9:35am PT by Eriq Gardner
Harvey Weinstein Accusers May Get Role Investigating Claims By Other Weinstein Accusers
After declaring bankruptcy thanks to Harvey Weinstein's sexual misdeeds, The Weinstein Company recovered $289 million after selling its assets to Lantern Entertainment. More money is likely coming from insurers. Now it's time to pay out. But who is in charge of disbursing the pot of money to the many women who have stepped forward to share stories of being victimized? That question was addressed in a motion filed Tuesday in Delaware bankruptcy court.
The Weinstein Company is now requesting that the Committee of Unsecured Creditors be given the authority to investigate, prosecute and settle claims. If the judge grants the motion, it will mean that at least two of Weinstein's accusers — Louisette Geiss and Sandeep Rehal — will have a role in resolving allegations from other Weinstein accusers. Also on the Committee is Cinedigm, Light Chaser Animation and William Morris Endeavor, each mindful of those in the entertainment industry who are owed money from the debtor.
It's a slightly unusual arrangement for settling claims as Geiss is currently leading a racketeering class action against The Weinstein Company and its board members for allegedly facilitating Harvey Weinstein's misconduct. As such, she could have a role in determining what The Weinstein Company pays to settle that lawsuit. The Committee would also be in a position to reject claims deemed to be less than meritorious.
Alan Jacobs, one of the new board members for Weinstein Co., submitted a declaration in conjunction with the motion. He provides three reasons why giving the Committee such authority is in the debtor's best interest.
"First, the Committee has already expended substantial time and resources investigating, evaluating and conducting legal research regarding the Affected Claims," he states. "In contrast, and in keeping with the agreement in place between the Debtors and the Committee regarding the division of responsibilities (which predates the New Board), the New Board and the Debtors’ professionals have not conducted an investigation of the Affected Claims. Given the limited resources of these estates, there is no reason to require the New Board and the Debtors’ professionals to duplicate the work already performed by the Committee."
"Second, the Committee is comprised of both trade and tort claimants," he adds. "Thus, it is well situated to consider the perspective and interests of all unsecured creditor constituencies in connection with its investigation, prosecution and/or settlement of the Affected Claims."
"Third, the Committee and the Debtors share a common goal: to maximize the value of the Debtors’ estates. Therefore, the New Board has confidence that the Committee will fulfill its duties regarding the Affected Claims and it believes the Committee is as capable as the New Board of completing the assigned tasks."