SANTA MONICA — In a marketplace fraught with insecurity until the cash is in the bank, it seems that the Carnegie Film Group has contributed mightily to the skittishness at this year’s American Film Market.
On March 2, Carnegie topper Krishna Shah was served with a $ 315,000-plus lawsuit for breach of contract, fraud and fraudulent conveyance on behalf of the Private Lessons Partnership.
According to the plaintiff’s attorneys, Carnegie acquired the rights to rep the $ 2.5 million indie remake “Private Lessons” for overseas rollout in 1992 and defaulted on a $ 350,000 advance to the producers, paying only $ 35,000 by the Dec. 1, 1993, deadline.
According to court papers filed in Los Angeles Superior Court, the Los Angeles Marshal’s office was instructed to attach “all of the property of defendant … including, without limitation, bank accounts and film elements.”
Simultaneously, other entities directly or indirectly involved with Carnegie (previously Double Helix Prods.) deals have been affected:
On March 1, toppers from AFM attendee Filmways Entertainment Corp. were surprised in their suite by a process server sporting an AFM badge, who informed them that any Carnegie product sold by Filmways would be attached under the terms of the suit. Other Filmways product is unaffected.
Texas-based communications company ATC, which owns a substantial portion of Carnegie, is also named in the Private Lessons vs. Carnegie suit, the plaintiff’s legal reps said.
“Essentially, Carnegie’s posture through all this has been, ‘Let’s try to work it out,’ but every time it comes to that, they have shown no interest in paying us,” a legal rep for the plaintiff said.
Carnegie reps did not return calls.
“For six months, Carnegie told us they were going public, and that we would get our money if we just waited,” said R. Ben Efraim, plaintiff and Private Lessons producer/topper, whose attorney added that the Carnegie suit is a Byzantine affair.
“What makes this extremely confusing for us is that there are all these people in the suite who say someone else is going to pay,” a legal rep for the plaintiff said. “And it’s difficult to ascertain exactly who’s going to do it.”
The plaintiff also has asked for unspecified punitive damages because of the fraud charge. “We’ve asked for anything else we can get,” the rep concluded.