Almost three years after Weinstein Co. declared bankruptcy, a judge on Monday confirmed a liquidation plan that provides a $ 17.1 million fund for Harvey Weinstein’s accusers of sexual misconduct.
The plan also provides $ 9.7 million to Weinstein Co.’s former executives and directors, allowing them to pay a portion of their legal bills in recent years. Directors and executives – which include Weinstein’s brother Bob, as well as James Dolan, Tarak Ben Ammar and Lance Maerov – have also received releases that exempt them from any potential responsibility for allowing Weinstein’s conduct.
US bankruptcy judge Mary Walrath approved the plan after a hearing in Delaware, saying that without the deal, Weinstein’s accusers would have “minimal, if any, recovery.”
The liquidation plan ends a long-standing legal dispute over the remains of Weinstein’s independent studio. The company collapsed in late 2017, following the release of dozens of reports of rape, sexual assault, harassment and other misconduct.
Several insurers will pay a total of $ 35.2 million to resolve all remaining claims, including those of Weinstein Co.’s commercial creditors.
The $ 17 million fund will be split between more than 50 applicants, with the most serious allegations resulting in payments of $ 500,000 or more. The agreement was put to a vote by Weinstein’s accusers, with 39 votes in favor and eight against.
Ruby Liu, a lawyer who represents opponents, argued on Monday that the settlement fund is “scarce” and that the business deprives its clients of the opportunity to pursue Bob Weinstein and other directors in court.
“There are more than monetary considerations that my clients are looking for,” she said. “They are looking for a jury decision that holds all responsible parties accountable. This is not just Harvey Weinstein.”
Paul Zumbro, a lawyer representing the Weinstein Co. estate, argued that the deal was the best possible for the prosecutors. Without releasing directors and officers, insurers would not be willing to pay.
Several lawyers who supported the plan argued that it is better to “close” most claimants, rather than forcing all claimants to endure years of litigation for an uncertain outcome.
“This is the best we will do,” said Debra Grassgreen, a lawyer for the committee of unsecured creditors.
An earlier version of the agreement would have provided a payment of $ 24.3 million to the accusers, including women who claimed to have been abused in the “Miramax” era, prior to 2005. But Judge Alvin Hellerstein rejected the agreement, saying the class action which included the Miramax era accusers were not viable. The agreement was later revised to exclude Miramax, Disney and their insurers.
Part of the payment of defense costs was initially earmarked for the defense of Harvey Weinstein. This funding was withdrawn from the plan. Civil claimants still have the option to sue Harvey Weinstein in civil court, although most of the lawyers involved believe he has few assets that can be recovered.
Most of Weinstein’s Co.’s assets were sold in 2018 to Lantern Capital, a Dallas-based private equity firm, for $ 289 million. These funds were used to pay the company’s secured creditors.