Green-Light International has declared bankruptcy following a blistering arbitrator’s ruling that found that the foreign sales agent committed acts that “bordered on criminal fraud.”
The company was accused of pocketing $410,000 from distributors that should have gone to a collection account, and using the money for salaries and “a lavish post-Cannes Film Festival vacation in the Italian Riviera.”
The claim was brought by Raven Asset-Based Opportunity Fund, which extended loans totaling $9 million for production of two films, “Imperium” and “Urge.”
In his ruling, arbitrator Jeffrey G. Benz found that the company’s principals had also repeatedly lied, sometimes under oath, and failed to produce bank statements. The ruling also found that the company violated a distribution agreement with Universal on “Imperium” by publicly announcing the deal, which caused Universal to cancel it.
“Certainly, this Arbitrator has never seen in his years of practice as an entertainment lawyer such a, at best, cavalier attitude from a sales agent toward its principal and its obligations and duties, or at, worst, outright… efforts to intentionally mislead the sales agent’s principal,” Benz wrote.
Benz ordered Green-Light to pay damages of $765,000, plus attorney’s fees and more than $1 million in sanctions.
In response, Green-Light CEO Jeff Elliott said that some of the arbitrator’s statements were “outrageous” and “gratuitous.”
“This was a business dispute where Green-Light was trying to protect its right to compensation and to suggest that there was anything more than that was uncalled for in a civil arbitration,” Elliott said. “Quite frankly, some of the arbitrator’s statements are simply slanderous.”
Elliott said the company would continue to fight the award in court.
“Among other things, there is a total failure to acknowledge that Green-Light obtained millions of dollars of sales for these movies for which we have not been compensated,” he said. “We also had evidence of improprieties by Raven and Sculptor Media that we were deprived from producing in the arbitration.”
The bankruptcy filing states that the company has just $20 in assets. It lists the $410,000 award to Raven as the company’s largest unsecured debt.
Green-Light announced its formation at the 2015 American Film Market, and included “Imperium” on its initial roster of films.
Raven’s attorney, Mathew Rosengart, said the financier was happy with the outcome.
“Our client is extremely pleased by the Arbitrator’s Award, which completely vindicates Raven and even further exposes the misconduct of GreenLight, which has apparently now also filed for bankruptcy as a result,” Rosengart said. “The Arbitrator’s detailed and conclusive rulings against GreenLight are consistent with those of initial Arbitrator, Judge Rosalyn Chapman, and they speak for themselves.”