Malaysian Company Claims Fox, Disney Sabotaged Its Theme Park

LOS ANGELES (CN) – Entertainment giants 21st Century Fox and The Walt Disney Company colluded to sabotage the development of a Fox-themed park and resort in Malaysia in order to wrestle away more profits and creative control, the park’s developer claimed in a federal lawsuit Monday.

Genting Malaysia Berhad, an international theme park and resort development firm, said in a 29-page complaint that Fox Entertainment Group undermined a 2013 contract that allowed the firm to license select Fox intellectual property for use in the construction of what was to become Fox World, the globe’s first Fox-branded theme park.

In exchange for the right to use Fox properties in the park, Genting agreed to pay Fox annual license fees and royalties on certain revenue such as retail and food & beverage. Sharing profits from gate admission sales, however, was not included in the agreement.

The company said it worked feverishly to bring the park to life, with plans on making it the centerpiece of an “idyllic mountain retreat” in the Genting Highlands an hour outside Malaysia’s capital city of Kuala Lumpur.

The Walt Disney Co. logo appears on a screen above the floor of the New York Stock Exchange on Aug. 7, 2017. (AP Photo/Richard Drew)

Fox World was in the final phases of development, ahead of its 2019 soft opening, but was delayed because Fox sabotaged the project at nearly every opportunity, the complaint said.

In one case, Fox required Genting to replace their preferred vendor with a Fox-appointed vendor “whose inexperience and unethical business practices led to its termination from the project and months of delays,” the complaint said.

The company claims Fox failed to provide on-site support at the construction site and didn’t hand over style guides or digital assets, including the company’s own 21st Century Fox logo.

Fox later blamed Genting for project delays and threatened to terminate the contract or “force a renegotiation of the economic terms of what it viewed as a below-market deal,” including a negotiation for a share of ticket sales, the complaint said.

But Genting said the entity orchestrating the sabotage was Disney, which is in the process of acquiring Fox in a deal now expected to close in the first half of 2019.

The firm said the Burbank, California-based company was concerned about Fox Worlds’ proximity to the Genting casino outside Kuala Lumpur.

Disney killed the Fox World project in order to reap a windfall of advance payments from Genting, boot out competition for its Disneyland parks in Asia and protect its “family-friendly” brand, the complaint said.

“But seller’s remorse – first by Fox and later by Disney – is not a valid ground for terminating an agreement,” the complaint stated.

In a statement, a Disney representative called the claims “utterly without merit.” Fox did not return a request for comment by press time.

Genting said it was the “sole owner, financier, and risk-taker concerning the future success of the park,” adding that Fox never invested any of its own money into the project.

Genting – which said its mountain retreat attracts 23 million visitors a year and features the only legal land-based casino in all of Malaysia – said it has already invested nearly $750 million in the project, even though the agreement only called on it to spend $130 million.

Fox wanted to compete with Disney and Universal, which both operate theme parks around the world, having only “dipped its toe into the business by licensing individual properties that it owned, such as The Simpsons and Avatar, for use in third-party-branded parks,” the complaint said.

The firm seeks to enforce its rights under the contract with Fox and to hold Disney and other named defendants responsible “for their meddling,” the complaint said.

Genting, represented by the firm Kasowitz, Benson & Torres, also seeks to recoup the $750 million it has invested in the park and over $1 billion in punitive damages.

%d bloggers like this: