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Full title: Objection to confirmation of plan (RE: related document(s)700 Chapter 11 plan) filed by Twentieth Century Fox Film Corporation, Walt Disney Studios Motion Pictures. (Davis, Matthew)

Document posted on Mar 9, 2021 in the bankruptcy, 5 pages and 0 tables.

Bankrupt11 Summary (Automatically Generated)

1The Debtors in these Chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, include: Studio Movie Grill Holdings, LLC (6546); OHAM Holdings, LLC (0966); Movie Grill Concepts Trademark Holdings, LLC (3096); Movie Grill Concepts I, Ltd. (6645); Movie Grill Concepts III, Ltd. (2793); Movie Grill Concepts IV, Ltd. (1454); Movie Grill Concepts IX, LLC (3736); Movie Grill Concepts VI, Ltd. (6895); Movie Grill Concepts VII, LLC (2291); Movie Grill Concepts X, LLC (6906); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XII, LLC (6040); Movie Grill Concepts XIII, LLC (5299); Movie Grill Concepts XIV, LLC (4709); Movie Grill Concepts XIX, LLC (9646); Movie Grill Concepts XL, LLC (4454); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLII, LLC (2309); Movie Grill Concepts XLIII, LLC (9721); Movie Grill Concepts XLIV, LLC (8783); Movie Grill Concepts XLV, LLC (2570); Movie Grill Concepts XV, LLC (4939); Movie Grill Concepts XVI, LLC (1033); Movie Grill Concepts XVII, LLC (1733); Movie Grill Concepts XVIII, LLC (8322); Movie Grill Concepts XX, LLC (7300); Movie Grill Concepts XXI, LLC (1508); Movie Grill Concepts XXII, LLC (6748); Movie Grill Concepts XXIV, LLC (5114); Movie Grill Concepts XXIX, LLC (5857); Movie Grill Concepts XXV, LLC (4985); Movie Grill Concepts XXVI, LLC (5233); Movie Grill Concepts XXVII, LLC (4427); Movie Grill Concepts XXVIII, LLC (1554); Movie Grill Concepts XXX, LLC (1431); Movie Grill Concepts XXXI, LLC (3223); Movie Grill Concepts XXXII, LLC (0196); Movie Grill Concepts XXXIII, LLC (1505); Movie Grill Concepts XXXIV, LLC (9770); Movie Grill Concepts XXXIX, LLC (3605); Movie Grill Concepts XXXV, LLC (0571); Movie Grill Concepts XXXVI, LLC (6927); Movie Grill Concepts XXXVII, LLC (6401); Movie Grill Concepts XXXVIII, LLC (9657); Movie Grill Concepts XXIII, LLC (7893); Studio Club, LLC (3023); Studio Club IV, LLC (9440); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLVI, LLC (2344); Movie Grill Concepts XLVII, LLC (5866); Movie Grill Concepts XLVIII, LLC (8601); Movie Grill Concepts XLIX, LLC (0537); Movie Grill Concepts L, LLC (5940); Movie Grill Concepts LI, LLC (7754); Movie Grill Concepts LII, LLC (8624); Movie Grill Concepts LIII, LLC (3066); Movie Grill Concepts LIV, LLC (2018); Movie Grill Concepts LV, LLC (4699); Movie Grill 700] Walt Disney Studios Motion Pictures (“Disney”) and Twentieth Century Fox Film Corporation (“TCF” and collectively with Disney, the “Licensors”), by and through their undersigned counsel, file this limited objection and reservation of rights (the “Response”) to the Second Amended Joint Plan of Reorganization for Studio Movie Grill Holdings, LLC and Jointly Administered Debtors [Doc. 700] (the “Plan”).2 LIMITED OBJECTION 1.Before the Petition Date, each of the Licensors licensed pictures to Studio Movie Grill Holdings, LLC and its affiliates (collectively, the “Debtors”) under a T

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Texas Bar No. 24069580 mdavis@lockelord.com LOCKE LORD LLP 2200 Ross Ave., Suite 2800 Dallas, Texas 75201 (214) 740-8000 (Telephone) (214) 740-8800 (Facsimile) Andrew N. Goldman Benjamin W. Loveland WILMER CUTLER PICKERING HALE AND DORR LLP 7 World Trade Center 250 Greenwich Street New York, New York 10007 Telephone: (212) 230-8800 Counsel to Walt Disney Studios Motion Pictures and Twentieth Century Fox Film Corporation IN THE UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF TEXAS DALLAS DIVISION In re: Chapter 11 STUDIO MOVIE GRILL HOLDINGS, LLC, Case No. 20-32633-sgj11 et al.1 (Jointly Administered) Debtors. 1The Debtors in these Chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, include: Studio Movie Grill Holdings, LLC (6546); OHAM Holdings, LLC (0966); Movie Grill Concepts Trademark Holdings, LLC (3096); Movie Grill Concepts I, Ltd. (6645); Movie Grill Concepts III, Ltd. (2793); Movie Grill Concepts IV, Ltd. (1454); Movie Grill Concepts IX, LLC (3736); Movie Grill Concepts VI, Ltd. (6895); Movie Grill Concepts VII, LLC (2291); Movie Grill Concepts X, LLC (6906); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XII, LLC (6040); Movie Grill Concepts XIII, LLC (5299); Movie Grill Concepts XIV, LLC (4709); Movie Grill Concepts XIX, LLC (9646); Movie Grill Concepts XL, LLC (4454); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLII, LLC (2309); Movie Grill Concepts XLIII, LLC (9721); Movie Grill Concepts XLIV, LLC (8783); Movie Grill Concepts XLV, LLC (2570); Movie Grill Concepts XV, LLC (4939); Movie Grill Concepts XVI, LLC (1033); Movie Grill Concepts XVII, LLC (1733); Movie Grill Concepts XVIII, LLC (8322); Movie Grill Concepts XX, LLC (7300); Movie Grill Concepts XXI, LLC (1508); Movie Grill Concepts XXII, LLC (6748); Movie Grill Concepts XXIV, LLC (5114); Movie Grill Concepts XXIX, LLC (5857); Movie Grill Concepts XXV, LLC (4985); Movie Grill Concepts XXVI, LLC (5233); Movie Grill Concepts XXVII, LLC (4427); Movie Grill Concepts XXVIII, LLC (1554); Movie Grill Concepts XXX, LLC (1431); Movie Grill Concepts XXXI, LLC (3223); Movie Grill Concepts XXXII, LLC (0196); Movie Grill Concepts XXXIII, LLC (1505); Movie Grill Concepts XXXIV, LLC (9770); Movie Grill Concepts XXXIX, LLC (3605); Movie Grill Concepts XXXV, LLC (0571); Movie Grill Concepts XXXVI, LLC (6927); Movie Grill Concepts XXXVII, LLC (6401); Movie Grill Concepts XXXVIII, LLC (9657); Movie Grill Concepts XXIII, LLC (7893); Studio Club, LLC (3023); Studio Club IV, LLC (9440); Movie Grill Concepts XI, LLC (2837); Movie Grill Concepts XLI, LLC (4624); Movie Grill Concepts XLVI, LLC (2344); Movie Grill Concepts XLVII, LLC (5866); Movie Grill Concepts XLVIII, LLC (8601); Movie Grill Concepts XLIX, LLC (0537); Movie Grill Concepts L, LLC (5940); Movie Grill Concepts LI, LLC (7754); Movie Grill Concepts LII, LLC (8624); Movie Grill Concepts LIII, LLC (3066); Movie Grill Concepts LIV, LLC (2018); Movie Grill Concepts LV, LLC (4699); Movie Grill

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DISNEY STUDIOS MOTION PICTURES AND TWENTIETH CENTURY FOX FILM CORPORATION TO SECOND AMENDED JOINT PLAN OF REORGANIZATION FOR STUDIO MOVIE GRILL HOLDINGS, LLC AND JOINTLY ADMINISTERED DEBTORS [Relates to Doc. 700] Walt Disney Studios Motion Pictures (“Disney”) and Twentieth Century Fox Film Corporation (“TCF” and collectively with Disney, the “Licensors”), by and through their undersigned counsel, file this limited objection and reservation of rights (the “Response”) to the Second Amended Joint Plan of Reorganization for Studio Movie Grill Holdings, LLC and Jointly Administered Debtors [Doc. 700] (the “Plan”).2 LIMITED OBJECTION 1. Before the Petition Date, each of the Licensors licensed pictures to Studio Movie Grill Holdings, LLC and its affiliates (collectively, the “Debtors”) under a Theatrical Exhibition License Agreement (the “Disney Agreement”) and Master Theatrical Exhibition Contract (the “TCF Agreement,” together with the Disney Agreement, the “Exhibition Agreements”), respectively. 2. The Exhibition Agreements set forth the terms and conditions on which Disney and TCF may elect, in their sole and absolute discretion, to provide (or not provide) pictures to the Debtors. The Exhibition Agreements do not require Disney or TCF to provide such pictures—indeed, they impose no ongoing obligations on Disney or TCF—the documents simply govern the parties’ obligations if and only if Disney or TCF, as the case may be, elects to license a picture to the debtors. Accordingly, because neither Disney nor TCF owes any continuing obligations under the Exhibition Agreements, those agreements are not executory contracts capable of assumption under section 365. See 11 U.S.C. § 365(a) (allowing a debtor to assume an “executory contract”); Phoenix Expl., Inc. v. Yaquinto (In re Murexco Petroleum, Inc.), 15

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filing, the failure of either party to complete performance would constitute a material breach of the contract, thereby excusing the performance of the other party.”). 3. During the course of the Chapter 11 Cases, the Debtors have acknowledged in communications with Licensors’ counsel that because the Exhibition Agreements are “non executory,” they would not be listed on any schedule of executory contracts to be assumed or rejected. Thus, neither of the Exhibition Agreements is listed on Exhibit L to the Debtors’ Plan Supplements [Docs. 702, 705] (the “Plan Supplement”), which lists the executory contracts that the Debtors propose to assume under the Plan as “Assumed Executory Contracts and Unexpired Leases,” nor on Exhibit M to the Plan Supplement, which lists the executory contracts that the Debtors propose to reject under the Plan. Instead, the Debtors have included the Exhibition Agreements on Exhibit N to the Plan Supplement, titled “List of Retained Studio Contracts.” 4. Consistent with the non-executory nature of the Exhibition Agreements and the Debtors’ acknowledgment, the Debtors appear to intend that these “Retained Studio Contracts,” including the Exhibition Agreements, will “revest in the Reorganized Debtors pursuant to the Plan on the Effective Date,” (Plan Supplement, Ex. N), rather than be assumed pursuant to section 365(a) of the Bankruptcy Code. However, Exhibit N also states: “A studio contract will constitute an Assumed Contract and will be assumed under the Plan if and only to the extent it constitutes an Executory Contract under applicable law.” (Plan Supplement, Ex. N.)35. As explained above, the Exhibition Agreements are not executory contracts, and that, along with the Debtors’ acknowledgment, is why the Licensors assume they are not listed on either Exhibit L or Exhibit M of the Plan Supplement concerning executory contracts. Nevertheless, Disney and TCF are unable to conclude from the inconsistent language in Exhibit 3 Exhibit N to the Plan Supplement contains additional references to the Debtors’ “assuming” the Retained Studio

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and, despite requests, Licensors have not yet gotten clarity on this issue from the Debtors. Accordingly, Disney and TCF object to the Plan to the extent it can be interpreted as treating the Exhibition Agreements as executory contracts subject to assumption. The confirmation order should state unequivocally that the Exhibition Agreements are not being treated as executory contracts under the Plan and instead the Debtors’ rights under those agreements will vest in the Reorganized Debtors. 6. The confirmation order should also expressly state that all rights of Disney and TCF under the Exhibition Agreements are preserved following the revesting of those agreements in the Reorganized Debtors. RESERVATION OF RIGHTS 7. Disney and TCF reserve all rights, including with respect to the Plan (including the treatment of the Exhibition Agreements thereunder), the Exhibition Agreements, and claims for amounts due under the Exhibition Agreements.4 4 Disney and TCF have filed proofs of claims for the pre-petition amounts the Debtors owe them under the Exhibition Agreements, and the Debtors and Disney have agreed to a payment arrangement for the amounts owing under the Disney Agreement in accordance with the Debtors’ authority pursuant to the Critical Vendor Order (defined below). Exhibit N reflects that the Reorganized Debtors agree to perform all obligations under that payment plan, and also states: “Except to the extent that the Debtors and the counterparty have agreed to different payment terms, any outstanding obligations shall be paid not later than the Effective Date in accordance with the terms of the Final Order Granting Debtors’ Emergency Motion for Authority to Pay Certain Movie Studios All or a

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/s/ Matthew H. Davis Matthew H. Davis Texas Bar No. 24069580 Email: mdavis@lockelord.com LOCKE LORD LLP 2200 Ross Avenue, Suite 2800 Dallas, Texas 75201 (214) 740-8000 (Telephone) (214) 740-8800 (Facsimile) Andrew N. Goldman Benjamin W. Loveland WILMER CUTLER PICKERING HALE AND DORR LLP 7 World Trade Center 250 Greenwich Street New York, New York 10007 Telephone: (212) 230-8800 Email: andrew.goldman@wilmerhale.com benjamin.loveland@wilmerhale.com Counsel to Walt Disney Studios Motion Pictures and Twentieth Century Fox Film Corporation CERTIFICATE OF SERVICE I certify that on March 10, 2021, a true and correct copy of the foregoing was served via the Court’s Case Management/Electronic Case Filing System to all parties requesting electronic notice in this proceeding. /s/ Matthew H. Davis Matthew H. Davis