## Facts

- Television writer Sandy Veith, through Vuelta International, Inc., entered a contract with Universal City Studios, Inc. for Veith’s creative services.
- The contract provided Veith a fixed salary plus additional sums if his creative efforts led to the licensing of a prime-time television series.
- Veith and Universal were signatories to a collective-bargaining agreement between the Writers Guild of America, West, Inc. and the Alliance of Motion Picture & Television Producers, Inc.
- The CBA’s arbitration mechanism was limited to disputes over writing credits and did not provide for arbitration of other disputes.
- Veith developed a television concept titled “Coletta.”
- The National Broadcasting Company purchased an option to produce “Coletta,” but later decided not to produce the series.
- The American Broadcasting Company also entered an option agreement related to a “Coletta” script, but likewise decided not to proceed.
- About four years later, Veith learned of the successful CBS series *Northern Exposure*, which he alleged shared many similarities with “Coletta.”
- Veith received neither credit nor the additional compensation he claimed was owed under his contract with Universal.
- Evidence at trial indicated Universal executives intentionally shared aspects of “Coletta” with persons involved in developing *Northern Exposure*.
- Veith and Vuelta sued Universal, its related company MCA, Inc., and Creative Artists Agency, Inc. for breach of written contract, breach of implied contract, and breach of fiduciary duty.
- A jury found for Veith and Vuelta and awarded $7.29 million in damages, reflecting the lost future value associated with being the creator of a successful series.
- The trial court denied defendants’ motions for judgment notwithstanding the verdict and for a new trial.
- Universal appealed, arguing Veith’s claims had to be arbitrated under the WGA CBA.

## Issues

1. Whether the WGA–AMPTP CBA required arbitration of Veith’s claims even though the CBA’s arbitration procedure addressed credit disputes.
2. Whether Veith’s contract, implied-contract, and fiduciary-duty claims were, in substance, credit disputes that had to be resolved through the CBA process rather than in court.
3. Whether the trial court erred by denying post-trial relief (JNOV or new trial) based on the asserted arbitration requirement.

## Decision

- The Court of Appeal affirmed the judgment.
- The court rejected Universal’s argument that the WGA CBA required arbitration of Veith’s claims beyond the CBA’s credit-dispute process.
- The trial court’s denial of JNOV and a new trial was affirmed, leaving the $7.29 million jury award intact.

## Legal Principles

- Arbitration under a collective-bargaining agreement is required only to the extent the agreement provides for arbitration of the dispute at issue.
- Where a guild CBA provides arbitration only for credit disputes, it does not, by itself, require arbitration of separate claims for breach of an individual written contract, breach of an implied contract, or breach of fiduciary duty seeking damages.
- A party seeking to compel arbitration must show the asserted claims fall within the scope of the arbitration procedure relied upon; if the procedure is limited (such as to credits), broader state-law claims may proceed in court.
- Denial of JNOV or a new trial will not be reversed when the asserted legal basis for taking the case away from the jury (such as mandatory arbitration) does not apply.

## Conclusion

In *Sandy Veith and Vuelta International, Inc. v. MCA, Inc.*, the California Court of Appeal affirmed a $7.29 million jury verdict for a television writer who claimed his unproduced “Coletta” concept was intentionally shared and used in developing *Northern Exposure* without credit or the contingent compensation promised by his Universal contract, holding that the WGA CBA’s arbitration process limited to credit disputes did not require arbitration of his contract and fiduciary-duty claims.


Sandy Veith and Vuelta International, Inc. v. MCA, Inc., 1997 Cal. App. Unpub. LEXIS 1 (1997)