Legal woes strike 'Transformers: AoE'

While the highly anticipated Transformers: Age of Extinction (Transformers: AoE) is set to premiere in the Chinese mainland this week, a sudden legal action against the producers of the film has caught audience attention.

On Wednesday, Beijing Pangu Investment Inc - an investment consulting, management and real estate development company - posted an announcement on its official website and Sina Weibo account, declaring that it was canceling its partnership with the film. Two days later, on Friday, the company held a press conference to further explain its stance.

According to a statement from Pangu, the company had signed a cooperative agreement with Jia Fu China and the Beijing Chengxin Shengshi Sports and Culture Development Company in June 2013 after viewing related authorization documents from Jiaflix and Paramount, the two production companies for Transformers: AoE.

Agree to disagree

Ma Nan, marketing director for Pangu, stated that according to the agreement Pangu Plaza - a hotel and shopping complex located in Beijing - would be featured in posters, trailers and all final versions of the movie, while Pangu would have the right to produce and sell merchandise related to the film, was to hold an exhibition of the film's movie equipment at the Pangu Plaza for no more than eight months and would host the film's opening premiere at Pangu Plaza's Pangu Seven Star Hotel.

In return, Pangu would pay at least 10 million yuan ($1.6 million) and provide reception and accommodation for the crew at the hotel during their stay in China, support for the film's Beijing shoot and an office of no less than 300 square meters for Chengxin Shengshi's use.

According to Ma, while Pangu fulfilled all its duties, the Chinese partners did not deliver on their pledges.

"Two days before this press conference, a movie exhibition organized by Chenxin Shengshi under the authorization of Jiaflix had been held at the Qianmen area of Beijing and is supposed to tour other cities like Shanghai, Guangzhou, and Shenzhen," Ma said, explaining that this, together with the production and sale of movie merchandise, is what concerns the group the most.

Believing Jia Fu China and Chengxin Shengshi are guilty of "malicious falsehood," Pangu has decided to take the case to court and has asked Paramount and Jiaflix to delete all scenes related to Pangu from the movie. It has also asked the State Administration of Press, Publication, Radio, Film and Television (SAPPRFT) to delay or bar Transformers: AoE from being shown in China.

On Saturday Pangu released another press statement in which the company detailed that Zhou Ning, a former soccer star and founder of Chengxin Shengshi, had used Pangu's company name to sign a three-party agreement with both Paramount and Jiaflix without authorization. It also pointed out major discrepancies between this contract and the Chinese contract Pangu had signed with Jia Fu China and Chengxin Shengshi.

Legal shadow

As movie industry ties between China and the world continue to grow, more and more Chinese companies have been hoping to work with Hollywood. When Transformers: AoE was reported to have a high percentage of Chinese elements than previous films, including Chinese actors and major scenes taking place in China, this was seen as a very positive move by many within the industry.

However, this unexpected legal dispute has now cast a shadow over the blockbuster and this spirit of cooperation. Although many within the industry are still wondering if this is merely an attempt by Pangu to bring attention to itself before the movie hits theaters in China.

Lisa Li, a reporter who got to watch Transformers: AoE in Hong Kong, told the Global Times that the film does contain a large number of scenes featuring Chinese actors and locations, including the Bird's Nest (National Stadium) and Water Cube (National Aquatics Center) in Beijing, as well as the Great Wall.

As for scenes of Pangu, Li said that the Pangu logo, the easily recognizable dragon-shaped building at Pangu Plaza and the inside of the hotel are all featured in the film. However, according to Ma, these scenes do not add up to the 20 seconds promised in the cooperative agreement.

In a text message to the Global Times, Zhou admitted that the company has signed an agreement with Pangu, but disagrees that his company is at fault.

"I do not want to fight a war of words, that would be useless," Zhou wrote, adding that it's his belief that Pangu is just trying to use Transformers huge influence to hype itself up.

"Pangu is also responsible for some of this unachieved cooperation," he wrote, explaining that the case is more akin to an ad customer who is not satisfied with a published newspaper ad asking for full refund.

According to an interview with Yao Kefeng, a lawyer specializing in intellectual property rights, on entertainment site ent.ifeng.com, Yao feels that Pangu won't be able to affect the film.

"Since both parties have signed contracts, this means the film's producers have the right to use the Pangu IP. As such unilaterally calling for scenes to be deleted or for the film to not be shown goes against the principles of fairness," he said.

With only a few days left before the Chinese mainland premiere of the film on Friday, there are still no signs that the SAPPRFT will keep the movie from being shown in theaters or whether the Pangu scenes will be deleted from the mainland version.