New Twist in Disney Conflict Over Pooh

Walt Disney Co. disclosed Monday what could become the legal equivalent of getting stuck in a honey jar for a Florida company locked in a battle over hundreds of millions of dollars in royalties from the sale of Winnie the Pooh merchandise.

But a lawyer for the Florida company called the latest development in the long-running case nothing more than legal gamesmanship by Disney, and predicted the ploy will eventually fail.

Eleven years ago Disney was sued by Stephen Slesinger Inc., a firm controlled by the family of the late literary agent who secured rights to sell Pooh merchandise in the 1930s. Shirley Slesinger Lasswell, and her daughter Patricia Slesinger, turned those rights over to Disney for a share of Pooh merchandising sales, but they contend the Burbank-based entertainment giant has cheated them out of at least $200 million in royalties.

The Slesingers went to Los Angeles Superior Court in an effort to end their Disney contract. Their aim is to be able to shop their Pooh rights elsewhere. A trial is scheduled for next year.

But Disney said that the granddaughters of Pooh author A.A. Milne, and artist E. H. Shepard, on Monday invoked U.S. copyright laws to reclaim their rights to the lovable bear in two years.

Disney said the two women simultaneously will grant back to Disney exclusive rights to Pooh merchandise, film, DVD, clothing and other rights under a fresh agreement. On Monday the two women gave both Disney and the Slesingers the two-year notice required by copyright law before they can “recapture” the Pooh rights, Disney said.

Disney said that the copyright notice would not affect the current lawsuit.

The Slesingers’ lawyer, Bert Fields, predicted that the copyright tactic will not survive legal challenges and disputed Disney’s claim that the Pooh rights can be so easily shifted because of an existing contract between the Slesingers and Disney. He called it an attempt by Disney to “sneak around the agreement” they have with the family.

“That would be in violation of the agreement they entered into,” Fields said. “This is another attempt by Disney to get out of paying what they have promised.”

Disney spokesman John Spelich said that U.S. copyright law allows the two women, Milne’s granddaughter Clare Milne and Shepard’s granddaughter Minette Hunt, to cut a new deal that excludes the Slesingers in November 2004.

“After that, it would appear that they’re out,” Spelich said.