Entertainment Industry

Category: New Line

New 'Mortal Kombat' movie coming via partnership of Warner units

MK9 "Mortal Kombat" is fighting its way back onto the big screen, marking a rare delivery of material from a studio's own video game division to its sibling film division.

Warner Bros.' New Line Cinema label is partnering with the Burbank studio’s video game unit Warner Bros. Interactive Entertainment to adapt for the big screen the tournament fighting series, which debuted on video game consoles in 1992. New Line is aiming to produce the new film next year and release it in 2013.

Like several other media companies, including Walt Disney Co., Warner has produced its own video games based on its film properties, such as June’s "Green Lantern."

"It's really important that we show we can bring our game properties to movies instead of just the other way around," said Warner home entertainment President Kevin Tsujihara.

In 2009, Warner Bros. acquired Mortal Kombat maker Midway Games out of bankruptcy for $49 million. In April Warner released the ninth Mortal Kombat game, which was one of the most successful in the series, selling more than 3 million copies.

Some of that success was credited by the studio to a promotional Web series it produced called "Mortal Kombat: Legacy." The nine-part series, made for about $2 million, was directed by Kevin Tancharoen. Previously known for directing Metro-Goldwyn-Mayer’s unsuccessful “Fame” remake, Tancharoen garnered new attention in 2010 by producing his own short film based on Mortal Kombat, which became a viral hit on YouTube and convinced Warner to let him produce the Web series.

Tancharoen has now been tapped to direct the feature film, which is being written by his partner Oren Uziel. New Line president Toby Emmerich said the idea to do the movie came entirely from the work the director did online.

"The new game and the online shorts prompted us to consider a reboot of a brand we hadn’t been actively thinking about," he said.

New Line produced two “Mortal Kombat” movies in 1995 and 1997 when it was an independent studio owned by Warner Bros. parent Time Warner and it licensed the rights from Midway. Though the first picture performed relatively well at the box office, grossing $122 million worldwide, they weren’t well received by fans and Emmerich granted that they “haven’t aged well.”

Tancharoen said his new movie, which is expected to be produced for well under $100 million, will offer a more realistic take on the Mortal Kombat characters, who are best known for over-the-top killing moves called "fatalities."

Because the Mortal Kombat games and movies are now being made under the same studio roof, the film’s release is expected to be coordinated with the next game. Emmerich and Tusjihara both said they hope the next Mortal Kombat game will come out when the movie hits theaters, or potentially in a single package along with the DVD and Blu-ray.

Development of a “Mortal Kombat” movie had been held up by litigation between Warner and producer Lawrence Kasanoff, who worked on the two 1990s movies. The studio prevailed in one lawsuit over royalties owed for the years 2000-2004, but cases are pending over royalties for 2008 and ownership of the movie rights.

While Tsujihara declined to comment on the litigation, people close to the movie but not authorized to discuss the matter publicly said they believed the two sides were close enough to a resolution to move ahead on the project. Kasanoff and his attorney did not return calls requesting comment.

-- Ben Fritz

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Photo: A scene from the latest Mortal Kombat game. Credit: Warner Bros. Interactive Entertainment.

CBS, Netflix extend partnership to Canada and Latin America

Dexterstory2 Beginning in September, Netflix customers in Canada will be able to stream episodes of several CBS owned television shows including "Numb3rs," "Twin Peaks" and episodes of past seasons of "Dexter."

The two-year, nonexclusive international licensing deal -- announced Wednesday -- expands a partnership between the two companies, which was signed earlier this year. The initial agreement covered TV show streaming by Netflix users in the U.S.

Financial terms of the international deal were not disclosed.

Netflix has been bolstering its offerings to compete with rival services. On Wednesday, episodes of the critically acclaimed AMC series "Mad Men" become available to Netflix's U.S. subscribers as part of a syndication deal that the Los Gatos-based company structured with studio Lionsgate.

Netflix primarily has access to older programming that CBS owns, including the original "Star Trek" series. The television company tightly guards online views of episodes of its current network hits, including "NCIS" and "Hawaii Five-0."  It does not make the latest episodes of shows available to Netflix, Hulu or Amazon.com.

CBS' strategy is designed to protect its TV ratings and the advertising revenue it receives when viewers watch programming on TV.  But CBS has been eager to structure deals to give companies access to its older titles that no longer air on television.

Later this year, users in Latin America also should be able to watch "Dexter" and other CBS titles online.

Earlier this month, Netflix said it would be launching movie and TV show streaming services in 43 countries in Central America, South America and the Caribbean. Netflix's arrangement with CBS represents it first international deal with a major content supplier.

Netflix said that CBS-owned  programming including past seasons of "Medium," "90210," or the Showtime programs "Nurse Jackie" and "Dexter" will be included in Netflix's $7.99 a month streaming plan.   

CBS Corp. owns the premium Showtime cable channel. 

"We are pleased to be partners with Netflix as they roll out their superb service to new markets," said Armando Nunez, president of CBS Studios International. "This new arrangement -- which does not compete with U.S. ratings or Showtime's domestic subscriber base -- underscores the popularity of CBS content around the world, and illustrates yet another meaningful way for us to realize incremental value from our vast library of content."

-- Meg James

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Photo: Michael C. Hall in a scene from "Dexter." Credit: Randy Tepper / Showtime

Warner Bros. to handle 'Hobbit' in most overseas markets, fund MGM's half of budget

LOTR Warner Bros. has struck a deal with Metro-Goldwyn-Mayer to handle distribution of the two upcoming movies based on "The Hobbit" in most foreign countries in exchange for covering the entire budget of the productions estimated at $530 million to $550 million.

Production on "The Hobbit," which will be overseen by Warner Bros.' New Line Cinema unit, is set to begin shooting in February in New Zealand. The first of the two movies will be released in December 2012, with the second one coming out the following December.

Under an existing arrangement, MGM was obligated to split the cost of "The Hobbit," which will be directed by Peter Jackson, with Warner Bros., and owned international distribution rights to the movies. Warner already controlled rights to the films in the U.S. and Canada.

MGM has just emerged from bankruptcy, however, and doesn't have enough cash to cover its portion of "The Hobbit" budget. In a bankruptcy filing, MGM said it would owe $265 million to $275 million for "The Hobbit," along with $40 million it has already spent on pre-production and development.

Under new leadership of co-chief executives Gary Barber and Roger Birnbaum, MGM recently closed a $500 million line of credit that will be used to produce other movies and cover its overhead.

While Warner will handle theatrical and home video distribution of "The Hobbit" in the majority of markets overseas, MGM will sell the television rights abroad.

--Ben Fritz

Related:

'The Hobbit' will stay in New Zealand, prime minister says

'The Hobbit' movies ready to go, pending labor resolution

Fellowship forms around 'The Hobbit'

Photo: Peter Jackson and Karl Urban on the set of "Lord of the Rings: The Return of the King." Credit: New Line Cinema.

'The Hobbit' movies ready to go, pending labor resolution [updated]

LordRingsJackson Following a multitude of delays, Warner Bros. and co-financing partner Metro-Goldwyn-Mayer Inc. have agreed to start production in February on the two films that serve as a prequel to the blockbuster "Lord of the Rings" trilogy, people familiar with the situation said.

[Update, 6:18 p.m.: The studios issued a press release late on Friday confirming that "The Hobbit" has officially been greenlit.]

Only one hitch remains, however, and it may not necessarily be a small one. The studios are waiting to announce the greenlight because a labor dispute between director Peter Jackson and the Screen Actors Guild and other performers unions is not yet resolved. The unions have advised members not to work on "The Hobbit" because they claim it's a non-union production. The parties are hopeful that a resolution is imminent, which would pave the way for the movies to be shot in Jackson's home country of New Zealand, where "Lord of the Rings" was made and preproduction for the new films is underway.

The first "Hobbit" movie is scheduled to be released in December 2012 and the second the following holiday season, both in 3-D.

Production on "The Hobbit" had also been held up because of the financial problems of MGM, which owns international distribution rights to the pictures and is obligated to cover half of the budget, which is expected to approach $500 million. Although MGM is still not financially able to foot its part of the bill, it had to commit to the production before filming could start.

MGM is expected to talk to potential funding sources, including other studios that could handle foreign distribution on its behalf. As a backup plan, Warner Bros. has agreed to loan MGM the money in exchange for additional rights to the picture beyond the domestic distribution it already controls.

The production will be overseen by Warner Bros.' New Line Cinema label, which made the "Lord of the Rings" trilogy before it was folded into its sibling studio by parent company Time Warner Inc.

Negotiations between the two sides have been led by New Line President Toby Emmerich, Warner Bros. Home Entertainment Group President Kevin Tsujihara, and Spyglass Entertainment chiefs Gary Barber and Roger Birnbaum, who will take over MGM's management if a proposed prepackaged bankruptcy plan gets approved by the studio's creditors.

Another major sticking point in recent weeks has been finalizing terms of a deal with Jackson, who co-wrote the script and is also a producer on the movies. He has been preparing the production for the past two years and in the spring he replaced Guillermo Del Toro as director.

-- Ben Fritz and Claudia Eller

Related:

Fellowship forms around 'The Hobbit'

Photo: Peter Jackson and Karl Urban on the set of "Lord of the Rings: The Return of the King." Credit: New Line Cinema.

'The Hobbit' finally close to getting greenlight from Warner Bros., New Line and MGM [updated]

JacksonLord After several years of delays that have frustrated eager fans, moviegoers may soon return to Middle-earth.

Warner Bros., its subsidiary New Line Cinema, and partner Metro-Goldwyn-Mayer appear to be close to greenlighting the hugely anticipated two-part "Lord of the Rings" prequel "The Hobbit," according to several people familiar with the matter who spoke on condition of anonymity because they were not authorized to discuss it publicly.

The studios have nearly finalized a deal with director, producer and co-writer Peter Jackson to make the two movies and have resolved most other key issues that have long held up the project, including those related to underlying rights from the estate of author J.R.R. Tolkien.

The one remaining hurdle is getting an official go-ahead from MGM, which is set to co-finance the movies because under a long-standing agreement it owns half the rights and controls international distribution.

The two "Hobbit" films, which will be shot together, are expected to cost close to $500 million to produce.

Warner and New Line, which produced the blockbuster "Lord of the Rings" trilogy and control domestic distribution for "Hobbit," are ready to commit their half of the money, said people familiar with the matter. They have been waiting for MGM, which for more than a year has been virtually out of cash and whose debt holders have been trying to decide upon a plan for reorganization.

Negotiations between the two sides are at a very tenuous stage because nearly bankrupt MGM needs to reach agreement among its more than 100 debt owners, which control the future of the studio. At the same time, MGM's creditors are scrambling to finalize a reorganization plan, through which Spyglass Entertainment chiefs Gary Barber and Roger Birnbaum are expected to take over management. Barber has been leading negotiations on "The Hobbit" for MGM with top Warner executives, including home entertainment group president Kevin Tsujihara.

MGM is eager to make the films, people close to the situation said, and could give Warner Bros. the official okay in the next few days. However, it will still need to secure its half of the financing. Barber is expected to approach a number of potential investors, including studios including 20th Century Fox, which has an existing deal with MGM to release its movies overseas. Other possibilities include outside financial investors or Warner Bros., which could loan MGM its share in exchange for additional distribution rights to the pictures.

People close to the project said that, barring a last-minute glitch, they expect to have all issues settled shortly in order to begin production in mid-January so that the first of the two movies would be ready for a holiday 2012 release. The second film is planned for a December 2013 opening. If production doesn't begin by the first quarter of next year, the people said, "The Hobbit" will miss its planned release dates and will likely have to once again be delayed.

Jackson has long planned to shoot the movies in his home country of New Zealand, but this week he ran afoul of various performer unions, including the Screen Actors Guild, which are advising their members not to work on what they allege is a non-union production. One person close to the situation said that dispute is close to being resolved as well, further clearing the way for a greenlight.

Jackson took on directing duties after "Pan's Labyrinth" director Guillermo Del Toro, who had been set to handle the job, backed out earlier this year because of the ongoing delays.

In recent weeks, Warner and New Line have been scrambling to clean up some underlying rights issues with the Tolkien Estate that partly stem from earlier litigation between the studios and the late author’s heirs. After intense negotiations between lawyers, the studios have agreed to pay millions of dollars to the estate to resolve matters, said people with knowledge of the situation.

Last year, Warner/New Line reached a settlement of reportedly more than $100 million with the Tolkien heirs, who in 2008 had sued the studios over royalties to Jackson's three "Lord of the Rings" films, saying the studio owed the estate more than $150 million in profits. The studio has also settled lawsuits over profit participation with Jackson and his partners as well as producer Saul Zaentz.

The estate, Zaentz, and Jackson will participate in the gross revenues of "The Hobbit," as well as Walt Disney Studios and Bob and Harvey Weinstein. The Weinsteins had originally developed the "Lord of the Rings" movies when they ran Miramax Films, which was at the time a division of Disney.

[Updated, 4:27 p.m.: Warner and MGM have together spent about $45 million on preproduction for "The Hobbit," including script fees, visual effects work, set preparations and casting meetings, according to two people familiar with the matter.]

-- Claudia Eller and Ben Fritz

Photo: Peter Jackson and Ian McKellan on the set of "The Lord of the Rings: The Return of the King." Credit: Van Redin / New Line.

New Line resolves lawsuit with Tolkien Trust and HarperCollins over 'Lord of the Rings'

LordRingsClearing the way to move forward with its planned two films of "The Hobbit," New Line Cinema has settled a lawsuit with the TolkienTrust and HarperCollins Publishers over the "Lord of the Rings" films.

 The trustees of the JRR Tolkien Estate and HarperCollins were co-plaintiffs in a claim filed last year against New Line relating to their profit participation in the highly lucurative "Lord of the Rings" movies. The suit sought to block production of "The Hobbit" films until those claims were resolved. The three films, which were released in 2001, 2002 and 2003, amassed close to $3 billion in worldwide ticket sales. Terms of the settlement were not disclosed.

Christopher Tolkien, the youngest son of the renowned author, said in a statement that the trustees "regret that legal action was necessary, but are glad that this dispute has been settled on satisfactory terms." The settlement allows the Tolkien Trust, a British charity, to "pursue its charitable objectives."

New Line parent Warner Bros. is also breathing a sigh of relief. "We are pleased to put this litigation behind us," said Warner Bros. President Alan Horn. "We all look foward to a mutually productive and beneficial relationship in the future."

Warner Bros./New Line and MGM have plans to co-finance two "Hobbit" movies, the first of which is expected to begin shooting next year in New Zealand. Guillermo del Toro is set to direct both, and "Lord of the Rings" director Peter Jackson is producing with Fran Walsh. Warner Bros. has domestic rights to the franchise, and MGM has international rights.

However, it's yet to be seen if MGM will be able to come up with its half of the budget given its financially beleaguered state. If not, there surely won't be a shortage of partners to take its place.

Update (11 PM): For more details on the settlement, see the story in tomorrow's Times.

— Claudia Eller

Photo: Elijah Woods and Sean Astin in "The Lord of the Rings: Return of the King." Credit: Pierre Vinet, New Line Cinema.

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