In a counterclaim, DMG blasts Fenton as a disloyal employee who advanced his own interests at the company’s expense. The suit alleges that Fenton “cultivated his persona of a ‘player'” in the industry even while losing millions of dollars.
“Fenton was terminated for his poor performance, gross mismanagement, and fraud on the companies he served,” the counterclaim states.
Fenton departed in February 2018, and alleges in his lawsuit that he was wrongfully cut out of the profits from the company’s IPO. Fenton claims his put his reputation on the line to defend DMG from an SEC investigation into possible bribery of Chinese officials.
He also says he lost faith in founders Dan Mintz, Wu Bing, and Peter Xiao, concluding that they were engaged in risky borrowing against company stock to finance the purchase of a $30 million jet and a $20 million mansion in Beverly Hills, Calif. He also alleges that the founders have run the company into the ground.
The counterclaim accuses Fenton of sloppy business practices, including failing to perform adequate due diligence or maintain proper business records. “He either was unable or unwilling to carry out even the most basic managerial tasks,” the suit alleges.
The suit also accuses Fenton of claiming credit for others’ work.
The suit states that Fenton, in 2016, cost the company millions in damages on a deal to produce live shows in China featuring the Transformers characters. DMG alleges that the shows were delayed, and that Fenton’s production partner, S2BN, allowed its licensing deal with Hasbro to expire. The shows were never produced.
“Fenton was driven by his own ego and desire for personal glorification in the public eye; in order to cultivate the persona of a ‘player,’ his priority was getting a deal ‘done,’ rather than looking out for the best interest of DMG CC,” the suit alleges.
The suit also accuses Fenton of making misstatements to the Academy of Motion Picture Arts and Sciences in order to gain admission, and that he used his membership “for his own personal gain rather than for the benefit of DMG CC.”
The suit accuses Fenton of fraud, breach of fiduciary duty, and negligence, and seeks $30 million in damages.
Fenton’s attorney, John R. Baldivia, issued this response:
“We find it interesting that our client, who was responsible for putting together the deals for both ‘Iron Man 3’ and DMG’s ownership of Valiant (as well as many other successful endeavors that DMG now brags about) is now on the receiving end of a cross-complaint concerning his performance as a former DMG employee. As we have said before, we will allow the facts to speak to the truth about DMG’s actions, as well as the actions of our client.”
A DMG spokesperson shot back: “Once again, Fenton is trying to take credit for work he didn’t do. He made a mess of those deals, which others had to clean up.”