KUALA LUMPUR: Shares of Malaysian casino operator Genting fell almost 19 percent on Tuesday (November 27) after suing Walt Disney Co. and 21st Century Fox for allegedly leaving the project to build an amusement park in the country.
The US $ 1 billion lawsuit, filed in US District Court in Los Angeles, alleges that Disney and Fox failed to honor the 2013 agreement to license intellectual property, including from Fox animated films such as "Ice Age" and "Planet of the Apes," for amusement parks outside Kuala Lumpur.
The lawsuit alleges that Fox tried to end the contract and that Disney executives were also interested in keeping away from the project because the park would be close to the casino and would endanger the company's "family friendly" image.
In a statement to AFP, a Disney spokesman dismissed claims made against the company as "totally baseless."
Fox representatives did not immediately respond to requests for comment.
Genting Malaysia Berhad (GENM) said in a message to local exchanges that they claimed damage of more than US $ 1 billion.
He vowed "to fully uphold his rights" under the agreement and "claim investment costs and consequential damages and penalties."
"The litigation is not expected to have an impact on GENM's current business operations," the company said.
However, investors still sell Genting shares, which fell as much as 18.6 percent before recovering slightly. They fell 14.72 percent in mid afternoon.
CGS broker CIMB Securities described the news about litigation as a "major negative surprise" for the playground, its opening has been delayed by more than a year.
"Potential legal problems" can also affect the opening date of the proposed new park, which is scheduled for the first half of 2019, he added.
"The plan is for Fox World to become the new center of Resorts World Genting, the integrated resort complex of GENM in Genting Highlands," according to the lawsuit.
The lawsuit alleges that Fox has used repeated delays in the project as an excuse to cancel the agreement and recently issued a notification about default, which requires developers to open the park in 30 days, an impossible deadline.
"This is a case of seller regret, first by Fox, and later by Disney, after the second started the process of acquiring Fox in a deal that is now expected to be closed in the first half of 2019," the claim claims.
He added that Genting has the right to recover more than the US $ 750 million it has invested in the park, along with consequential compensation and penalties of more than US $ 1 billion.
Built on more than 10 hectares in Genting Highlands, a very beautiful mountain resort, an hour's drive outside Kuala Lumpur, this park has been set up to display more than 25 rides and attractions based on best-selling films such as "Ice Age," "Life Pi, "" Alien "and" Night at the Museum. "