Frank Darabont and his agency, Creative Arts Agency (CAA), have filed a lawsuit against AMC over profits from The Walking Dead.
According to the lawsuit, Darabont is claiming AMC is participating in a "sham" by keeping the license fees for The Walking Dead artificially low by using affiliates that license out the series to each other which enhance the profit for AMC while keeping the revenue low for those in the profit pool. It's stated as a result of the sham, Darabont has been deprived of tens of millions of dollars.
The lawsuit makes note that Darabont developed The Walking Dead for AMC; that he "wrote, directed and executive produced the Series' first episode, and was the lead executive producer for the first season." It goes on to also note that Darabont was the showrunner for the first season and part of the second season. Mention is made that The Walking Dead is television's most popular series, and that Darbont's work on the series has led to AMC getting "unprecedented heights in terms of profits" etc. It's also stated that subsequent showrunners were initially brought on the series as a result of Darabont.
Regarding the "sham," Darabont and CAA get a majority of their profits from the license fee that goes into the profit pool. How the license fee works is normally unaffiliated studios negotiate a fair market value, but Darabont is alleging since the studios are affiliated (or controlled by AMC) they are manipulating the license fee - keeping it below fair market value - which is known as "self-dealing."
It's stated in the court documents that Darabont actually protected himself from this happening by coming to an agreement with AMC that if affiliated entities were used, they would go by the fair market value as if unrelated third parties were used.
The court papers state that Darabont hasn't received one dollar in profits from the series in four seasons - and may never do so because of the self-dealing.
The suit also states Darabont had an agreement in place with AMC to be the showrunner through Season 3. Also that AMC couldn't negotiate with anyone else before Darabont for Season 3.
It's stated after Comic-Con, Darabont was terminated without cause or reason, and AMC wouldn't give a reason when asked. Since AMC did bring a new showrunner on to Season 3 (Darabont's #2 with Glen Mazzarra), they breached contract by not negotiating with him.
Darabont is also claiming he was unjustly let go with the reason being that AMC intentionally desired to limit the profit pool through use of self-dealing.
It's stated AMC changed their minds about The Walking Dead using third party distributors after seeing the success of Mad Men (which uses LionsGate). It's said AMC delayed revealing the profits and went in-house manipulating the license fees.
You can read the full compaint here via Deadline.
AMC has not publicly commented on the lawsuit, and it's thought the matter will be settled out of court.
It's also been said that both Jon Bernthal (Shane) and Jeffrey DeMunn (Dale) were written out of The Walking Dead as a result of AMC's treatment of Darabont in which they obviously disagreed and wanted out of their contracts.