Disney Is Reportedly Getting Sued For A Whopping $1 Billion Dollars
Hey, “Disney World” fans. Unfortunately, there’s some really bad news out for Disney these days. According to the folks over at USA Today, Disney and FOX are facing a super lawsuit that’s seeking at least $1 Billion whopping dollars in damages! Notice I said, “at least.” That’s because it could actually be more than that!
It’s reported that Disney Company and Fox Entertainment Group allegedly breached a contract they had with Resort developer Genting Malaysia for a future theme park. The lawsuit was filed in sunny Los Angeles, California yesterday, November 26, 2018 at the Central California District Court. It cites damages from Fox’s withdrawal from an agreement that was made way back in 2013. The agreement was for Fox to license its intellectual property for a Fox World theme park in Resort World Genting, which is a sprawling facility perched on a mountain in Malaysia.
Genting is saying that Fox issued a “notice of default” aimed at ending the agreement. Fox had no grounds to pull out. They also allege that Disney and 21st Century Fox interfered with the contract and caused Twentieth Century Fox Licensing and Merchandising, part of Fox Entertainment, to breach it.
Disney’s acquisition of 21st Century Fox raised issues because Genting’s resort includes a casino, which conflicts with Disney’s anti-gambling message.
Genting went on to claim that they have raised nearly a whopping $180 million dollars for this new theme park. They were focusing on developing the resort and on preparing to roll out the “highly anticipated 20th Century Fox World Theme Park” as well as another attraction called, the Skytropolis indoor theme park. The opening of the new Fox themed park had been planned to launch in early 2019.
According to a new report from the folks over at Deadline.com ,Fox and Disney responded to this lawsuit today, November 27, 2018. They’re claiming it has no merit. Deadline also revealed that the lawsuit is actually for 1.75 billion dollars!
A spokesperson for 20th Century Fox commented on this with Deadline.com saying, “This lawsuit is entirely without merit. As the Complaint itself makes clear, Genting has been failing to meet the agreed-on deadlines for several years, long before the 21CF-Disney agreement. The allegation that Disney, rather than Fox, finally decided to declare a default is simply made up. We look forward to presenting all the facts in the appropriate forum.”
Deadline also pointed out that Disney has acquired most of Fox in a $71.3 billion-dollar merger which is expected to close in early 2019. A spokesperson for Disney also said this lawsuit was without merit stating, “The claims made against Disney in this matter are utterly without merit.”
Deadline revealed what the breach of contract complaint says. Apparently, Genting thinks Disney is trying to suppress any theme park that might compete with them. The complaint reads like this,”Defendant Disney benefited from FEG, TCFFC, and/or FoxNext’s improper termination of the Agreement by suppressing competition against Disney’s existing theme parks.
On information and belief, Fox’s soon-to-be owner Disney was now calling the shots, and its objective was no longer renegotiation of the MOA (Memorandum of Agreement), but termination. Permitting the ‘Fox’ brand to attach to a theme park over which FOX would have no control for what could amount to decades would have created business complications that Disney and 21CF preferred to avoid. Thus, on information and belief, Disney and 21CF, with knowledge of the Agreement, improperly directed FEG to terminate the Agreement.
Unlike Fox, which was perfectly happy to have the Park situated a stone’s throw from the casinos of Resorts World Genting so long as it could continue to extract financial concessions from GENM, Disney wanted no association with a gaming company like GENM due to Disney’s ‘family-friendly’ brand strategy, as evidenced by its well-documented history of lobbying against the opening of gaming facilities near its parks. Accordingly, FEG issued a ‘notice of default’ purporting to start the process of terminating the parties’ Agreement. If the plan were successful, not only would this termination give Fox—and therefore Disney—a windfall in accelerated payments, it would also protect Disney’s existing parks from increased competition and ‘protect’ its ‘family-friendly’ brand.”
So, it sounds like Disney could be in for one hell of a legal battle, but I definitely think they can afford it. It’s reported that the Disney theme park business globally brought in $20.3 billion dollars in revenue and reported an operating income of around $4.5 billion dollars!
What do you guys think about Disney getting sued for a whopping $1.75 billion, freaking dollars? Lets us know in the Facebook comments and stay tuned. Be sure to follow us on our Disney World News Facebook page for more Disney World news by Clicking Here.
