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Scarlett Johansson sues Disney over 'Black Widow' streaming concerns

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Yahoo Finance's Alexandra Canal breaks down what Scarlett Johansson's lawsuit may mean for streaming services and movie premieres.

Video Transcript

ADAM SHAPIRO: We've got to get to something that's also, I don't know if there's going to be a winner, but there could be a loser. Let's bring in Ali Canal. We want to talk about fame and fortune, because is it really wise to slap Mickey Mouse? Tell us more about what Scarlett Johansson is up to.

ALEXANDRA CANAL: Adam, the situation seems to be escalating. It's getting quite heated out there. Yesterday we got the bombshell announcement that Scarlett Johansson went ahead suing Disney over breach of contract after the media giant placed the film, "Black Widow" on Disney+ as a premium VOD offering. They also released the film in theaters, but by that move, sources at "The Wall Street Journal" say that Scarlett Johansson lost out on about $50 million. In the suit, Johansson and her team allege that Disney did this in order to inflate their stock price, also to boost the subscriber numbers of Disney+ at the detriment to her earnings potential.

There were also emails from the chief counsel at Marvel, who confirmed that this would be an exclusive theatrical release, and if it were not to be one, that they would have those conversations. But those conversations never happened. Hence, the lawsuit. Now Disney did issue a fiery response. In a statement to Yahoo Finance, they wrote, quote, "There is no merit whatsoever to this filing. The lawsuit is especially sad and distressing in its callous disregard for the horrific and prolonged global effects of the COVID-19 pandemic.

Disney has fully complied with Ms. Johansson's contract and furthermore, the release of "Black Widow" on Disney+ with Premier Access has significantly enhanced her ability to earn additional compensation on top of the $20 million she has received to date." Now Disney has 30 days from this filing to issue a formal response. And we take a look at the stock price right now, it's off almost 2% percentage points. But you know, personally, it's not a good look for Disney when one of your A-list stars goes and sues you.

SEANA SMITH: Yeah, Ali, it certainly isn't. And I think the big question here is, what's the talk right now is inside Hollywood? Do you think that this case could be a bellwether here for other cases going forward? Because it doesn't seem like this strategy, just in terms of releasing a film on streaming the same day that it's released in theaters, is going anywhere anytime soon.

ALEXANDRA CANAL: I think it could be a bellwether. Right now, I think that hybrid format is here to stay. Studios certainly have more power amid the streaming boom, definitely over theaters. But now as you're seeing with this case, potentially over talent. And I'm sure there's other A-lister out there that are taking a good look at their contract to make sure that something is included. I did speak to an entertainment lawyer on this. He said in this case in particular, the chances are Disney is just going to want to settle.

There is a chance that they could want to take this to court and set a precedent of their own. But historically speaking, that costs a lot of time and a lot of money. So from a business standpoint, Disney most likely will settle. The lawyer that I spoke with said he doesn't think any current contracts are going to change too drastically here, but down the line, certainly that's something that talent and producers are going to want included.

This is a story that we've been seeing in Hollywood. When the last "Wonder Woman" film was released, we did see Warner Media go ahead and give both Patty Jenkins and Gal Gadot $10 million each in response to that. Warner Media also renegotiated all of their contracts, issuing over $200 million reportedly in those new deals. But that's something that Disney did not do. So I think it's certainly an issue that they're going to have to address moving forward, because as you said, the hybrid release strategy is not going away.

ADAM SHAPIRO: And I'll bet you there's a force majeure clause in all of those star contracts, so maybe put your money on the companies. Let's shift gears real quick, because there's a body count rising when it comes to the streaming wars. Executives are in one day, they're out the next. What's going on? I mean, we're talking about the impact on all kinds of business, like AT&T, as it gets rid of TV and video.

ALEXANDRA CANAL: Yeah, and I think right now Hollywood is still trying to figure out this streaming battle. And I always think it's interesting to take a look back even a year or two to Netflix. Sure, now, they're doing video games. They have the Netflix Shop. But two years ago, Netflix was all streaming all the time. It was very black and white. Now we have these studios that have introduced streaming components. Disney, Warner Brothers, they have big ties to theaters, big ties to the box office.

There's a lot of gray area right now, and that's why I think we're seeing all of this play out. There's sort of a ripple effect. Hollywood needs to figure this out from a contract standpoint, a negotiation standpoint, and things are certainly changing. We did hear from Jason Kilar, the CEO of Warner Media, in "The New York Times" last week. He said that change is coming, but sometimes change can be good. And I do think for the consumer side, this is great. We now have a lot of different options.

There also is the debate of whether or not theaters are going away. I don't think that's happening. There will still be the theatrical side of the business. Will it be as prominent as it was in 2018 or 2019? Probably not. But it's still going to exist there. But again, I think Hollywood is figuring this out and I don't think we're going to have a definite answer on anything for quite some time. And in that regard, that's why I think the CEO reshuffling is happening too, because people just don't have all the answers right now.

ADAM SHAPIRO: Ali, thank you very much.