Melrose 2 Sues Paramount Over Blockbuster Films Profit Sharing

Wednesday, November 30th, 2011 at 12:05 pm , filed under News by Nelson

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Melrose 2 has sued Paramount Pictures over its blockbuster films profit sharing issue in Los Angeles Superior Court on Tuesday.

Melrose 2 the financing partner of Paramount Pictures has sued the studio over the profit sharing issues on blockbuster movies in Los Angeles Superior Court on Tuesday, November 29, 2011, after a lawsuit was filed. Melrose 2 claims that, the oldest studio of America has not shared the profits on 29 blockbuster films including ‘Transformers’ franchise, ‘Dreamgirls’, ‘Mission Impossible 3’, ‘Blades of Glory’ and ‘Jackass: Number Two’.

The financing company claimed that, they have not been given the profits of an estimated $375 million in the year 2006, over their investments on 29 movies that were produced by both Paramount and DreamWorks, which was a subsidiary of Paramount at that time. The claim further adds that, the movies have grossed approximately $7 billion through global ticket sales.

The complaint of Melrose 2 reads that, the distribution of earnings comes about as a direct result of Defendants practice of understanding gross receipts, delaying payments to Melrose 2, overstating he distribution and production costs and pulling the ability of Melrose 2, to verify the revenues and costs associated with the movies they have funded. Paramount has also released a statement slamming the complaint.

The studio claimed that, they have agreed with its obligations to Melrose 2. It also further said that, they are disappointed over the sophisticated investors would choose to file a lawsuit filled with the things that neglects the real facts rather than seeing that process through to completion. Paramount further added that, they have the intention to defend the lawsuit vigorously and the differences between the parties’ positions are relatively small in amount and they are confident that, they could be resolved in an ordinary course.

This is not the first time that Paramount Pictures is facing a lawsuit over similar case, which is known as ‘Hollywood Accounting’. Melrose 1 sued the studio in the year 2008, over security fraud and the financing company was seeking for $30 million in damages.

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