Miller Barondess Wins a Federal Court Jury Defense Verdict on Behalf of Virtual Sonics, a Cutting-Edge Digital Music Company

Miller Barondess Wins a Federal Court Jury Defense Verdict on Behalf of Virtual Sonics, a Cutting-Edge Digital Music Company

On November 18, 2022, the Miller Barondess team of Sasha Frid, Erik Wilson, and paralegal Annie Yang, prevailed in a jury trial resulting in a unanimous defense verdict.

Miller Barondess represents defendant Virtual Sonics, Inc. (VSI), a cutting-edge digital music company, and the life-long dream of brothers Jeremy and Julian Soule, against plaintiffs Scott Mednick and his son, Skyler Mednick. Plaintiff Scott Mednick is a co-founder of Legendary Pictures, a prominent film production company, and was an executive producer for blockbuster films including, 300, Superman Returns, Teenage Mutant Ninja Turtles, Batman Begins, Batman and the Dark Knight, and We Are Marshall.

The plaintiffs, former investors in VSI, allege that VSI violated the California Labor Code by failing to pay them deferred compensation when they sold their interests in August 2019.

In 2014, the Soules and the Mednicks invested in VSI. VSI was the brainchild of musical composers Jeremy and Julian Soule. Because it was a start-up, the parties agreed to enter into a deferred compensation agreement by which their salaries would be deferred until VSI hit certain financial benchmarks. In 2019, after VSI had received its first large investment, the Mednicks asked to get bought out. To that end, the parties entered into a stock purchase agreement which mutually released their obligations with each other and VSI bought out the Mednicks’ interests in the company.

On May 4, 2021, the Mednicks sued VSI for violating the California Labor Code claiming that the deferred compensation was not part of the buy-out.  The case proceeded to a jury trial on November 15, 2022. During trial, there were key admissions on the witness stand by the Mednicks that undercut their Labor Law claims. Also, the undisputed evidence showed that the deferred compensation was part of the 2019 buy-out and that the Mednicks were not owed any additional monies under the terms of the deferred compensation agreement.

On Friday, November 18, 2022, after 45 minutes of deliberation, the jury returned a unanimous defense verdict, wiping out plaintiffs’ claims. The jury found that the Mednicks are not owed any additional wages under the Labor Code. A judgment is pending.

“The jury figured out what happened here and got the right result. This was a win for the good guys. The plaintiffs got everything they bargained for in the buy-out and were trying to leverage the company with this lawsuit. Virtual Sonics never budged and were resolute that it did not owe the Mednicks a penny more. I am honored to represent such a great client. We thank the jury and the court for its diligence in this tough case,” said Sasha Frid, partner, Miller Barondess, LLP, and lead counsel for VSI.

Scott Mednick and Skyler Mednick v. Virtual Sonics, Inc., CACD Case No. 2:21-CV-03755-MRW

Read the Daily Journal’s coverage of the defense verdict here (credentials required).