Last year, Arnon Milchan was effusive in his praise of Warren Beatty, whose film “Rules Don’t Apply” he had agreed to help finance. In an interview with Variety, the Israeli-born financier said he put his full confidence in “the master.”
“We all put in the money and said, ‘Go make your movie. We will leave you alone,'” Milchan said at the time. Beatty was effusive in return, calling Milchan “the Medici of the movies.”
Cut to: one year later. The film flopped, grossing $3.9 million worldwide, and Milchan’s company is now suing Beatty for $18 million.
On Friday, Milchan’s company, Regency Entertainment, filed suit in L.A. Superior Court against Beatty’s company and several other big-name financiers, including Ron Burkle, Terry Semel, Steve Bing, Jeffrey Soros, and Brett Ratner’s RatPac Entertainment. The suit contends that each of the investors breached their obligation to refund Regency’s P&A costs.
“I have no comment,” Beatty said on Friday night.
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According to the suit, Regency agreed to distribute the film in 2013, but obtained guarantees from Beatty and others to cover its P&A costs in the event they were not covered by the film’s grosses. Regency also invested $2.5 million of the total $31.1 million cost of the film.
“Regency agreed to incur substantial upfront costs to distribute the Picture, which it could recoup from the Picture’s revenues,” the suit states. “The Defendants agreed to guarantee any shortfall of the amounts incurred by Regency and to pay back to Regency any costs that were not recouped from the Picture’s revenues within a specified time period.”
On Nov. 15, Regency submitted a shortfall notice to Beatty’s company and to the other investors. Beatty’s company was given 10 days to refund Regency’s costs. The company and the other defendants have refused to pay, according to the lawsuit.