WarnerMedia is being sued for releasing The Matrix Resurrections on HBO Max

WarnerMedia is being sued for releasing The Matrix Resurrections on HBO Max

A lawsuit has been filed against another major studio over the day-and-date release of a highly anticipated title. Village Roadshow Films, which co-produced The Matrix Resurrections with Warner Bros., issued a WarnerMedia release over the film’s simultaneous release on HBO Max and in theatres.

The case, which was filed today in Los Angeles Superior Court, claims that WarnerMedia “rushed” the publication of The Matrix Resurrections from 2022 to 2021 so that it could premiere as part of “Project Popcorn,” an internally coded endeavour. This distribution approach would swap box office money for streaming subscriptions, depriving partners of cash connected to the performance of the film.

As part of its pandemic plan in 2021, WarnerMedia chose to distribute its entire slate of films on HBO Max on the same day they were released in theatres. (In 2022, Warner Bros. reverted to exclusive theatrical contracts.) According to the lawsuit, Project Popcorn is a “secret strategy” by WarnerMedia to “materially diminish box office and ancillary revenue produced from tent pole pictures that Villiage Roadshow and others would be entitled to in exchange for boosting subscription revenue for the new HBO Max service.”

Warner Bros. labelled the complaint “a ridiculous attempt by Village Roadshow to dodge their contractual duty to participate in the arbitration that we commenced against them last week,” according to a statement shared with The Verge. We are certain that the matter will be decided in our favour.”

Village Roadshow contends that publishing The Matrix Resurrections under this paradigm brought “zero advantage” to itself, its talent, or its partners, similar to Scarlett Johansson’s complaint against Disney for the simultaneous release of Black Widow during the pandemic.

According to the lawsuit, a picture that “could have been an extremely valuable sequel to The Matrix trilogy” helped enhance HBO Max’s value and subscribers while hurting the film’s theatrical income and “inflicting substantial harm to the entire Matrix franchise.”

The suit claims that “the impact to The Matrix Resurrections’ box office profits was not merely the effect of cannibalization from streaming, but also from the rampant piracy it knew would ensue by placing this marquee picture on a streaming platform on the same day as its theatrical release.” “The whole effect was terrible.”

For decades, Village Roadshow has collaborated with Warner Bros. on 91 films, including Joker, the Ocean’s franchise, and The Matrix films. Warner Bros. is allegedly pushing them away, aiming to cut them out of collaborating on and earning from franchise projects, according to the firm.

These copyright disputes extend to projects like Willy Wonka and a series based on the Village Roadshow film Edge of Tomorrow. Warner Bros. “insisted that Village Roadshow forgo its co-finance and co-ownership rights freely” in the instance of Edge of Tomorrow.

“When Village Roadshow refused, WB said the quiet part out loud: despite the nearly $4.5 billion it has paid WB to develop and distribute 91 pictures, it will not enable Village Roadshow to benefit from any of its Derivative Rights going ahead,” according to the lawsuit. “In other words, if Village Roadshow refuses to relinquish its rights, WB will ensure that they are worthless.”

Warner Bros. “has a fiduciary duty to account to Village Roadshow for all earnings from the exploitation of the films’ copyrights, not just those it can’t hide through sweetheart deals to benefit HBO Max,” said Mark Holscher, a Kirkland & Ellis litigation partner representing Village Roadshow in a statement.

Village Roadshow alleges that despite knowing about probable profit and piracy issues, Warner Bros. pushed forward with a hybrid release of The Matrix Resurrections anyhow, hurting not only the franchise’s earnings but also its legacy.

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The suit claims that “the abysmal theatrical box office sales figures from The Matrix Resurrections dilute the value of this tent pole franchise as a film’s lack of profitability generally prevents studios from investing in additional sequels and derivative films in the near term,” and that “the abysmal theatrical box office sales figures from The Matrix Resurrections dilute the value of this tent pole franchise as a film’s lack of profitability generally prevents studios from investing in

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