The film studio the Weinstein Company has filed for bankruptcy this Sunday, after talks with a potential buyer broke down.
The company had been struggling following the various sexual harassment accusations towards co-founder Harvey Weinstein. They were hoping to make a $500 million deal with an investor group who had been eyeballing the company to prevent the official bankruptcy.
The investor group led by Maria Contreras-Sweet, a former Obama administration official, and Ron Burkle, were intending to keep the studio open and alongside keeping its 150 employees.
However, the deal started to fall apart earlier this month after Eric Schneiderman filed a civil rights lawsuit against the company, which blocked the sale. The New York’s attorney general brought forward alleged claims of sexual harassment and abuse of employees. With the lawsuit he wanted to ensure those involved reached a fair agreement and was sufficiently compensated.
“While we deeply regret that your actions have led to this unfortunate outcome for our employees, our creditors and any victims, we will now pursue the Board’s only viable option to maximise the Company’s remaining value: an orderly bankruptcy process,” stated a letter issued by the film studio on Sunday.
“We must conclude that your plan to buy this company was illusory and would only leave this Company hobbling toward its demise to the detriment of all constituents.”
Harvey Weinstein, who was fired by his own company on October 8th and soon after removed from the Academy of Motion Picture Arts and Sciences, has been accused of sexual misconduct by more than 70 women. Some of the accusations include rape. He has denied all allegations of non-consensual sex.
The film giant will file for Chapter 11 bankruptcy and plans to formulate a strategy to pay off their creditors.