Dear Friends and Colleagues:

My good friend and associate, Jim Hardison, said it best, "It's surreal!"

After many great years building Will Vinton Prods. and creating groundbreaking Claymation and 3D-animated films, television and commercials, and growing Will Vinton Studios, I have been forced out of active involvement with the company by Phil Knight and his associates. The situation could also be described as "Machiavellian"! And I expect you'll hear much more about this David and Goliath story in the near future.

Entrepreneur Haim Saban has dropped out of his $2.3 billion contract to buy Germany's biggest broadcaster ProSiebenSat 1 from bankrupt KirchMedia. Saban signed the 40,000-page contract on March 27, 2003 for the acquisition of the broadcaster and its programming rights to approximately 18,000 films and series, the largest film library outside of Hollywood. Over the next two months, Saban did not agree with KirchMedia and creditor banks on "details of the transaction" by the deadline of May 31 for the purchase of ProSiebenSat 1.

Dieselfx has commenced operations in Santa Monica, California. Elliot Jobe founded the new effects house after leaving Playground where he was the lead inferno artist. Joining the team with be Craig Price, Playground's former creative director and producer Alessandra Pasquino, who also worked at Playground. From design and production supervision to final finishes, the new firm has a wide range of serves for clients including a complete CGI package.

Post-production company PostWorks New York has made a major move, acquiring all of Tapehouse companies, including Tapehouse Editorial, Tapehouse Digital Film, Tapehouse Broadband, Black Logic and The Anx, as well as all of SMA Realtime and 50% of audio post house Caterini Studios. With the acquisition, PostWorks will be equipped to handle every aspect of digital or film post-production for both short-form and long-form television, film and multimedia projects.

By an overwhelming vote, the members of the Animation Guild and Affiliated Optical Electronic and Graphic Arts, Local 839 IATSE have ratified a new collective bargaining agreement with the major animation producers. The new Animation Guild agreement offers the same wage minimum increases, health and pension benefits as the IATSE Hollywood Basic Agreement, which was agreed to in November 2002 and ratified in February 2003.

Newark, New Jersey-based IDT Media announced May 15, 2003 that its animation production unit, Digital Production Solutions (DPS), will acquire a 51% interest in Film Roman, Inc., a leading independent animation company, through the purchase of newly issued shares of Film Roman common stock. Film Roman produces the animation on the primetime hits THE SIMPSONS and KING OF THE HILL. IDT Media is a subsidiary of IDT Corp., a multinational carrier, telecommunications and technology company.

The following is a letter from Joseph Barbera read at the Hollywood Hills West Neighborhood Council along with a statement from Alan Leib, chairman of The Modern Committee of the L.A. Conservancy to support saving the Hanna-Barbera building.

Dear members of the Hollywood Hills West Neighborhood Council,

First, I’d like to thank you for your time and interest in a subject very near and dear to my heart; the facility at 3400 Cahuenga Boulevard.

George Lucas has divided his empire in Point Richmond, California into a new animation division to focus on the creation of digitally animated feature films reportedly due to his frustration over studio-controlled animated projects that have fallen through over the past six years. Lucas-film Animation will be given its own identity and autonomy to develop and generate full-length CG cartoons.

Leading videogame publisher Infogrames Entertainment SA (IESA) has changed its corporate name to Atari. Infogrames (New York City and Lyon, France) acquired the Atari brand when it bought the interactive assets of toymaker Hasbro in January 2001 and has periodically used the name, one of the oldest (30 years) and most legendary in videogame history, for titles such as DRAGON BALL Z, MISSION IMPOSSIBLE, SUPERMAN, TERMINATOR 3 and ENTER THE MATRIX, which debuts on May 15, 2003, day and date with the film, THE MATRIX RELOADED.

Chel White, Ray Di Carlo and David Daniels have combined strengths to form an artist-driven studio Bent Image Lab, in Portland, Oregon. "Our mission is to generate the future in 'mixed media/animation/live-action'," said partner/executive producer Di Carlo. "We are artists doing business, not businessmen trying to make art." Di Carlo however, has a successful business background and will operate Bent under a highly unique business model.

Viacom-owned Showtime Networks Inc. (SNI) has laid off 70 workers, roughly 10% of its staff, on May 5, 2003, primarily in the areas of affiliate relations, marketing and creative services. This follows on the heels of rival HBO eliminating 20 jobs the previous week.

The Henson family is the winning bidder to buy 100% of The Jim Henson Company from German kids TV outfit EM.TV Merchandising AG for $89 million. Recently Disney, Saban and Sony Pictures had appeared to be the likely buyers. The Henson heirs sold the company to EM.TV three years ago for $680 million and now are set to pay $78 million in cash plus $11 million of the Henson Co. assets.

S4 Studios a traditional/3D animation design and content creation studio founded in 1999 in the San Fernando Valley, has opened its new studio in the heart of Hollywood. The new facility, located at 1529 N. Cahuenga Boulevard, will allow the growing studio greater access to its core businesses of trailers, network graphics and TV commercials while continuing to develop original content for motion pictures, television, direct to video and online.

DIC Entertainment has sued Speed Racer Enterprises to enforce DIC’s television, merchandise and other ancillary rights to the animated series SPEED RACER, which is airing weekly on the Nickelodeon network. DIC is seeking damages of $5 million plus punitive damages and injunctive relief for fraud, breach of contract, injunctive relief, conversion, slander of title and a number of other causes of action in case filed with Los Angeles Super Court.

Broadcast design industry leaders Paul Newman, Jim Moran and Gary Bonilla have formed CO-OP, a new advertising and design company in New York City that operates as the strategic core of a network of partners with a full range of complimentary creative companies. CO-OP offers its clients brand strategy and brand development through advertising, vertical marketing, business to business communication, direct marketing, interactive, brand design and identity and broadcast design.

A developer wants to raze the Hanna-Barbera Studios buildings that animation legends William Hanna and Joseph Barbera erected in 1963 at 3400 Cahuenga Blvd. near Universal City, to build shops and apartments. HB preservationists are scrambling to mount a campaign to save what they call is a historic and architecturally significant landmark, while some residents of that neighborhood fear the project would worsen traffic in the Cahuenga Pass.

;;<??orial started up April 21, 2003 in Santa Monica, California to offer creative editorial to the television advertising community. Company co-founders are Michael Raimondi, Werner Mayes and Ron Moler, with Raimondi also acting as executive producer and Megan Dahlman as producer. Mayes and Raimondi worked together for several years at Santa Monica-based editorial facility Harley's House.