Lantern Capital Partners is now facing the prospect of explaining at trial its moves three years ago when it maneuvered to buy most of The Weinstein Company’s assets out of bankruptcy for about $270 million. The Texas-based private equity firm — which then spun out Lantern Entertainment, which became Spyglass Media — is being pursued by Marvin Peart, who alleges that the huge Weinstein transaction entitles him to a percentage. On May 25, a Los Angeles judge ruled Peart’s contract claims couldn’t be decided on summary judgment, setting up a potential trial with tens of millions on the line.
Peart, a financier and producer (Mob Wives, The War with Grandpa), stepped forward when the Harvey Weinstein scandal left The Weinstein Company in tatters. With a strong relationship with TWC executives like David Glasser, Peart scouted for potential buyers and reached out to Lantern.
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According to his complaint, Peart claims he was promised in writing a 3 percent “introduction fee,” a seat on the board of directors, and public recognition of being the African-American architect of the deal. He also says he has an oral contract for a 10 percent share in eventual proceeds from selling TWC assets after acquiring them. He was eventually shut out of meetings, and Peart alleges the jilting is explained by racial animus.
The chief defense to the claim of a breached contract is that there was only assent to fees for Peart for a deal that included Yucaipa, Ron Burkle’s investment firm which is separately pursuing Lantern in another suit. The $270 million bankruptcy buy-out didn’t include Yucaipa.
L.A. Superior Court Judge Robert Broadbelt rejects the defendants’ contention that email exchanges make clear any Yucaipa stipulation. On the other hand, Broadbelt throws out non-contract claims including fraud, which means that Peart can no longer collect punitive damages should he prevail at trial.
Here’s the full decision…
(Update: This post originally stated that Spyglass was facing trial. It’s been corrected to reflect that Lantern Capital Partners is the entity that couldn’t prevail at the summary judgment round.)
