Group sues over Axium collapse
Claims Golden Tree engaged in a secret foreclosureA group of production companies has filed a $7.5 million fraud lawsuit against Golden Tree Asset Management over the collapse of payroll processing service Axium.
The plaintiffs, which include 2929 Prods., Yari Film Group, Mel Gibson's Icon Prods. and Sneak Preview Entertainment, claim Golden Tree, which had loaned money to Axium, engaged in a secret foreclosure of Axium. The result was the bank transferring $28 million in funds from Axium, which were entrusted funds deposited by the plaintiffs.
Axium abruptly closed its doors in January and filed for bankruptcy after its finances collapsed, leaving several production companies in a lurch with their payroll.
The plaintiffs claim the damage has included delays in film releases and special promotions -- one involving a film being unveiled at Comic-Con -- and increased costs in completing productions.
"To mitigate the impact of these increased costs, these plaintiffs have been obliged to bring aboard equity investors and thereby diminish these plaintiffs opportunities for future profits on these productions," the lawsuit states. "The release of their films has been disrupted and forced limited early release of one film in certain markets, with a resulting adverse effect on its ultimate market success."