A Los Angeles bankruptcy judge has appointed an interim trustee to watchdog Menachem Golan’s 21st Century Film Corp. to make sure it complies with bankruptcy petitions filed by a host of creditors and to stop it from fleeing the country and abandoning its massive debts.
The company, run by Golan, owes some $ 20 million to such creditors as Credit Lyonnais, the Directors Guild of America, the Writers Guild of America, the Screen Actors Guild and all their pension plans.
According to the motion filed by Credit Lyonnais attorney Philip Grosz, Golan made specific plans to illegally and surreptitiously leave the country with his company in tow.
“Golan is engaged in a deliberate scheme to transfer assets of the debtor beyond the jurisdiction of this court for the express purpose of ‘hiding’ them from the company’s creditors,” the motion said.
Bankruptcy Judge Kathleen T. Lax issued an order Wednesday for an interim trustee to be named. She is expected to appoint a permanent trustee at a hearing today in the Los Angeles Courthouse.
Golan, producer with former partner Yoram Globus of such pix as “Runaway Train” and “Missing in Action,” allegedly attempted to fleece his creditors through a complex financial scheme that involved offshore companies.
“Golan summarily ‘fired’ all of debtor’s employees, with the proviso that they are all summarily ‘rehired’ as employees of the new film production company ,” the motion said. “Golan has recently announced that he has imminent plans to leave the United States for London. Consistent with these plans, Golan has taken steps to obtain possession of various film elements, such as film prints and copies, for the express purpose of ‘moving them around and hiding them’ from Credit Lyonnais bank and other creditors.”
Golan, who founded the company after he and Globus separated as partners, owns 94% of 21st Century Film Corp. stock. The rest is traded publicly.
The motion said the company has been deteriorating for the last two years with the departure of several key employees, including former veep of biz affairs Patrick Peel, former chief financial officer Jamie Cullen and former prexy Ami Artzi.
Peel and Cullen, in legal declarations included in the motion, offered a scathing indictment of Golan’s business practices.
Peel said the producer hoped to transfer all present and future assets to an offshore company named Grove Park Intl. that would be unrelated to 21st Century.
He said he was fired after Golan discovered a copy of a memo Peel sent to then-prexy Artzi outlining the offshore scam.