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FBI Seeking Victims Of Gigapix Studios Scam For ‘Wizard Of Oz’ Feature Toon

By THE DEADLINE TEAM | Tuesday May 14, 2013 @ 8:01pm PDTTags: Daniel Zucker, FBI, Gigapix Studios, The Wizard of

The FBI in Los Angeles is conducting an investigation involving investments made with Gigapix Studios Inc and OZ3D LLC between 2002 and the present for a scam to remake The Wizard Of Oz as a computer-animated feature film. The feds are “seeking victims” of financial fraud in the private offerings and is trying to find the “large number of investors” who were fleeced. Here’s the announcement on the FBI website:

Gigapix Studios, Inc. claims to be using investor capital to purchase rights to intellectual property in the entertainment industry, with a focus on family-friendly films, arête films, and reality television. According to its private placement memorandum dated May 17, 2010, Gigapix Studios, Inc. is focusing on high yield industry indentifiable segments, such as targeted production of modest budgeted theatrical films and controlling theatrical distribution foremost, in addition to other ventures. They claim that they are in the process of developing, acquiring, and producing several films and other creative concepts.

OZ3D, LLC claims to be using investor capital to finance and produce the proposed computer generated animation motion picture “The Wizard of Oz,” and the manager of the entity is Gigapix Studios, Inc. The private placement memorandum for OZ3D, LLC, dated May 5, 2008, stated that the company was trying to raise $20 million for the project.

In the process of raising money for their offerings, Gigapix Studios, Inc. Chief Executive Officer Chris Blauvelt and others have received cease and desist orders from numerous state regulatory agencies, including in Oregon, Alabama, Washington, Colorado, and California.

There’s a lot more behind this story, according to Courthouse News. Gigapix raised upward of $8M+ for the film, but it never got made. Arc Productions in Canada was going to produce the animation and has filed a claim against Gigapix as well. So have some investors, like Daniel Zucker who has sued Gigapix Releasing, OZ3D, Gigapix Studios, and its president David Pritchard, in Los Angeles Superior Court. In his complaint, Zucker claims the defendants sweet-talked him out of $700,000 by offering him 1.5% of the profits. He claims that Pritchard told him he would earn 10 to 20 times the amount of his loan to Gigapix which promised to repay him no later than June 29, 2012. But he hasn’t seen a single dime, Zucker says.

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Harvey Weinstein Helps FBI Foil $13M Extortion Plot: Actor Threatened To Kill Mogul’s Family

By NIKKI FINKE, Editor in Chief | Thursday August 23, 2012 @ 9:59am PDTTags: Big Deals Film, FBI, Harvey Weinstein

I’ve confirmed that, while not named in any court papers, Harvey Weinstein is the “Connecticut resident and co-founder of a film studio” victimized by a struggling actor turned deadly serious … Read More »

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Lionsgate A Victim of Fraud, FBI Charges

By THE DEADLINE TEAM | Monday March 26, 2012 @ 2:13pm PDTTags: FBI, Lawsuit, Lionsgate

Lionsgate FBI ArrestsThis was a busy weekend for Lionsgate. The Santa Monica-based company enjoyed the rare position of opening a blockbuster film in The Hunger Games and the hit return of its flagship series Mad Men. But also, agents from … Read More »

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Michael Douglas Stars In FBI Campaign Against Securities Fraud

By DAVID LIEBERMAN, Executive Editor | Monday February 27, 2012 @ 11:35am PSTTags: FBI, Michael Douglas, Wall Street

He’s not an insider trader, but he plays one in the movies — and that’s what counted for the FBI’s new campaign warning investors about securities fraud. The agency enlisted Michael Douglas for a PSA that harkens back to his role as swindler Gordon Gekko in the Wall Street films. ”The movie was … Read More »

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Celebrity Hacker: “It Started As Curiosity And It Turned To Just Being Addictive”

By THE DEADLINE TEAM | Thursday October 13, 2011 @ 4:18pm PDTTags: FBI, hacking, Scarlett Johansson

The guy arrested for hacking the emails of Scarlett Johansson and other celebrities admits he knew what he was doing was wrong but once he started and discovered he could do it, he couldn’t stop. “It started … Read More »

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SAG Member Cops Plea On Screener Leak

By THE DEADLINE TEAM | Wednesday September 14, 2011 @ 8:57pm PDTTags: Black Swan, copyright infringement, FBI, SAG, Screen Actors Guild

Actor Wes DeSoto has agreed to plead guilty to copyright infringement for leaking an awards screener of Black Swan and other films to file-sharer BitTorrent. DeSoto’s L.A. apartment was raided by FBI agents in April after a MPAA piracy officer tipped the … Read More »

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BREAKING: Feds Bust $25M Indie Film Scam

By NIKKI FINKE, Editor in Chief | Friday June 17, 2011 @ 1:45pm PDTTags: FBI

UPDATE: The feds released info today that FBI and IRS agents this week arrested and charged 18 people who now face fraud and money laundering charges relating to a telemarketing “boiler room” scam that solicited $25 million in so-called investments in indie films with false promises of up to 1,000% returns. The scam was run in Southern California and Florida. While some of the movies were actually produced, the indictments allege that the defendants lied, gave half-truths and concealed material facts from investors around the nation.

A former CIA agent who ran a Burbank movie company called Q Media Assets has already pleaded guilty to conspiracy, mail fraud, and tax charges in relation to the fraudulent boiler rooms. Also fingered are the activities of Cinamour Entertainment LLC, which allegedly bilked investors who put money into independent motion pictures called From Mexico With Love and Red Water: 2012. It follows the May 2009 apparent suicide  of Glen Hartford, the 45-year-old chairman-CEO-founder of Cinamour Entertainment.

The charged defendants and other telemarketers cold-called investors from “lead lists” and solicited investments with false claims, such as that 93% of investor money would be used to produce and promote the films, and that investors would receive returns up to 1,000%. According to the indictment, the telemarketers failed to disclose that they would receive commissions when, in fact, often more than 1/3 of the investments went into their pockets. Little more than 1/3 of investor funds were used to actually produce and promote From Mexico With Love.

During the course of the Cinamour scheme – which the indictment alleges ran from early 2004 through May 2009 – the defendants collected approximately $15 million for From Mexico With Love from about 450 victim-investors. The movie cost about $5 million to produce and generated approximately $550,000 in its theatrical release in October 2009. The defendants raised about $2.7 million for the Red Water movie from about 100 victim-investors, but essentially none of the money was used to produce the film, which was never made.

The second indictment alleges that telemarketers for Q Media Assets LLC fraudulently raised funds for films called Eye of the Dolphin and its sequel, Way of the Dolphin (which was later called Beneath the Blue). Telemarkers associated with Q Media also bought “lead lists” from the same San Clemente company that sold lists to the Cinamour telemarketers.  As in the Cinamour case, telemarketers seeking investments in the Dolphin movies allegedly “made material misrepresentations, told material half-truths, and concealed material facts, when speaking to investors,” specifically concealing information about commissions and promising returns of up to 1,000%. Read More »

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