When it filed for chapter earlier this 12 months, Village Roadshow pointed to the souring of its longtime partnership with Warner Bros. for its monetary woes. On the coronary heart of the falling out that was years within the making: A authorized battle over the studio’s resolution to launch Matrix Resurrections concurrently on HBO Max and in theaters, consuming away at field workplace returns.
That lawsuit went darkish shortly after it was filed, with a choose shifting it to arbitration.
A 12 months later, an arbitrator present in favor of WBD and awarded the studio roughly $125 million, The Hollywood Reporter has discovered of the beforehand unreported determine. It was present in 2023 that Village Roadshow breached a sequence of offers involving the Matrix movies by failing to pay its $107 million share of the cofinancing association, based on an individual acquainted with the state of affairs who was granted anonymity as a result of the matter is confidential. The debt stays unpaid.
In March, Village Roadshow filed for chapter safety. The transfer from the corporate — as soon as one of the crucial prolific behind-the-scenes financiers in Hollywood that backed The Matrix and Ocean’s franchises — got here after a expensive endeavor aimed toward creating content material in-house and the 2022 lawsuit, which “irreparably decimated the working relationship” with WBD, wrote Village Roadshow chief restructuring officer Keith Maib in a court docket doc. Matrix Resurrections wasn’t the one movie at concern in that authorized battle. Village Roadshow alleged that it was shut out of cofinancing sequels and remakes to key franchises based mostly on motion pictures it shares the rights to with WBD, together with Wonka, Joker and I Am Legend.
One instance that predated the Matrix feud: Village Roadshow needed in on a TV sequence that was being growing based mostly on Fringe of Tomorrow however was informed the mission wouldn’t transfer ahead if it didn’t relinquish its rights, based on court docket filings. WBD ended up abandoning the present.
Responding to claims over The Matrix Resurrections, WBD maintained in public statements and court docket filings that it provided Village Roadshow the chance to cofinance the movie, which was accepted. The financier later refused to pay its share on the film, which price roughly $200 million to make and $100 million to market, based on a court docket doc. WBD prevailed on claims Village Roadshow superior for unfair competitors, breach of contract and breach of implied covenant of excellent religion and honest dealing, which covers unhealthy religion dealings, stated the particular person acquainted with the arbitration.
An arbitrator sided with WBD that Village Roadshow breached the co-ownership and distribution agreements, added the particular person, who confirmed that the studio was awarded over $107 million in damages plus $17 million in curiosity.
That ruling has been confirmed on attraction, although damages can be recalculated to account for a would-be day-and-date license for the film and different distribution revenues that WBD had already obtained and would’ve needed to pay, based on a court docket doc. The studio stays assured that the award will stand, a supply says. Curiosity on the excellent co-financing obligation has ballooned to just about $32 million.
Village Roadshow incurred over $18 million in authorized charges over the course of the litigation, whereas WBD spent roughly $8 million throughout arbitrations associated to the Matrix sequel and Wonka, which contain allegations that the studio refused to acknowledge the financier’s rights to associate on the film by claiming that it’s not a prequel to Charlie and the Chocolate Manufacturing unit — a movie co-owned by the 2 sides, per the court docket doc.
The studio is trying to accumulate on the debt as Village Roadshow seems to be to promote most of its property. Final month, the court docket authorized a $417.5 million supply from Blade Runner 2049 producer Alcon Media Group for Village Roadshow’s movie library, together with stakes in The Matrix and Ocean’s franchises. The stalking horse bid, which units a value ground for the property, can be examined at public sale. Rival provides, together with from Warner Bros. Discovery and funding agency Content material Companions, should still floor forward of the deadline Might 16.
Additionally up on the market: the by-product rights to confirmed tentpoles, amongst different motion pictures, and Village Roadshow’s studio enterprise. Since 2018, the corporate has had 99 function movies and 233 tv sequence in growth, although solely six motion pictures and 7 tv exhibits went into manufacturing at a price ticket of $47.5 million. None of them have been capable of flip a revenue indicating sustainability of the endeavor aimed toward creating content material in-house.
WBD and Village Roadshow declined to remark for this story.
