Kerkorian Faces Suits Seeking $1.25 Billion : Hollywood: MGM and French bank allege that the billionaire and four others concealed cash-flow problems in the sale of the studio.

Metro-Goldwyn-Mayer Inc. and its owner, the French bank Credit Lyonnais, sued billionaire Kirk Kerkorian on Monday for a combined $1.25 billion, alleging that Kerkorian left the historic studio in financial shambles when he sold it in 1990.

In separate lawsuits filed in U.S. District Court in Los Angeles, the bank and the studio allege that Kerkorian and four other defendants concealed MGM’s cash-flow problems when he sold it to Italian financier Giancarlo Parretti. Parretti financed the buyout with about $1.1 billion in loans from Credit Lyonnais.

The bank now owns 98.5% of MGM, having taken possession of the studio last year when Parretti defaulted. It is said to have as much as $2 billion tied up in the studio.

Kerkorian owned 80% of the stock when he sold MGM to Parretti for $1.3 billion. The lawsuit goes so far as to allege that Kerkorian, who now runs Las Vegas-based MGM Grand, conspired with Parretti to induce Credit Lyonnais to finance the deal by omitting and concealing the studio’s cash-flow problems.

Kerkorian’s lawyer, Terry N. Christensen, called the lawsuit completely unfounded, adding that Credit Lyonnais is trying to recoup money lost because of its own mistakes.

“We make a deal, and bring shareholders twice the market price their stock is trading at. Credit Lyonnais then squanders whatever money they have given MGM. And then they sue us?” Christensen said.

In addition to Kerkorian, the lawsuit names his Tracinda Corp. as a defendant. Other defendants are the investment firm Houlihan, Lokey Howard & Zukin, which issued an opinion calling the deal fair, former MGM Chairman Jeffrey Barbakow and former MGM Vice Chairman Stephen Silbert.

Barbakow and Silbert could not be reached. Houlihan, Lokey partner Kit Lokey said he was unfamiliar with the lawsuit.

Once one of the major studios in Hollywood when it made such movies as “The Wizard of Oz” and “Gone With the Wind” in the 1930s, MGM today hardly resembles its glory days. The studio sold off the rights to its classic MGM films to cable entrepreneur Ted Turner and now tends to make smaller-budget films by Hollywood’s current standards.