More Marvel at Disney

[The Pho]

just out of curiosity, does anyone know (of course some of you do ) how all of this applies to the X-Men franchise? I know that Wolverine was one of the original Avengers (although I haven't seen him in that role in a long time). Can Disney use the X-Men or are they also a no-no?

Well the X Men have a ride so they are limited the same way the Avengers are, the Fantastic Four also have one.

 

[Planogirl]

Wolverine, Storm, Cyclops and Rogue are also featured as characters.

 

[BrianL]

just out of curiosity, does anyone know (of course some of you do ) how all of this applies to the X-Men franchise? I know that Wolverine was one of the original Avengers (although I haven't seen him in that role in a long time). Can Disney use the X-Men or are they also a no-no?

Wolverine was not an original member of the Avengers. He only officially joined the team during the "New Avengers" run in the early 2005's. Wolvrerine is generally and solidly associated with the X-Men, and Universal does have the rights to most of those characters, at least the ones that were popular in the 90's.

 

[jknezek]

from page 7 of the contract

Once THE MARVEL UNIVERSE opens within the above time period, the term of this agreement shall continue for so long as a THE MARVEL UNIVERSE shall remain open (and operated consistent with the standards of the next paragraph below) at any Universal Theme Park (allowing for temporary closures for force majeure events or refurbishment/maintenance provided they are being diligently pursued), except for termination for material breach (with written notice and a reasonable opportunity to cure).
Each THE MARVEL UNIVERSE shall be operated and maintained in a first class manner consistent with the highest standards of the theme park industry and shall be deemed “open” only when operated in such manner (subject to temporary closures for force majeure events as described in the prior paragraph).

HP is the first class standard at Universal. Therefore it is the required standard.

I suspect any competent lawyer would tell you this paragraph is so ambiguous as to be very expensive to litigate with little certainty about the outcome, especially in front of a jury likely to see one large company trying to pick on a competitor by initiating the suit. I suspect Disney has no desire to waste the money required to find out.

Disney is getting paid royalties, and they are most likely gearing Phase 4 toward properties they can use. I suspect they will let Universal hold on to the properties they have. It cuts both ways for Universal, promoting something that Disney owns, paying them some token amount of money (and it is a token since Marvel was desperate when the contract was written), but getting some quality IP for very little.

Basically, don't hold out hope. Legally this would be very difficult and the incentive just isn't there. Maybe someday it will change and Universal will have a property of their own they want to go in with in a big way in that area and they will reasonably sell the rights back to Disney. That's about the best hope. But by the time that happens, Marvel, in the way Disney can use it, will probably already be well established in WDW and it will take a ride generation or two until they need to get rebranded. And by then, who knows if Hulk or Captain America or a Phase IV less popular character will have been made the biggest star. It might never be worth having an Avengers ride in WDW...

 

[seascapemvy]

I suspect any competent lawyer would tell you this paragraph is so ambiguous as to be very expensive to litigate with little certainty about the outcome, especially in front of a jury likely to see one large company trying to pick on a competitor by initiating the suit. I suspect Disney has no desire to waste the money required to find out.

Disney is getting paid royalties, and they are most likely gearing Phase 4 toward properties they can use. I suspect they will let Universal hold on to the properties they have. It cuts both ways for Universal, promoting something that Disney owns, paying them some token amount of money (and it is a token since Marvel was desperate when the contract was written), but getting some quality IP for very little.

Basically, don't hold out hope. Legally this would be very difficult and the incentive just isn't there. Maybe someday it will change and Universal will have a property of their own they want to go in with in a big way in that area and they will reasonably sell the rights back to Disney. That's about the best hope. But by the time that happens, Marvel, in the way Disney can use it, will probably already be well established in WDW and it will take a ride generation or two until they need to get rebranded. And by then, who knows if Hulk or Captain America or a Phase IV less popular character will have been made the biggest star. It might never be worth having an Avengers ride in WDW...

I think you miss my point. Disney has absolutely no interest in buying the Marvel rights back for Orlando. They are not worth anywhere near what some of the Universal fans think. As for forcing Universal to spend on upgrades and improvements to Hulk and Spiderman, it was well stated by insiders years ago that Universal was told by Marvel to upgrade them. Finally, the contract calls for arbitration not court proceedings. The cost is minimal on both sides and I am sure Disney would win. IP needs to be presented in a good light and if Universal treated Marvel poorly and HP in the fantastic way it lowers the value for Marvel. No arbitration would ever allow one company to hurt the value of another. Universal knows they have to spend on Marvel and will have to in the future. That is why they eventually will just give up the rights and spend on their own IP rather tyan continue to send Disney money for Marvel and the Simpsons.

 

[jknezek]

I think you miss my point. Disney has absolutely no interest in buying the Marvel rights back for Orlando. They are not worth anywhere near what some of the Universal fans think. As for forcing Universal to spend on upgrades and improvements to Hulk and Spiderman, it was well stated by insiders years ago that Universal was told by Marvel to upgrade them. Finally, the contract calls for arbitration not court proceedings. The cost is minimal on both sides and I am sure Disney would win. IP needs to be presented in a good light and if Universal treated Marvel poorly and HP in the fantastic way it lowers the value for Marvel. No arbitration would ever allow one company to hurt the value of another. Universal knows they have to spend on Marvel and will have to in the future. That is why they eventually will just give up the rights and spend on their own IP rather tyan continue to send Disney money for Marvel and the Simpsons.

I think you are reading the paragraph of the contract wrong, as do many people. It doesn't say the rides have to be the very top standard rides. It says "shall be operated and maintained in a first class manner consistent with the highest standards of the theme park industry"

The law is very particular about these things in contracts. Operation and maintenance does not, in any way, require the rides to be the top tier attractions in the park or any park. It just means they have to work and be able to work at a top tier standard. The goal is not that the rides are the best, but that they work well so they don't associate the IP with things like injured riders or constant breakdowns.

As I said, the contract is somewhat ambiguous and that never bodes well for the person challenging it. As for your last sentence, we are making the same point that this is the most likely outcome at some point, but I suspect that point will not be for quite a long time.

 

[seascapemvy]

I think you are reading the paragraph of the contract wrong, as do many people. It doesn't say the rides have to be the very top standard rides. It says "shall be operated and maintained in a first class manner consistent with the highest standards of the theme park industry"

The law is very particular about these things in contracts. Operation and maintenance does not, in any way, require the rides to be the top tier attractions in the park or any park. It just means they have to work and be able to work at a top tier standard. The goal is not that the rides are the best, but that they work well so they don't associate the IP with things like injured riders or constant breakdowns.

As I said, the contract is somewhat ambiguous and that never bodes well for the person challenging it. As for your last sentence, we are making the same point that this is the most likely outcome at some point, but I suspect that point will not be for quite a long time.

You can have your opinion and I can have mine. However given the fact that Universal upgraded Spiderman and completely rebuilt The Hulk, I am 100% certain an arbitrator would rule in Disney's favor on making Comcast continue to upgrade the rides in the future. In fact a better argument would have been on the monorail raps. Advertising a movie has noting to do with having a ride or attraction in a themepark but Universal raised that issue.

 

[DanBoris]

You can have your opinion and I can have mine. However given the fact that Universal upgraded Spiderman and completely rebuilt The Hulk, I am 100% certain an arbitrator would rule in Disney's favor on making Comcast continue to upgrade the rides in the future. In fact a better argument would have been on the monorail raps. Advertising a movie has noting to do with having a ride or attraction in a themepark but Universal raised that issue.

Even if what you say is true, it really wouldn't matter at this point since they upgraded the two expensive rides. I would not cost much to properly maintain the other two.

 

[Anthony Vito]

I think you are reading the paragraph of the contract wrong, as do many people. It doesn't say the rides have to be the very top standard rides. It says "shall be operated and maintained in a first class manner consistent with the highest standards of the theme park industry"

The law is very particular about these things in contracts. Operation and maintenance does not, in any way, require the rides to be the top tier attractions in the park or any park. It just means they have to work and be able to work at a top tier standard. The goal is not that the rides are the best, but that they work well so they don't associate the IP with things like injured riders or constant breakdowns.

As I said, the contract is somewhat ambiguous and that never bodes well for the person challenging it. As for your last sentence, we are making the same point that this is the most likely outcome at some point, but I suspect that point will not be for quite a long time.

I agree with this. I also think the there is enough ambiguity, absent a definitions section of the contract that clearly lays out such requirements, that this could certainly be litigated. I also think Disney would have particularly difficult hurdles in making any such argument. Disney would never admit that anything in its parks is done in anything less than "a first class manner consistent with the highest standards of the theme park industry." In fact, I would think Disney would argue that the way it does things IS the the standard for the theme park industry. As such, a judge or arbitrator would very likely ask them how they can argue that they are the standard but not every attraction is at the level of Flight of Passage or SWGE. Unless they are willing to concede that only their E-ticket attractions that have been completely refurbished and overhauled every few years would qualify as being operated and maintained in a first class manner, they can't argue that Universal is not doing the same.

Also, even an arbitration in a case like this would likely cost hundreds of thousands if not in the millions of dollars. Just because it's before an arbitrator does not preclude it from being extremely costly litigation with discovery, etc.

Finally, such litigation will almost certainly never take place, but another reason for that is that if the question revolves around operations and maintenance of a theme park, there would extensive discovery that would almost certainly have to include disclosure of internal park operations and maintenance, including likely by Disney to Universal, which I cannot imagine is a road they'd want to go down over something as basic as some limited IP availability in only one region of its parks (albeit the flagship parks).

 

[Anthony Vito]

Also, where can the full text of this contract be found?

 

[jknezek]

Also, where can the full text of this contract be found?

I believe this is the most complete publicly available document, though some of it is **** out. https://www.sec.gov/Archives/edgar/data/1262449/000119312510008732/dex1057.htm

 

[Anthony Vito]

So what's interesting about the arbitration provision is that it specifically provides for the right to sue in court for injunctive or other provisional relief (also likely equitable) while arbitration is pending, which means they could essentially begin arbitration filings, then immediately file in court for temporary relief, which for all intents and purposes could be the true results of the case. In other words, if a court issued an injunction (which it could do pretty quickly), I think there could be ongoing proceedings in court related to that as well, that would have an immediate impact that would be in effect for potentially quite a while until arbitration is completed. Such an in injunction could very well just convince the losing party to give up on the arbitration because of the immediate impact it would have.

Also, likely only interesting to me, but the choice of law provides that New York law applies, but it would be interesting to see if in such a hypothetical (and extremely unlikely one) where they'd file suit for an injunctive relief. While New York seems like it would be the first inclination, that's certainly not a requirement of the contract. Also, given that they're all incorporated in Delaware and given Delaware's reputation for its corporate and equitable court (which does not have juries anyway), it would not be farfetched to think it would be filed in DE.

 

[xuxa777]

I really liked Solo...but it lost a ton of money. It lost so much that Kathleen Kennedy announced the other day that there will be no more spin-off and/or standalone Star Wars films.

That is incorrect, Lucasfilm refuted that report a while back, and with plenty of Star Wars movies coming, a movie series from the GOT guys and another trilogy from Rian Johnson, a bunch of Star Wars in the pipeline. I bet there will be a Solo 2 and or Boba Fett at some point in the next ten years. The loss on Solo was less than $100MM and probably a good bit less if you factor in merch. Wrinkle in Time was a much bigger loss for Disney, and Universal did even worse with Mortal Engine. Yes, 50-100 million is a lot of money but when other movies are making $2B+ then it isn't that big.

 

[Planogirl]

Disney would have pushed for character rights already. Why would they wait until a few popular names are killed off? Besides Spider-Man is at the top quality wise. Very few attractions anywhere else even come close.

 

[OnSpaceshipEarth]

That is incorrect, Lucasfilm refuted that report a while back, and with plenty of Star Wars movies coming, a movie series from the GOT guys and another trilogy from Rian Johnson, a bunch of Star Wars in the pipeline. I bet there will be a Solo 2 and or Boba Fett at some point in the next ten years. The loss on Solo was less than $100MM and probably a good bit less if you factor in merch. Wrinkle in Time was a much bigger loss for Disney, and Universal did even worse with Mortal Engine. Yes, 50-100 million is a lot of money but when other movies are making $2B+ then it isn't that big.

Kathleen Kennedy said it less than a week ago and the only Star Wars films for the next 5 years given official release dates are the trilogy from the GOT guys.

 

[xuxa777]

Kathleen Kennedy said it less than a week ago and the only Star Wars films for the next 5 years given official release dates are the trilogy from the GOT guys.

That is correct and Rian's are still in the pipeline. They will release those sooner than later, that is if D&D don't ruin it for everyone. #MakeSolo2Happen