The court overseeing Relativity Media’s bankruptcy should ignore IM Global Film Fund’s effort to win back distribution rights to British director Eran Creevy’s hot title Collide, previously known as Autobahn, the studio says today.
Relativity responded to IM Global’s plea for U.S. Bankruptcy Court Judge Michael Wiles to scrap the companies’ October 17, 2014 distribution agreement as of September 30, and not wait until someone steps up to buy the studio.
IM Global said that the film starring Nicholas Hoult, Felicity Jones and Anthony Hopkins was supposed to be released in the U.S. on October 20. That can’t happen with Relativity struggling to get back on its feet, which could cost IM Global about $9 million. It’s already looking for an alternate distributor.
But Relativity says today that IM Global’s merely trying to benefit from the studio’s woes.
The September 30 date to end the contract is “questionable” because it comes just a day before the planned bankruptcy auction. A group of creditors known as Stalking Horse Bidders say they’ll offer $250 million for Relativity. IM Global’s “continuous request” to renegotiate the contract with the bidding group “undermines its stated concerns” that Stalking Horse won’t be able to release the film “within an acceptable time frame.”
Relativity says it needs “more time and the clarity of the results of the Auction before [it] can determine how to proceed” with the film.
If time is so important, Relativity adds, then its curious that IM Global “at no point” complained last month when the Bankruptcy Court lengthened the time frame for an auction.
The studio also says that there’s nothing magical about the planned release date for the movie, which it says is actually October 30. Although it agreed to that after signing the distribution contract, the deal itself merely says that Relativity will offer it “on a mutually approved release date in 2015.” The terms also “explicitly” anticipate scenarios when the date can be moved.
Even if Relativity’s plans breached the contract, the point of bankruptcy is to give a debtor the opportunity “to cure such alleged defaults and assume the Contract.”
The committee of unsecured creditors side with Relativity on this one. In a separate filing, it says that “it is unclear why IM Global needs its Motion considered now.”
Waiting a few weeks for a buyer to emerge “can hardly be prejudicial to IM Global,” the committee says. It also notes that the firm says it “may” lose money and overseas distribution opportunities with a delay. That’s “nothing but conjecture at this point and premature given that [Relativity has] not completed [its] sale process, which may or may not produce a purchaser willing and able to perform under the Agreement.”