LeFlore

This case involves a so-called “negative pickup” deal surrounding a motion picture production. Appellants assert that the term reflects a common business arrangement in the entertainment industry. The particular question presented here is whether the arrangement characterized as a “negative pickup” deal created in appellants a superior security interest in tangible film materials, specifically movie film negatives.

Appellants New Line Productions, Inc., New Line Cinema Corp., and Motion Picture Guarantors, Ltd. (MPG) entered this debtor judgment matter as third party claimants. They contend that they acquired a superior security interest in the motion picture The Grass Harp by virtue of a “negative pickup” contractual arrangement with Grass Harp Productions, Inc. (GHP), the film’s producer. The superior court denied the third party claimants’ claims to a superior security interest in the film materials and a right to possess them. As a result, Solomon J. LeFlore (respondent) executed a lien against the The Grass Harp film materials to satisfy a judgment against GHP. The third party claimants appeal from the superior court’s orders denying their respective claims.…