Producers Say Warner OKd Release to Sony

The “Hollywood embrace” gained new meaning Thursday with the filing of court documents describing in detail the dispute between Warner Bros. and Sony Corp. for the executive talents of Peter Guber and Jon Peters, producers of this summer’s smash hit, “Batman.”

According to pleadings filed by Guber and Peters’ lawyers, Warner production president Terry Semel “hugged and congratulated” Peter Guber upon learning on Sept. 25 that Guber and his partner had been offered the top jobs at Columbia Pictures Entertainment, now being acquired by Sony.

The following day, however, Time Warner Co-Chairman Steven J. Ross hit the roof, according to Guber’s sworn affidavit.

“Mr. Semel told us that Mr. Ross was ‘crazy because of the Time deal,’ meaning that he did not want to communicate to his new merger parter, Time Inc., that Warner’s agreements provided for our departure under these circumstances,” the Guber affidavit says.

The filings came in response to Warner’s request for a preliminary injunction to bar Guber and Peters from “reneging” on their five-year contract with Warner Bros. to manage Columbia.

A hearing on the matter is set for Nov. 2 in Los Angeles Superior Court--two days after Sony’s $3.4-billion tender offer for all of Columbia’s shares will expire.

Although long expected, Sony’s entrance into the motion picture business has stirred nationwide debate about foreign acquisition of a major studio. That debate dwarfed any discussion of the Australian Qintex group’s attempt to acquire MGM/UA Communications, whose luster has waned under financier Kirk Kerkorian. (The Qintex deal collapsed two weeks ago.)

As the affidavit attests, Guber and Peters had earlier won Warner’s blessing when they asked to be released so they could take the helm of MGM in 1988 (a bid that also collapsed). According to Guber’s account, when he reminded Semel of those events, “Mr. Semel became embarrassed and uncomfortable, and responded that ‘you guys at MGM would not be a real competitor.’ ”

In his filing, Guber swore that he would be irreparably harmed if the injunction is granted because he would be unable to work at Columbia or anywhere else in the industry while “according to Warner, our relationship is already irreparably damaged.”

Guber also predicted that “Columbia will be thrown into complete disarray” until it can install a management team to replace the president, chief executive and chairman whom the company has already released.

Guber’s partner, Jon Peters, in his affidavit swears that since Sept. 26, “Warner has made every effort to prevent Mr. Guber and myself from doing work on our ongoing projects at Warner.”

Peters said that Warner forced the producers off one of their projects (“Tango and Cash,” to star Sylvester Stallone and Kurt Russell) and fired a senior editor on the film, “apparently due to his relationship with Guber and Peters.”

In response to the Sony filings, Warner’s outside counsel, Stuart Robinowitz, said: “Sony violates American business morality by raiding major producers under exclusive contract to Warner. Sony’s own SEC filings refute Guber and Peters’ present claim they had an oral option to terminate Warner’s five-year written agreement and walk away from 50 projects in development, in which Warner had invested more than $20 million.”

Robinowitz continued: “Sony would be upset if Warner induced its top recording stars--Michael Jackson and Bruce Springsteen--to breech their exclusive contracts with Sony’s record company. Warner, by the same token, will not tolerate Sony’s illegal inducements to steal its top creative talent. That is not the way we do business in the United States.”

Sony, for its part, issued a prepared response. It said: “Sony’s position remains that Peter Guber and Jon Peters . . . are free to come to Columbia as senior managers.

“Even if a court should find that Guber and Peters must serve Warner as producers of theatrical motion pictures, they are still free to accept senior management positions elsewhere,” the Sony statement went on.

“It is unfortunate that Warner continues to try to stifle the career opportunity that Guber and Peters have to manage a major multifaceted entertainment company.”