NEW YORK — An arbitrator recently awarded Wicked Pictures $2 million after the adult entertainment studio claimed that cable and satellite TV distributor Trans Digital Media breached its contract after it stopped making royalty payments.
The case has its roots from a September 2006 deal, when New York-based Trans Digital Media inked a pact with Wicked to exclusively distribute its content to U.S. cable and satellite multiple-system operators.
The agreement operated satisfactorily for the first few years — Wicked delivered the requisite number of films and TDM placed the films with the MSOs, paying Wicked proper royalties.
But three years into the deal, Trans Digital Media fell behind in minimum payment obligations.
Wicked and Trans Digital Media later agreed to renegotiate its contract in 2010, striking a new deal with lower minimum guarantees.
"We worked with TDM to make a few changes here and there," Wicked owner Steve Orenstein told XBIZ. "And then we came to an agreement with them for a new five-year deal.
"But within six months of that five-year deal, there started to be issues with getting payments. We were patient with them, but then we said, 'enough is enough,' and we filed our claim."
Orenstein said that Wicked had been without a cable and satellite distribution agreement for about one year because of the legal squabble, but "now, we have a successful future in cable with our new partners Pure Play Broadcasting."
Wicked last May entered into an exclusive broadcast distribution relationship with Pure Play Broadcasting, which provides video-on-demand content to more than 33 million homes in North America through its Heat On Demand VOD service.
Pure Play Broadcasting also provides content for operators in Latin America through Sky Brazil and Sky Mexico and licenses and distributes mature-themed content to premium and broadcast channels in the U.S. and E.U.
Trans Digital Media owner Carl Ruderman did not immediately respond to XBIZ for comment.