ACC501-mod3-case-

ACC501-mod3-case- - Basinger - 1 - Main line Vs. Basinger...

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Basinger - 1 - Main line Vs. Basinger Module 3 Case Assignment ACC501 – Accounting for Decision Making Dr. Dereshiwsky August 21, 2008
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Basinger - 2 - Introduction In 991, Main Line Pictures, Inc. sued Kim Basinger (along with a few others) for breach of contract. Basinger had been in negotiation with Main Line to star in a film called “Boxing Helena” but she withdrew from the project after not being pleased with the character and the image it might portray her as having. The suit was heard in early 1993 in the Superior Court of California, for the county of Los Angeles. For this case we will discuss whether or not Main Line’s maximum and minimum lost profit amounts should be revised downward, whether certain factors should be relevant to the determination of lost profits, and other issues related to the profits and revenues of Main Line Inc. We will finish with an assessment of the jury’s decision. Should Main Line’s lost profit amounts be revised downward for the following and why? a. The domestic distribution revenues of $3 million because the deal had not been finalized Yes. Main Line should not have been able to claim “hypothetical” losses, even if they could prove how much Basinger made on average per movie versus the newer actress, Sherilyn Fenn. While some movies may be able to get a buzz depending on the actor/actress who stars in the film, it does not guarantee the film will make that much money. There are plenty of films starring actors with not much name recognition that go on to make plenty of money based on the quality of the film. b. The $800,000 of foreign pre-sales because they were “probable” not actual.
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Basinger - 3 - Again, I say YES. While the expert witness for Main Line stated the average Basinger films
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ACC501-mod3-case- - Basinger - 1 - Main line Vs. Basinger...

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