Village Roadshow Approves Arbitration in Warner Bros. Matrix Streaming Suit – Deadline


UPDATED with the latest: Looks like Warner Bros. has succeeded.

The Matrix Resurrections co-producer Village Roadshow Films has agreed to arbitrate its claims alleging Warner Bros. The decision to release the film simultaneously on HBO Max and in theaters was a breach of contract.

Village Roadshow attorneys filed paperwork Thursday with Los Angeles Superior Court Judge David Cunningham saying the company would no longer pursue its claims in court, an outcome Warners has been pursuing for months.

“After reviewing the court’s interim rulings, Village hereby waives its right to the May 27 hearing on Warner Bros.” motion to compel arbitration…and accepts the court’s interim rulings on the motion to compel arbitration…as final,” Roadshow’s attorneys said in their court filings.

In the original lawsuit filed Feb. 7, Village Roadshow alleges that Warner Bros. moved the film’s release date to 2021 from 2022 to help HBO Max attract more subscribers, thereby deliberately hurting the film’s box office revenue.

Village Roadshow then filed an amended lawsuit on March 25, adding Warner Media LLC as a defendant.

Lawyers for Warners alleged in April that the revised lawsuit was filed in violation of a Feb. 15 court order imposing a stay on the case. They also submit that the plaintiff’s lawyers indicated only a few weeks earlier that they were not considering such a modification.

Warner Bros. also argued that all of Village Roadshow’s additional claims for violation of the state’s unfair competition law were a re-statement of its original complaint and were also subject to arbitration with the cause of action for relief. declaratory.

“Although the court declined to uphold the case, Village Roadshow will pursue its claims in arbitration, access all legal remedies to enforce its rights to these valuable properties, and is confident that it will ultimately prevail over the merits of his case,” the representatives said. for Village Roadshow in a statement Friday. “This is an important matter not only for Village Roadshow, but for all content owners abused by the studios’ self-dealing practices. The company will prove that it is entitled to all remedies sought, including damages -significant interests, for WB’s willful and continued breaches of the parties’ agreements.”

PREVIOUSLY February 15: Looks like Village Roadshow won’t get their breach of contract and other lawsuits against Warner Bros expedited through the courts.

A day after the film’s finance company submitted documents to expedite the process regarding the dispute over The Matrix Resurrections and other films, a Los Angeles Superior Court this morning ruled No. Deciding that there was no basis to support an ex parte remedy, the judge rejected the desire of the attorneys of Kirland & Ellis of Village to lift the stay of litigation in court; allow the filing of a motion for a preliminary injunction; and accelerated discovery.

As WB tries to take the case to arbitration, today’s DTLA hearing means everything pretty much slows down until at least mid-March — that is, this show not on the road for almost a month.

UPDATE, February 14 at 12:18 p.m.: A week after hauling Warner Bros into open court in a battle for box office disappointment money The Matrix Resurrections and other films, Village Roadshow now wants a judge to put the pedal to the metal on the whole thing.

“Village Roadshow respectfully requests the Court to expedite this action, granting Village Roadshow leave to file a motion for a preliminary injunction, partially lifting the stay on complex litigation regarding the motion, and scheduling all briefings, expedited discovery and hearings,” the company’s Kirkland & Ellis attorneys said in a not unexpected filing Monday in Los Angeles Superior Court. “Village Roadshow seeks leave to file its motion for a preliminary injunction with the Court by March 7, 2022,” they added.

Indeed, hoping to hit the road harder and faster than a Mad Max movie, Village wants a hearing on the order Tuesday morning in downtown LA before Judge Ana Maria Luna.

Making it clear that it believes all dust should be settled behind closed doors in the arbitration, Warner Bros did not respond to request for comment on Village’s latest legal ruling today. If and when it does, we’ll update this story.

While WB didn’t directly respond to this morning’s filing, the studio was very blunt earlier Monday in calling what it called Village Roadshow “duplicitous” actions and calling “this dispute… artificial”.

PREVIOUSLY, February 7: Warner Bros, which managed to evade prosecution in 2021 despite a barrage of protests over parent company WarnerMedia’s aggressive tactics with streaming service HBO Max, has been sued by Village Roadshow.

The longtime tentpole films financier sued the studio in Los Angeles Superior Court today, alleging breach of contract. The 50-page complaint (read it here) doesn’t mince words, lambasting WB’s “deliberate and consistent coordinated efforts to eviscerate the significant value of Village Roadshow’s intellectual property.”

In a statement, Warner Bros responded, “This is a frivolous attempt by Village Roadshow to avoid their contractual cooperation.commitment to participate in the arbitration we initiated against them last week. We have no doubt that this case will be resolved in our favor.

At the center of the complaint is The Matrix Resurrections, the fourth installment in the franchise, which limped towards the $150 million mark at the worldwide box office after its December release. Village Roadshow argues that WarnerMedia hindered the film’s commercial prospects by promoting streaming.

During a 25-year relationship with Warner Bros, Village Roadshow paid $4.5 billion to produce and distribute nearly 100 films, according to the lawsuit. In this quarter century, there has been no prior legal entanglement, a fact described as “unique in the entertainment industry”.

Not only the Matrix The franchise has grossed some $2 billion at the box office, the lawsuit notes, but other Village Roadshow properties have also taken off financially after successful theatrical releases. costume names Jokerthe oceans series, Charly
and the chocolate factory and edge of tomorrow.

With traditional box office less of a factor in considering a property’s overall value in generating streaming subscriptions, production partners are left with the bag, according to Village Roadshow. “As a distributor and joint copyright owner, WB has a fiduciary duty to account to Village Roadshow for all revenue derived from the exploitation of the copyrights of the films, not just those ‘he can’t hide,’ the lawsuit says.

The Village Roadshow campaign comes after a tense year as WarnerMedia laid out plans for a $43 billion merger with Discovery, a deal that is still pending.

Another key producing partner, Legendary Entertainment, first made rumors last year about the fate of Dunes and Godzilla vs. Kongas have many other stakeholders in the 2021 releases. Legendary had sought to sell GvK to Netflix, but WarnerMedia stepped in, striking a deal to provide Legendary with drop protection and keep the film. Neither party had previously sued, in part because WarnerMedia spent about $200 million to compensate dozens of partners for lost box office revenue.

Disney, of course, faced a public outburst last summer with star Scarlett Johansson chasing Marvel’s release. Black Widow. The case settled weeks later, but exposed tensions between talent and distributors amid the streaming boom and dramatic changes to the film’s release model.

With Covid altering the landscape and closing cinemas for months in 2020, media companies already engaged in a battle to close the gap with Netflix have made a number of dramatic moves. With HBO Max getting off to a slow start after its May 2020 launch and former Amazon and Hulu executive Jason Kilar at the helm at WarnerMedia, the company was looking to stir the pot more than most. While other companies were more on a case-by-case basis, Warner Bros embarked on what was known internally as Project Popcorn. Without notice to any of its partners, the studio has put all 17 of its 2021 releases on HBO Max at the same time they hit theaters.

The move, unveiled at the end of 2020, has been decried by filmmakers like Christopher Nolan, major agency heads and others. Soon, however, the uproar died down and the company said it would make decisions on individual releases, rather than the entire roster, in 2022.

The Village Roadshow suit ripped Project Popcorn as a “clandestine plan to dramatically reduce the box office and correlated ancillary revenue generated by tentpole movies”.

While Disney put Black Widow and a few other films released as Premier Access titles, charging Disney+ subscribers an additional $30, other distributors went day-to-day at no additional cost. Some movies have even skipped theaters altogether in favor of streaming.

By attaching no charge for a slate of movies with budgets over $200 million, WarnerMedia and WB “effectively lured movie-going audiences away from theaters,” the lawsuit said. This decision is “completely inconsistent with ‘industry standards’ and ‘usual business practices in the motion picture industry.’ separate and merge with Discovery, while providing no benefit to Village Roadshow, talent and other partners.

City News Service and Tom Tapp contributed to this report.


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