Village Roadshow has reached a settlement with Warner Bros. to pay $57 million to the studio after an arbitrator ruled against them in a dispute over the financing and distribution agreement of the 2021 film “The Matrix Resurrections.”
In 2022, Warner Bros. filed arbitration demands to Village Roadshow over “Matrix Resurrections” and other IP the studio shared the rights to with Warner Bros.
Roadshow, which was struggling financially in the aftermath of the COVID pandemic and with the failing launch of its new television production division and the poor box office of “Matrix Resurrections,” filed a lawsuit against Warner, accusing the studio of breach of contract over its decision to release “Resurrections” day-and-date in theaters and on HBO Max.
Village Roadshow also alleged that it was shut out of co-financing sequels and remakes to key franchises it shared the rights to, including the Timothée Chalamet musical “Wonka.”
But when the lawsuit was moved to arbitration, a ruling came down in favor of Warner Bros., as the arbiter found that Roadshow had breached the film’s co-ownership and distribution agreements. The studio was awarded $125 million in damages and interest, a ruling that played a factor in Village Roadshow’s bankruptcy last year.
In the wake of that bankruptcy, Warner filed a claim for the $125 million payment which has now been negotiated down to $57 million in bankruptcy court.
As for Village Roadshow’s catalog, Warner attempted to buy the derivative rights in bankruptcy court, but lost out to an $18.5 million offer from Alcon, which had previously purchased Roadshow’s catalog for $417.5 million. The derivative rights grant Alcon the right to produce sequels based on Roadshow’s catalog, including the 1998 fantasy film “Practical Magic,” which starred Nicole Kidman and Sandra Bullock and which is getting a sequel distributed by Warner this September.
