MB Kinetoplay LLC et al

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
MB KINETOPLA Y, LLC,
ERIC LAV AN CHY, AND
LAURENCE TOBIN,
Appellants,
V.
NATIONAL CINEMEDIA, LLC,
Debtors/Appellees,
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Civil Case No. 4:25-CV-0061 3
Bankruptcy Case No. 23-90291
MEMORANDUM OPINION AND ORDER
Pending before this Court is an appeal from the Bankruptcy Court for the Southern District
of Texas arising from the Chapter 11 bankruptcy proceedings for National CineMedia, LLC
("NCM"). (Bankr. No. 23 -90291). Claimants MB Kinetoplay, LLC, Eric Lavanchy, and Laurence
Tobin (collectively, "Appellants") and NCM filed cross-motions for partial summary judgment on
the interpretation of the language of a bonus provision that provided for additional sums to be paid
to Appellants should certain parameters be met. The Bankruptcy Court granted partial summary
judgment for NCM, and Appellants appealed the issue to this Court. (Bankr. No. 23-90291 , Doc.
No. 755). This Court affirms the judgment of the Bankruptcy Court.
I. 	Factual Background and Procedural History
While the Bankruptcy Court provides detailed background facts in its Memorandum
Opinion, see (Bankr. No. 23 -90291, Doc. No. 755), this Court provides a limited background of
the case to give context to this Opinion. NCM is in the business of selling on-screen advertising in
movie theatres, and it does so on a nationwide basis. See (Doc. No. 25 -1 at 53) ("NCM' s core
business is selling advertisements to be placed on the 'big screen' or in the lobbies of movie
United States District Court
Southern District of Texas
ENTERED
March 23, 2026
Nathan Ochsner, Clerk
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theaters in business-to-business transactions."). Kinetoplay LLC ("Kinetoplay"), founded by
Matthew Berry, Eric LaVanchy ("Lavanchy"), Laurence Tobin ("Tobin"), and an entity called
SlyTrunk, was a company that developed online and mobile gaming applications, more commonly
referred to as "apps." (Doc. No. 7 at 152). 1 Kinetoplay's primary product was Fantasy Movie
League- 	a mobile gaming app designed to facilitate "a weekly fantasy sports-style game for movie
fans, who were challenged to pick a mix of films then screening in cinemas to create a 'virtual
movie theater' of their own." (Id. at 154). NCM, in an effort to expand its revenue stream and to
expand its digital presence in the movie theatre industry, acquired the assets ofKinetoplay through
an Asset Purchase Agreement (the "APA"). (Doc. No. 26 -5 at 4). At the same time, NCM and
Kinetoplay signed a "Side Letter," providing for promotion and marketing support to expand
NCM' s post-acquisition gaming products business segment. (Id.).
Two months later, LaVanchy and Tobin entered into employment agreements with NCM.
(Id. at 5). MB Kinetoplay, an entity owned by Matthew Berry, and NCM also entered into a
consulting agreement. 	(Id.). 	Those agreements 	contained Business Performance Provisions
(referred to herein as "bonus provisions") that are at the heart of this dispute. See, e.g., (id. at 14 ).
The provisions for all pertinent purposes are identical:
In the event that the Business (as defined in the Asset Purchase Agreement,
dated May 16, 2017, among the Company, Kinetoplay Inc. and the Shareholders
(as defined therein)) achieves Five Million Dollars ($5 ,000,000) in revenue
directly generated by the Business's digital gaming products in the Company's
digital gaming pillar through advertising, sponsorship, tournaments, virtual
goods 	and 	merchandise directly purchased 	from 	the 	Company's digital
gaming pillar from the Company's website or revenue share generated through
the purchase from an affiliate of the Company or partner site of the Company, and
others are mutually agreed upon by the Company and the Employee[/Consultant
(collectively "Digital Gaming Revenue") in the twelve (12) months prior to the
third (3rd) anniversary of the date hereof (the "Third Year Revenue"), the Company
1 SlyTrunk is not an Appellant here nor a Claimant in the Bankruptcy Court. Matthew Barry, individually,
is also not an Appellant here nor a Claimant in the Bankruptcy Court. Nevertheless, hi s company, MB
Kinetoplay, is an Appellant and a Claimant.
2
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shall pay [the Third Year Bonus.] In the event that the Business achieves Seven
Million Five Hundred Thousand Dollars ($7,500,000) in Digital Gaming Revenue
in the twelve (12) months prior to the fourth (4th) anniversary of the date hereof
(the "Fourth Year Revenue"), the Company shall pay [the Fourth Year Bonus.]
(Id.) ( emphasis added).
While neither side claims this provision is ambiguous, they disagree on whether it should
have included the various revenue streams. Conversely, there seems to be no debate, at least in the
dispute before this Court, on how the bonus provision was actually applied. Instead, this debate is
focused on whether NCM' s accounting of the various revenue streams was compliant with the
bonus clause.
NCM used the following general principles to allocate funds to Appellants to measure
whether the revenues received reached the level to trigger the application of the bonus provisions.
First, NCM credited Appellants whenever revenue was generated by advertising impressions
delivered on the gaming produced in the digital gaming pillar. 2 (Doc. No. 26-4 at 8). Second, for
those transactions involving both digital and on-screen components, NCM credited the Appellants
for the portion of the contract earmarked for the gaming pillar. (Id.). When a contract was silent as
to the apportionment, the Appellants were credited with 50% of the contract revenue. (Id.).
NCM takes the position that during the bonus years in question, the revenue amounts, as
defined by the bonus provision, never reached the bonus threshold, and therefore, NCM did not
pay out the bonus amount. (Id.). The Appellants obviously disagree. Their disagreement is focused
upon what revenue streams NCM attributed (or, more accurately, did not attribute) toward the
bonus threshold calculation. The Appellants sued in Colorado state court alleging breach of
contract, breach of the implied duty of good faith and fair dealing, civil theft, and violations of the
2 NCM 's business concept had three somewhat discrete digital business departments that it labeled as
" pillars." There was the commerce pillar, the gaming pillar, and the content pillar. The digital gaming pillar
contained the Appellants' former business but is not defined in the written agreements.
3
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state Wage Claim Act. (Doc. No. 23-5 at 69). Subsequent to that lawsuit being filed, NCM
commenced Chapter 11 bankruptcy proceedings in Houston. (Bankr. No. 23-90291, Doc. No. 1) .
The Claimants (the Appellants in this matter) filed proofs of claim in the bankruptcy proceeding
in which they reiterate the same allegations they made in the Colorado state lawsuit. See, e.g. ,
(Doc. No. 23-5 at 65). NCM contested these claims, and eventually, the Bankruptcy Court granted
partial summary judgment in NCM' s favor and detennined that the Appellants did not reach the
bonus threshold per the relevant contracts. (Bankr. No. 23-90291 , Doc. No. 755).
The Bankruptcy Court' s ruling is fairly straightforward and for the most part, the ruling
was focused on the exact language in the parties ' agreements. The Bankruptcy Court first analyzed
the contractual prerequisites for the bonus payment to even come into play. It set out in bullet
points the bonus criteria that had to be satisfied:
• 	Revenues must exceed $5 ,000,000;
• 	The revenue must be directly generated by the Business's digital gaming products in
the digital gaming pillar; and
• 	The revenue must be generated through advertising, sponsorships, tournaments, or
virtual goods directly purchased from the digital gaming pillar or a share of the
revenue through purchases from an affiliate or partner site of the Company. 3
(Id. at 8) (emphasis added).
While not included as a bullet point in the Bankruptcy Court's opinion, it earlier noted that
the revenue had to be achieved by the "Business," as that term was defined in the AP A. "Business"
is defined in the AP A as "the business of creating and developing, commercializing and managing
the online/mobile application of movie and cinema-related entertainment gaming and content
business for consumer engagement and use." (Id. at 2). Consequently, not only must the revenue
3 The agreements also contained a provision for mutually agreed-upon revenue, but all parties concede that
this component is not a factor in this appeal. S ee, e.g., (Doc. No. 22 at 48).
4
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be directly generated by digital gaming products through certain projected activities (advertising,
sponsorships, tournaments, and virtual goods merchandise), but it also must have been directly
generated by the Business (as defined above) via its activities in the online/mobile app "of movie
and cinema-related entertainment gaming and content business for consumer engagement and
use." (Id.). As one can see, there are not one, but multiple different criteria that must be satisfied
in order for a certain revenue source to be included in the bonus calculation. These limitations
apply regardless of whether the revenue stems from a product emanating solely from within the
province of the gaming pillar or whether it stems from a product outside that pillar that integrates
some gaming pillar feature or product.
Finally, it is of some importance, given some of the Appellants' 	claims, that the
employee/consulting agreements that formalized the actual relationship between the Appellants
and Appellee not only contain the bonus criteria, but they also have a merger clause:
Complete Agreement. This Agreement, those documents expressly referred to
herein and other documents of even date herewith embody the complete agreement
and understanding 	among the parties and supersede and preempt any 	prior
understandings, agreements or representations by or among the parties, written or
oral, which may have related to the subject matter hereof in any way.
See, 	e.g., 	(Doc. 	No. 	26 -6 	at 	5). 	Thus, 	under 	these 	contracts, 	no 	pnor 	representations,
understandings or agreements survive the execution of the contracts.
The Court notes that the parties here and in the Bankruptcy Court argued that the contract
was unambiguous. This Court finds no reason to conclude that this conclusion is incorrect.
The Appellants appealed to this Court attacking three primary rulings. 	Their first
contention is that the Bankruptcy Court erred in granting partial summary judgment for NCM (and
denying the Appellants' 	cross-motion for partial summary judgment) because the contracts
unambiguously require that the bonus calculation includes the revenue from Integrated Deals, the
Cinema Accelerator, and the On-Screen Sponsorships. See (Doc. No. 22 at 13 - 14). Second, the
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Appellants contend that the Bankruptcy Court should have relied on certain parol evidence that
proves these three components should have been included. (Id.). Finally, the Appellants claim that
the Bankruptcy Court erred by disallowing the Colorado civil theft claims. (Id.). The Court
addresses each of these contentions below.
II. 	Legal Standard
District courts are given jurisdiction to review appeals from the bankruptcy comis under
28 U.S.C. § 158(a)(l). Generally, district courts apply the same standard of review for bankruptcy
court decisions as appellate courts apply to district court decisions. Webb v. Reserve Life In s. Co .
(In re Webb), 954 F.2d 1102, 1103- 04 (5th Cir. 1992). Findings of fact are reviewed for clear
error; issues of law and mixed questions of law and fact are reviewed de nova. Szwak v. Earwood
(In re Bodenheimer, Jones, Szwak, & Winchell L.L.P.), 592 F.3d 664 ,66 8 (5th Cir. 2009); see also
Wooley v. Faulkner (In re SI Re structurin g, Inc.), 542 F.3d 131 , 134- 35 (5th Cir. 2008). This
Court "may affirm for any reason supported by the record, even if not [explicitly] relied on by the
[bankruptcy] court." Un it ed States v. Gonzalez, 592 F.3d 675, 681 (5th Cir. 2009); In re Brown ,
No. 4:18-CV-04416, 2020 WL 730878, at *l (S.D. Tex. Feb. 13 , 2020). The Court applies a de
nova standard ofreview. Szwak, 592 F.3d at 668.
III. 	Analysis
As noted earlier, Appellants sought to recover a bonus based upon the inclusion of their
share of three main revenue streams: (1) Cinema Accelerator, (2) Integrated Deals, such as the
State Farm sponsorship, and (3) On-Screen Sponsorships. The Court will address each of those
potential revenue streams below. First, however, the Court addresses what the Bankruptcy Court
below actually ruled upon and what it did not address.
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First, the Bankruptcy Court in the process of granting partial summary judgment for NCM
and denying the Appellants' cross-motion found ( as all parties contended) that the bonus provision
was not ambiguous. It next found that:
1. 	Consumer data is not among the Business' digital gaming products as that phrase is
used in the definition of Digital Gaming Revenue in the Service Agreements;
2. 	Revenue attributable to the use or sale of consumer data is not Digital Gaming
Revenue as that term is defined in the Service Agreements;
3. 	Claimants are not entitled to credit in the Bonus Calculation for all Cinema
Accelerator revenue during the Performance Periods simply because consumer data
from the Business' digital games was ingested into NCM's data management
platform. Claimants are only entitled to credit for revenue generated from impressions
in the digital games themselves;
4. 	Cinema Accelerator revenue is not in the digital gaming pillar, and revenue
attributable to Cinema Accelerator is therefore not Digital Gaming Revenue as that
term is defined in the Service Agreements unless the ads were run on the actual
digital gaming platforms;
5. 	Revenue attributable to on-screen advertising is not Digital Gaming Revenue as that
term is defined in the Service Agreements;
6. 	Claimants are not entitled to credit in the Bonus Calculation for on-screen revenue
during Performance Periods;
7. 	The entire value of any integrated contract is not a Digital Gaming Revenue as that
term is defined in the Service Agreements;
8. 	Claimants are not entitled to credit in the Bonus Calculation for the entire value of
integrated contracts during the Performance Periods;
9. 	DOOH Service revenue is not a Digital Gaming Revenue as that term is defined in
the Service Agreements;
10. Claimants are not entitled to credit in the Bonus Calculation for DOOH Service
revenue during Performance Periods;
11. LEN revenue is not a Digital Gaming Revenue as that term is defined in the Service
Agreements;
12. Claimants are not entitled to credit in the Bonus Calculation for LEN revenue during
the Performance Period;
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13. Advertising revenue that was not associated with the digital gaming products
themselves is not Digital Gaming Revenue as that term is defined in the Service
Agreements; and
14. Claimants are not entitled to credit in the Bonus Calculation for advertising revenue
that was not associated with digital gaming products themselves during the
Performance Periods.
15. DOOH Service revenue is not a Digital Gaming Revenue as that term is defined in
the Service Agreements;
16. Claimants are not entitled to credit in the Bonus Calculation for DOOH Service
revenue during Performance Periods;
17 . LEN revenue is not a Digital Gaming Revenue as that term is defined in the Service
Agreements;
18. Claimants are not entitled to credit in the Bonus Calculation for LEN revenue during
the Performance Period;
19 . Advertising revenue that was not associated with the digital gaming products
themselves is not Digital Gaming Revenue as that term is defined in the Service
Agreements;
20. Claimants are not entitled to credit in the Bonus Calculation for advertising revenue
that was not associated with digital gaming products themselves during the
Performance Periods;
21. Claimants' civil theft claim is disallowed; and
22. Claimants' claims for treble damages are disallowed.
(Banla. No. 23-90291, Doc. No. 756).
The Banlauptcy Court did not rule upon the actual allowance of the Appellants' breach of
contract claims, nor did it rule upon whether the Appellee properly performed the bonus
calculations because that inquiry would have entailed the resolution of certain issues of fact. The
Banlauptcy Court ultimately reserved the allowance of the Appellants' breach of contract claims
for trial.
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The points of error that Appellants have brought before this Court are not necessarily
specific as to the multiple findings quoted above. As noted earlier, their briefing focuses only upon
revenue from Integrated Deals, On-Screen Sponsorships, and Cinema Accelerator. As a secondary
contention, one of the Appellants' complaints (buried in their over 60-page brief) is the use by the
Bankruptcy Court of parol evidence from NCM with regard to the meaning of "Digital Gaming
Pillar." Since this Court reviews questions of law de novo, this Court will review the matter solely
based upon the contract that both sides have agreed is unambiguous foregoing any use of parol
evidence to interpret the unambiguous contract. The Appellants also attack the Bankruptcy Court's
finding dismissing their claims for Colorado civil theft. This Court will address this complaint
first.
A. Colorado Civil Theft Claims
Under Colorado law, a person or entity commits the offense of civil theft if he: (1)
knowingly obtains, retains, or exercises control over anything of value that belongs to someone
else without authorization or by threat or deception; (2) and intends to deprive that individual or
entity permanently of that object of value. Colo. Rev. Stat. § 18-4-401 (2022). While this dispute
is essentially a breach of contract suit, these kinds of claims can still be the basis of such a cause
of action if the claimant has a property interest in the funds at issue. A mere expectancy or
contractual right is not sufficient. Million v. Grasse , 549 P.3d 1043, 1051 (Colo. App. 2024). To
qualify, the interest in the funds must be a specifically identifiable account or a wrongful obtaining,
retention, or exercise of control over specifically identifiable funds that belong to plaintiff. Id. The
Million opinion is controlling here because it holds that when the money due is yet to be
determined pursuant to a specific formula it cannot be an "identifiable" sum as required by the
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statute. Id. at 1052. The Million court also noted that in instances where it was unclear whether the
plaintiff is owed money at all, such a claim is outside the scope of the statute. Id.
Appellants' brief concedes the fact that Colorado law requires a specific amount to be
considered due and owing, but argues:
Million does not require the establishment of a trust or escrow amount to prevail on
a civil theft claim. Rather, it requires the parties to establish that they had a right to
a specific payment at the time of taking.
(Doc. No. 9 at 57). That may be a guiding principle, but even in this Court, the Appellants have
not referenced any summary judgment evidence that would hint at what specific payment "was
owed"- 	if any payment was owed at all. See generally (Doc. No. 7). Appellants try to argue by
analogy that their claim is similar to a W-2 wages claim. See (id.) ("For LaVanchy and Tobin, the
Performance Bonuses were W-2 wages to which they had a constitutional property interest." ). This
contention falls woefully short. First, MB Kinetoplay is a company, and this argument certainly
does not apply to the entity. The Appellants produced no evidence that a company, like it, ever
received a W-2 form or was even supposed to receive such a form. Moreover, for both MB
Kinetoplay and Lavanchy and Tobin, the unknown sums in question were not wages but rather a
conditional bonus based upon certain revenues reaching certain thresholds. By definition, these
are not specific sums, nor were they immediately due and owing. Those types of sums would
require an allocation and, in some instances, an apportionment and calculations involving various
revenue streams.
More importantly, the Colorado Supreme Court has held that a contractual dispute over a
sum of money that may or may not be owed is not civil theft. People v. Rot ella, 754 P.2d 765 , 767
(Colo. 1988). The sums in this case were not guaranteed- 	they were contingent on certain
parameters outlined by the plain terms of the agreements. The fact that one side claims these
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parameters were satisfied and the other claims they were not does not subject the latter party to a
theft claim. Lastly, the amount due, if any, is one of the issues upon which the Bankruptcy Court
did not rule. It set that issue for trial and the results of that trial are not part of this appeal.
This Court agrees as a matter of law that the claims made under the Colorado civil theft
statute are not sustainable.
B. 	Breach of Contract Claims
As previously noted, the Appellants and Appellee filed competing motions for summary
judgment in the Bankruptcy Court. Appellants here seek a reversal of the denial of their motion as
well as a reversal of the granting ofNCM's motion. Their points of attack on the breach of contract
ruling fall into two categories: (1) contract interpretation and (2) the Bankruptcy Court's failure to
use parol evidence that the Appellants ' claim proves their entitlement to the bonuses.
While their attack on the Bankruptcy Court' s opinion is somewhat scattershot, their overall
goal, at least, here, appears to be to have this Court include three different components into the
bonus calculations. Those revenue components result from: (1) On-Screen Sponsorships, (2)
Integrated Deals, and (3) Cinema Accelerator. The Court addresses the first two categories jointly,
describing these categories as "advertising and sponsorship revenue," (Doc. No. 7 at 47), the
Appellants' briefing more or less lumps them together and lacks specific contractual analysis as to
why those two categories should fall under the contract's bonus provision.
On-Screen 	Sponsorships 	and 	Integrated 	Deals. 	Appellants 	contend 	On-Screen
Sponsorships and Integrated Deals should have been counted toward the Appellants ' performance
bonus. 	As 	the 	Appellants 	state, " [n]umerous 	clients 	sponsored, 	advertised, 	or 	otherwise
incorporated digital gaming into their productions including State Farm, Tyson, Foods, US Air
Force, Sony Playstation, and Dell XPS." (Doc. No. 7 at 22). According to the Appellants, "NCM
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directly generated revenue from these products across numerous platforms by pitching them to
clients- 	and then closing sales from those pitches." (Id.).
In this regard, the Appellants conclude that NCM received at least $5 million in revenue
from State Farm and others that should have been included in their bonus calculations. While the
Appellants made the broad assertions repeated above, their contention is clearly not tethered to
how these revenues were derived and how the inclusion of those revenues is justified by the
specific requirements of the contract language. Appellants make little or no attempt to demonstrate
in any non-conclusory fashion how the contract supports their position- 	perhaps because the
contract does not support such a widespread contention. In fact, given the half-hearted attempt by
Appellees to support their claims, NCM goes so far in its Brief to claim that Appellants have
legally "abandoned" this claim.
Regardless of whether Appellants have legally conceded this point, it is clear that for
Appellants to receive credit for the revenue generated by an integrated product, that product (or
portion thereof) must still fall within the parameters laid out by the contract. That revenue must be
directly generated by the Business' s gaming products. This requirement has several components,
all of which must be satisfied:
1. 	The revenue must stem from the Business 's creation, commercialization, development,
or management of movie-related apps for consumer engagement and use; and
2. 	The revenue must be directly generated by the gaming products; and
3. 	The 	revenue 	must 	be 	directly 	generated 	through 	advertisement, 	sponsorships,
tournaments or virtual goods and merchandise that is directly purchased from the
Company's website (or an affiliate).
Appellants latch on to pieces of these requirements but conveniently skip over those
requirements that they do not fulfill. For example, they argue:
To start, the first category of revenue to be included in the calculation was
"advertising." Advertising means "the activity and industry of advertising things to
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people on television, in newspapers, on the Internet, etc." The very business of
NCM was advertising. On the basis of this plain language, the Parties intended that
this term by itself broadly encompass every means by which the Digital Gaming
Products might be commercialized by NCM in NCM's current line of business.
The revenue category for "Sponsorship" was similarly broad. It means "financial
support from a sponsor." By the plain language, the term "sponsorship" was
intended to capture revenue in which a client sponsored a Digital Gaming Product.
Again, there is no limitation on the format of the sponsorship- 	any and all
sponsorship revenue, whether on-screen, in a lobby, or online was supposed to be
allocated for the purposes of the Performance Bonuses.
(Doc. No. 9 at 45-46) (emphasis added) (citing the Declaration of Laurence Tobin).
While the Appellants incorporate Tobin' s statements about contractual intent to build their
argument, Tobin's statements (and his reliance on online dictionary definitions) have little effect
here. The statements may provide some fodder for the Appellants' brief, but legally, the statements
are a vain attempt to amend the terms of a written contract. First, it should be noted that according
to the wording of the contract, Tobin's recollections are just wrong. There are many limitations in
the contract language. Second, his understandings and/or interpretations are legally precluded from
effect by the contract' s merger clause:
Complete Agreement. This Agreement, those documents expressly referred to
herein and other documents of even date herewith embody the complete agreement
and understanding among the parties and 	supersede and preempt any 	prior
understandings, agreements or representations by or among the parties, written or
oral, which may have related to the subject matter hereof in any way.
(Doc. No. 26-6 at 5). This merger clause clearly precludes any such prior "understandings." Absent
this type of "evidence," Appellants have provided no competent summary judgment evidence that
would raise an issue of material fact. For example, Appellants have not referred the Court to any
competent summary judgment evidence that on-screen advertising sterns from the "creation,
commercialization, 	development, 	or 	management" 	of 	movie-related 	apps 	for 	consumer
engagement or use, nor is there evidence that the on-screen revenue is directly generated by gaming
products. (Bankr. No. 23-90291 , Doc. No. 255) (defining "Business" as "the business of creating
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and de veloping, commercializing and managmg the online/mobile application of movie and
cinema-related entertainment gaming and content business for consumer engagement and use").
The same is true for those products containing a digital component. Integrated deals contain
both digital and non-digital components. (Doc. No. 11 at 164). The primary example that the
Appellants raise in this category is the State Farm contract. (Doc. No. 7 at 22, 27). That contract
itself recognized that a portion was, in fact, due to be allocated in the applicable revenue stream
toward the bonus provisions and apparently, that allocation was honored. (Id.). Nevertheless,
Appellants claim that the entire value of the contract should be included- 	ignoring the contractual
requirement that to be included all revenue had to be directly generated from the Business. 4 The
Court relies on the plain terms of the written agreements and finds that this argument is meritless.
Cinema Accelerator. Appellants finally focus on the Cinema Accelerator product. Cinema
Accelerator is a product that predates the relationship between Appellants and Appellee. 5 (Doc.
4 Appel Ian ts arguments with respect to al I three categories at issue also seem to ignore the first Iine of the
bonus provisions that require the Business (as defined) achieve revenue directly generated by the Business 's
digital stream. 	In other words, 	it must be directly derived 	from 	the creation and 	development,
commercialization, and management of on line/mobile apps of movie- and cinema-related entertainment
and content business for conswner engagement and use. Appellants provide no evidence how these
business-to-business deals which generate revenue are, in fact, revenues directly generated from apps made
for consumer engagement and use.
5 NCM stresses in its briefing that the inclusion of Cinema Accelerator as a part of the revenue stream to
be counted wou ld have never happened and would have actually rendered the entire bonus calcu lation
meaningless. First, NCM points out that Cinema Accelerator predates the APA, so it was an already existing
product. As such, it argues that NCM would never have included it in a bonus calculation designed to
account for new products. Second, it points out that at the time of the drafting of the contracts in question,
Cinema Accelerator was already generating we ll in excess of the amount that would trigger the bonus at
issue here. That being the case, NCM points out that neither party wou ld have needed to describe a bonus
calculation for a figure that Appellants would automatically qualify for with the Cinema Acce lerator
product. If that was the case, NCM contends that the entire language concerning what revenue would be
counted toward the bonus would be meaningless. See generally (Doc. No. 22 at 41-45).
While this Court finds this argument to make sense, it need not and will not consider it, as this Court
concentrates its analysis on the actual contract language and summary judgment evidence (or lack thereof).
Moreover, this " understanding" of NCM would be precluded from consideration just like those of the
Appellants due to the merger clause.
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No. 11 at 162). It is not an app or game engaged with or used by consumers. (Id.). It is a service
sold by NCM to advertisers. (Id.) . While no party has pointed the Court to evidence that describes
the actual mechanics of its operation, Cinema Accelerator, in theory , enables advertisers to retarget
theater patrons with subsequent advertisements through the impressions or "clicks" obtained
through third parties. Appellee describes how it functions as follows :
Cinema Accelerator 	online 	campaigns 	require 	significant 	consumer 	data to
effectively target the advertising client' s desired audience. Data sources come in
three varieties: first-party , second-party, and third-party. During the relevant time
period, NCM ' s first-party data sources were data generated by NCM's owned and
operated properties, like its digital games, as well as data received from NCM' s
affiliates and data from beacons located in theaters that were owned by NCM.
Second-party data sources primarily consisted of geo-location data that NCM
purchased and enhanced. Third party data sources consisted of data purchased from
third parties about moviegoers.
Data, regardless 	of source, was 	ingested into 	a data management platform
("DMP"), which then translated the identifier(s) associated with the data into an
online form of identity that allows the identity to be found on different channels
across the web. The DMP enables the use of the accumulated data to build customer
models and target audience members with future advertising impressions. NCM
then delivers targets ads, whether by delivering them through NCM' s owned and
operated properties or by acquiring impressions from third parties.
(Doc. No. 22 at 43-44). 6 Clearly, the data coming from second and third parties could not, by any
stretch of the imagination, pertain to the Appellants ' activities- 	directly or indirectly. Some of the
first-party data did come from NCM' s digital game platform, as well as from other NCM-owned
sources. That being said, the fact that some data from Appellants' Business was transferred to
NCM did not directly produce any revenue. What the Cinema Accelerator produced was data that
eventually (after many permutations) produced some revenue.
6 Here, the Court uses the description contained in the Appellee' s brief. The Appellants do not contend that
this description is materially false or misleading.
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Appellants contend that I 00% of the Cinema Accelerator revenue should be included in
their bonus revenue calculations, yet they offer no evidence as to how the small percentage of data
mined in part from its Business directly produced any revenue (much less 100% of the Cinema
Accelerator revenue). Cinema Accelerator is not a gaming product, nor is it a product that is
sold/marketed for "consumer engagement and use." It is important to remember that, in addition
to the dual requirement that the revenue must be directly generated by the Business's digital
gaming product and be directly generated through advertising, sponsorships, tournaments, and
virtual goods and merchandise (which clearly excludes the Cinema Accelerator income), in order
to qualify as revenue it must be achieved by the "Business"- 	which is defined as the sale of
online/mobile applications of movie and cinema-related entertainment for consumer engagement.
(Bankr. No. 23-90291 , Doc. No. 255). Data that is mined and indirectly used to sell unrelated
products or services to other businesses fails both "direct" requirements and falls outside of the
clearly defined definition of "Business."
In sum, the revenue derived from mining data, repackaging it, and selling it to some
business for use in the latter's advertising campaign is not:
1. 	Revenue achieved from the Business;
2. 	Directly generated from the Business's gaming products, and/or
3. 	Directly generated through advertising, sponsorships, tournaments, or virtual goods or
merchandise.
It is merely an internal transfer of data which by itself generates no revenue. Therefore, the Court
affirms the Bankruptcy Court' s finding that (1) On-Screen Sponsorships, (2) Integrated Deals, and
(3) Cinema Accelerator do not, as a matter oflaw , fall into the calculation of the bonus provisions
based on the plain meaning of the contract.
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C. Paro) Evidence
Lastly, Appellants argue that, if this Court finds the contracts to be ambiguous, it should
consider parol evidence that raises at least a fact issue as to whether the Integrated Deals, On-
Screen Sponsorships, and Cinema Accelerator revenues should be included in their bonus
calculations.
The 	Colorado 	law that governs 	the 	contract 	interpretation here 	follows 	the 	general
nationwide principles of contract law with a few wrinkles. Under Colorado law, the interpretation
of a contract is generally a question of law for the court. In re Parsons, 272 B.R. 735 , 752 (D .
Colo. 2001 ). The primary goal of contract interpretation is to determine and give effect to the intent
of the parties as it existed at the time the contract was executed. Id. "The meaning of a contract is
found by examination of the entire instrument and not by viewing clauses or phrases in isolation.
Each word in an instrument is to be given meaning if at all possible." Id. A written contract that is
complete and free from ambiguity represents the objective intent of the parties and will be enforced
according to its plain language. Id. However, " [i]f the court determines a contract is ambiguous
and its construction depends on extrinsic evidence, then the interpretation of the contract becomes
a question of fact. " Id. Whether a contract term is ambiguous is a question oflaw. Id.
"Under Colorado law, to determine if a particular term is ambiguous, 'the language of the
agreement must be constructed by application of the accepted meaning of the words with reference
to all of its provisions. The nature of the transaction which forms the contract subject matter must
also be considered. "' Id. "Contractual terms are not rendered ambiguous merely because the parties
subsequently urge diverse interpretations." Id.
In interpreting a contract, a court should admit and consider parol evidence only when the
contract is so ambiguous that the parties' intent is unclear. Id. Although parol evidence may be
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consider ed by the court to determine if a contract is ambiguous, if after hearing the evidence the
contract remains unambiguous, the parol evidence should be stricken. Id. Absent allegations of
fraud, accident, or mistake in the formation of the contract, parol evidence may not be admitted to
add to, subtract from, vary, or contradict, change, or modify an unambiguous integrated contract.
Id. Even when parol evidence is admissible to ascertain the intent of the parties, it may not be used
to demonstrate an intent that contradicts or adds to the intent expressed in the writing. Id. This is
especially true when that "evidence" is contractually barred by a merger clause such as the clause
present in the existing contracts. Under Colorado law, courts "may consider extrins ic evidence
regarding the meaning of the written terms, including evidence of local usage and of the
circumstances surrounding the making of the contract" in order to determine whether a contract
term is ambiguous. Pub. Serv. Co . of Colo. v. Meadow Island Ditch Co . N o. 2, 132 P.3d 333, 339
(Colo. 2006). That being said, courts may not consider extrinsic expressions of intent by the
partie s. Id.
While the Appellant rightfully conditions their argument on a finding that the contract is
ambiguous, they are essentially offering pieces of parol evidence that are: (1) extrinsic expressions
of intent and (2) contrary to the contract's merger clause. Se e (Doc. No. 7 at 52) (" If the Court
determines that the contracts are ambiguous .. . it may consider parol evidence that does not vary
or contradict the terms of the agreement." ).
As a preliminary matter, this Court finds no ambiguity in the agreements. The primary battle
in this case focuses on the phrase "directly generated," and this is a phrase that needs no extraneous
evidence to be understandable. The second important term is "Business," and that term has a
specific contractual definition. As a consequence, this Court sees no need for the consideration of
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any parol evidence from either side. 7 Finally, the vast majority of the evidence Appellants
conditionally want this Court to consider goes directly to the "intent of the parties," which is
explicitly barred by Colorado state law. One need only look at how the Appellants captioned their
argument in their opening brief:
The Parol Evidence Also Proves That The Parties Agreed That the Performance
Bonus Calculation Include Revenue Generated By Integrated Deals, Cinema
Accelerator, and On-Screen Sponsorships
See, e.g. , (Doc. No. 9 at 52). The next few pages of their brief set out various arguments that at
their heart are what the Appellants claim they intended with respect to the bonus provisions or
what they think NCM intended. This is just the kind of evidence that the Court cannot consider
when weighing a dispute over an unambiguous contract. S ee Pub. Serv. Co. of Colo. , 132 P.3d at
339; see also Nat '! Union Fire Ins. Co. of Pittsburgh, PA v. Fed. Ins. Co. , 213 F. Supp. 3d 1333,
1344 (D. Colo. 2016), ajf'd, 734 F. App' x 586 (10th Cir. 2018); Cheyenne Mountain Sch. Dist.
No. 12 v. Thompson , 861 P.2d 711 , 715 (Colo. 1993).
Finally, this is not a situation where local usage or the circumstances surrounding the
making of the contracts comes into play. This is a contract that may be viewed by some as
"complex," but it is not ambiguous or unintelligible. 8 Therefore, the Court sees no need for parol
evidence to enter into the discussion and has focused this analysis on the plain terms of the written
agreements.
7 While there apparently was a dispute below over the definition of the phrase "digital gaming pillar," the
parties did not appeal this point, so the Court need not address it. Moreover, this Court finds that term to be
perfectly understandable without parol evidence in the context of the entirety of the contract.
8 See the Bankruptcy Court opinion where it states, "[a]though the Provision is complex, the Court sees no
ambiguity." (Bankr. No. 23-90291 , Doc. No. 755 at 9).
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IV. 	Conclusion
While the Bankruptcy Court made over twenty individual findings in its ruling denying
Appellants' Motion for Partial Summary Judgment and granting NCM's Motion for Partial
Summary Judgment, the Appellants chose not to appeal those findings individually. Instead, their
course of action on appeal to this Court was to narrow the appeal to the finding concerning four
topics. It attacked the Bankruptcy Court findings with regard to its rulings on: (1) Integrated Deals,
(2) On-Screen Sponsorships, (3) Cinema Accelerator, and (4) the denial of the civil theft claims.
That being the case, this Court has confined its opinion to these topics.
The Court, as did the parties and the Bankruptcy Court, found the contract to be
unambiguous. This Court found no need to rely on any outside explanations or parol evidence to
explain any of the terms in the contract. In fact, given the contract' s clear language (in addition to
its straightforward merger provision), the Court finds no need and certainly no legal reason to rely
on the parol evidence proffered by either side.
The Court finds no reason to disturb the judgment of the Bankruptcy Court. It finds that
the Appellants have no cause of action under Colorado's civil theft statute. It also finds for the
reasons articulated above that the bonus calculation did not improperly exclude On-Screen
Sponsorships, Integrated Deals, or Cinema Accelerate. Those sums were not directly generated by
the Business's (as that term is defined) gaming products through advertising, sponsorship,
tournaments, or virtual goods and merchandise. This result takes into account not only the
requirements that such revenue be directly generated but also that it must be directly generated by
the 	business 	of 	creating 	and 	developing, 	commercializing 	and 	managing 	online/mobile
applications of movie- and cinema-related entertainment and content business for consumer
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engagement and use. The revenue generated in the three business segments in question does not
satisfy the requirements.
The decision of the Bankruptcy Court is AFFIRMED.
It is so ordered.
ttSigned on this the 	'2..'2:, 	day of March 2026.
Andrew S. Han en
United States District Judge
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