Spoiler alert: not all movies succeed.
In any given year, the bombs will outnumber the blockbusters, much to the dismay of the companies fronting the cash (and that doesn’t even count all the movies that “lose money” on paper). American treasury bonds may no longer be AAA gold-plated, but you better believe they’re a safer bet than financing a movie — just ask every pro athlete who went bankrupt investing their multi-million dollar advance into a pet motion picture project. But not everybody who watches their investment wither and die at the hands of unforgiving reviewers and uninterested audiences is willing to just walk away. For these investors, there is recoupment by litigation (and entertainment lawyers everywhere rejoiced!).
Consider the financiers of the movie Free Style, who filed a lawsuit last week in hopes of salvaging their investment in the box office bomb. Unsurprisingly, the suit names the producers as defendants, alleging that they made misrepresentations about the marketing budget and the scope of the movie’s release. More interestingly, though, the financiers are going directly after star Corbin Bleu (of High School Musical fame, for those of you without tweenage daughters), alleging that he failed to honor an agreement to provide interviews to promote the film. As a result, say the money men, after they loaned $8.57 million, the movie only earned $1.3 million from all sources including foreign distribution and DVD sales. (If you’re thinking that’s not so bad, chew on this: the movie earned only $463 on opening weekend in the United States. Yes, 463 dollars, no zeros added. The investors might have been better off selling their collectible Barbies on eBay that weekend.)
Since you’ve likely never heard of the movie (case in point?), here’s a synopsis: “High School Musical’s Corbin Bleu trades in his dancing shoes for a helmet in this family film. InFree Style, young Cale (Bleu) gives his all in his effort to be on the Grand National Motocross racing team, while his mother (Penelope Ann Miller), sister (The Game Plan’s Madison Pettis), and girlfriend (Sandra Echeverria) cheer him on.”
I’ll give you a moment while you toggle over to Netflix to add the DVD to your queue. You’re welcome.
So, having taken the unusual step of suing the star of their film, what hurdles do the investors face in proving their case against Bleu? Continue reading the full story . . . »