MUMBAI: Film financier David Bergstein has sued the owners of Miramax alleging that they haven’t paid him money and an equity stake owed for his role in the acquisition of the film label from Walt Disney Co. in 2010.
The suit, filed by law firm Weingarten Brown, claimed that Bergstein played a crucial role in the deal to acquire Miramax. It further reiterates that Santa Monica private equity firm Colony Capital, one of Miramax‘s new owners and its principal Richard Nanula, conspired to deny Bergstein a $6.1-million fee and 3.3 per cent stake in the company that they agreed to provide him as part of the purchase.
The suit, filed in Los Angeles Superior Court by the law firm, has named Filmyard Holdings, the entity which owns Miramax, as well as Colony Capital and its principal Richard Nanula. While Colony and Nanula are named as defendants as is Filmyard Holdings, others who also have stakes in Filmyard are the Qatari government‘s Qatar Holdings and Ron Tutor, the chief executive of construction firm Tutor-Perini Corp.
It was not clear exactly what role Bergstein played in the acquisition, except that he was working with Tutor before Colony joined the acquisition team in July 2010. In the suit, Bergstein says that he initiated talks with Disney which had already put Miramax up for sale and negotiated the structure of the deal.
He claims that for his work, he was promised two separate $6.1-million fees, one at closing and another when certain conditions were met, plus a 5 per cent equity stake in Filmyard. Later Bergstein agreed to reduce his stake to 3.33 per cent on the insistence of Tutor and Colony chief Tom Barrack.
Colony declined to provide Bergstein with any documentation as part of his stake or a share of profits when the company was recapitalized last fall, the complaint alleges. Bergstein also said that he was not paid his second $6.1-million fee when conditions were met though he did receive the initial payment.
The troubled film financer claims he was cut out because he has been the subject of negative press coverage related to his legal troubles from a string of troubled companies and business deals in which he has been involved. His controversial past would have put off Qatar Holdings and a lender, the complaint says.
Advisory firm Duff and Phelps pegged Miramax‘s value at $813 million when the company refinanced in December. According to Bergstein‘s suit, his 3.33 per cent ownership stake would entitle him to somewhere around $27 million of that valutation, plus whatever moneys investors earned during the transaction.