Time Warner Inc. (NYSE:TWX), The Weinstein Brothers And The “Hobbit In The Court Room”

Posted by George Brook December 13, 2013 0 Comment 946 views

Time Warner Inc. (NYSE:TWX)’s stock has delivered more than 37.5% returns year to date, overshadowing the broader S&P 500 which has delivered close to 24.5% and the peer Twenty-First Century Fox Inc. (NASDAQ:FOXA) that has delivered around 28% returns in the same period. Recently Time Warner Inc. is battling with Weinstein brothers over a business issue revolving around ‘Hobbit’ films. Earlier this year, the two battled over the title of one the films, which was later named ‘Lee Daniels’ The Butler’.

‘Hobbit’ films: a Brief

This time Weinstein brothers filed a lawsuit just three days before the worldwide release of ‘The Hobbit: The Desolation of Smaug’ on Dec. 13th. The film is directed by Peter Jackson and it is the second of the three series ‘Hobbit’ films. The first film of ‘Hobbit’ series titled ‘The Hobbit: An Unexpected Journey’ was released last year and grossed more than $1 billion worldwide.

The Litigations

In a complaint filed on Tuesday, the Weinstein brothers and Miramax LLC have alleged Time Warner Inc. (NYSE:TWX)’s executives at Warner Brothers as well as at its New Line Cinema unit for twisting the historic deal in a way that would deprive them of 5% of the gross receipts from two of the three planned ‘Hobbit’ films. The complaint has been filed in New York State Supreme Court in Manhattan.

The Defendants

While the Weinstein brothers alleged Time Warner Inc. (NYSE:TWX) for depriving them of the rights to share in the revenues from two of the ‘The Hobbit’ films; the defendants accused the accusers of having made a business mistake when they sold the film rights to New Line.

Paul McGuire, a Warner Brothers spokesman said, “the studio filed for arbitration on Nov. 26 with JAMS Inc., a New York firm once known as Judicial Arbitration and Mediation Services, to resolve the dispute.”

About George Brook

George Brook covers money and politics for GDP Insider. George is a veteran journalist who has also covered Congress, national political conventions and presidential politics. George also covers the White House as well as economic and domestic policy for GDP insider. George's reporting has won numerous awards, including two Scripps Howard awards, two National Headliners, two Gerald Loeb Awards, as well as honors from Sigma Delta Chi and the National Press Club.

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