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Movie Gallery to Pay Select Studios $7.8 Million in Claims



By : Erik Gruenwedel | Posted: 24 Mar 2010


A U.S. bankruptcy court in Richmond, Va., has authorized Movie Gallery to pay $7.8 million in pre-petition claims to four major studios and a distributor.

The payments include partial revenue-sharing amounts due to Paramount Home Entertainment, Sony Pictures Home Entertainment, Universal Studios Home Entertainment, 20th Century Fox Home Entertainment and distributor VPD, according to a March 24 court filing.

It wasn’t immediately clear why Warner Home Video, which is owed more than $9.5 million, was not included in the list.

The court authorized the payments in an effort to continue studio shipments of DVD and Blu-ray Disc titles to operating Gallery and Hollywood Video locations.

Wilsonville, Ore.-based Gallery, which owns Hollywood Video, in February filed for Chapter 11 bankruptcy protection for the second time, citing $540 million in debt, including $45 million owed to studios and distributors.

Among studio creditors, Sony Pictures is owned $9.3 million and Fox $8.2 million. Universal is owned $7.7 million, Paramount $6.9 million and VPD $2.9 million.

The court authorized, but did not order, Gallery to pay similar claims to so-called “B” studio creditors, including Starz Home Entertainment, which is owed $645,000, and Image Entertainment ($351,000), among others.

Gallery, which operated about 2,600 stores domestically at the time of the filing, has shuttered more than 1,200 underperforming location since.

Authors


User comments

Commented by TJ
Posted on 2010-03-26 00:52:27

Movie gallery is simply cashing in their chips before they check out of the room... They've got to pay back the coffers that let them float the last 2 years and then they are gonna split and MG and HW will be no more. This time next year I expect to read the article describing how the #2 and #3 video stores shuttering completely.





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