Variety reports that L.A. Superior Court Judge Alexander Williams has sided with Sony and is referring the Marvel vs. Sony lawsuit to a retired judge, who will hold a public hearing on the case and make a ruling. Marvel had sought a jury trial in its dispute with Sony, but the Judge noted that the contract between Sony and Marvel called for settling disputes by a 'reference' to a retired judge, and told Marvel, 'even in Hollywood, a deal's a deal.' Marvel claimed that 'the contract was induced by fraud,' and therefore the agreed upon method for settling disputes should be ignored. Judge Williams didn't buy Marvel's claims of fraud, considering the case to be more about 'breach of contract' rather than fraud. Both sides have until June 27 to pick a judge to resolve the dispute or one will be appointed. Whatever the judge decides, his ruling can be appealed.
The essence of Marvel's $50 million lawsuit against Sony is that Sony attempted to interfere with the marketing of classic (non-movie) Spider-Man products, and set itself up to obtain a substantial percentage of profits from the entire Spider-Man franchise for the duration of the movie-based agreement (see 'More on Marvel Sony Suit'). Licensing has played a huge role in Marvel's financial turnaround (see 'Marvel Blows Away Q1 Expectations') and the company is quite naturally highly protective of its licensing rights. In the case of the Spider-Man movie, this concern has created considerable friction with Sony's own licensing arm, which according to Marvel's suit tried to 'hijack' the Spider-Man character. Sony has alleged that Marvel mis-characterized sales of movie-related merchandise as 'classic' Spider-man sales, depriving Sony of its share of the royalties.
While the Judge's ruling is a setback for Marvel, it does not mean that the publisher has lost the case--only that it will be decided by a retired judge, whose ruling can be appealed. Marvel is seeking through its legal action to end its contract with Sony as soon as Spider-Man 2 is filmed (see 'Sony Loses Fight To Keep Marvel Suit Secret'), thus the very future of the biggest superhero box office franchise ever is in potential jeopardy. Perhaps if Marvel wins the suit, the publisher can take Spider-Man to another studio and keep the franchise on top of the superhero heap, or possibly even forge a better deal with Sony, but there is also the possibility that the web-slinging golden goose could be damaged in all this legal wrangling.