The Weinstein Company announced plans to file for bankruptcy on Sunday night after talks failed for a possible sale. The co-founder of the producer and studio, Harvey Weinstein, was expelled from the company last October after numerous accusations of sexual harassment and assault of dozens of women who said their abuses had persisted for decades. The Weinstein Company has had financial difficulties since those accusations came to light, in particular the reports of The New York Times and The New Yorker.
The company tried to obtain loans from private equity firm Colony Capital to prop up its finances, but those plans failed, and Colony predicted that the Weinstein Company would end up bankrupt. The company then sold its distribution rights in North America to Paddington 2, a children's movie that came out last month.
An investment group, which included Obama administration official Maria Contreras-Sweet and billionaire Ron Burkle, also held talks about potential purchases in the company. The original agreement had been to pay around $ 275 million and assume a debt of $ 225 million.
On February 11, New York Attorney General Eric Schneiderman sued the company and its founders, the Weinstein brothers, accusing them of "abusive and abusive mistreatment of company employees." The lawsuit put a key to the sale negotiations, but Burkle and Contreras-Sweet met with Schneiderman last week to try to salvage the deal.
Contreras-Sweet created a plan to set up a women's majority board and set up a dedicated fund for Weinstein victims that would include a $ 10 million line of credit and at least $ 40 million more by selling the Weinstein Co. film and television projects. , anonymous sources told the LA Times. Nor was it supposed that the Weinstein brothers, holders of shares or any other person who enabled Weinstein should receive cash from the sale.
On Sunday night, the board of representatives of the Weinstein Company wrote a letter to Contreras-Sweet and Burkle, stating that their offer in an "incomplete document" recently received was below expectations and that the Weinstein company was better at declaring the bankruptcy. The letter says that the offer "unfortunately does not keep [their] promises … It increased the responsibilities left for the Company, tracing a financial path that will fail … in short, the return that it returned does not present a viable option for a sale. "
The Weinstein company's status as a pariah in the entertainment industry and its subsequent financial problems, as well as investigations into the complicity of other Weinstein executives, demonstrates that accusations of sexual misconduct can have tangible and financial repercussions for abusers and its facilitators. Weinstein and his company are not alone either. The #MeToo movement, which was triggered by the accusations against Weinstein, has led to defining career consequences for other men in Hollywood as well. In the last four months, actor Kevin Spacey was fired from Netflix's House of Cards, Amazon fired Jeffrey Tambor of Transparent and Amazon Studios executive Roy Price resigned after allegations of sexual misconduct.