Curtain rises on Televisa-Univision trial

Mexican media giant Grupo Televisa on Tuesday accused its longtime television partner, Univision Communications Inc., of heavy-handed tactics and financial shenanigans during the opening day of a high-stakes trial in Los Angeles.

The outcome of the court case, expected to unfold over the next three weeks unless there is a surprise settlement, could reshape the landscape of Spanish-language television in the U.S.

Televisa is the world’s largest producer of the salacious Spanish-language soap operas, or telenovelas, that generate huge prime-time ratings for Univision. The Mexican company wants to end its relationship with its longtime U.S. distributor.

Univision, the dominant Spanish-language TV company in the U.S., is loath to lose Televisa’s programming because it accounts for the vast bulk of the network’s top-rated shows. The partnership that began in 1992 has generated billions in revenue for each company.

Executives from both companies packed the courtroom Tuesday, including Mexico’s media barron Emilio Azcarraga Jean and Los Angeles billionaire Haim Saban, who is part of the group that owns Univision.

But profits aside, Televisa’s lawyer, Marshall B. Grossman, depicted the Mexico City company as a victim. He alleged that Univision denied Televisa more than $100 million in royalties from programs. Then, when Televisa dispatched auditors to examine the books, Univision tried to block them.

“Televisa came to conclude that it could no longer trust Univision no matter how profitable their relationship had been,” Grossman said. “It just wasn’t worth the price.”

If the jury finds that Univision’s actions constituted a “material breach” of the contract, Televisa would be free to sell its shows to rival networks. Otherwise, the company must continue to provide its shows in the U.S. exclusively to Univision through the end of its contract in 2017.

The nine-person jury includes four Latinos. A retired man from Whittier, who identified himself as David Sanchez, volunteered that he was born in Mexico and that he watches the “good novelas” produced by Televisa.

Univision attorneys requested that he be removed from the panel. U.S. District Judge Philip S. Gutierrez agreed to excuse Sanchez over Televisa’s objections.

When it was his turn, Univision lead attorney John Keker accused Televisa of trying to make mountains out of “accounting molehills.” Univision, he said, has already paid $21 million in disputed royalties.

Keker alleged that the lawsuit was a tactic by Televisa’s chairman, Azcarraga Jean, who is scheduled to testify next week, to scare away other bidders for Univision when it was put up for sale in 2006. At the time, Televisa assembled its own investor group in an effort to buy Univision.

Companies such as Walt Disney Co., Time Warner Inc. and Comcast Corp. decided to skip the auction rather than buy Univision and risk losing its steady supply of top-rated programming, Keker said.

Azcarraga Jean’s plan to gain control of Univision backfired, Keker said. “He miscalculated. He bid too low. Now he wants to bust the contract so that he can bring the successful bidders to their knees.”

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meg.james@latimes.com