Blockbuster Video In Trouble : Failure to Pay Summit for Eclipse DVD’s
Recent news reports indicate that Blockbuster video has been experiencing serious financial difficulties. These problems have now affected the Twilight franchise. Â According to news reports, Blockbuster has filed for Chapter 11 Bankruptcy, and has allegedly failed to pay Summit Entertainment for dvd shipments of The Twilight Saga : Eclipse and other movie titles.
Home Media magazine reports :
Summit Home Entertainment has filed a complaint seeking immediate payment of more than $9.5 million from bankrupt Blockbuster regarding disc shipments of theÂ thirdÂ installment of its popular vampire franchise,Â The Twilight Saga: Eclipse, among other titles.
Dallas-based Blockbuster, which filed for bankruptcy last September, had agreed to pay within 60 days of the titleâ€™s Dec. 4 release initial invoices totaling more than $1.6 million, according to the motion filed Feb. 3 in U.S. Bankruptcy Court in New York.
In a Jan. 28 phone call with Blockbuster management, Summit president Steve Nickerson was told Blockbuster could not pay the invoices because it did not have the funds to do so, according to the filing.
In the complaint, Summit claims it was assured in writing that Blockbusterâ€™s court-ordered â€œStudio Accommodation Orderâ€ mandated all content providers be paid within two months of shipment.
Specifically, Summit last November shipped Blockbuster 426,180 DVDs (excluding widescreen) ofÂ Eclipse for unit prices ranging from $6 to $20.20 each, in addition to 92,290 copies of the film on Blu-ray Disc (excluding widescreen) for unit prices from $6 to $23.99 each.
Summit, which claimsÂ Eclipse was the fourth-biggest home video release of 2010, contends Blockbuster has generated $8.3 million in rental revenue from the shipments.
An article in Reuters reports :
Blockbuster told Summit Distribution LLC that it would not pay $6.8 million it owed for DVDs shipped since it filed for Chapter 11 bankruptcy in September because it did not have the money, according to documents filed with a U.S. bankruptcy court in Manhattan on Thursday.
Blockbuster said in a statement it was reviewing Summit’s request.
“We continue to work diligently with the studios, our lender group and other key parties to achieve an outcome in the recapitalization process that is in the best interest of the company’s stakeholders, including customers, vendors and employees,” Blockbuster said.
Summit’s president, Stephen Nickerson, said in a court document that Blockbuster will take in $8.3 million alone from the “Eclipse” DVD and he called the unpaid bills a “significant hardship” for the small studio.
Times are tough, I just hope that they are able to resolve this matter in a fair and equitable way.
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