Update: rhythm & hues gets $5m to finish legendary’s ‘seventh son’

_DOMINIC PATTEN contributed to this report_ 4TH UPDATE, THURSDAY 11:00 AM The court has given Legendary the go-ahead to infuse Rhythm & Hues with another $4.9M to finish _Seventh Son_.

Law firm Venable LLP repped the studio, which sought the court’s approval to pump additional payments into the ailing effects house after receiving only 25% of their commissioned 225 VFX

shots last December. 3RD UPDATE, WEDNESDAY AM: Legendary Pictures has officially filed a motion to be allowed to give Rhythm & Hues an additional $4,961,751 to complete VFX work on their

October release _Seventh Son_, according to a change order filed yesterday (read it here). 2ND UPDATE, FRIDAY PM: In a preliminary ruling, Judge Neil Bason has approved $11 million of the

loan. A first disbursement of $6 million is expected immediately, with $5 million to follow on February 19. On March 12, Bason will offer final judgement on the loan and, pending no legal

hurdles or objections, allow the remaining $5.5 million to be given to Rhythm & Hues. UPDATE, 12:40 PM: Legendary Pictures has asked the court if it can write a check to _Rhythm &

Hues_ outside the DIP loan being offered by Universal and Fox. The production company said if the “change order” is not approved it could mean a $9 million hit, and that even though it’s

already paid for the work it’s willing to “pay twice” to get its movie finished. That could be a reference to Guillermo del Toro’s _Pacific Rim_, which already has set a July 12 release date

via Warner Bros. (UPDATE: Nope. Legendary lawyers say it’s the Jeff Bridges-starrer _Seventh Son_, which has an October 18 release date via Warner Bros. A hearing date has been set for

February 21.) Additionally today, two former employees of the VFX company filed similar class action suits against Rhythm & Hues over letting people go without proper notification.

Former compositing technical director Anthony Barcelo says in his complaint (read it here) that under the Worker Adjustment and Retraining Act, he and others should have given 60 days’

written notice for being terminated without cause. The other suit (read it here) is from Thomas Capizzi, who also alleges he and others were fired from the company without the required

written notice or cause. On Monday, Rhythm & Hues let go 254 of the company’s approximate 700 employees at its El Segundo offices. PREVIOUS, 9:37 AM: The Oscar-nominated _Life Of Pi_ VFX

house is desperately seeking approval of a $17 million emergency loan from Universal and 20th Century Fox at a preliminary hearing in LA this morning in federal bankruptcy court. The

studios are two of Rhythm & Hues’ biggest clients; another, Warner Bros, has withdrawn its projects and financial support. The troubled effects company filed for Chapter 11 bankruptcy

protection Wednesday. If approved, the loan (read the motion here) will allow the company to complete contracted work on the studios’ projects and continue operations through the end of

April. The financially unstable company could also seek new work and possible buyers during this period. Rhythm & Hues claimed it had $33.8 million in liabilities by the end of 2012

according to a filing submitted this week. If the DIP loan is not approved, the company will be unable to operate and must liquidate immediately, according to the documents. The Rhythm &

Hues filing also reveals that Universal and Fox had already floated the company two loans in the amount of $750,000 and $5.25 million to clear its payroll through January 15, the last date

many employees reportedly received payment for completed work. At least 200 employees were laid off last week without any promise of a paycheck, multiple sources tell Deadline. CEO and

founder John Hughes will appear this morning in front of Judge Neil Bason. RELATED: Lifeline: Ex-Rhythm & Hues Artists Recruited By VFX House