By now everyone is likely familiar with the whole Tonight Show controversy surrounding Jay Leno and Conan O’Brien. In terms of a legal standpoint, there is a virtual buffet of laws that have been touched upon through the course of this recent colossal debacle.
As it was stipulated in a contract set forth by NBC back in 2004, effective June 2009, Conan O’Brien, then host of Late Night, was to take over has host of the Tonight Show, replacing long time host Jay Leno. This was an unheard of arrangement, as Leno at the time was number one in terms of ratings and NBC was promising O’Brien the Tonight Show five years in the future. To put it mildly, a lot could happen in five years, and as it turns out, a lot did.
This whole debacle raises all sorts of legal issues centering around contracts, estoppel, detrimental reliance, intellectual property rights and so on. The fact that NBC allowed for this crazy snafu to occur after the much publicized Leno/Letterman controversy absolutely boggles my mind.
On a personal level, I have a soft spot for Conan O’Brien, as his Late Night show debuted my freshman year of college. At the time, the College of St. Rose didn’t have cable so I only received one station on my ancient Samsung rabbit-ears TV. That channel, of course, was NBC. I watched Conan almost nightly and I grew to be a huge fan of his.
When NBC offered him the Tonight Show in 2004 to take it over in 2009, the contract stipulated that if they didn’t go through with it as planned they would have to buy him out. During this five year holding period, Conan detrimentally relied on NBC’s word that he would receive the Tonight Show come 2009. By relying on NBC, he passed on other offers from rival networks such as Fox to do a show for them and receive a more lucrative payday. Since NBC arguably broke the terms of the Conan deal, they had to contractually compensate him for his detriment, which was waiting 5 years and not entering into other offers based on reliance that NBC was going to give him the “ultimate prize” which to Conan was the Tonight Show.
What it all boiled down to was simple contract law. Conan’s contract did not specify what time slot his version of the Tonight Show would air, it simply guaranteed him as host of the Tonight Show itself. Other late night hosts, however, all had contracts that were time slot specific such as David Letterman, Jay Leno and even relative newcomer to late night TV, Jimmy Kimmel. Why Conan’s attorneys did not put such language in the contract is a mystery.
Since NBC was not contractually obligated to put Conan on at 11:35, they proposed a new Jay Leno show at that time for a half hour and then would shift Conan to 12:05, still calling his show the Tonight Show. As the world knows by now, Conan did not accept this proposal, to put it mildly and a buyout of his contract was worked out for an estimated $45 million, 15 of which allegedly went to his staff as compensation.
Jay Leno, on the other hand, had a “golden parachute” so to speak, as his contract with NBC regarding his failed 10 pm show was virtually iron clad. If NBC chose to dump him the pay out would have been approximately 3 times as to what they had to pay Conan and unlike Conan’s contract, Jay had time specific language and could have placed an injunction on NBC to keep him on the air for at least another year or so. When Conan walked away from the proposed new time slot, Jay slid back into the Tonight Show seat as if the last 7 months were a bad dream.
Conan is now on TBS, having signed a deal similar to what David Letterman did back in 1993 with CBS. Conan now owns his show and has a lot more creative freedom. He will from here on out own all his comedy bits, which in the legal field fall under the category of intellectual property. Since NBC owned his version of the Tonight Show and his version of the Late Night show, all the recurring comedy segments such as In the Year 2000/3000, Triumph the Insult Comic Dog, Conando, If they Mated, etc. are owned by NBC and he can not use them outright. Letterman had the same issue when he moved to CBS but he simply changed some of the wording around in his bits, such as changing The Top Ten List to The Late Show Top Ten, and was able to rehash most of his old material. Conan, if need be, can do the same but as of this writing I did hear through the grape vine that NBC may allow him to use his old material, but it hasn’t been officially confirmed.
This whole late night controversy all boils down to two things. Contracts and money. NBC felt Conan wasn’t bringing in the ratings and revenue that Leno did at 11:35 pm and Leno was bombing at his new 10 pm time slot. NBC tried to resolve the situation by tinkering with things in an attempt to make all parties happy. Often when somebody tries to make everyone happy, they wind up making everyone miserable instead. This is what happened here, as Conan felt betrayed after 17 years of loyal service, as did Jay, for his 18 years of service. NBC had, and still has, in my opinion, a ton of egg on their face, especially having gone through a similar situation in 1992. After the Letterman fall out, it was not foreseeable that something like that would happen again at any network, let alone NBC. The ultimate moral of the story is, to take a page out of Stone Cold Steve Austin’s playbook, “Don’t trust anybody” when it comes to contracts. Always be sure that the I’s are dotted and the T’s are crossed.
On a final note, Conan’s new show on TBS is great and I encourage all to check it out every Monday through Thursday at 11 pm. Support Team Coco.