Wednesday, July 18, 2012

3D Conversion Tech Legal Disputes: Digital Domain And Prime Focus Settle; Thomas Randolph Sues StereoD Including Giovanni Ribisi

There have been some interesting legal developments in the 3D conversion space this week, one disagreement being settled amicably and the other just starting to develop.

First off we have a software producer, Thomas Randolph who has made a claim against 3D conversion specialist StereoD for failure to pay him a 5% cut of the company.

Here's a portion of the story taken from Courthouse News Service:
Randolph and his company Interactive Artists LLC sued William Sherak (son of nonparty Tom Sherak, president of the Academy of Motion Pictures Arts and Sciences and a former partner of Revolution Studios); movie producer Christopher Mallick; actor Giovanni Ribisi; Kuniaki Izumi, the owner and developer of VDX software; and Hollywood agent David Phillips, who along with Sherak allegedly introduced Randolph to Mallick.

Mallick formed MRSR LLC fka StereoD LLC in 2009 to market and sell Izumi's VDX technology, according to the complaint. Randolph claims that he created the business plan for the 3D conversion company and introduced Mallick to Izumi's software, which converts 2D movies into 3D.

Randolph says he met with Mallick in late 2008, while he was a principal of Kerner Technologies, when the filmmaker expressed an interest in converting 2D movies into 3D.

Randolph says he told Mallick about the VDX technology, and persuaded Izumi to combine VDX technologies with Kerner's CPX technologies and with Kerner's consent entered into a venture with Mallick.

Under the terms of deal, Randolph would be the venture's Chief Technical Officer, own a 5-10 percent stake and license FrameFree and CPF technologies from Kerner, according to the lawsuit.

Randolph is seeking damages for breach of contract, intentional interference with prospective economic advantage, intentional interference with contractual relations, fraud and negligent misrepresentation. His representation is Alexander Volchegursky, with Lvovich, Volchegursky & Szucsko, in San Francisco.


Secondly we have a settlement between Digital Domain (who recently bought the top tier conversion house In-Three) and Prime Focus. The two companies will be actually working together in the future so it is my understanding that this is an amicable arrangement.

Here's the press release for the settlement:

Digital Domain Media Group and Prime Focus World Settle DDMG Patent Infringement Claim on 3D Technology Through Licensing

Companies Will Collaborate on Visual Effects and 3D Conversion for Feature Films

Port St. Lucie, Fla. And Los Angeles, CA — July 18, 2012 — Digital Domain Media Group (NYSE: DDMG) and Prime Focus World NV have signed an agreement whereby Digital Domain Media Group (DDMG) will license its 3D conversion technology to Prime Focus World. The agreement settles and terminates the patent infringement litigation action filed by DDMG against Prime Focus World in 2011. Under the agreement DDMG and Prime Focus World will collaborate on visual effects and 2D-to-3D conversion services work for feature films.

“Ultimately this was a lawsuit between two companies that enjoy working together, so we’re happy to put it behind us and resume our prior relationship with Prime Focus one of performing high-quality VFX work collaboratively,” said John Textor, CEO and Chairman of DDMG. “We understand that Prime Focus has its own significant 3D technology and we are pleased to report, as this license suggests, that they respect ours as we respect theirs.”

“Prime Focus is dedicated to delivering the highest level of conversion to its clients. The technology that we’ve licensed from Digital Domain Media Group enhances our own robust proprietary processes and increases our efficiency for our customers. We look forward to continuing our work with DDMG on their most important VFX projects,” said Namit Malhotra, CEO and Chairman of Prime Focus World.”

Through the Digital Domain Stereo Group, DDMG owns the six U.S. patents that represent the original commercially feasible computerized process for converting 2-dimensional filmed imagery into 3-dimensional stereoscopic imagery. The DDSG patents provide fundamental coverage of any modern conversion process that involves rotoscoping (i.e., computerized, semi-automatic and semi-automatic conversion with roto), and relate to any conversion process that includes horizontal image displacement / transform. In 2011, DDMG made its patent portfolio available to select companies in the broader industry through a studio-friendly licensing program. Prime Focus joins Samsung Electronics Co., Ltd., which licensed DDMG’s technology in 2011 for use in its consumer electronics, components, services and software businesses.

About Digital Domain Media Group
Digital Domain Media Group (DDMG: NYSE) leverages its expertise in digital visual effects (VFX) and computer-generated (CG) animation across a group of interrelated businesses. At its foundation is Digital Domain Productions (DDPI), an award-winning digital production company founded in 1993. This leading provider of visuals has contributed to more than 90 major motion pictures, including Titanic, the Transformers series, Pirates of the Caribbean: At World’s End and TRON: Legacy, hundreds of commercials, and recently created the virtual likeness of rapper Tupac Shakur for Dr. Dre’s show at the Coachella Valley Music Festival. Mothership, a DDPI subsidiary, focuses on creating advertising, entertainment and branded content from concept to completion, across multiple media platforms. DDMG, its work and its employees have been recognized with numerous awards, including seven from the Academy of Motion Picture Arts and Sciences. The company is building on its success in VFX to participate as a co-producer in major productions and is currently co-producing the upcoming live-action sci-fi feature film Ender’s Game, as well as virtual likenesses for Elvis Presley that will be jointly owned by CORE Media Group and DDMG. DDMG also converts two-dimensional (2D) imagery to three-dimensional (3D) imagery and holds key patents in this area. The company is also applying its CG expertise to produce original, family-friendly animated feature films at its subsidiary Tradition Studios. The first movie, The Legend of Tembo, is in pre-production and two more features are in development. The company’s education subsidiary, the Digital Domain Institute, sets a new standard in digital media education through a pioneering public-private partnership with The Florida State University College of Motion Picture Arts. DDMG is expanding its worldwide footprint of the highest quality visual effects and animation at the lowest possible cost through global partnerships in India and China. The company has studios in Los Angeles, San Francisco, Florida, Vancouver, Mumbai and London, and is currently establishing studios in Beijing and Abu Dhabi.

Prime Focus World is a leading global technology services company providing comprehensive creative and technical services to the film, broadcast and advertising industries. Providing 2D to 3D conversion, visual effects and animation services for major media and entertainment companies, the Company has brought its expertise to many wide release Hollywood films, including Men in Black 3, Star Wars: Episode One – The Phantom Menace, Harry Potter and the Deathly Hallows: Part 2, Narnia: The Voyage of the Dawn Treader, Green Lantern, Immortals, Transformers: Dark of the Moon and Avatar. Prime Focus World has global operations with a presence in key centers of creative content production – Los Angeles, New York, London, Vancouver and Mumbai.

This post makes no interpretation of who is right and wrong in these legal matters that are in the hands of the courts.

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