Techdirt Threatened With Defamation Suit Over Story On Feds Getting Royalty In Movie From Mexican Drug Cartel Money Launderer

from the the-sequel dept

We recently wrote about a very strange case, in which the US government apparently ended up with a 10% royalty in a soon to be produced Hollywood movie that is being billed as the "prequel" to Passion of the Christ -- the famous Mel Gibson movie that made over $600 million. The details were convoluted, but apparently our reporting on the subject upset someone, as we were sent an email, claiming that our post was defamatory and could cause damages in "the hundreds of millions of dollars," threatening that legal action would be taken if we did not change the post immediately.

In case you missed the original story, it involved a guy by the name of Jorge Vazquez Sanchez, who everyone seems to admit was somehow connected to a Mexican drug cartel. The government specifically charged him with money laundering and extortion. Reporters covering the story, including Guillermo Contreras and Jason Buch at the San Antonio Express-News, refer to Vazquez as a "drug trafficker."

Either way, the extortion claim came from the way he took ownership of a screenplay for Mary, Mother of Christ, which was written by Benedict Fitzgerald, who also wrote the screenplay for Passion.... Fitzgerald, at some point, took out and then defaulted on a business loan for $340,000 with Macri Inc. Because of this, the owner of Macri Inc., Arturo Madrigal, took possession of the screenplay. Some time after this, apparently Vazquez had Madrigal's brother kidnapped in Mexico, and demanded the rights to the screenplay in exchange for his release. Madrigal signed over the rights to the screenplay to Vazquez. Vazquez apparently then was able to sell the screenplay to Proud Mary Entertainment, which was later renamed Aloe Entertainment, in exchange for $1 million (less some fees) and a 10% royalty rate on any profits from the movie. After Vazquez did a plea deal in which he plead guilty and handed over that 10% royalty to the US government, Madrigal hit Vazquez with a separate lawsuit, seeking to regain control of the screenplay that Vazquez had obtained through these questionable means.

As far as we can tell all of the above are undisputed facts. It's what has been reported by others. It's what's in the legal documents. And it's what we reported. Our report focused almost entirely on the oddity of the US government ending up with a 10% royalty interest in a Hollywood movie.

And yet... we received a very threatening email claiming that our post was defamatory. The full email (complete with a series of typos, though minus the odd line breaks) is posted below. The lawyer who sent it claims to represent the producers of the film who purchased the screenplay from Vazquez. This may mean Aloe Entertainment, though the email never names the client. Oddly, the email, while insisting that our post was defamatory, more or less repeats the identical facts as we described them in the original post, and which we are reiterating here. The email does appear to raise two issues:

• Our original post referred to Vazquez as a "drug smuggler." This was based on the San Antonio Express-News report that refers to him as a "drug trafficker." Perhaps there is a difference between one and the other, but it does not seem to be one of significance. Either way, the threat email was quite upset that we did not specify that he was merely "acting as a money launderer for a Mexican drug cartel." I will admit that I do not see how this makes a major difference one way or another, but in the interest of accuracy in reporting, we have changed our original reference from "Mexican drug smuggler" to now say "money launderer for a Mexican drug cartel" -- which is how both the federal prosecutors and the lawyer sending the email appear to describe him. Considering that the lawyer claims to represent the production company, however, I still am at a loss as to how this matters. I do not believe our original statement in any way defamed the production company. It was a mere use of a synonym for the original report. But that should only concern Vazquez. It makes no mention of Aloe Entertainment nor any statement about that company.


• The threat email says that the headline of our post "implies that the film has drug money in it" and suggests that "the film or its production has drug ties." Except we never said that. We did not state it. We did not imply it. We said nothing of the sort. We explained the same chain of events that we explained above, which noted that the production house bought the screenplay from Vazquez. Nowhere did we suggest that drug money went the other way. So, we were left somewhat baffled by the threat.

Either way, as we often do, we feel that it is reasonable and important to publicize legal threats against us. We sent an email reply to the lawyer in question, noting our general confusion about what he was complaining about, while also noting the small editing change we made for factual accuracy entirely unrelated to his client. I still do not know why the original threat email was sent, as the facts about the client that were stated in the threat email are no different than what we reported. I do wonder how much the producers of the film pay their lawyers to send out such threat emails, but I imagine that is a separate issue for them to deal with on their own.

Filed Under: arturo madrigal, benedict fitzgerald, defamation, jorge vazquez sanchez, passion of the christ, seizure
Companies: aloe entertainment, proud mary entertainment, techdirt

US Government Gets 10% Royalty On 'Passion Of The Christ' Prequel In Plea Deal With Mexican Drug Cartel Money Launderer

from the say-what-now? dept

This story is just bizarre. Sinkdeep alerted us to the details, which seem to make a better story for a movie than the script at the heart of this story. Let's start from the beginning. You've got Benedict Fitzgerald, who wrote the screenplay for The Passion of the Christ, the controversial Mel Gibson movie that made over $600 million. Fitzgerald apparently wrote a "prequel" script to that movie, called Mary, Mother of Christ. However, at some point, Fitzgerald ran into some money trouble, and in defaulting on a $340,000 business loan from a company called Macri, he ended up giving the script to Macri's owner, Arturo Madrigal. Okay, so now Madrigal has the script... but not for long.

Jorge Vazquez Sanchez, who federal prosecutors claimed was a money launderer for a Mexican drug cartel, apparently hatched a plan to extort the script out of Madrigal. This was done by having some "associates" kidnap Madrigal's brother, in Mexico. In exchange for his release, Madrigal agreed to hand over the rights to the script. Vazquez, script in hand, somehow then sold the screenplay to a Hollywood production company now known as Aloe Entertainment (then known as Proud Mary Entertainment) for close to $1 million with a 10% royalty on any profits from the movie. From there, Aloe was able to get the wheels moving on a full on production, with famed pastor Joel Osteen acting as exec producer. Filming was expected to happen later this year.

Throwing a bit of a wrench into all of this is that the US government came down on Vazquez for his various illegal activities, leading him to cop a plea deal in which he gave the US government the 10% royalty rights in the screenplay. He also had to plead guilty for money laundering and extortion. But in giving the feds his cut of the profits, he may have decreased his jail time from 40 years down to 7.

Of course, the story doesn't end there. Apparently, minutes after officially making the plea in court (while still in court), Madrigal slapped Vazquez with a lawsuit of his own, saying that Vazquez had no right to sell the screenplay to Aloe in the first place, and he wants the rights to the script returned. Indeed, it would seem that the script and the deal are ill-gotten gains.

What's really bizarre here is the feds role in all of this. First of all, why would it ever want a cut of the profits in a Hollywood movie? Second, wouldn't it realize that the movie rights were obtained through illegal means -- and shouldn't it then have been the responsibility of the feds to return the rights to the script back to Madrigal? Either way, it seems pretty bizarre that the Justice Department appears to have given this guy a deal for a much lower jail sentence in exchange for some profits from a Hollywood movie the US attorneys had to know the guy had no right to.

Filed Under: arturo madrigal, benedict fitzgerald, joel osteen, jorge vazquez sanchez, mexico, passion of the christ, plea bargon
Companies: aloe entertainment, macri, proud mary entertainment