The producer alleges Weinstein got a license agreement through fraudulent inducement, and wants the deal declared void and not part of any TWC asset sale.

The bankruptcy of The Weinstein Co. has spurred its first big battle over rights, with the producer of Hotel Mumbai suing to make clear that a license agreement has been rescinded and may not be transferred as part of an upcoming auction for TWC assets.

Hotel Mumbai is a film about the November 2008 terrorist attack in Mumbai, India, that left more than 160 people dead. It is directed by Anthony Maras and stars Armie Hammer, Dev Patel, Jason Isaacs and Nazanin Boniadi.

The Weinstein Co. is in Chapter 11 bankruptcy from the fallout of sexual misconduct allegations against Harvey Weinstein. The debtor plans an auction on May 4, and in the meantime, interested parties are scrambling to prepare. For example, on Monday, the official committee of unsecured creditors filed notice that it would be deposing Robert Del Genio, the chief restructuring officer at TWC, as well as Lantern Entertainment, which is acting as stalking horse at the auction with a $310 million bid.

Often in bankruptcy cases, objections come to the proposed assumption of assets in any sale. But Hotel Mumbai Pty Ltd., the production company associated with Hotel Mumbai, is going an extra step with a new adversary proceeding against TWC.

Hotel Mumbai says it was promised $10 million in marketing from a prestigious studio but that TWC's officers knew about Weinstein's sordid history of sexual abuse and that the issue "was effectively a ticking time bomb that would decimate TWC when the full extent of Harvey Weinstein’s illegal actions became known to the general public."

"Had HMPL known, at any time, before or during the negotiations for the License Agreement of the TWC Cover-Up and the extent of Harvey Weinstein’s alleged crimes and misconduct, it never would have entered into the License Agreement or allowed the Picture to be distributed by TWC or to be associated in any way with the now discredited TWC brand," states the complaint.

The film's producer says it sent a rescission letter on February 14 and never got any response contesting a cancellation of the license agreement. Nevertheless, the deal for Hotel Mumbai is among the assets listed to be sold as a "top unreleased picture" in the stalking horse agreement.

The plaintiff argues the license agreement is not a "property of the estate," as it was terminated before the bankruptcy petition, and wants to move on this case before Hotel Mumbai gets released around the 10-year anniversary of the terrorist attacks in Mumbai.

"Every day that the Debtors continue to represent to the entertainment industry that the License Agreement is an asset of the estate causes irreparable harm to HMPL’s ability to secure a new distributor, which can ensure a U.S. theatrical release of the Picture prior to the international release," continues the complaint, which is being handled by attorneys at Brutzkus Gubner and Gellert Scali.