9:40am PT by Eriq Gardner
'One Life to Live' Producer Plans to Liquidate
Anyone want a piece of soap opera history?
Prospect Park Networks, the company that attempted to re-launch One Life to Live and All My Children as web-only series, has announced its intention to liquidate assets in its ongoing bankruptcy case. The prize might be a front-row seat at a trial against ABC that could be coming soon.
The producer is suing ABC, alleging a fraud, wherein the network allegedly asked to "borrow" OLTL characters for use on General Hospital, then changed storylines, killed some characters and began scheming "in its quest for a mega soap." The claimed interference is estimated to have caused tens of millions of dollars in damage for Prospect Park.
When Prospect Park filed for bankruptcy last March, the pending dispute in Los Angeles Superior Court was put on hold. But the judge in the case is conducting a case management conference next week, and in recent papers lodged in the bankruptcy proceedings, an attorney representing the debtor states, "It is anticipated that the LA Court will terminate the 'dark period' and allow the ABC Litigation to proceed expeditiously to trial."
ABC has noted in prior legal filings that Prospect Park didn't complain while it used OLTL characters and even renewed a license agreement. ABC is also counter-suing Prospect Park for $5 million in claimed breach-of-contract damages.
The cost of litigation is undoubtedly expensive. According to more documents in the bankruptcy case, the law firm of Andrews Kurth says it is owed more than $700,000 in unpaid fees. The law firm of Lavely & Singer says it is owed more than $120,000.
If or when Prospect Park goes to trial against ABC, the bankrupt company will likely be represented by a new law firm. There were at least three firms that were interested in picking up the "mega soap" fraud case, and the firm of Jones Day emerged as the one to take the reigns.
And what will Jones Day be getting? Secured by a $400,000 retainer, the law firm will see 33 percent of any settlement money and 40 percent of any money recovered if the case goes to jury.
Meanwhile, on the road to liquidation and in need of paying its creditors, Prospect Park came to an arrangement with Apple, Inc.
The soaps producer was eligible for a 30 percent tax credit for shooting OLTL in Connecticut, and racked up production expenditures of nearly $20 million. With tax money then due from Connecticut -- nicknamed the "Provisions State" -- the debtor entered into a loan and security agreement with EP Financial Solutions, which concurrently sold the tax credit to Apple for $5 million. Yes, Apple not only runs the iTunes store, which once carried the OLTL web-only series, but it apparently bails out producers of soap operas at a modest price.