(Adds statement from de Havilland's lawyer)
By Jan Wolfe
March 26 (Reuters) - FX Networks, a unit of Twenty-First Century Fox Inc, on Monday prevailed in a lawsuit brought by Oscar-winning actress Olivia de Havilland over her depiction in a miniseries about the feud between Hollywood screen legends Bette Davis and Joan Crawford.
A state appeals court in California dismissed de Havilland's claims that the docudrama “Feud: Bette and Joan” falsely portrayed her as a gossip and a hypocrite, damaging her reputation.
The portrayal of de Havilland in "Feud," created by producer Ryan Murphy, was overwhelmingly positive, the court said.
The court said allowing de Havilland's case to proceed would interfere with the rights of authors and filmmakers to make creative works that dramatize historical events.
"Books, films, plays, and television shows often portray real people," the court said. "Whether a person portrayed in one of these expressive works is a world-renowned film star, ‘a living legend,’ or a person no one knows, she or he does not own history."
De Havilland was portrayed by Catherine Zeta-Jones in "Feud," which starred Jessica Lange as Joan Crawford and Susan Sarandon as Bette Davis. The series explored the bad blood between Crawford and Davis in the later years of their lives.
Suzelle Smith, a lawyer for de Havilland, said in a statement the decision "does not properly balance the First Amendment with other important rights" and she would appeal.
Murphy said the ruling "gives all creators the breathing room necessary to continue to tell important historical stories inspired by true events."
In February Netflix Inc hired Murphy, known for the hit series “American Horror Story” and "Glee," to create exclusive series and films as part of a five-year deal expected to be worth up to $300 million.
De Havilland, best known for the 1939 film “Gone With the Wind,” won two Oscars in a career spanning 50 movies.
De Havilland moved to Paris in the 1950s and has made rare public appearances since retiring.
Lawyers for de Havilland, 101, said she was the only living person to be depicted in the eight-part miniseries.
De Havilland objected to scenes in which she was portrayed as using a vulgar term to refer to her sister, actress Joan Fontaine, and joking about Frank Sinatra's drinking.
In October a lower court judge denied an FX request to dismiss the case on First Amendment grounds, saying there was merit to her allegation that she was depicted in a false light. (Reporting by Jan Wolfe in New York; Editing by Cynthia Osterman)