From what I understand about how bankruptcy works, wouldn't the victims have had to have monetary judgments in place against the company prior to bankruptcy in order to be considered creditors? If someone knows for sure, I'd appreciate if you would comment. I don't see how this strengthens the victims position. If the company is sold for pennies on the dollar, and Weinstein seems to be burning through his personal fortune, they wouldn't get much in a civil judgment. They can't pay what they don't have, no matter what the judge says they owe. How will they cover their legal fees to pursue these lawsuits to pick over whatever, if anything remains after all the other creditors are done?
2
Mr. Schneiderman's lawsuit to protect the victims seems to have had exactly the opposite effect. The Contreras-Sweet group proposal included a victims' compensation fund and would not have had the benefit of a bankruptcy proceeding to cut off claims. Instead the victims can join other unsecured creditors in sharing any residual assets in a bankruptcy proceeding.
Of course Mr. Schneiderman got his headlines for filing the lawsuit, so his objectives are most likely satisfied.
2
Ah, poor Swinestein. Funny, I don't feel any sympathy at all!
4
Weinstein has nothing to do with it at this point. As the article makes clear, none of the equity holders (including the Weinstein brothers) was going to get any money from this deal. But by torpedoing the deal, Schneiderman has ensured that legal fees will be higher, delays will be longer, and most importantly, the money available for creditors will be less, because nobody will pay as much as the Contreras-Sweet group was going to pay, and now they get to recut the deal at a lower price if they are still interested.
Meanwhile, many people will lose their jobs, and victims will get paid much less and much later. Do you feel any sympathy yet?
5
The Weinstein group and all involved in it are going over a cliff. This is what happens to an organization when the leader is a bad actor. Did anyone actually think things would work out for them if they tied their destiny to such a deviant? This lesson will applied to the Trump supporters in time. We won't let them forget.
12
I think all the bad actors are in peril and Trump most of all. So many are in the process being swept away on the river of their own misdeeds and abuses. Whether in the end the president and his lackeys go down for their racism, sexual offenses, misogyny, pro-gun sycophancy or other social deviancy, when it comes it will be long overdue. I hope all the current movements coalesce into one with Trump as their biggest target, but also that they don't stop with him.
3
Must be so expensive going to chronic habitual sexual abuser therapy.
10
To say nothing about what the dying company owes to those who were abused by the chronic habitual sexual abuser.
1
I'm not sure if by filing the lawsuit Schneiderman wound up doing the exact opposite of a major part of what he wanted of any potential bidder. There will be no compensation fund for victims and employees will not be protected if Weinstein Company files for bankruptcy. Wouldn't it have been better had he let the sale go through rather than impose those requirements from the outside? There would have been a solvent company for victims to pursue and Contreras-Sweet intended to continue operations so its employees would've had jobs.
5
TWC was already insolvent. Filing for bankruptcy doesn't make the company insolvent. Rather, it simply recognizes that fact and provides a process to deal with that problem.
8
Understood but my point is that the sale to Contreras would've created a solvent company. And apparently helped to accomplish part of Schneiderman's goals.
2
No, the sale would not create a solvent company. They were simply proposing to pay off some financial creditors, and assume the rest of the debt. The resulting company would still be have been subject to the claims of the Weinstein victim/creditors, and would still be insolvent
Dear Mr. Barnes:
Under typical bankruptcy filing, employees get paid first, then the debt holders, and the equity owners are the last to get paid. What I wonder is if actors and actresses a share of revenue if gross movie revenue exceed a certain level, is that considered compensations, or is it a payment for equity interest in the movie in question.
If the actors and actresses that performed in the movie are to be compensated as an equity owner, they will probably get nothing, and some of them will be harmed more than once.
1
Elizabeth's comment is not accurate. First, employees only get paid first to the extent that there is unencumbered cash available to pay them. So if the lenders have liens on all the cash, then the employees do not get paid.
Second, even when there is cash available to pay employees, the employees "first place in line" is only with regard to what are considered "priority wages." These are amounts earned within 180 days of the bk filing, and are limited to about $13k
4
I feel bad for the employees, but I would like to see Harvey living out of a cardboard box on sunset blvd after he gets out of jail.
23
How far the mighty fall. Hollywood must take stock yet again of how perilous and expensive is the old system, relying as it does almost exclusively on male leaders and on the tacit acceptance of the "casting couch" approach to picking female actors. That the tremendously successful Weinstein Company now has more current and potential debts than it does value shows that at some point, women, minorities and social revolution will out. Wake up! we say to all industries and entities -- from politics to sports to entertainment -- that rely on an Old Order. If you don't learn from this overdue era of social rebellion -- lead by the likes of Black Lives Matter, MeToo and Parkland students -- they'll come for you next.
7
Is it really about a payday for the victims or is it about their vindication? I don't think they are standing in line with their hands out? Are they?
5
This shall send a strong message to board rooms across the nation perhaps the globe.
4
I know what I will write will sound jaded. It probably is. It is hard for me to take all this seriously and not just shake my head. These Hollywood moguls have had their way with young up-and-coming actors, male and female, for decades. One of their most famous gets caught and they write an “oh poor us” letter to stave off bankruptcy, but it fails.
I do feel a bit sorry for their employees, but I am sure they can walk across the street and get a job. Hollywood is still Hollywood.
19
...really.. "walk across the street and get a job".. ?- you mean as a waiter/waitress?
5
Maria you wanted this company for nothing...now you are getting nothing!! Well done. Burkle should've known better than get greedy at the last minute to squeeze out more blood for himself.
2
Dude, they can still buy it out of bankruptcy for even less and the creditors will be stuck with the difference
4
$500 million is nothing? Let's see what the next rounds of bids looks like now.
2
I see a few comments her mentioning how the victims will be better off in a bankruptcy proceeding. Obviously those commenters don't understand bankruptcy. In a bankruptcy, the debts (and potential debts) outnumber the assets. Therefore any creditors will have to fight to get pennies on the dollar for what they are owed, including victims. If the company was bought outright, there would be potentially more money for victims. A.G. Schneiderman barging into the mess just made it worst for everyone, including the victims.
4
Actualy, sounds like RBC does not understand bankruptcy. The availability of money to pay victims depends on what the company is worth, not the process used to sell it. Here, the fact is that already the liabilities exceed the debts; filing for bankruptcy doesn't change that math.
9
sorry - should be "the fact is that already the liabilities exceed the value of the assets"
4
Schneiderman - another man making victims of these women again.
9
From all the accounts reported, it seemed as if the only viewings Harvey became interested in were those of him in the shower.
Women victimized. People's lives ruined. Careers destroyed. Fraternal feuds. Broken families. Bankruptcies. It would have made for a great movie in the old Miramax company. I suspect another studio is already looking for a production company to come forward with a script proposal.
That's Hollywood....some things never change.
7
Now Glasser intends to sue Weinstein Co. for wrongful dismissal. All any of them care about is money. What Weinstein and Cronies deserve is total emasculation from the top down.
7
I feel the better term is dehumanization. since they were not masculine before. True masculinity does not need to put anyone down. Weinstein and others like him should have all assets redistributed to victims first, then employees. That way the cost of their behavior will become too great for others to risk repeating it.
2
The bankruptcy actually enhances victims' rights in my view, if professional fees are held in check. The Contreras-Sweet group can still fund an operating loan and buy the operating company or its pieces in a bankruptcy and is further along than others in making a proposal to do so and getting favorable lead bidder protections. If I were advising them, I would have insisted on doing the deal in a "prepackaged" bankruptcy anyway.
More importantly, the bankruptcy will give the victims an opportunity for a more formalized voice and representation as to how sale proceeds and insurance coverage are allocated to address their claims. This is how other toxic issues such as asbestos claims were handled in the past.
3
Karen, you probably know better than I, but is it not true that in a bankruptcy proceeding, the victims would be knocked down to the lower rungs of the creditors' ladder, behind all of the lending banks?
2
If the bank's have liens, they are ahead of the unsecured victims, but not otherwise. Importantly, the victims likely have claims against additional assets such as D&O policies.
3
The victimization of women has finally been given the attention it demands. This ongoing abuse is a human-rights violations pandemic. If institutions and abusers fall, so be it.
11
What a clever way to avoid paying reparations to victims.
24
Eric Schneiderman is a self aggrandizing clown. The sale was about to close when he stuck his headline seeking nose in.
17
The owners, board and management deserve to be vilified, bankrupted, punished. The films made by the talented actors, writers, directors and all their creative personnel deserve to be preserved. If anyone is interested, I'll be happy take over and work with the creative teams!
1
This was predictable. Ultimately, the Board decides to seek bankruptcy protection to save itself, and everyone else gets overlooked. The victimizers continue to victimize.
This arc of failure was brought about by the culture of silence around sexual abuse and misconduct. No one can say they didn't see this coming.
25
Mr. Schneidermann's last-minute lawsuit to halt the sale made bankruptcy the only option. Instead of a compensation fund as Ms. Contreras-Sweet proposed, the victims will now be lumped together with all of the company's other unsecured creditors. They'll have to overcome several defenses to their claims (including statutes of limitations) and hope that something remains when the process is complete. Atta boy, Mr. Schneidermann.
17
Statues of limitation are for criminal cases. These are civil and there's no such thing as "too long ago" when it comes to the sexual, physical violations wreaked by that man. No company should bear Weinstein's name and no limit placed on financial restitution -- as a starting point -- for the careers he despoiled, the women whose lives he will continue to haunt and the sense of security and self-possession among his victims that he shattered. What other creditor could come even close in their claims? The answer is none, no one.
This is not correct. There are statutes of limitation that bar a plaintiff from bringing a claim after a certain period of time has passed.
2