Mel Gibson Film
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CAUTION: THIS DOCUMENT HAS NOT YET BEEN REVIEWED BY THE COUNTY CLERK. (See below.) INDEX NO. UNASSIGNED NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 06/14/2020 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK ----------------------------------------------------------------------- X RAVEN CAPITAL MANAGEMENT LLC, RIVE BL, : LLC, : : COMPLAINT Plaintiffs, : : Index No.: _______________ v. : : GEORGIA FILM FUND 72, LLC, : : Defendant. : ----------------------------------------------------------------------- X Plaintiffs Raven Capital Management LLC (“ Raven ”) and RIVE BL, LLC (“ RIVE ”) (collectively, “Plaintiffs”), by their undersigned counsel, as and for their Complaint against Defendant Georgia Film Fund, LLC (“ GFF ” or “Defendant ”), allege as follows: I. NATURE OF THE ACTION 1. This action involves film production company GFF’s deceptive and fraudulent attempts to secure from Plaintiffs substantial capital investment and a commitment to distribute a theatrical motion picture titled Boss Level starring, among others, Frank Grillo, Mel Gibson and Naomi Watts, and directed by Joe Carnahan (the “Film”) and GFF’s wrongful failure to honor its obligations and representations that would deprive Plaintiffs of these unique and valuable distribution rights just as movie theatres in the United States are beginning to reopen after extended closures during the COVID-19 pandemic. 2. Raven is a private equity fund manager and Registered Investment Advisor with the Securities and Exchange Commission. The Raven team has decades of investment experience, with deep expertise in the media and entertainment sector. It has deployed billions of dollars and has been active in developing, financing, and producing films, and acquiring and managing film This is a copy of a pleading filed electronically pursuant to New York State court rules (22 NYCRR §202.5-b(d)(3)(i)) which, at the time of its printout from the court system's electronic website, had not yet been reviewed and approved by the County Clerk. Because court rules (22 NYCRR §202.5[d]) authorize the County Clerk to reject filings for various reasons, readers should be aware that documents bearing this legend may not have been accepted for filing by the County Clerk. 1 of 22 CAUTION: THIS DOCUMENT HAS NOT YET BEEN REVIEWED BY THE COUNTY CLERK. (See below.) INDEX NO. UNASSIGNED NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 06/14/2020 studios and libraries. Raven’s entertainment enterprise encompasses film and TV rights ownership, financing and production, and sales and distribution, among its other media and entertainment capabilities. In 2015, Raven teamed with AMBI Media Group to acquire the lucrative Exclusive Media Group library from Dutch-based investment fund Dasym Investment Strategies. This acquisition gave Raven the rights to distribute approximately 400 titles covering a diverse portfolio of critical hits, commercial blockbusters, and cult favorites. In 2018, Raven acquired the Academy Award-winning Hollywood studio Open Road Films, which it now manages. The Open Road library has an aggregate worldwide box office of $1.3 billion. 3. Raven has dedicated significant financial and operational resources towards further developing its first-run theatrical and ancillary rights distribution strategy. Raven’s investment and media teams have an established track record of creating substantial value with structurally complex projects, strategically identifying undervalued assets and solving issues inherent in challenging projects that may deter others in the industry. 4. The Film is such a project. The Film was inherently well positioned to become a box office blockbuster based on its A-list cast and director, creative execution, and audience appeal. However, due to GFF’s financial mismanagement, which started as early as the production financing stage, resulting in an internally conflicted investor group, GFF made logistically challenging distribution and financial demands that prevented the Film from gaining traction with potential distributors prior to Raven’s introduction to the scene. Raven pursued the opportunity despite this complexity because creating success with a project like the Film, where others saw only insurmountable financial problems, would grow the enterprise and demonstrate its expertise in the theatrical market. 2 This is a copy of a pleading filed electronically pursuant to New York State court rules (22 NYCRR §202.5-b(d)(3)(i)) which, at the time of its printout from the court system's electronic website, had not yet been reviewed and approved by the County Clerk. Because court rules (22 NYCRR §202.5[d]) authorize the County Clerk to reject filings for various reasons, readers should be aware that documents bearing this legend may not have been accepted for filing by the County Clerk. 2 of 22 CAUTION: THIS DOCUMENT HAS NOT YET BEEN REVIEWED BY THE COUNTY CLERK. (See below.) INDEX NO. UNASSIGNED NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 06/14/2020 5. In early 2020, GFF offered Raven the opportunity to distribute the Film. GFF had spent years unsuccessfully attempting to obtain a domestic distribution deal that included a major theatrical release supported by a substantial marketing and promotion budget. GFF told Raven that this was critical to the Film’s success. In this industry, that is hardly unique. But at that point, only Raven expressed interest in distributing the Film in the manner the GFF required. Over the ensuing months, the parties conducted extensive negotiations that centered around GFF’s “core terms” for the Film which specifically required a major theatrical release. 6. On March 12, 2020, the day after the World Health Organization officially declared the outbreak of COVID-19 a pandemic, Raven and GFF executed a Summary of Terms and Conditions for Acquisition of Certain Distribution Rights in the Picture (the “Term Sheet”), through which GFF extended Plaintiffs an offer to acquire all distribution rights to the Film in the United States and its associated territories. Critically, the Term Sheet grants Raven exclusive rights to negotiate a distribution agreement and expressly prohibits GFF from soliciting offers, inquiries or proposals for, or actively negotiating or entering into, any transaction for the acquisition of distribution rights that would compete with GFF’s proposed offer to Raven. Reasonably relying upon the Term Sheet and GFF’s agents’ representations, Plaintiffs proceeded in the following months to negotiate a long-form written distribution agreement. During this period, in a series of phone calls and email exchanges, the parties agreed upon all material terms of a distribution agreement. Plaintiffs also expended and reserved considerable financial resources in preparation for the Film’s theatrical marketing and distribution, to the exclusion of other potentially lucrative financial investments and business opportunities. 7. However, on June 1, 2020, GFF abruptly advised Raven of its intent not to move forward with Plaintiffs. GFF stated that it instead intended to enter into a distribution agreement 3 This is a copy of a pleading filed electronically pursuant to New York State court rules (22 NYCRR §202.5-b(d)(3)(i)) which, at the time of its printout from the court system's electronic website, had not yet been reviewed and approved by the County Clerk. Because court rules (22 NYCRR §202.5[d]) authorize the County Clerk to reject filings for various reasons, readers should be aware that documents bearing this legend may not have been accepted for filing by the County Clerk. 3 of 22 CAUTION: THIS DOCUMENT HAS NOT YET BEEN REVIEWED BY THE COUNTY CLERK. (See below.) INDEX NO. UNASSIGNED NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 06/14/2020 with a third-party licensee. Unbeknownst to Plaintiffs, and upon information and belief, GFF had been engaged in ongoing and extensive negotiations over a competing exclusive licensing deal for the United States exploitation rights for the Film with an unrelated third-party behind Plaintiffs’ back, contrary to GFF’s representations and in blatant disregard for the Term Sheet’s confidentiality and exclusivity provisions, among others. Upon information and belief, GFF intentionally and deceptively induced Plaintiffs to continue expending and reserving the resources necessary to effectively distribute and market the Film for theatrical release, presumably as an insurance policy in case GFF’s competing deal fell through. If Raven had known at any time that GFF was actively negotiating an exclusive license agreement with a competing third party, and that GFF had no real intention of honoring its offer to provide Plaintiffs with distribution rights in the Film, then Plaintiffs never would have spent the time and resources to negotiate a distribution agreement or reserved many millions of dollars in investment funds that could have been deployed elsewhere. 8. On June 10, 2020, after orally agreeing to a distribution agreement with Raven, GFF sent Raven a letter purporting to terminate negotiations with respect to a written distribution agreement and thereby terminate Raven’s exclusive right to negotiate and enter into a distribution agreement for the Film. But that letter is ineffective under the Term Sheet’s termination requirements and was simply too little, too late. Plaintiffs now bring this suit for injunctive relief to enforce GFF’s promises and to prevent GFF from purportedly transferring to any third party exclusive distribution rights to the Film that GFF no longer controls as a result of the oral distribution agreement between GFF and RIVE. Plaintiffs additionally seek monetary damages to recover their lost profits resulting from GFF’s breach of the Term Sheet and the parties’ oral 4 This is a copy of a pleading filed electronically pursuant to New York State court rules (22 NYCRR §202.5-b(d)(3)(i)) which, at the time of its printout from the court system's electronic website, had not yet been reviewed and approved by the County Clerk. Because court rules (22 NYCRR §202.5[d]) authorize the County Clerk to reject filings for various reasons, readers should be aware that documents bearing this legend may not have been accepted for filing by the County Clerk.