Roughly two months after Warner Bros. Discovery sued Paramount Global over “South Park” streaming rights, Paramount has unleashed a counterclaim alleging WBD owes $52 million in unpaid licensing fees.
The legal battle stems from a $500 million deal WBD made with Paramount-owned South Park Digital Studios (SPDS) in 2019, which gave the HBO Max parent company domestic streaming rights for existing and future “South Park” seasons, through June 2025.
In a Wednesday evening court filing, Paramount said WBD withheld licensing payments of $26 million each that were due in December 2022 and March 2023, respectively. WBD in its February lawsuit claimed SPDS did not provide all the “South Park” content outlined in the 2019 agreement.
“By simply refusing to pay ongoing license fees, WarnerMedia has made it clear that it intends not to make any future license fee payments under the Term Sheet unless it gets the content it claims to be owed,” said Paramount in its countersuit.
Furthermore, WBD argued Paramount violated the terms of its contract with SPDS in 2021, when Paramount subsidiary MTV Studios struck a $900 million deal with South Park creators Trey Parker and Matt Stone to air 14 made-for-streaming movies on Paramount+.
According to WBD, the parties engaged in “verbal trickery” to get around the 2019 licensing agreement.
A key element of WBD’s argument is SPDS was required to provide 10 episodes each for “South Park” seasons 24 to 26. However, Paramount stated WBD’s contract with SPDS “did not specify any minimum required number of episodes for the forthcoming Seasons 24-26.”
Paramount went on to say the deal consisted of over 300 existing “South Park” episodes and “forthcoming television episodes” from seasons 24 to 26, provided the episodes first aired on a cable or broadcast network, such as Comedy Central.
The company said all 318 “South Park” episodes are currently available on HBO Max, and that WBD is refusing to pay for content it “indisputably received.”
“Although WarnerMedia claims that it should have received 14 more episodes, it had not been charged for any episodes not actually delivered,” said Paramount. “In other words, WarnerMedia is not complaining about ‘missing’ content that it paid for.”
Additionally, Paramount said WBD had rights to “specified short-form content,” such as behind-the-scenes episode footage, as well as one made-for-TV documentary titled “6 Days to Air: The Making of South Park.”
Due to the above stipulations, Paramount claimed “WarnerMedia never sought, and certainly did not obtain, the right to license any “made-for-streaming” movies,” which were included in the MTV Studios deal.
“South Park Studios would not have agreed to license any ‘made-for-streaming’ movie rights on the same terms as, and certainly not for the price of, an episode of the television series,” added Paramount.
Paramount’s counterclaim comes one week after WBD unveiled its combined HBO Max-Discovery+ service – officially dubbed “Max” – is set to launch May 23. WBD doesn’t plan to raise prices for the new streaming service and intends to keep Discovery+ as a standalone product.