The bankrupt effects house has reached a million-dollar settlement to end lawsuits filed against it by a pair of pink-slipped employees. Today’s LA Bankruptcy Court filing includes a proposed settlement of potential class action claims in which Anthony Barcelo and Thomas Capizzi each would get $10,000 as the class reps and the remaining $980,000 would be divvied up among the 238 other employees let go by Rhythm & Hues while it filed for Chapter 11 bankruptcy protection on February 11. Ten days later, separate suits were filed by Barcelo (read it here) and Capizzi (read it here) claiming they were fired without proper written notice or cause. Today’s proposed settlement, of which plaintiffs’ attorneys would take a third plus court costs, addresses those and other claims. A bankruptcy judge must approve the settlement, and fired R&H staffers have the right to opt out.
Gravity Post sought the shelter of Chapter 11 protection this week but the veteran VFX company isn’t going out of business. And, unlike other troubled VFX firms in recent months, no layoffs are planned either. “The debtor’s business is fundamentally strong. In past several months (sic), the debtor has secured several profitable contracts from influential clients in the automotive and sports industries, among others,” Zviah Elder said in an affidavit (read it here) filed on September 17. Gravity has “ just finished up a feature film for The Weinstein Company and they are presently working on four commercials. They will continue working on these projects without interruption,” Elder told me today. The company filed a bankruptcy petition (read it here) in federal court in NY this week under its formal corporate name of Rhinoceros Visual Effects and Design. The move was designed to evade eviction from their Madison Avenue offices over a dispute with the landlord in which they now owe $464,381 plus legal fees. Gravity says they don’t have that money right now but they could pay it off in time. As the Chapter 11 process weaves through the courts, the NYC and Santa Monica-based Gravity will likely be moving NYC offices before the end of the year but they’re not closing up shop, says their CEO in this …
The fallout from Digital Domain Media Group’s bankruptcy continues with investors in the troubled special effects and 3D conversion firm taking the former CEO, the company’s auditors and other executives to court for fraud. Having lost millions in the James Cameron-founded company just before it went under last September, Iroquois Master Fund and Kingsbrook Opportunities Master Fund late last week filed a six claim complaint (read it here) against John Textor, his wife Deborah, various DDMG directors and auditors SingerLewak LLP. The plaintiffs are seeking compensatory damages as well as interest, legal fees and “such other and further relief as the Court may deem just and proper.” The complaint in New York State Supreme Court alleges common law fraud, aiding and abetting fraud, negligent misrepresentations and omissions, negligence, breach of the implied covenant of good faith and fair dealing and civil conspiracy.
Fox Sports has asked a federal bankruptcy court to dismiss the Dodgers from bankruptcy as the networks said it would earlier this week, the LA Times reported late Friday. Fox Sports said it is not necessary for owner Frank McCourt to market the team’s TV rights to fulfill his obligations to creditors. Fox contends McCourt can repay his creditors in full simply by selling the team “for a handsome price” either with the current TV contract with Fox Sports or with a new owner negotiating a new TV deal. The team’s bankruptcy likely would hamper Fox’s ability to enforce its existing contract without court intervention. The Dodgers would like to auction those rights and attract higher bids for the team and for those broadcast rights. Fox has asked the court to enforce the current contract that bars the Dodgers from discussions with any other media outlets before November 30, 2012. Major League Baseball extracted an agreement with McCourt to sell the team, and he’s promised to close a sale by April 30. Fox cited the $160 million contract with Matt Kemp as evidence that bankruptcy is not necessary for the Dodgers to continue operating and that McCourt is just trying to come out of any deal with more money in his own pocket.
The Los Angeles Dodgers sued Fox Sports on Wednesday, accusing the News Corp-owned network of attempting to ”interfere with the sale of the Dodgers and their assets in bankruptcy.” The Dodgers’ goal is to sell the team and its valuable TV rights through separate court-sanctioned auctions to maximize returns. In a sharply worded court response filed Wednesday night Fox said it would ask that the Dodgers be dismissed from bankruptcy, according to the LA Times. Fox slammed Major League Baseball as “Prime Ticket’s former ally” and asserted the only reason Frank McCourt wants to auction the team’s TV rights now is to put “value rightfully belonging to Prime Ticket,in his own pocket” — referring to Fox Sports’ package of programming. The Dodgers’ suit was filed in U.S. Bankruptcy Court in Delaware, where Fox already has a suit pending against the team for alleged breach of contract in the continuing squabble over TV rights. Responding to the latest development, the Dodgers called Fox “obviously desperate” to prevent an auction that would reveal the “enormous value” of those rights and “lead to a record-smashing sale price for the team and benefit not just the Dodgers but all of baseball.”
If Frank McCourt’s fight to remain owner of the Los Angeles Dodgers seemed long and arduous, it was — after all, he had to fight his ex-wife Jamie with one hand and baseball commissioner Bud Selig with the other. If the end of that fight seemed to come fast and easy, well, it kinda did. Here’s the release from Major League Baseball that came out tonight announcing a deal to sell one of the most popular and lucrative franchises in sports:
“The Los Angeles Dodgers and Major League Baseball announced that they have agreed today to a court supervised process to sell the team and its attendant media rights in a manner designed to realize maximum value for the Dodgers and their owner, Frank McCourt. The Blackstone Group LP will manage the sale process.”
According to the L.A. Times, the sale would include the team, Dodger Stadium and its parking lots, which McCourt paid $421 million for in 2004. McCourt has put the current value of the team at more than $1 billion; Forbes said it is worth $800 million. Any new owner would certainly attract a lucrative TV rights contract — one worth more than the reported 20-year, $3 billion deal McCourt negotiated with current rightsholder Fox Sports that he said would have given him the cash to keep the team. Selig rejected that …
The Wall Street Journal is reporting that Borders Group will liquidate after it received no offers to save its bankrupt bookstore chain. This is a real blow to the brick and border set–Borders was the second largest book chain in the U.S.–and doesn’t bode well for a chain that employed 10,700, per the WSJ. Rather than selling to a white knight, Borders is now asking a bankruptcy judge approved a sale to a liquidator as Borders ends its book selling run in the fall.
Dish Network has revealed in filings with the U.S. Bankruptcy Court in New York that it will assume the leases on more than 500 Blockbuster stores, meaning the retailer will remain a bricks-and-mortar business at least in some capacity, the Wall Street Journal reported today. Dish has been mostly mum on what it will do with Blockbuster since winning an auction for the failed move-rental chain earlier this month, though it is widely believed that Charlie Ergen’s satellite company will use the Blockbuster brand to develop a digital service to rival Netflix, the company responsible for taking down Blockbuster in the first place. In the meantime, Blockbuster has been shuttering stores like crazy during the past few months. Dish’s acquisition is expected to close before the May 5 deadline agreed upon under terms of its winning bid at auction.
RHI Entertainment, the made-for-TV movie developer/producer/distributor that filed for Chapter 11 in December, had its reorganization plan approved today in U.S. Bankruptcy Court. The company will emerge with its debt obligation reduced by more than $400 million; the rest will be paid to lien holders via newly issued stock among other arrangements. “This is a great day for RHI,” company CEO Robert Halmi Jr. said. RHI, which has more than 1000 titles in its library, hasn’t been quiet despite its financial troubles: It said it has commenced production on three miniseries — Neverland, Treasure Island and Blackout– and produced two-hour TV movies for networks including Syfy and Hallmark.