MIAMI — A federal judge has denied a Hollywood film company's motion to bar the claims of a man who says he owns the book upon which the movie "War Dogs" was based.
Warner Bros. Pictures' motion to stay the third-party claims of Matthew Bevan Cox was denied because it "will create more case management problems than it solves," according to the order handed down Nov. 6.
The nine-page order by U.S. Magistrate Judge Edwin G. Torres, on the bench in Florida's Southern District, was in response to Warner's motion in litigation in which Incarcerated Entertainment and Efraim Diveroli are suing Cox and Cox is suing Warner and the estate of Ross Reback.
"War Dogs", a film about several young men from Miami, including Diveroli, who got a U.S. Defense Department contract to provide arms to the Afghan Army, was released in 2016.
This past May, Incarcerated Entertainment and Diveroli asked the federal court for declaratory judgment about the rights and status of the book "Once a Gun Runner," according to the background portion of Judge Torres order. Incarcerated Entertainment was formed by Diveroli and his business partner, Reback, to monetize Diveroli's life in the self-published "Once a Gun Runner."
The request for declaratory judgment followed now dismissed litigation between Incarcerated Entertainment and Warner.
"The gravamen of Incarcerated Entertainment's amended complaint was that, in marketing War Dogs, Warner unlawfully sold the film as the true story and as the unadulterated truth," Judge Torres' order said.
Cox sought to intervene in the litigation, claiming to be rightful owner of "Once a Gun Runner" and that Incarcerated Entertainment, Diveroli and Reback conspired to steal his copyright and violate contracts among them.
In its declaratory judgment request, Incarcerated Entertainment said Cox does not own the copyright to "Once a Gun Runner" and that he should be barred from saying he does. In June, Cox filed an 11-count counterclaim against Incarcerated Entertainment and Diveroli and a four-count third-party complaint against Warner. Cox added an additional five counts against Warner in September.
In its motion for a stay on Cox's third-party claims, Warner argued that the primary issue in the case is who actually owns "Once a Gun Runner" and that if Incarcerated Entertainment owns it, then Cox will have no standing for his false advertising and other claims. "As such, Warner concludes that Mr. Cox's third-party claims should not proceed until we determine the underlying question of who owns the copyright to the book," Judge Torres' order said.
Judge Torres called Warner's argument "viable" but said it overlooked the "substantial likelihood" of duplicative discovery if Cox prevails against Incarcerated Entertainment and that Cox's claims are based on whether the two film companies committed fraud.
"And if this is true, then the Court and the parties will inevitably engage in a duplication of discovery disputes and unnecessary litigation expenses—both of which could have been conserved if the parties had participated in the discovery process in the first instance," the order said.