A few days ago, Genting Malaysia announced that it was suing the Walt Disney Company and Twenty-First Century Fox after the two decided to terminate Genting’s contract for the “Fox World” theme park at Resorts World Genting in Malaysia. The lawsuit specifies breach of contract and breach of “implied covenant of good faith and fair dealing” and seeks compensation of $1 billion. Fox and Disney have now issued their response to the lawsuit, calling it frivolous and without merit.
The lawsuit was filed in U.S. District Court in Los Angeles, California. In Fox’s statement, the company asserts that the allegations that Disney and forced the termination of the theme park was “simply made up.” Disney issued a separate statement, saying that the lawsuit is “utterly without merit.”
Genting believes that Disney could have forced the issue because of its anti-gambling stance. However, it has not been able to prove any evidence. On the other hand, not much information has been provided regarding why the company saw its contract prematurely cancelled. The only information was a statement sent to Bloomberg News from Fox that said that Genting had not met agreed-upon deadlines. The dispute has apparently been going on for the past several years.
A statement by Twentieth Century Fox Film, another defendant in the case, asserts, “The allegation that Disney, rather than Fox, finally decided to declare a default is simply made up.”
The theme park was meant to be a Fox-branded venue, a first for Fox. However, Disney is set to acquire 21st Century Fox assets for around $71.3 billion and, because Resorts World Genting contains a casino, it reportedly doesn’t want to get involved.
The day after the lawsuit was filed, shares in Genting dropped 16.7%. It has said that it has spent around $750 million on advancing the project. If the case is found to be valid, it’s possible that Genting could receive the theme park for free. Maybank Investment Bank Bhd believes that Genting could run the theme park minus the Fox branding, since it has experience in the field with its own theme park at Genting Highlands in Kuala Lumpur.