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Sony denied Spider-Man case shield

Los Angeles, April 22 (Reuters): A Los Angeles judge has formally denied a request by Sony Pictures Entertainment to seal proceedings in a lawsuit brought by comic book publisher Marvel Enterprises over last year's blockbuster film Spider-Man.

But the judge put off a decision on Sony’s motion to refer the litigation to a court-appointed “referee” -- usually a retired judge who would be chosen by the two sides to handle the case in an expedited manner.

A ruling on Sony’s request for a private referee is expected after the next hearing, set for May 20. Marvel is asking for a jury trial.

During a two-hour hearing in Los Angeles Superior Court, Judge Alexander Williams said he saw no compelling reason to close proceedings or seal documents, saying the case did not involve “trade secrets” warranting special protection.

“I don’t think sealing documents in this case will afford much secrecy or protection in this case,” Williams said. “I have zero faith in confidentiality.”

Marvel filed suit in February against the studio, a unit of Japanese electronics giant Sony Corp, seeking $50 million in damages and termination of its Spider-Man licensing agreement after the upcoming sequel to last year’s film based on the web-slinging comic book hero.

The original Spider-Man movie, starring Tobey Maguire as a geeky teen-ager transformed into a superhuman crime fighter by a radioactive spider bite, was the highest-grossing movie of 2002, generating worldwide ticket sales of $800 million.

Losing its licensing pact with Marvel would effectively cut short one of Sony’s most potentially lucrative film franchises. But Marvel has insisted that its suit is not aimed at halting production of the sequel, titled The Amazing Spider-Man, which reportedly began filming in New York last week.

Marvel has accused Sony of essentially trying to hijack the Spider-Man brand by claiming exclusive merchandising rights to the character and “cross-promoting” the superhero with other Sony features, in violation of their licensing agreement.

Marvel claims it was “fraudulently induced” to sign the licensing deal in 1999 as Sony never revealed its alleged intent to “disassociate” Spider-Man from Marvel in the minds of retailers and the public.

Sony counters that it is Marvel that has acted in bad faith. According to Sony, the dispute arose after it questioned “accounting irregularities” by Marvel and that Marvel was merely using the litigation as leverage to pressure the studio to renegotiate the licensing deal.

Sony had been most concerned about the possible disclosure of proprietary information contained in an addendum to the licensing pact and in an internal marketing strategy that included revenue projections, advertising budgets and royalty targets from the first Spider-Man movie.

While those documents were initially lodged under seal with the original lawsuit, Marvel’s lawyers said Monday they saw no need to include them in court papers being newly opened to public scrutiny this week subject to Judge Williams’ ruling.

Spider-Man is based on a character created by artist San Lee, who last year sued Marvel seeking a bigger cut of profits from related marketing.

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