3:35pm PT by Ashley Cullins
Red Granite Wants Independent Fiduciary During Government's 'Wolf of Wall Street' Probe
Red Granite Pictures and the U.S. government are in "productive settlement discussions" relating to a Malaysian embezzlement investigation — and they're asking the court for an independent third party to keep an eye on things while they continue negotiating.
The government filed multiple civil forfeiture cases in 2016 against The Wolf of Wall Street, Dumb and Dumber To and Daddy's Home seeking any rights to profits, royalties and distribution proceeds that are owed to Red Granite. Federal authorities are targeting more than $1 billion in assets that were allegedly diverted by high-level Malaysian officials into shell companies, some of which may have been used to fund the films.
The parties asked the court to allow them to appoint an independent operational fiduciary to oversee the operations and management of Red Granite. This mutually agreed upon person would have the authority to inspect the company's books, monitor transactions, open bank accounts and consult with Red Granite's management team on preserving assets, among other duties. The person would not be empowered to take out loan facilities, acquire capital assets, withdraw from contracts, hire or fire staff or access attorney-client privileged information.
"[I]t is not the intention of the United States in joining this application to prevent any third parties, including but not limited to financial institutions, motion picture studios or distributors, or trade vendors, from doing business with Red Granite, or to otherwise interfere with Red Granite’s ordinary business operations," writes Red Granite attorney Matthew Schwartz in a joint stipulation filed Wednesday. The filing says the U.S. government is actually hoping for the opposite: "that the appointment of this independent operational fiduciary will facilitate and support Red Granite’s ongoing business operations."
It sounds like a reasonable request, but U.S. District Judge Dale Fischer won't sign off on the order — at least as it's currently written.
"Along with the stipulations, the parties filed proposed orders for the Court’s signature," states Fischer's brief order, filed Thursday. "Those proposed orders merely state that 'Pursuant to the stipulation and request of the parties, and good cause appearing therefor, the attached stipulation IS SO ORDERED.' This makes no sense. The Court does not 'order' a stipulation. It is unclear what the parties want the Court to order or what the purported effect of that order would be."