MONTREAL — Canuck indie film distributor and producer Blackwatch Communications, which distributed Oscar-winner “Crouching Tiger, Hidden Dragon” in Canada, has filed for bankruptcy protection and laid off half its 30 staff.

Blackwatch CEO Bill Mariani said the company will drop production and film-financing and focus on distribution.

“I don’t think I’ll be producing anymore,” said Mariani. “It’s too capital-intensive and too risky. I see it becoming a small, niche distributor giving more assistance to producers to get films made. We took a look and saw what was bringing in cash in the short-term.”

Blackwatch was founded in 1995 as a production house, but the company gained a much higher-profile when it formed distributor Blackwatch Releasing two years ago.

The Montreal-based company has deals to distribute films from several U.S. companies in Canada, notably Sony Pictures Classics, the Shooting Gallery and Trimark Pictures.

It had its first hit with Pedro Almodovar’s Oscar-winner “All About My Mother” and hit the box office jackpot with Asian martial-arts epic “Crouching Tiger, Hidden Dragon.” The Ang Lee film has grossed C$16 million ($10.3 million) for Blackwatch, making it Canada’s top-grossing foreign-lingo film.

Blackwatch continues to have a number of pics on screens across Canada, including “House of Mirth” and “Pollock.”

Blackwatch is the latest in a growing list of Montreal film and TV production companies that have fallen on hard times.

Kids TV producer Cinar Corp. has struggled to deliver new series following its much-publicized financial scandal; Telescene Film Group sought bankruptcy protection last fall; and seasoned producer Prisma went out of business last year.

Blackwatch has tapped accounting firm Richter, Usher and Vineberg to re-organize the company. But the firm has already lost its top distribution executive. Yves Dion, formerly prexy of Blackwatch Releasing, has resigned. Blackwatch Releasing’s Toronto-based senior VP Andy Myers remains with the company.

The other divisions of Blackwatch are Blackwatch Productions, Blackwatch Financial and Blackwatch International.

Blackwatch-produced pics include “Dead Innocent” with Genevieve Bujold, “Dead Silent” starring Rob Lowe and last year’s Bo Derek pic “Life in the Balance”. At the Toronto Intl. Film Festival last fall, Mariani announced a new $50 million financing scheme to help indie Canuck producers.

Mariani said Blackwatch was finding it increasingly hard to attract bank financing and investment-community support due to the high-profile local film-biz failures.