Producers Sue to Block Sale of Spelling Stock

The creators of the popular prime-time soap operas “Dynasty” and “The Colbys” filed suit Monday seeking to block a plan by Aaron Spelling Productions to sell about a third of its stock to the public for an estimated $108 million.

The lawsuit, filed in Los Angeles Superior Court by executive producers Esther and Richard Shapiro, claims that the initial public offering announced last week by Los Angeles-based Spelling violates the joint ventures that the two producers formed with the company in 1979 and 1985 for production and distribution of the two TV shows.

Under the agreement, the Shapiros retained 60% of all rights to the shows, while Aaron Spelling Productions controlled the remaining 40%. Neither side is permitted to sell or transfer its interest without the written consent of the other, the suit alleges.

“The parties had made an agreement that contemplated a close and personal working relationship,” an agreement that will be violated if Spelling goes through with the stock offering under which company owner Aaron Spelling would retain 68.7% of the voting shares, the Shapiros’ attorney, Donald P. Walerstein, said.

“Dynasty” and “The Colbys” represent a “substantial portion” of the value of the shares offered for sale by the production company and have “become assets of enormous present and future value,” yet the Shapiros have no opportunity to share in the profits of the proposed stock sale, the suit alleges.

The suit, which seeks a total of $40 million in damages, also names the investment firms that are managing the stock sale, Drexel Burnham Lambert and Bear, Stearns & Co. Representatives of Spelling and the investment houses could not be reached immediately for comment.