Imperial Added to Suit Against Movie Producer

Imperial Bank worked with flamboyant movie producer Elie Samaha to defraud a German company that is alleging Samaha inflated film budgets to force the firm to pay a larger chunk of Samaha’s film costs, said court papers filed Tuesday.

In adding Imperial as a defendant to a lawsuit it filed against Samaha in December, Germany’s Intertainment escalated what already is a nasty battle with the producer over accusations that he deliberately inflated budget figures--sometimes by nearly twice what they actually were.

Among the films--as many as 22--whose budgets Samaha allegedly hiked were Sylvester Stallone’s “Get Carter,” John Travolta’s “Battlefield Earth,” the Bruce Willis movie “The Whole Nine Yards” and the upcoming Kevin Costner film “3000 Miles to Graceland.”

In “Graceland,” which opens Friday, Intertainment alleges it was told the budget would be $61 million, of which it was to cover 47%. The actual budget needed to make the film was $47.4 million, the lawsuit alleges.

Imperial lawyer Michael Wachtell declined to comment. Samaha lawyer Stanton L. Stein denied the allegations, saying “there is no reason why Imperial Bank bank should be in cahoots [with Samaha].”

As a result of that and other films, Intertainment gave Samaha $75 million more than it should have for European rights to its films, the lawsuit alleges. That, court papers say, gave Imperial a much bigger cushion of collateral as protection on its film loans to Samaha’s Franchise Pictures.

Imperial also benefited from the bigger cushion because it could then lend money on films it might otherwise not have and, as a result, “would not have been able to receive the fees associated with that loan,” according to papers filed in federal court in Los Angeles.

“They participated in it, they knew about it and they benefited from it,” Intertainment lawyer Scott A. Edelman said.

But Samaha lawyer Stein said that Intertainment’s latest salvo is part of a “continuing smoke screen” in which Intertainment is trying to find a scapegoat for the poor performance of the company and its stock price, which is off more than 90% over the last 12 months.

“They want to have as many targets as possible and have as many deep pockets as possible,” Stein said.

Franchise also alleged in its lawsuit against Intertainment that the German company has reneged on various contract promises, which lawyer Edelman denies.

Since emerging a year ago in a splash of publicity, the brash Samaha has become one of the most visible and prolific producers in Hollywood through Franchise Pictures, which are released through Warner Bros.

But with the exception of “The Whole Nine Yards,” his track record is littered with films, such as “Battlefield Earth,” that have been ravaged by critics and were flops at the box office.

According to Edelman, Intertainment has helped finance 22 Samaha pictures, 11 under its most recent deal to provide 47% of the so-called bonded budget, the budget used by bond companies, that, acting like insurance firms, guarantees lenders that a film will be completed.

Imperial, an Inglewood-based bank that was acquired last month by Detroit’s Comerica, is a major lender to smaller independent film companies often shunned by Wall Street and major banks.

According to the lawsuit, Franchise was Imperial’s single most important entertainment customer, providing 60% of Imperial’s business in that area in 1999.

The lawsuit alleges that Samaha was so critical to Imperial that a full-page picture of him once appeared in Imperial’s annual report, which quoted him as saying: “They have always come through for me when I needed them. With their help, I’m now producing and financing the biggest independent projects in town.”