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Disney Destroyed Documents In Winnie Licensing Case

In a 22-page decision filed Friday, June 23, 2000, L.A. Superior Court Judge Ernest Hiroshige ruled that the Walt Disney Co. willfully destroyed documents regarding the long-running litigation over royalties on WINNIE THE POOH. The judge ruled that plaintiff Stephen Slesinger Inc., owner of the rights to late author A.A. Milne's WINNIE THE POOH characters, is entitled to monetary sanctions and that the jury in the upcoming trial be instructed that Disney willfully suppressed evidence to prevent it being presented. This first round lose is a big blow to Disneys claim that it does not owe hundreds of millions of dollars to Slesinger. The original lawsuit was filed in 1992 by Slesinger to resolve disputes over the terms of its 1983 agreement with Disney, who claims that under the agreement it does not have to pay any royalties on POOH videos or computer software. In addition, other merchandise royalty amounts owed are also in dispute. Judge Hiroshige's opinion states that Vince Jefferds, Disney's president of consumer products in 1983, spearheaded the 1983 deal on Disney's behalf. In 1994, two years after the lawsuit was filed, Jefferds' replacement okayed the destruction of all his files. Slesinger contends these files contained correspondences that support its position that it is entitled to royalties on videocassettes. On April 15, 1997, Disney claimed it could not find the correspondences and then the next day claimed it learned for the first time that the files had been destroyed. In March 1999, Disney disclosed to Slesinger that it had destroyed an estimated 40 boxes of Jefferds' files in 1994. Then in December of 1999, Disney disclosed that it had indeed destroyed a box of files marked "Winnie-the-Pooh, legal problems." A Disney spokeswoman declined to comment on the judge's orders stating that the case file and sanction decision are both sealed.

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