Financier claims he's owed cash and 3 percent of library
Film financier David Bergstein claims in a lawsuit filed Monday that Miramax owes him millions of dollars and 3.33% of the company for his role in its sale from Disney.
Bergstein advised the consortium of investors, including Tom Barrack’s Colony Capital, who purchased the library from Disney in 2010. Miramax has played down Bergstein’s involvement in the company ever since.
As part of the deal, Bergstein claims he and his company Exodus Film Co. were entitled to 3.33% of the company and $6.1 million when Miramax refinanced last year, as well as hundreds of thousands of dollars as part of a consulting agreement.
“They strung me out for a long time,” Bergstein told Variety by phone Monday. “The Miramax transaction is a transaction that I put together myself and had the deal done with Disney before Colony ever came along. And when they came along we had a very clear agreement in place about what I was to get and everything was signed and done.”
Bergstein claims that his legal troubles – a number of involuntary bankruptcies which also entangle Miramax investor Ron Tutor – made the Miramax backers uneasy about his involvement as a consultant. Bergstein says that Josh Grode, the attorney for Nanula and Colony, told him to keep a low profile so as not to make other financiers nervous.
“They specifically told him he should just sit down and shut up and not make any noise and as long as he behaved himself they would pay him something,” Bergstein’s attorney Alex Weingarten told Variety. “But if he persisted on asking what he was entitled to, they would make sure that he got nothing.”
Suit alleges that Grode has a beneficial interest in GHL & Company, an investment banking firm based in New York which “served as either a consultant or underwriter” on Disney’s sale of Miramax and its subsequent refinancing. Suit alleges the “G” in GHL stands for “Grode,” while it is widely known that the “H” and “L” stand for partners Peter Hoffman and Sasha Lloyd, respectively.
Bergstein alleges in his suit that GHL and Grode received $15 million in fees from the initial transaction.
“The money to pay those fees had to come from somewhere and Grode realized that he could shove Bergstein out of the deal to take the fees for himself while the investors would be none the wiser,” the suit states. “Grode never disclosed his relationship with GHL to Exodus and, on information and belief, never disclosed it to any other investor in the Miramax deal, other than Colony.”
Advisory firm Duff and Phelps pegged Miramax’s value at $813 million when the company refinanced in December. According to Bergstein’s suit, his 3.33% ownership stake would entitle him to somewhere around $27 million of that valutation, plus whatever moneys investors earned during the transaction.
“We’re at somewhat of a disadvantage because they’re not sharing the information with us,” Weingarten told Variety.
Additionally, the suit claims that former Miramax CEO Mike Lang was fired from the company, contrary to reports that he resigned last month.
A spokeswoman for Miramax and Colony said the companies had not yet been served with the suit and could not comment.