficial to the studio because it prevents the budget from becoming too bloated during production, and limits the overall loss if the movie bombs at the box office. It can also be very lucrative for the actor, as they stand to make a lot more money from back end bonuses than they would have been able to negotiate in an upfront fee. For example, Robert Downey Jr. made $20 million upfront for playing Tony Stark in Avengers: Endgame,and a further $55 million from his back-end deal for an 8% share of the box office profits.
These contracts usually include a guarantee that the movie will receive an exclusive theatrical release, which ensures that they reach their maximum box office potential. Johansson’s lawsuit against Disney states that her salary was largely tied to the performance of Black Widow, with the star set to receive bonuses when it hit certain targets at the box office, and that the decision to release the movie simultaneously on Disney+ constitutes a breach of contract. Black Widow made $158.8 million internationally in its opening weekend, and in a rare lifting of the veil surrounding streaming numbers, Disney revealed that it had also generated $60 million in Disney+ Premier Access purchases, for a combined $218.8 million global launch.
Though Black Widow is another solid hit for the Marvel Cinematic Universe, the movie dropped sharply at the box office in its second weekend. Its simultaneous Disney+ release not only means that some people are choosing to pay for home viewing instead of seeing it in theaters, but also makes the movie more vulnerable to piracy. Johansson’s lawsuit argues that this hybrid release strategy has cut into Black Widow‘s box office profits, and therefore significantly impacted the amount that she was projected to make from the movie.
Disney’s Response To The Lawsuit
Disney has hit back at Johansson for the lawsuit in a strongly-worded response, stating: “There is no merit whatsoever to this filing. The lawsuit is especially sad and distressing in its callous disregard for the horrific and prolonged global effects of the COVID-19 pandemic.” The company did not address the claim that it had ignored previous efforts to renegotiate Johansson’s contract, though the statement goes on to argue that “the release of Black Widow on Disney+ with Premier Access has significantly enhanced [Johansson]’s ability to earn additional compensation on top of the $20M she has received to date.”
A Wall Street Journal source with knowledge of Johansson’s contract claims that she faces a projected loss of $50 million in earnings due to Black Widow‘s release on Disney+. Ultimately Johansson’s legal standing will come down to whether or not she can prove damages, and Disney’s accusation that the lawsuit shows a “callous disregard” for the pandemic is irrelevant. The fiery response seems designed to make Johansson back off by threatening her public image. However, the actress’ attorney, John Berlinski, responded in a statement (via Variety) that argues Black Widow‘s Disney+ release and the alleged breach of contract was driven by Disney’s own financial self-interest:
“It’s no secret that Disney is releasing films like Black Widow directly onto Disney Plus to increase subscribers and thereby boost the company’s stock price – and that it’s hiding behind Covid-19 as a pretext to do so. But ignoring the contracts of the artists responsible for the success of its films in furtherance of this short-sighted strategy violates their rights and we look forward to proving as much in court. This will surely not be the last case where Hollywood talent stands up to Disney and makes it clear that, whatever the company may pretend, it has a legal obligation to honor its contracts.”
How Warner Bros. Handled HBO Max’s Movie Releases
Disney isn’t the first studio to court controversy with a hybrid release model. The coronavirus pandemic has been an unprecedented obstacle for Hollywood, with theaters across the United States and the rest of the world closing their doors in compliance with lockdown measures. The initial response from studios was simply to delay the release of their upcoming movies to later in the year. However, when theaters first began to reopen in August 2020 and the waters were tested with releases like Tenet and The New Mutants, it became clear that the box office would be back to normal any time soon.
Anticipating (correctly) that the coronavirus pandemic and its impact on theaters would last well into the following year, Warner Bros. made the bold announcement that all of its 2021 movies would release simultaneously in theaters and on HBO Max. This triggered a major backlash across the film industry. In a statement, AMC Theatres CEO Adam Aron accused Warner Bros. of “sacrific[ing] a considerable portion of the profitability of its movie studio division, and that of its production partners and filmmakers, to subsidize its HBO Max start up.” Director Christopher Nolan criticized Warner Bros. for failing to consult or even warn its associated filmmakers and talent before the news was announced, and argued that the hybrid release model “makes no economic sense.”
Warner Bros. faced its own threat of legal action as a result of the HBO Max release plan. Legendary Entertainment, which provided 75% of the financing for Dune and Godzilla vs. Kong, sent out legal warnings to Warner Bros. after being blindsided by the announcement of the movies’ hybrid releases. In January 2021, THR reported that Warner Bros. was close to a deal with Legendary to resolve the legal confrontation, and Bloomberg reported shortly afterwards that Warner Bros. was resolving disputes with filmmakers and other talent by offering them guaranteed paydays, larger performance-based bonuses, and other means of compensation.
How Scarlett Johansson’s Lawsuit Could Impact Hollywood
As with the legal challenges faced by Warner Bros., it’s extremely likely that Scarlett Johansson’s lawsuit against Disney will end up being settled out of court. But regardless of whether the dispute is resolved in the public eye or behind closed doors, the lawsuit sets a precedent for other parties affected by hybrid releases to take legal action. Disney’s upcoming movie Jungle Cruise will use the same hybrid release model as Black Widow, which means that if stars Dwayne Johnson and Emily Blunt haven’t already made new deals with the studio, they could also sue for breach of contract. Given the number of cast, crew members and companies involved in these movies whose contracts with Disney will have included some kind of back end deal, there’s even potential for a class-action lawsuit.
Another possible effect of Johansson’s lawsuit is that Disney and other studios will avoid trying to blindside actors and other talent with changes to their release plans in the future. Much of the ire from the Warner Bros./HBO Max announcement resulted from the studio making the decision unilaterally and not giving any advance notice to partners whose earnings depended on an exclusive theatrical release. Johansson’s complaint states that her team tried to renegotiate her contract after the decision was made to release Black Widow on Disney+ Premier Access, but that Marvel Studios and Disney were unresponsive. Given how quickly legal fees can add up, it could be more financially prudent for studios to proactively negotiate new deals rather than waiting to get sued.
Will The Lawsuit Affect Future Disney+ Releases?
Scarlett Johansson’s lawsuit may have some impact on Disney+’s decision to continue with hybrid releases throughout 2021 (and perhaps beyond), but it won’t be the deciding factor. The film industry has never had to deal with anything like the coronavirus pandemic before, and while dual releases in theaters and on streaming services has become the favored solution, it’s still a largely untested and constantly evolving release strategy. Not only will studios have to adapt talent and partner contracts to fairly reflect a blend of box office and streaming revenue, they’ll also have to deal with pushback from theater chains like AMC, Regal and Cinemark.
When it comes to attracting talent, the arguments against hybrid releases go beyond dollars and cents. Many directors and actors believe fiercely in the theatrical experience and are unhappy with the idea of their movie debuting on iPhones and laptops at the same time as it premieres in theaters. Christopher Nolan has been among the most outspoken advocates for the big screen experience, but he’s certainly not alone, and many filmmakers may be reluctant to sign deals without the guarantee of an exclusive theatrical release. There’s also brand value in theatrical exclusivity, especially for franchises like Marvel and Star Wars, where each major movie release is supposed to feel like an event.
Disney’s next big MCU movie, Shang-Chi and the Legend of the Ten Rings, is currently set for an exclusive release in theaters, but its release window has been halved from the traditional 90 days to just 45 days before it’s available for home viewing. The same approach can likely be expected for Eternals, which will release a couple of months after Shang-Chi. But whether these hybrid release strategies and shortened theatrical windows will continue beyond the end of the pandemic remains to be seen.
Key Release Dates
- Shang-Chi And The Legend Of The Ten Rings (2021)Release Date: Sep 03, 2021
- Eternals (2021)Release Date: Nov 05, 2021
- Spider-Man: No Way Home (2021)Release Date: Dec 17, 2021
- Doctor Strange In The Multiverse Of Madness (2022)Release Date: Mar 25, 2022
- Thor: Love And Thunder (2022)Release Date: May 06, 2022
- Black Panther: Wakanda Forever/Black Panther 2 (2022)Release Date: Jul 08, 2022
- The Marvels/Captain Marvel 2 (2022)Release Date: Nov 11, 2022
- Ant-Man And The Wasp: Quantumania (2023)Release Date: Feb 17, 2023
- Guardians Of The Galaxy Vol. 3 (2023)Release Date: May 05, 2023