The Matrix Producer Village Roadshow Files for Bankruptcy Amid Legal Battle.
Village Roadshow Entertainment Group, the production company behind blockbuster franchises such as The Matrix, Joker, and Ocean's Eleven, has filed for bankruptcy protection in the U.S., according to a court filing in Delaware.
The company attributes its financial struggles to a costly legal dispute with former partner Warner Bros. (WB) and an unsuccessful venture into independent film and television production.
To alleviate some of its financial woes, Village Roadshow is proposing the sale of its extensive film library for $365 million (£281 million). Meanwhile, court documents estimate the company's total debt to be between $500 million and $1 billion.
For decades, Village Roadshow and WB co-produced and co-owned numerous films, but their partnership deteriorated following the release of The Matrix Resurrections in 2022. The film debuted on HBO Max, sparking a dispute over rights to future sequels and prequels of their co-productions.
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Village Roadshow alleged that WB had unfairly excluded it from its contractual rights, igniting a prolonged legal battle. "The WB arbitration has caused the company to incur more than $18 million in legal fees, nearly all of which remain unpaid," stated Chief Restructuring Officer Keith Maib in a court filing.
According to Maib, this dispute has "irreparably decimated the working relationship" between the two companies, effectively ending "the most lucrative nexus" of Village Roadshow's historic success.
In addition to its legal troubles, the company suffered significant losses from a high-risk studio venture launched in 2018. None of the independently produced films or television series from this endeavor generated profits.
Like many entertainment companies, Village Roadshow also faced challenges from the COVID-19 pandemic, which led to decreased demand for films. More recently, the company was further impacted by the Hollywood actors’ and writers’ strikes that began in May 2023, disrupting the industry.
Adding to its difficulties, the Writers Guild of America (WGA) barred its members from working with Village Roadshow in December, citing the company's alleged failure to pay its contributors.
As Village Roadshow navigates bankruptcy proceedings, the future of its film library and remaining assets remains uncertain.
