Vincent Bruzzese exits to form new venture with backing from Benaroya Pictures, Miscellaneous Entertainment
Hollywood market research firm Worldwide Motion Picture Group abruptly shuts its doors just days before its CEO and his longtime lieutenants announced a new venture Tuesday, leaving conflicting accounts of what exactly transpired.
But the circumstances surrounding the MPG closure and subsequent launch of the new form, called C4, are cloudy. In an interview Tuesday with Bruzzese, Michael Benaroya and Miscellaneous principal D. Todd Shepherd, the trio explained that they approached MPG’s employees about joining C4 only after they were let go by MPG.
But David Lugliani, who helped purchase MPG from Ipsos OTX last year, painted a very different picture of what transpired. While Bruzzese described himself as just an employee, Lugliani characterized him as a part owner who abruptly resigned and fired all of the employees without notice last week, leaving behind significant debt after a year of financial straits that amounted to $3 million in losses.
Bruzzese’s departure also comes a little over a year after Ipsos OTX sold MPG to him and Lugliani. MPG was one of a trio of companies that has dominated the movie and TV market research sector alongside Nielsen’s National Research Group and Shamrock Capital’s Marketcast. Bruzzese’s departure also marks the second big departure to rock this sector in as many weeks, given the recent ouster of NRG president Derek McLay.
Litigation is a distinct possiblity given stakeholders had no choice but to shutter MPG given the employees’ mass exodus. “At this point, we are getting ready to sue,” said Lugliani. “It’s always better to settle, but there were a lot of problems with how they handled this.”
“The bottom line is that we’re not concerned about any litigation because we had no role in people becoming available,” said Benaroya. “We didn’t have anything to do with them being let go from their previous job.”
But Lugliani alleges that months prior to Bruzzese’s departure, Benaroya and Miscellaneous approached MPG as a potential owner and examined its books. MPG had been actively seeking a buyer in recent months given the sorry financial state of the company, but there were no takers given the impediment the company’s debts likely created for potential buyers.
He also contends that the formation of C4 prevents him from paying off debt to creditors, which include Ipsos OTX. Without the employees in place, MPG can’t continue the services that would have helped pay off its debt or attract new potential investors.
“The decision to do what they did makes no sense whatsoever,” said Lugliani, a private investor with various holdings in real estate and media. “You don’t just walk out out of an airplane and see where it crashes.”
What also remains to be seen is the fate of the most crucial element of a research business: MPG’s data, over which the companies still appear to still be negotiating. Both sides confirm that Benaroya/Miscellaneous made an offer to acquire MPG’s assets, but that the offer was declined.
Benaroya maintains that C4 doesn’t need MPG’s data, which can be obtained from other unspecified sources.
“We are interested in potentially making a deal to have access to that data from MPG but that data is historic and losing value by the minute,” he said. “We are prepared to move forward with or without that data.”
MPG drew notice last year for introducing data capable of informing story choices in movie scripts. In addition to that script assessment tool, MPG also conducted audience test screenings, advertising testing, and audience tracking and exit polling.
Benaroya and Miscellaneous teamed to together last year to form a sales company for movies. In addition to Shepherd, Miscellaneous is backed by George Waud. Also backing the company is Josh James, founder and CEO of Domo.
What will be interesting to see besides whether C4 can hold onto MPG’s data is whether studio clients will make the transition as well. C4’s announcement boasted supportive comments from research chiefs at Warner Bros. Pictures and Imagine Entertainment.
Joining Bruzzese at C4 are MPG executives Kristen Simmons, Rich Fineza, Miriam Brin, Wade Young and Rob Siegel. Bruzzese said that his new firm will be able to adapt to how Hollywood is rapidly being transformed in the era of new media. “What C4 is looking to do is address the new kind of paradigm out there,” he said. “My team currently has all the things that we were looking to do.”