Coyote vs Acme | Why have Warner Bros. allowed ‘Coyote vs Acme’ to be shopped around but not ‘Batgirl’?

It’s almost played out like a Looney Toon short itself; not a day or so after the news emerged that the John Cena-led ‘Coyote vs Acme’ film was to be shelved by Warns Bros. Pictures then it has now emerged that the studio will allow David Green to shop the film around to other distributors, effectively saving the film. 

But with it comes another question - how come ‘Coyote vs. Acme’ was allowed to be shopped around to other distributors, but other films canned by David Zaslav et. al such as ‘Batgirl’ or ‘Scoob! Holiday Haunt’ cannot? That sadly all boils down to accounting in Hollywood and taxes - always taxes.

‘Coyote vs Acme’ received its reprieve so suddenly due to Warner Bros. Pictures not having the time to call the production a ‘tax write-off’ on their books, as opposed to the other two films that were ultimately filed as write-offs ahead of the 2023-2024 financial year, that runs from April to March each year. 

Investopedia details what a business write-off means: “Businesses and individuals have the opportunity to claim certain deductions that reduce their taxable income. The Internal Revenue Service allows individuals to claim a standard deduction on their income tax returns. Individuals can also itemize deductions if they exceed the standard deduction level. Deductions reduce the adjusted gross income applied to a corresponding tax rate.”

“Corporations and small businesses have a broad range of expenses that comprehensively reduce the profits required to be taxed. An expense write-off will usually increase expenses on an income statement which leads to a lower profit and lower taxable income.”

In Lehman’s terms, it means that if Warner Bros. didn’t write off ‘Batgirl’ or ‘Scoob! Holiday Haunt’ as tax write-offs, they would be liable for those figures to be offset on their balance sheets by something else. Given the costs of both productions (‘Batgirl’ was estimated to be a $90 million USD production) and the concern they would not make their money back, they were shelved and considered tax write-offs - meaning that no taxes would need to be paid on those productions as they ran at a loss for the company. 

However, given the immediate outrage regarding the news of ‘Coyote vs. Acme,’ perhaps executives at the company have seen that there is a market for the film. The 2021 film ‘Tom and Jerry’ might not have earned rave reviews, but it made a cool $136.5 million USD at the box office in the end. That the budget for ‘Coyote vs. Acme’ is only $70 million USD, perhaps Warner Bros. Discovery believe that they’ll recuperate some of that production cost back, with another studio paying up for marketing and promotion?