Weinstein Company says it will file for bankruptcy

The Weinstein Company is moving closer to bankruptcy.The studio co-founded by Harvey Weinstein has been crippl...

Posted: Feb 26, 2018 8:53 PM
Updated: Feb 26, 2018 8:53 PM

The Weinstein Company is moving closer to bankruptcy.

The studio co-founded by Harvey Weinstein has been crippled by the sexual harassment and assault allegations that have been leveled against him. Now it appears that a deal to sell the studio's assets is falling apart.

The studio's board of directors said in a letter Sunday night that the would-be buyers were unwilling to provide interim financing to keep it afloat while the deal was finalized.

Without that cash, the company is on its last legs, the board indicated.

The group of investors seeking to buy the assets -- led by Maria Contreras-Sweet, former head of the U.S. Small Business Administration -- have not yet publicly responded to the board.

But a source involved with the talks confirmed that the investors have received the letter.

"They are trying to figure out if there's still a way forward," the source said.

The bankruptcy paperwork has not yet been filed, according to two sources, but it could be filed in the next few days.

In the Sunday night letter, Weinstein Co. accused the investors of an "illusory" bid.

"It is simply impossible to avoid the conclusion that you have no intention to sign an agreement -- much less to close one -- and no desire to save valuable assets and jobs," the letter stated.

It concluded, "We will now pursue the board's only viable option to maximize the company's remaining value: an orderly bankruptcy process."

Variety posted a copy of the letter on Sunday. CNN has not yet obtained a copy of it.

Weinstein was ousted from his role at The Weinstein Company last fall after numerous reports of sexual misconduct. He has been accused of sexual harassment or abuse by more than 60 women.

Weinstein has denied any accounts of non-consenusal sex.

Related: Weinstein Company sale in jeopardy

In the wake of the reports, many of the studio's business partners fled. New business opportunities dried up.

With bankruptry seen as a worst case scenario, the studio sought a buyer. In January it entered into exclusive talks with Contreras-Sweet's investor group. She promoted the idea of a new studio, led by women, with the Weinstein name wiped away.

In the meantime, the existing owners tried to keep the studio's doors open and keep staffers on payroll through a variety of financial maneuverings.

The deal talks were complicated two weeks ago when New York Attorney General Eric Schneiderman filed a lawsuit against Weinstein and his former company.

Schneiderman said that a four-month investigation into sexual harassment found "vicious and exploitative mistreatment of company employees." The suit cites what it calls "egregious" violations of state civil and human rights laws.

The state A.G. said he "will not stand in the way" of a sale if his concerns are addressed. He expressed three concerns: "Any deal must ensure first that victims will be adequately compensated;" that employees will be protected; and that executives who knew about Weinstein's alleged acts "will not be rewarded."

In the wake of the suit, the Weinstein Co. board forced out David Glasser, the company's COO, one of the executives who had been singled out by Schneiderman.

Last Wednesday there was a meeting involving Schneiderman's office and the would-be buyers of the studio. Both sides said it was "productive," indicating that an agreement was within reach.

But then came Sunday's letter from the board about the company's financial crunch.

Amid the lengthy talks -- first about the terms of the deal, then about addressing Schneiderman's concerns -- the troubled studio "simply ran out of money," a person involved in the deal said.

Now there's a lot of finger-pointing going on.

Schneiderman's office said in a statement on Monday that the recent talks had come up with a "clear path forward" on the issues raised by the lawsuit.

For example, Contreras-Sweet's investor group had committed to a victim compensation fund of up to $90 million.

"We are disappointed" that the parties "were unable to resolve their financial differences," Schneiderman's office said. "We will continue to pursue justice for victims in the event of the company's bankruptcy, and our investigation into the pattern of egregious abuse by Harvey Weinstein and his enablers is ongoing."

Mississippi Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 92432

Reported Deaths: 2792
CountyConfirmedDeaths
Hinds6931154
DeSoto535455
Harrison370771
Jackson335867
Madison319086
Rankin316174
Lee256166
Jones237678
Forrest231769
Washington216371
Lafayette205039
Lauderdale1990124
Bolivar177565
Oktibbeha174149
Lamar157733
Neshoba1529103
Panola142426
Sunflower139643
Lowndes138957
Warren137250
Leflore135380
Pontotoc121216
Pike120448
Monroe118265
Scott115925
Copiah115733
Coahoma111227
Holmes108558
Marshall107115
Grenada105035
Lincoln104953
Yazoo103529
Simpson100742
Union97724
Tate95037
Leake93735
Adams90936
Wayne87121
Pearl River85150
Marion83633
Prentiss80317
Covington79622
Alcorn76311
Newton75022
Itawamba74621
Tallahatchie74518
George74013
Winston72019
Tishomingo65336
Chickasaw64124
Attala64025
Tippah63716
Walthall59025
Clay56516
Hancock55720
Noxubee54015
Jasper53815
Clarke53138
Smith51814
Calhoun50612
Tunica47613
Montgomery45320
Claiborne45116
Lawrence42312
Yalobusha41514
Perry39417
Humphreys37215
Quitman3725
Stone34811
Greene33817
Webster32813
Jefferson Davis32311
Amite31110
Carroll31012
Wilkinson30117
Kemper28615
Sharkey26212
Jefferson2379
Benton2181
Franklin1873
Choctaw1775
Issaquena1033
Unassigned00

Alabama Coronavirus Cases

Confirmed Cases: 128818

Reported Deaths: 2284
CountyConfirmedDeaths
Jefferson18772333
Mobile12975289
Montgomery8598173
Madison742275
Tuscaloosa7081114
Lee560359
Shelby557250
Baldwin503348
Marshall378442
Etowah330645
Calhoun324939
Morgan314226
Houston264422
Elmore249747
DeKalb232619
St. Clair219835
Walker219180
Talladega203426
Limestone194219
Cullman180817
Franklin173428
Dallas173226
Russell16922
Autauga166424
Lauderdale161633
Colbert158126
Escambia155424
Blount152714
Jackson148511
Chilton146327
Covington130327
Dale130043
Coffee12488
Pike11359
Tallapoosa112983
Chambers111742
Clarke104617
Marion92128
Butler90638
Barbour8247
Marengo69619
Winston68712
Lowndes64527
Pickens62814
Bibb61910
Hale61028
Randolph59112
Bullock58514
Lawrence57820
Monroe5738
Geneva5564
Cherokee54816
Washington54513
Perry5366
Clay5317
Wilcox53011
Crenshaw51931
Conecuh51711
Macon46720
Henry4594
Sumter41719
Fayette4159
Choctaw34412
Lamar3372
Cleburne3166
Greene30015
Coosa1603
Out of AL00
Unassigned00
Tupelo
Few Clouds
72° wxIcon
Hi: 78° Lo: 61°
Feels Like: 72°
Columbus
Overcast
73° wxIcon
Hi: 79° Lo: 61°
Feels Like: 73°
Oxford
Clear
72° wxIcon
Hi: 77° Lo: 58°
Feels Like: 72°
Starkville
Overcast
72° wxIcon
Hi: 75° Lo: 58°
Feels Like: 72°
WTVA Radar
WTVA Temperatures
WTVA Severe Weather