A Lenexa video firm is blackmailing Wal-Mart.

Candid Camera: Trove of Videos Vexes Wal-Mart
Producer Peddles Clips To Lawyers and Unions; Mrs. Clinton on Stage

By GARY MCWILLIAMS April 9, 2008; Page A1
    LENEXA, Kan. -- For nearly 30 years, Wal-Mart Stores Inc. employed a video-production company here to capture footage of its top executives, sometimes in unguarded moments. Two years ago, the retailing giant stopped using the tiny company.
    At first, the decision threw Flagler Productions Inc. into a panic. Now it's Wal-Mart that's squirming.
    In recent months, Flagler has opened its trove of some 15,000 Wal-Mart tapes to the outside world, with an eye toward selling clips. The material is proving irresistible to everyone from business historians and documentary filmmakers to plaintiffs lawyers and union organizers.
    Among the revealing moments: A former executive vice president and board member challenges store managers in 2004 to continue his work opposing unionization. Male managers in drag lead thousands of co-workers in the company's corporate cheer.
   In another meeting, managers mock foolish or dangerous use of a product sold in its stores. In 1991, founder Sam Walton describes Hillary Clinton, then a Wal-Mart director, as "one of us." The best part, maintains plaintiffs lawyer Gene P. Graham Jr., is that "Wal-Mart has no control over this stuff." Wal-Mart isn't pleased.
    "It's difficult to understand how the company could now sell to third parties the material we paid it to produce on our behalf," says a Wal-Mart spokeswoman. "Needless to say, we did not pay Flagler Productions to tape internal meetings with this aftermarket in mind."
   She adds that the company is "reviewing our legal options."
    The production company's founder and former owner, Mike Flagler, says he was hired on a handshake in the 1970s to help produce the events Wal-Mart holds each year for managers and shareholders, including entertainment portions of its annual meeting and important sales meetings. He filmed them as well. He says he rebuffed Wal-Mart's suggestions that he reuse the tapes to save money.
    Instead, he held onto recordings of commercials, executive speeches and manager hijinks. Corporate records typically are closely controlled through legal contracts that restrict access and use. Mr. Flagler says he never signed a contract with Wal-Mart for the production or video work.
   Flagler Productions says that that arrangement left ownership and control of the films with it. In a Jan. 14 letter to Flagler, Marshall S. Ney, a lawyer for Wal-Mart, said the retailer has "claims to rights in the video library" and the film transcripts. Mr. Ney didn't return calls for comment, and Wal-Mart's spokeswoman declined to elaborate.

   Link to rest of article: http://online.wsj.com/article/SB120770260120100121.html?mod=djemITP
   Video below...

ABC News:
Wal-Mart Turned Down $150 Million Asking Price for Videos; Wal-Mart's Counteroffer? $500,000; Video Company Refused

MADDY SAUER and RHONDA SCHWARTZ
April 10, 2008—

   The production company that filmed more than three decades of Wal-Mart corporate meetings and events offered the retail giant the opportunity to purchase their video library for $150 million.

Today, Wal-Mart released a letter from the attorney for Flagler Productions Inc., saying that the small video production company refused Wal-Mart's counteroffer of $500,000 and that Flagler had lowered their asking price to $145 million. [Read the letter.]

A spokesperson for Wal-Mart said they decided to release the letter after various press reports referred to Flagler's initial asking price as "several million."

Flagler owners Mary Lyn Villanueva and Gregory Pierce say they lost more than 90 percent of their business when Wal-Mart abruptly dropped them in 2006. They say they've had no choice but to sell the videos to other interested third parties.

"The prospective buyers range from a political bent to legal to national media," wrote Flagler's attorney David Sexton in the letter to Wal-Mart dated Oct. 26, 2007.

Sexton said today that the letter "is what it is" and that it shows that Flagler was initially negotiating only with Wal-Mart, but once negotiations had stalled, Flagler wanted to let Wal-Mart know that it would entertain other offers.

"The library is actually priceless," Sexton said. "So how can you quantify this? This video doesn't exist anywhere else."

Sexton said no written contract ever established that Wal-Mart has rights to the video in question.

The videos, thousands of them spanning three decades, are in the Flagler library in Lenexa, Kan. Flagler was hired on a handshake deal by Wal-Mart in the 1970s to produce and film corporate sales meetings and other company events.

After receiving a verbal commitment that Flagler would be used for meetings in the future, Wal-Mart abruptly ended its deal with Flagler in 2006 causing the company to lay off most of their employees, according to Flagler.