Sony vs CBS: The battle that should shake distribution

By Siobhan Crawford 17-02-2025

Our regular formats columnist talks the Sony vs CBS lawsuit surrounding distribution of Wheel of Fortune and Jeopardy!, and why everybody working in distribution should be concerned about it.

I have been watching a lot of Yellowstone, so expect ‘y’alls’ for the foreseeable.

I think y’all were hoping for a London Screenings shopping list from me, weren’t you? Sometimes I give those, sometimes I don’t. The most informed Dutchie I know has always said he knows what is coming; there are very few surprises now. Once someone has a format, they shout it from the rooftops… so I am sure you have heard all the announcements by now.

No, today I want to talk about the Sony vs CBS lawsuit surrounding the distribution of Wheel of Fortune and Jeopardy!. Why? Because this hits at the core of distribution today and should make all of us worry.

The basics
Sony Pictures Television and CBS have a longstanding agreement on the distribution of these two formats. Both companies acquired one creator each of the two formats in the 1980s, which left Sony producing the shows and CBS distributing them.

In October 2024, Sony filed a lawsuit alleging CBS owed it money from past distribution deals and also that CBS overstepped the boundaries of their distribution contract when it licensed the format in multiple territories and struck unauthorised syndication deals in the US, plus other things. CBS counter-sued in November, alleging Sony was trying to break the contracts to get control.

Since then, more amended fillings, press statements and counter-statements. Yeah, it is messy, but this one shook the distributor in me to the core.

Around 10 versions of Jeopardy! are on air in various territories

Sony’s complaints against CBS are many, but the points of interest for us distributors are below:

  • “Unauthorised licensing” – that CBS worked outside the mandate it was given in a contract that is over 40 years old (!). This may be the easiest part of the complaint to check.

  • “Undercutting value and profitability of the formats.” This is harder to gauge in poor financial times but, basically, sub-optimal deals, packaging formats or excluding revenue from shares. Sony accuses CBS of putting these two formats at lower-ranked broadcasters within territories.

  • Favouring wholly owned formats in distribution. Now that is a big one. “Self-preferencing,” as it has been called, means putting formats that are 100% owned ahead of these two formats. Sony accuses CBS of packaging formats, as leverage, to acquire one of the two plus take a smaller format from them.

  • “CBS has gutted the team responsible for distribution and exploitation.” Yes, this is huge, but it also connects to expectations and whether a distribution contract can quantify what is required to be able to sell formats ‘well enough.’

  • “Maximising of revenues” – the Sony claim that CBS has failed to live up to its contractual obligation to make revenues as large as possible. Also worrying. CBS refuted the claim and said it did use its best efforts in distributing the format.

Ask yourself: when the contract between these parties was drawn up 40 years ago, could we have imagined the industry would contract and evolve to this extent to allow any contract to stand the test of time?

What is good distribution?
The K7 ‘Tracking the Giants’ report tells me there have been 61 local versions of Wheel of Fortune, with around 20 that are still on air now. This places it 13th in the list of top 100 unscripted formats and makes it the highest-ranked Paramount Global format.

The format looks to be rebooted every 10 to 20 years, and there is coverage in all the main format territories of Europe, Australia and the US.

Jeopardy! sits a little lower with 41 versions, around 10 of which are still on air, but without the same reboot success. This puts it at 34th on the 100 unscripted formats list and third among Paramount formats.

Now, if we look at Who Wants to be a Millionaire?, this is ranked number one, with 179 versions to date. But to be clear, this format is a freak of nature. I mean, if you compare anything to this, it is a failure; the rest of the top formats all have 30 to 80 versions and they are huge names.

To anyone, the disputed formats are premium, heritage formats that most people would love to have in a catalogue. Advances would be paid for them – half-a-million a year, perhaps. This means only those groups with pockets deep enough can acquire the rights, and that anyone who held them would have wholly owned formats within their catalogues too.

Now, distribution is a business dependent on the economy, the times, the genres of the moment. Does having these formats mean you can demand an 8% format fee in a primetime slot on the leading broadcaster in every territory? I don’t think so. I think this still means you have 100 other big-hitter formats to compete.

There are only so many quiz slots on a channel. So what is good distribution? When is ‘good enough’ good enough? And does a higher number of people in your sales team make it better? Or does the quality of the people count? Is the economy a legitimate excuse for less distribution? Are US expectations of distribution and international deal-making the reality? If this was BBC that held the rights, would The 1% Club have to suffer to prove contractual obligations were being fulfilled? Is it either or? Do we need to start asking if catalogues are a good thing, if acquiring third-party content in addition to internal pipelines dilutes the results? So many questions.

The UK version of Wheel of Fortune is fronted by Graham Norton

Why we should be scared of this battle
Material breaching of contracts (and I love contracts) can be vague. We have force majeure language. We have remedy windows appropriate to the fault, or we have set windows. We have notifications. And one could claim ambiguity can favour both parties.

All contracts range in complexity – breach or early-termination conditions can be clearly stated, or it can be non-fulfilment of the overall paperwork; little things that catch you like delivery of material meaning an invoice was not paid, seeking approvals over something small but required; the vagueness that is ‘industry customs and standards.’

We won’t ever know the full details of the contract between Sony and CBS, but we can assume this is US studios language, so even good-faith and morality clauses existed in these deals, making them open to more interpretation. The big question is, can all of the above break this contract? And if this one can be broken, do we need to worry about our own contracts?

A parallel argument in our industry is IP infringement. We claim that there needs to be precedence in a country for the IP infringement case to move forward; without it, we are left up to the legal interpretation within that country’s law – meaning there is no way to predict how that lawsuit goes, and settling out of court might be smarter.

Will this deal set a precedent for breaking distribution deals? Opportunistic companies could be looking at the news and thinking they can do similar. I can already think of a few companies and formats that this could be tried on.

Once we open the floodgates, who is next? When is good distribution, in bad times, good enough?