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Weinstein Co.’s unsecured creditors committee is calling to have lenders’ claims for repayment dealt with in a chapter 11 plan, and not sooner, as the bankrupt studio nears a $310 million sale to private-equity firm Lantern Capital Partners, WSJ Pro Bankruptcy reported. The committee, whose members include alleged victims of studio co-founder Harvey Weinstein, said yesterday in a court filing in Wilmington, Del., that the distribution of sale proceeds to cover debt incurred before bankruptcy should only be made through a negotiated repayment plan that is approved by a judge. Lender Bank of America NA has sought immediate repayment for a secured debt, which is given higher priority on repayment in chapter 11. Bank of America is the administrative agent on a term loan for Weinstein Co.’s television business for which the bank says at least $18.1 million is owed, court papers say. A separate lender, controlled by billionaire Len Blavatnik and owed more than $46 million, has sought to put proceeds in an escrow account.

Broadway producer Howard Kagan said he has raised his last-minute bid for the Weinstein Company in another push to acquire the TV and film producer, which filed for bankruptcy in the wake of harassment claims against co-founder Harvey Weinstein, Reuters reported. The Weinstein Co. on Tuesday selected Lantern Capital’s $310 million bid for the company and rejected an offer from Kagan that he said was worth $315 million. Kagan’s initial bid, made through his Inclusion Media LLC business, lacked a deposit and financing, according to the Weinstein Co. “We have increased our offer to $325 million, matching Lantern’s cash bid and providing the cash needed to satisfy Lantern’s alleged breakup fee claims,” Kagan said yesterday. Kagan has not yet made a deposit or shown he has committed financing for his new bid. The money raised from the sale will be used to pay off the Weinstein Co’s creditors. Kagan said his bid would include compensation for harassment plaintiffs.

The embattled political consulting firm Cambridge Analytica announced yesterday that it would cease most operations and file for bankruptcy amid growing legal and political scrutiny of its business practices and work for Donald J. Trump’s presidential campaign, the New York Times reported. The decision was made less than two months after Cambridge Analytica and Facebook became embroiled in a data-harvesting scandal that compromised the personal information of up to 87 million people. In a statement posted to its website, Cambridge Analytica said that the controversy had driven away virtually all of the company’s customers, forcing it to file for bankruptcy in both the U.S. and Britain. The elections division of Cambridge’s British affiliate, SCL Group, will also shut down, the company said.

The Weinstein Company yesterday named a Dallas private equity firm as the winning bidder in its bankruptcy sale, spurning an offer by the Broadway producer Howard Kagan, the New York Times reported. The victor — for now, at least, as a bankruptcy judge still has to sign off and the decision could be challenged by creditors — is Lantern Capital Partners. It entered the sale as the studio’s prearranged bidder, or “stalking horse,” which set a price floor. Lantern offered $310 million plus the assumption of about $115 million in debt. Lantern has no Hollywood experience as its portfolio includes underperforming auto dealerships and a company that recycles zinc. Lantern became involved with the Weinstein Company this year, when it agreed to help finance an attempt to help the troubled studio avert bankruptcy. That effort, led in part by the billionaire Ron Burkle, fell apart in March. The Weinstein Company imploded in October after dozens of women publicly accused its former chief executive, Harvey Weinstein, of sexual misconduct stretching back decades. It announced on March 19 that it would file for bankruptcy. The movie and television studio, once known for Oscar-winning films like “The King’s Speech” and “The Artist,” had less than $500,000 in cash. It was facing a mountain of debt and a swelling number of lawsuits, including one by New York’s attorney general.

Private equity firm Lantern Capital is nearing a deal to acquire the Weinstein Company, the TV and film studio whose former chairman Harvey Weinstein faces sexual assault claims, with a $310 million offer, Reuters reported. The Weinstein Company filed for bankruptcy in March with the offer from Lantern Capital in hand as the stalking-horse bidder. It had hoped to get better offers from other suitors, but no higher bid emerged by a deadline set in a bankruptcy auction for yesterday. The deal, which is subject to approval by a U.S. bankruptcy judge, would be the culmination of efforts by the Weinstein Company over several months to find a buyer. An offer for the studio from a group of investors led by former Obama administration official Maria Contreras-Sweet failed to produce a deal earlier this year, after New York Attorney General Eric Schneiderman filed a civil lawsuit against the company and demanded more compensation for Harvey Weinstein’s victims. Read more.

In related news, Ashley Judd sued Harvey Weinstein yesterday, opening a new legal battlefront for the disgraced film producer by claiming that her career withered because he spread lies about her in Hollywood after she rejected his sexual requests, the New York Times reported. Judd has an A-list director on her side: Peter Jackson, who came forward in December to say that he removed her from a casting list “as a direct result” of what he now thought was “false information” provided by Weinstein. Until then, according to the lawsuit, Judd did not know that “something unseen was holding her back from obtaining the work she wanted, and had been doing so for decades.” he suit, filed in Los Angeles Superior Court, involves Jackson’s “Lord of the Rings” films, the first of which was released in 2001. Jackson had wanted to cast Judd in a prominent role in the series. But Weinstein “torpedoed Ms. Judd’s incredible professional opportunity,” according to the complaint, by falsely telling Jackson that Judd was a “nightmare” who should be avoided “at all costs.” Read more. 

After six years of litigation and three attempts at mediation, victims of Catholic clergy sex abuse in Eastern Montana have reached a settlement with the church, the <em>Billings Gazette</em> reported. The tentative $20 million agreement with the Great Falls-Billings Diocese was announced Friday by the diocese and two law firms representing the victims. The bankruptcy judge and the victims still must approve the settlement. The claims cover allegations of sexual abuse between the 1940s and 1980s at ministries throughout the eastern half of the state, from the St. Labre Indian School on the Northern Cheyenne Reservation to the small town of Absarokee. A year ago the diocese filed for Chapter 11 bankruptcy protection to negotiate a settlement. In March, the diocese moved to dismiss its bankruptcy case, saying that negotiations had reached an impasse and continuing legal costs were draining the resources it had to fund a settlement. To fund the settlement, the church will use bishop assets and money from its insurance carrier, Catholic Mutual Insurance. The insurance coverage started in 1974 and covers just 22 of the claims.

Harvey Weinstein borrowed $1 million from his company last year in the months before public revelations of his alleged sexual misconduct plunged the movie studio that bore his name into bankruptcy, WSJ Pro Bankruptcy reported. In all, Weinstein took home nearly $3 million during his last half year at the award-winning studio, new court papers say. Additionally, Weinstein Co. paid nearly $2 million to service a debt Weinstein personally guaranteed, which was owed to a company controlled by billionaire Len Blavatnik. Records filed yesterday in the bankruptcy case of Weinstein Co. detail what Mr. Weinstein, his brother and studio co-chief Bob Weinstein and other leaders received from the company before and after misconduct allegations against Harvey Weinstein were published in October.

Movie producer Harvey Weinstein asked a U.S. bankruptcy judge on Friday to order his company, which filed for chapter 11 protection in March, to turn over personal emails that he says are relevant to ongoing civil and criminal investigations against him, Reuters reported. Harvey Weinstein, who co-founded the Weinstein Company with his brother Bob, has been accused of sexual misconduct by more than 70 women. He has denied having non-consensual sex with anyone. In a filing with the U.S. Bankruptcy Court in Delaware, Harvey Weinstein’s lawyers said the bankrupt company has refused to provide him access to e-mails and personal files that they said would exonerate him. Harvey Weinstein, once one of Hollywood’s most influential film producers, was ousted as co-chairman of the Weinstein Company in October 2017 when accusations against him became public.

The production company behind the unreleased drama “Hotel Mumbai” starring actors Dev Patel and Armie Hammer has sued Weinstein Co. in an attempt to wrest control of the project from the bankrupt film studio, WSJ Pro Bankruptcy reported. The lawsuit, brought on Monday by producer Hotel Mumbai Partners Ltd., seeks a judgment that a 2016 agreement that gave Weinstein Co. licensing and distribution rights for the film terminated because the studio’s leadership “participated in a cover-up of Harvey Weinstein’s sordid history of sexual abuse.” Despite objections, agreements for both “Project Runway” and “Hotel Mumbai” remain packaged in the proposed $310 million acquisition of the studio by Dallas-based investment firm Lantern Capital Partners, court papers say. Other films Weinstein Co. has rights to include “The Current War” starring Benedict Cumberbatch. Lantern’s offer is subject to a higher bids, should any materialize, at a bankruptcy auction scheduled for May 4. Read more. 

Don't miss the "Restructuring a Firm After Discrimination or Sexual Harassment Claims" panel Saturday at #ABISpringMeeting! Hon. Judith K. Fitzgerald (ret.) of Tucker Arensberg provides a preview. Click here to register. 

Auto components maker Key Safety Systems yesterday completed its $1.6 billion deal to acquire air-bag maker Takata Corp, whose inflators triggered the auto industry’s biggest recall and have been linked to at least 22 deaths around the world, Reuters reported. After more than a decade of recalls, lawsuits and a criminal investigation which drove Takata to bankruptcy, the deal ensures the Japanese company will be able to continue producing replacement inflators before winding itself down, which may take years. The combined companies would be renamed Joyson Safety Systems, after a consortium led by KSS’s Chinese parent company, Ningbo Joyson Electronic Corporation, provided funding to acquire most of Takata’s operations, Joyson Safety Systems said in a statement. The new company will be based in Michigan.