The iconic DeLorean may have been a time machine in Back to the Future, but it turns out there’s no going back when it comes to real world trademarks and royalties.
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Sally DeLorean, the widow of car maker John DeLorean, lost her bid in to collect ongoing royalties from Universal Pictures in federal court on Friday. According to The Hollywood Reporter, a New Jersey judge ruled that DeLorean gave up her royalty claims in the settlement to a 2015 trademark lawsuit with the DeLorean Motor Company.
Back the 1980s, John DeLorean had a deal with Universal that allowed the studio to feature the vehicle as well as the name “DeLorean” and the “DMC” logo in Back to the Future and in advertising and merchandising for the film. The agreement gave DeLorean 5 percent of net receipts from any commercial work that utilized the DeLorean. However, payments for those royalties allegedly stopped at a point, prompting the John DeLorean Estate to demand an accounting of the royalties owed from Universal and that’s when things get really complicated.
Universal responded to the request by informing the estate that the DeLorean Motor Company — a Texas company using the DeLorean name — had asserted rights to the royalties and Universal had paid them, not the estate, based on a settlement between the estate and the company. You see, a previous lawsuit alleged that the DeLorean Motor Company had “improperly and illegally appropriated for its own use Mr. DeLorean’s legacy” which included intellectual property. That lawsuit was closed with a 2015 settlement in which the estate agreed not to sue the automaker for using the DeLorean name or the DMC logo.
Upon finding out that the company was collecting the Universal payments, Sally DeLorean filed suit to have the royalties shifted back to the estate, however Friday’s decision ultimately concluded that despite the settlement between the DeLorean estate and the DeLorean Motor Company never specifically mentioned the Universal money, because the company was granted rights to the same things Universal was allowed to use — namely the DeLorean name and the DMC logo — then the company also gets the royalties.
“Though the terms ‘Universal Agreement’ or ‘royalty payments’ are not mentioned in the Settlement Agreement, the Court nonetheless finds that the subject matter of the Universal Agreement is covered by the Settlement Agreement,” U.S. District Court Judge Jose Linares wrote in his opinion. “The Court reaches this conclusion based on the overlap of the clear terms in both agreements.”
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