AMC Theatres has been sued by the landlords of a shopping mall in Hialeah, Florida for failing to pay the rent for the month of April, Variety has learned.
Palm Springs Mile Associates, Ltd. accuses AMC Theatres of committing a breach of contract when the movie theater chain didn't pay their $52,153.87 monthly rent for their AMC Hialeah 12 location. The suit contends that the COVID-19 global pandemic doesn't constitute that AMC Theatres can trigger the force majeure provision of the lease.
According to the law firm Akerman LLP, the force majeure clause "excuses one or both parties’ performance obligations when circumstances arise which are beyond the parties’ control and make performance of the contract impractical or impossible."
"The Landlord recognizes the challenges posed by COVID-19, including on its own business," the lawsuit reads. "Under the express terms and provisions of the Lease and Guaranty, however, Defendant is obligated to pay Rent and that obligation is not excused." Palm Springs Mile Associates, Ltd. is seeking in excess of $7.5 million in damages.
AMC Theatres announced on March 17 that all of their locations hoped of re-opening at some point in June, at the earliest. Following reports earlier this month that the company was in talks to hire the law firm Weil Gotshal & Manges to explore the possibility of filing for bankruptcy, AMC Theatres announced a plan to raise $500 million in new debt that would hopefully keep their struggling business afloat until November.
The Hollywood Reporterreports that, among their numerous debt issues, around $250 million each financial quarter is committed to paying the rent for all of their theaters.
