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Disney mulls settlement?
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October 31, 1997: 8:22 p.m. ET
Eisner, Katzenberg may be ready to settle lawsuit before it goes to court
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NEW YORK (CNNfn) - Peace and harmony may once again be ready to return to the Magic Kingdom.
With less than three weeks before Walt Disney Co. squares off in court against former executive Jeffrey Katzenberg, Hollywood is abuzz with word of a possible settlement.
According to people familiar with the lawsuit, Disney Chairman Michael Eisner recently instructed Executive Vice President and close confidant Sanford Litvack to see if Katzenberg would be interested in settling his $250 million lawsuit.
While the move does not mean a settlement will be reached, it does underscore the company's determination to try to avoid a costly and potentially embarrassing lawsuit.
Katzenberg left Disney in 1994 after Eisner decided not to promote him to president. He is seeking $250 million from Disney based on his claim that he should be entitled to a portion of the studio's profits from blockbusters such as ``Beauty and the Beast'' and ``The Lion King''.
Disney has repeatedly denied Katzenberg's claim, saying he relinquished his rights to share in the profits of those films when he opted out of his contract early.
Lawyers for both sides have been taking depositions all summer and the trial is scheduled to begin November 18.
While it is unlikely Disney would agree to pay Katzenberg $250 million, sources familiar with the lawsuit say Disney would be willing to settle if both sides could agree on a more reasonable amount.
Disney, which came under heavy criticism earlier this year for agreeing to give former executive Michael Ovitz a severance package of more than $100 million, apparently is eager to avoid another large settlement.
However, Katzenberg, who went on to found DreamWorks SKG with director Steven Spielberg and music producer David Geffen, would like to use the proceeds from his lawsuit to help finance his portion of the partnership.
If both sides fail to reach an agreement, Litvack, widely regarded as an accomplished litigator, would help to bolster Disney's outside legal counsel, led by Lou Meisinger.
Representatives for both Disney and Katzenberg declined to comment on the settlement talks, which was first reported Friday by the Los Angeles Times.
Separately, trade workers at the Disney World theme park complex in Florida have approved a new labor contract with the company, averting a strike.
According to a report in Friday's Orlando Sentinel, the Craft Maintenance Council voted 1,435 to 603 to approve the three-year contract, which calls for a 2.5 percent wage increase in the first year and three percent rises in the second and third years. Health insurance premiums for the workers would be raised in 1999. 
-- by staff writer Jerry Dubrowski
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