Variety: Warner Bros. Discovery Owes $52 Million for ‘South Park’ Streaming Rights, Paramount Alleges

Story from Variety:

Paramount Global fired back on Wednesday in the battle over “South Park” streaming rights, accusing Warner Bros. Discovery of withholding $52 million in license fees.

Warner Bros. Discovery sued Paramount in February, alleging that the company had breached its $500 million licensing deal with HBO Max by diverting “South Park” specials to Paramount+.

On Wednesday, Paramount filed a counterclaim, alleging that HBO Max got everything it bargained for under the agreement, but has nevertheless withheld two required payments of $26 million apiece.

The countersuit, filed in New York Supreme Court, also argues that the unpaid fees cover the 300-plus episodes of “South Park” now streaming on HBO Max, which are not in dispute in the lawsuit.

“Warner Bros. Discovery has indefensibly refused to pay the more than $50 million dollars it owes for South Park content that it has undisputedly received and which HBO Max continues to air and exploit,” a Paramount spokesperson said in a statement. “Warner Bros. Discovery’s argument that Paramount Global was required to deliver additional South Park content is baseless and wholly unsupported by the parties’ agreement. Furthermore, it certainly does not justify Warner Bros. Discovery’s refusal to pay for immensely valuable content all of which it has received and from which it continues to profit.”

Warner Bros. agreed in 2019 to pay $500 million for rights to stream 23 seasons of “South Park,” plus an additional three seasons that had yet to air on Comedy Central. In its lawsuit, Warner Bros. Discovery alleged that each of those seasons was to consist of 10 episodes.

The COVID pandemic upended the 2020 season; HBO Max ultimately got only two episodes. The next two seasons produced 12 more episodes, for a total of 14 instead of the expected 30.

In 2021, MTV Entertainment Studios announced a $900 million deal with creators Trey Parker and Matt Stone, ordering 14 “South Park” “made-for-streaming movies” to air on Paramount+. Warner Bros. Discovery alleged that Paramount was engaged in “verbal trickery” to avoid delivering the required episodes to HBO Max.

In the counterclaim, Paramount states that there was never a guarantee that the seasons would include 10 episodes apiece.

“The Term Sheet reflects no episodic commitment whatsoever for the new seasons of ‘South Park,'” the counterclaim states. “The Term Sheet likewise reflects no term that could require South Park Studios to offer to license to WarnerMedia the rights to any made-for-streaming movies developed outside the television seasons.”

The suit argues that other bidders for the “South Park” library did seek to mandate a minimum number of episodes for the new seasons, but that HBO Max did not.