Warner Bros. Is in Big Trouble Over John Cena's Canceled 'Coyote vs. Acme'

Warner Bros. Discovery could face far-reaching consequences over its decision to shelve the already-completed movie Coyote vs. Acme.

It was announced on November 9 that the $72 million live-action/animation hybrid, which stars John Cena and Will Arnett, would not see the light of day in movie theaters or on streaming services. Per The Hollywood Reporter, it had been greenlit as a production for HBO Max.

"With the re-launch of Warner Bros. Pictures Animation in June, the studio has shifted its global strategy to focus on theatrical releases," read a statement from the studio at the time. "With this new direction, we have made the difficult decision not to move forward with Coyote vs. Acme."

The comedy follows animated favorite Wile E. Coyote of Road Runner fame taking action against Acme Corporation over its faulty gadgets. Arnett was cast as Coyote's attorney, while Cena landed the role as the CEO of Acme.

Newsweek has contacted representatives of Warner Bros. Discovery via email for comment.

Expressing frustration at the decision, the film's director Dave Green wrote on X, formerly Twitter, that he was "proud" of the movie, adding that he was "beyond devastated by WB's decision. But in the spirit of Wile E. Coyote, resilience and persistence win the day."

The resilience and persistence proved fruitful in less than a week. Following an uproar over plans to shelve the movie, Puck reported on Tuesday that WBD had reversed its decision, instead allowing filmmaker Green to shop the project to other studios. Netflix, Amazon's Prime Video, and Apple Studios are reported to be among the interested parties.

While the move would seemingly add a neat bow to a story in need of a happy ending, WBD's initial action has prompted calls for a federal investigation. At issue is the allegation that Coyote vs. Acme had been shelved as a tax write-down—which the studio was accused of having done last year with Batgirl and Scoob! Holiday Haunt. Unlike the Wile E. Coyote movie, those projects remain shelved.

Frank Salzano, managing partner of Salzano Ettinger Lampert & Wilson, LLP, a boutique entertainment, and sports law firm based in New York City, weighed in on allegations that the studio's original decision to shelve the release of Coyote vs. Acme was for a tax break.

Salzano, who is not connected to the project, told Newsweek that "in addition to any regulatory violations that Warner's decision may trigger, there [are] also the contractual implications. Most states have the implied covenant of good faith and fair dealing built into all contractual relationships.

"It could be reasonably argued that this covenant was breached between any agreement(s) between the studios and the producers as it would appear Warner's initial decision to shelve the project was a self-motivated decision at the peril of the producers' project."

Representative Joaquín Castro, a Texas Democrat, is now asking the Federal Trade Commission and the Justice Department to investigate the matter, as he likened WDB's actions to "burning down a building for the insurance money."

"The WBD tactic of scrapping fully made films for tax breaks is predatory and anti-competitive," Castro wrote on X on Monday. "As the Justice Department and @FTC revise their antitrust guidelines, they should review this conduct. As someone remarked, it's like burning down a building for the insurance money."

While the message could be dismissed as hyperbole, this is not the first time that Castro has taken aim at WBD. In a letter dated April 7 and signed by Congress members that included Castro and Senator Elizabeth Warren, WBD was accused of "hollowing out an iconic American studio" after its formation through the April 2022 merger of WarnerMedia and Discovery, Inc.

"After the merger was consummated, WBD cancelled many projects in various stages of development and removed content from its platforms," read the letter. "For example, WBD took 68 titles off HBO Max. Some content removed from HBO Max is not available for streaming, renting, or buying on other platforms—meaning consumers no longer have access to content they expected when paying for HBO Max.

"Moreover, audiences will never see such projects like 'Batgirl,' a $90 million film that was cancelled while 'deep into post-production,' despite consumer outcry, reportedly to allow WBD to claim a tax break.

"One creator, Moisés Zamora, sold his show, 'Whistleblower' to HBO Max in February 2021 after a 'competitive bidding process with multiple outlets. Shortly after the merger was consummated, WBD cancelled the development of the show.

"These three examples are merely a prelude of what could come as WBD plans further cuts. The damage to content creators whose projects are cancelled in deep development and post-production cannot be overstated.

"Such cancellations stain these projects, making them less appealing and marketable to other buyers—consumers will likely never be able to watch shows purchased then cancelled by WBD. WBD's conduct amounts to a de facto 'catch and kill' practice, vastly limiting consumer choice."

The letter, which was addressed to the Department of Justice, requested that the federal executive department "take another look at the transaction, considering WBD's post-transaction conduct.

"We also hope that the competitive consequences resulting from the WarnerMedia-Discovery merger inform updates to the merger guidelines to ensure that the
guidelines reflect the needs of workers, consumers, and content creators in the media and entertainment industry."

Amid the controversy, Coyote vs. Acme has been well received by test audiences, which have included notable industry professionals.

Christopher Miller, co-director of Lego Movie and a Spider-verse producer, wrote on X on Tuesday: "I saw COYOTE VS ACME and it's delightful. Funny, charming, good physical comedy timing, with a surprising amount of heart. I hope several studios go after it so the world can see all the good work people did.

"Coyote vs. Acme is wonderful," added fellow Spider-verse producer Phil Lord, before tagging director Green. "@dgreenmachine nails it. Hilarious smart existential and moving and moves this all time character more relevant than ever."

Deadpool producer Aditya Sood wrote that the movie "achieves the most difficult of all feats: a Looney Tunes movie that Messrs. [Tex] Avery, [Chuck] Jones and [Michael] Maltese would be very very proud of. It's a delight and hopefully it finds its audience very soon. Congrats @dgreenmachine and co.!!!"

Update 11/16/23, 11:45 a.m. ET: This story has been updated to include comment from attorney Salzano.