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