Rupert Bear, the cartoon character with checked trousers and a scarlet sweater, is at the centre of a multimillion-dollar lawsuit between a troubled Canadian animation company and a British media mogul.
In a series of claims and counterclaims in an Ontario court, animator Nelvana Ltd. alleges that Express Newspapers PLC is failing to live up to the terms of a long-term contract granting the Toronto company commercial rights to Rupert Bear. Nelvana is owned by TV and radio broadcaster Corus Entertainment Inc.
New management of Express "has sought to interfere with and frustrate" the agreement between the two companies, Nelvana said in a 2002 legal filing. A Corus spokeswoman said the company is eager to resolve the dispute and is committed to the long-term success of Rupert Bear.
Express is a newspaper group owned by Richard Desmond that published the first Rupert Bear cartoon in 1920. The white-faced bear's adventures in the imaginary world of Nutwood have been featured in British comics and annuals for more than 80 years.
Express alleges that Nelvana has mismanaged and neglected the property. Express wants to regain control of Rupert Bear and is claiming more than $2-million in damages and unpaid licencing fees.
"Nelvana drastically reduced its commitment of resources for promoting Rupert Bear," Express alleged last year. "Nelvana has permitted the Rupert Bear property to languish far below potential."
None of the allegations have been proved in court.
In 1989, Nelvana and Express concluded a licencing agreement that granted Nelvana exclusive broadcast-TV, theatrical and merchandising rights to Rupert Bear, court documents say.
Over the next seven years, Nelvana produced 65 animated episodes of Rupert that were broadcast across Canada and the United States. Express received a percentage of broadcasting and merchandise revenue and had the right to safeguard the integrity of the Rupert Bear character and stories. In the fall of 1997, the licencing deal between the two companies was extended to 2004, the legal filings say.
The paths of both Nelvana and Express changed in 2000. Nelvana was sold to Corus for $540-million in September. The subsequent downturn in TV markets, consolidation across the media sector and a slowdown in advertising forced Corus to subsidize operations. Nelvana has since undergone a series of dramatic changes, including production cuts and layoffs.
In Britain, Mr. Desmond gained admission to the league of Fleet Street proprietors when he agreed to acquire the Express group in November, 2000. The deal was met with some concern in the British press and Parliament. Mr. Desmond's interests include dozens of pornography magazines, Web sites and an adult entertainment TV channel.
Nelvana produced its last episode of Rupert in 1997 and revenue from the character was below expectations, Express claims. In November, 2001, Nelvana's financial records were inspected by Express-appointed auditors, court documents say.
A trial date has not been set in Toronto's Ontario Superior Court.