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27
1 years

Ruling Opens Door to Recovering Millions From David Bergstein Movie Companies

Even before the ruling on Tuesday, Aramid has begun acting on behalf of the trustee, with court approval. Since last November, Aramid has filed about 90 “placeholder” lawsuits against not only Bergstein and Tutor and their many companies, but also against others who got money from the bankrupt movie companies including Bergstein’s mother, Sarah, and various Las Vegas casinos such as  Mandalay Bay, which received payments to cover Bergstein’s debts. Each of those companies and individuals will have to prove the bankrupt companies got fair value for the money, or they will be required to pay it back.

Aramid is sorting through more than 800 transactions involving more than 200 bank accounts, dozens of corporate shells and a number of individuals to seek out the money that was moved from the bankrupt companies into accounts where it could not be seized on behalf of creditors.

They are “placeholders” because the statute of limitations was about to run out, so the suits were filed to keep the clock ticking until they can move forward on the road to recovery. Now with Russell’s approval, they will do that and more.

On Feb. 15, Aramid also filed the first in what is expected to be an additional series of lawsuits on behalf of ThinkFilm, the once successful Canadian-American indie distributor that won an Oscar in 2008 for the documentary Taxi To The Darkside. Aramid is seeking the return of $25 million the company believes was improperly taken from ThinkFilm alone.

The ThinkFilm suit against Bergstein and his companies goes into detail about Bergstein and Tutor’s alleged improper behavior throughout the case, which includes allegedly filing false financial documents with the court, backdating documents, providing misleading information about what assets were in the bankrupt companies, withholding computer files and more.

“The proposed settlement is fair and equitable,” Durkin said in his legal filing. “Indeed, it is designed to promote reorganization, settle disputed and dubious claims, and to address the scorched-earth opposition by (Bergstein and Tutor) whose claims likely merit subordination.”

Lawyers representing Bergstein and Tutor did not respond to requests for comment.