Investor takes Key Brand, Mirvish to court
In the course of less than 12 hours on Wednesday, the Canadian theater scene was rocked by a series of legal accusations and publicity machinations supplemented by good old showbiz flash.
The drama began when Dancap Prods., a relatively new producing entity headed by Aubrey Dan, announced it had filed a lawsuit against Key Brand Entertainment, the U.S.-based group that purchased the theatrical assets of Live Nation, and Mirvish Enterprises, the Toronto dynasty that has successfully produced shows for more than 50 years.
At issue is Key Brand’s sale of the 2,300-seat Canon and 750-seat Panasonic theaters in downtown Toronto to Mirvish for an unconfirmed pricetag of $35 million.
Dancap felt the company was entitled to the venues, having contributed a substantial amount of money to Key Brand for rights to manage the two properties, which generated $1 million in profits last year.
But the Mirvishes were operating under a 15-year lease they had signed with Key Brand predecessor SFZ Theatricals back in 2001, giving the org the right to lease the buildings.
When Dan heard of the purchase on April 9, he immediately started legal proceedings. After a Tuesday hearing in Ontario Superior Court, the deal’s closing was delayed until June 6 to allow Dan time to file an injunction.
“I was completely blindsided,” Dan told Daily Variety. “When I signed the binding term sheet with Key Brand, I thought the right to buy the buildings was ours.”
That’s not how Key Brand CEO John Gore read the agreement. “Nothing in Key Brand’s agreement with Dancap in any way restricts our ability to sell the Panasonic and Canon Theaters to Mirvish,” he insisted.
Mirvish, meanwhile, staged a PR stunt on Wednesday by inviting reporters onto the stage of the Canon Theater, where Queen musical “We Will Rock You” is about to close a successful run to make way for previously booked shows.
The cast surrounded Mirvish as he announced closing a deal with Key Brand for the Canon and Panasonic Theaters. He then announced that “We Will Rock You” would reopen at the Panasonic on July 16, while star Yvan Pedneault led the company singing “We Are the Champions.”
The show may be set to go on, but the legal battle is on hold until the court reconvenes June 6.