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After Terminator Salvation faced judgment day at the box office, the producers sued their financing firm and their holding company declared bankruptcy. But sources familiar with the legal morass tell io9 Terminator 5 will still happen, no matter what.
You've probably already heard about the lawsuit and the bankruptcy filing — but we've read the legal filings, and we have some more info about the tangled web below. The most important question for movie-lovers, however, is: Does this mean Terminator 5 (and 6) are doomed? Will the legal battles and money disputes keep the movie rights tied up indefinitely?
People familiar with the lawsuits tell io9 that Terminator 5 will definitely still happen — although different sources disagree about how long it'll take. But sources seem to agree that Terminator Salvation made too much money ($371 million worldwide, according to Box Office Mojo) for anyone to stand in the way of a fifth outing.
"Terminator 4 was a big hit, and everybody who was connected with that movie was pretty happy with it, and the're looking forward to a Terminator 5 and a Terminator 6 down the road," says a source familiar with Halcyon. All that needs to happen is for Halcyon to get rid of some liens that its financing company put on its assets (see below) and the company will move forward. (The holding company only filed for Chapter 11, or restructuring, bankruptcy.) Even though Terminator Salvation was more expensive than anticipated — something Halcyon blames on Pacificor — it still made a healthy profit.
Another source familiar with the case agrees, but says that the courts may have to get involved in the question of who owns the Terminator movie rights, and that may take some time. At the end of the day, someone will emerge holding those rights, and that someone will be highly motivated to put together another installment — but it may or may not be Halcyon co-founders Victor Kubicek and Derek Anderson.
So how did we reach this apocalyptic legal scenario?
The Terminator movie rights are at the center of a massive power struggle between the producers of Terminator 4 and their financial backers, and the allegations are already flying like a squad of Hunter-Killers. We read the filings that Halcyon Co. put forth in their lawsuit against their financing company (Pacificor) and one exec in particular, Kurt Benjamin, and it reads like a thriller, with deception, double-crosses, deadly plane crashes and ticking clocks.
In a nutshell, Halcyon got wind of an opportunity to buy the Terminator franchise in 2006, but to do this they needed to raise cash in a hurry. Halcyon co-founders Victor Kubicek and Derek Anderson met up with Kurt Benjamin, who helped raise money from Pacificor. But in their lawsuit, Halcyon claims that Benjamin never revealed that he was an employee of Pacificor. So Halcyon allegedly gave inside information to Benjamin — including the fact that they were desperate to raise money in time to buy the Terminator rights — and then Benjamin turned around and gave that info to Pacificor. That inside info allegedly allowed Pacificor to strong-arm Halcyon into agreeing to tougher loan terms.
Later, Benjamin allegedly used his inside info about Halcyon to extort a salary out of the company, driving it deeper into debt and forcing it to seek a second loan from Pacificor at tougher terms. After Pacificor's founder died in a plane crash, Halcyon allegedly became even more dependent on Benjamin to negotiate continuing finance from Pacificor, because Benjamin claimed nobody else at Pacificor even knew about the Terminator deal. Halcyon claims it was left with no choice but to pay up Benjamin's alleged "blackmail," which added to its debt load — at one point, Halcyon claims that it worried it would run out of money a scant few months before T4 was due to come out.
The upshot of all this is that Halcyon is apparently deeper in debt to Pacificor than the Terminator producers had bargained on. And according to their legal filings, Pacificor put a lien on all their assets "in a deliberate and desperate attempt to seize control and ownership of the Halcyon entities and the [Terminator] franchise," and to keep Halcyon from paying off its creditors. "As a result of the Lien, Halcyon has been unable to obtain financing that would enable [it] to meet its obligations, which could potentially result in Halcyon's loss of the [Terminator] Franchise."
A spokesperson for Halcyon declined to comment on pending litigation.
But Benjamin, the main defendant in one of Halcyon's two legal actions, tells io9 "everything that's alleged in their lawsuit, every allegation, is a lie." He adds: "This is just salacious creative writing, and I highly recomend that they and their lawyers work more on writing science fiction."
Both the Halcyon co-founders and their attorney knew all along that Benjamin worked for Pacificor, he claims. And far from acting as a go-between in the lending negotiations between Pacificor and Halcyon, Benjamin says he had no part in the discussions once he introduced the two parties. And after Pacificor's founder was killed in that plane crash, Anderson and Kubicek "coerced me to work with them," says Benjamin. Benjamin claims he wasn't even drawing a salary from Pacificor — he was just paid on commission for any deals he set up, which means his first paycheck didn't even materialize until January 2008.
And the reason why Terminator Salvation wound up costing more than expected, according to Benjamin? Producers Anderson and Kubicek wasted the money on personal expenses. "They're known in most Hollywood circles as the glitter twins," claims Benjamin. "The minute these guys got the funding, they went on wild spending sprees."
Send an email to Charlie Jane Anders, the author of this post, at charliejane@io9.com.
Original material is licensed under a Creative Commons License permitting non-commercial sharing with attribution.
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