Casino operator Genting Malaysia has sued Twenty-First Century Fox and its soon-to-be owner Walt Disney for more than US$1 billion, accusing the duo of terminating a contract related to the construction of the first Fox-branded theme park in Genting Highlands.
The lawsuit was filed in the US District Court in Los Angeles, in response to a notice issued by Fox in which it terminated a Memorandum of Agreement (MOA) and claimed approximately US$46.2 million in accelerated payments.
In its company announcement dated November 27 through Bursa Malaysia, Genting Malaysia denied that Fox had grounds to terminate the MOA, and has pursued cause of action against Fox for breach of contract, and breach of the implied covenant of good faith and fair dealing, among others.
According to the MOA, Genting Malaysia was granted a licence to utilise certain intellectual property rights associated with Fox theatrical motion pictures in connection with the design, development, construction and operation of what was to be called the Twentieth Century Fox World theme park. The MOA was subsequently amended on June 2014 and June 2017.
Genting Malaysia has also pursued cause of action against Disney and Twenty First Century Fox for inducing breach of contract and for interference with contract. This comes as Disney prepares to complete US$71.3 billion purchase of many Fox assets, expected to happen in 1Q2019.
Genting said “seller’s remorse” induced Fox, with Disney’s help, to breach its 2013 contract with Fox Entertainment Group to license intellectual property for Fox World, a proposed addition to its Resorts World Genting complex in Genting Highlands. Genting further added that it had already made a “US$750 million-plus investment” in the theme park.
But according to the complaint, Disney is now “calling the shots”, and wants to end the contract because associating with a gaming company did not fit its “family-friendly” brand strategy.
The 10ha park in Genting Highlands, part of the Resorts World Genting complex, was initially slated to open in 2016 but is now scheduled for a 2019 opening following repeated delays.
Additional reporting by S Puvaneswary
