'Joker,' 'Matrix' producer files for bankruptcy protection amid Warner Bros. fight

Village Roadshow Entertainment has filed for Chapter 11 bankruptcy protection, a acheronian crook for the once-prolific movie financing institution that backed the “Joker,” “The Matrix” and “Ocean’s Eleven” movie franchises.

The West Hollywood-based institution blamed its ongoing ineligible conflict with longtime spouse Warner Bros. for its collapse, according to a Monday filing successful U.S. bankruptcy tribunal successful Delaware. Village Roadshow besides conceded that its ambitious propulsion into producing autarkic films and tv programs earlier the pandemic was unprofitable, exacerbating its fiscal woes.

The breach of declaration suit against Warner Bros. came aft the workplace introduced “The Matrix Resurrections” successful December 2021 connected its HBO Max streaming work the aforesaid time the movie was released successful movie theaters. Village Roadshow complained that the Burbank studio’s pivot distant from an exclusive theatrical merchandise had destroyed the worth of a cardinal franchise.

Village Roadshow’s predicament is simply a stark illustration of however the amusement industry’s displacement to streaming has upended erstwhile vibrant businesses.

Since its founding successful 1997, Village Roadshow has co-produced and co-financed much than 100 movies that unneurotic generated much than $19 cardinal successful worldwide container bureau receipts, according to tribunal documents.

“A confluence of macro-economic factors person weighed heavy connected the company’s equilibrium sheet,” Keith Maib, an enforcement with Accordion Partners who is serving arsenic main restructuring serviceman for the Village Roadshow liquidation, wrote successful a declaration.

The disruption caused by the COVID-19 pandemic, the 2023 writers’ and actors’ strikes and large amusement companies’ clasp of streaming helped crater the company, Maib wrote.

The bankruptcy filing was designed to facilitate “orderly income of the debtor’s assets,” helium said.

Village Roadshow is controlled by Vine Media Opportunities, Falcon Strategic Partners and a Canadian constricted partnership, 1397225 Ontario Ltd.

The institution said its assets are worthy an estimated $100 cardinal to $500 million.

But it has much than 200 creditors and debts of $500 cardinal to $1 billion, according to the filing.

Village Roadshow owes much than $11 cardinal to Kirkland & Ellis successful Los Angeles for nonrecreational services. Its indebtedness to the Writers Guild of America West tops $1.4 million. (The WGA enactment Village Roadshow connected its onslaught database successful December for nonpayment.)

The filing besides shows that Village Roadshow owes Bryan Cranston’s Moonshot Entertainment Inc. $794,000 for improvement costs and different $250,000 to Sony Pictures Television.

Former Sony enforcement Steve Mosko, who joined Village Roadshow successful 2018 arsenic main executive, near earlier this year. He had attempted to physique Village Roadshow into an autarkic workplace that produced its ain movies and tv shows.

But the Mosko-led run to remake the institution into a full-service workplace proved costly and untimely.

Village Roadshow enactment into improvement 99 diagnostic films, 166 scripted tv bid and 67 unscripted series. Of those, six movies and 7 tv bid went into production. “No movie oregon tv bid that was produced was capable to make a nett that could prolong the workplace business,” Maib wrote.

Village Roadshow’s ineligible conflict with Warner Bros. was the past straw. The company’s quality against Warner Bros. remains unresolved successful arbitration — much past 3 years aft the suit was filed.

In precocious 2021, Warner Bros. was recalibrating owed to the lingering effects of the COVID-19 pandemic. The company, past owned by AT&T, was prioritizing gaining subscribers to enactment its streaming work implicit its accepted concern of releasing movies to cinemas. That’s erstwhile it placed “The Matrix Resurrections” connected HBO Max.

Village Roadshow said it has spent much than $18 cardinal successful ineligible fees to effort to resoluteness the Warner Bros. quality — fees that stay unpaid.

While the steadfast besides worked connected movies with Sony Pictures Entertainment and Paramount Pictures, its astir invaluable assets were produced successful conjunction with Warner Bros., including “Mad Max: Fury Road” and “The Lego Movie.” The institution co-produced and co-financed 91 films with Warner Bros. by arranging immoderate $4.5 cardinal successful financing.

Village Roadshow’s room assets make astir $50 cardinal a twelvemonth successful revenue, according to Maib’s declaration.

Last year, Village Roadshow engaged Goldman Sachs Group to merchantability immoderate room assets, but uncertainty caused by the lingering Warner Bros. quality scuttled the effort.

The institution past engaged Sheppard Mullin Richter and Solic Capital Advisors, which came up with a “stalking equine bidder” to bargain the assets pursuing the Chapter 11 process, Maib wrote.

A twelvemonth ago, the institution had astir 45 employees successful the U.S. and Melbourne, Australia. In its determination to slash costs, the steadfast present has less than a twelve employees. As of this month, the company’s monthly overhead is astir $300,000.