December 18, 2014 / 10:14 PM / in 3 years

Washington weighs response to Sony hack; options limited

WASHINGTON/LOS ANGELES, (Reuters) - The U.S. government on Thursday said it was weighing the proportional response to the sophisticated perpetrator of a cyberattack that crippled Sony Pictures, exposed its executives and led to the cancellation of the film “The Interview.”

A security guard stands at the entrance of United Artists theater during the premiere of the film "The Interview" in Los Angeles, California December 11, 2014. REUTERS/Kevork Djansezian

Spokesman Josh Earnest said the White House is not in a position to confirm that North Korea is responsible for the hack at Sony, after a U.S. official said Wednesday that Washington may soon formally announce the involvement of the Pyongyang government. The effect of any response, such as cyber retaliation or financial sanctions, could be limited, U.S. experts said.

More than three weeks after the attack by hackers identifying themselves as “Guardians of Peace” brought down the computer network at Sony Pictures Entertainment, one of Hollywood’s biggest studios grappled with the losses to its operation and reputation through sensitive leaked emails.

Sony decided on Wednesday to scrap its big Christmas Day release of “The Interview,” a comic film that culminates in the assassination of North Korean leader Kim Jong Un. Movie theater chains said they would not show the film citing security concerns after hackers made threats against cinemas and audiences.

A senior North Korean U.N. diplomat declined to comment on accusations that Pyongyang was responsible for the hacking attack on Sony Pictures. He also declined to comment on the delay of the release of the film.

After the cancellation, Sony began pulling promotion of the $44 million film, dismantling the giant promotional billboard on Hollywood’s famed Sunset Boulevard on Thursday.

Some of the Hollywood’s biggest names howled over the cancellation of the film starring James Franco and Seth Rogen, the latter also a co-director on the movie with partner Evan Goldberg.

Steve Carell, who has starred alongside Rogen in numerous comedies, said “Sad day for creative expression.”

The hacking could hit Carell more directly. A film project called “Pyongyang,” a paranoid thriller starring the actor that was to be set in North Korea, was scrapped by producer New Regency, Deadline.com reported.

Neither Rogen nor Goldberg would comment on Thursday on the fate of their film amid grassroots efforts like screenings and petitions to keep the movie alive and honor the filmmakers.

SCREENINGS CANCELED

Three movie houses called off special screenings of 2004 Paramount Pictures puppet-comedy “Team America: World Police” in which a U.S. paramilitary force tries to foil a plot by then-North Korean leader Kim Jong Il, father of Kim Jong Un.

The Alamo Drafthouse in Texas scrapped the screening because of “circumstances beyond our control,” while the Ohio-based Capitol Theatre and the Plaza in Atlanta said their screenings were canceled by Paramount.

Representatives for Paramount were not immediately available to comment.

Sony said Wednesday it has no further plans to release “The Interview,” but that has not stopped speculation that another company or maybe even Sony itself would aim for a smaller distribution some time in the future.

Sony’s embattled executives continued efforts to undo damage to their reputation wrought by the leaking of sensitive emails hacked in the November attack.

Civil rights activist Reverend Al Sharpton met Thursday with Sony Pictures Co-Chairman Amy Pascal to discuss racially insensitive emails from her, included joking remarks related to U.S. President Barack Obama and his taste in movies.

But Sharpton stopped short of asking for her resignation.

“The jury is still out on where we go with Amy,” Sharpton said. “We’re not going to be satisfied until we see something concrete done.”

It was still unclear what the costs to Sony Pictures would be for cancelling “The Interview” and for the cyberattack.

Any losses will undermine Sony Corp’s goal to boost results at the film studio as the money-losing conglomerate undergoes a restructuring and tries to counter flagging smartphone sales. Sony CEO Kazuo Hirai told investors in November that he aimed to lift its movie entertainment revenues by more than a third in the next three years.

While Rogen last week praised Pascal for having the courage to make the film, the long-time executive might be in a fight to keep her job because of that decision.

“If you look at some of the emails, you have to go back and research, and look at her discussions with the head of Sony overall in Japan, they never wanted to make this movie in the first place,” Mike Paul, crisis management consultant and president of Reputation Doctor LLC, told Reuters Insider.

Additional reporting by Michelle Nichols at the United Nations,; Writing by Mary Milliken; Editing by Grant McCool

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