A US Bankruptcy Court judge on Monday approved The Weinstein Co's liquidation plan, which sets aside $17 million for women who accused co-founder Harvey Weinstein of sexual misconduct.
Judge Mary Walrath in Wilmington, Delaware announced her ruling at the conclusion of a remote hearing. She overruled an objection from a handful of women who are looking to pursue appeals of their claims outside of bankruptcy court.
She noted that 83% of sexual misconduct claimants in the bankruptcy "have expressed very loudly that they want closure through acceptance of this plan, that they do not seek to have to go through any further litigation in order to receive some recovery, some possible recompense ... although it's clear that money will never give them that."
The Weinstein Co sold its assets to Lantern Entertainment, which later became Spyglass Media Group, for $289 million after it filed for bankruptcy in 2018. The bankruptcy was precipitated by widespread claims of sexual misconduct against company founder Harvey Weinstein, who is serving a 23-year prison term after being convicted of sexually assaulting a former production assistant and raping an actress.
Insurers have contributed $35 million under the plan, so holders of sexual misconduct claims will get almost half of that. The Weinstein Co's lawyers say the women who filed the claims could each see six-figure recoveries.
They will have the option to forgo most of their payout under the plan if they want to continue pursuing their claims against Harvey Weinstein and former officers and directors of the company.
A group of women with sexual abuse claims argued that the choice between a full payout and continuing to pursue their claims was unfair. But lawyers for the company and an unsecured creditors' committee, which includes women who filed sexual misconduct claims, say those releases for former officers and directors are a key component of the plan.
A lawyer for the company, Paul Zumbro of Cravath Swaine & Moore, said during the hearing that the plan is "remarkable" and a "favorable closure of this really ugly story."
The case is In re The Weinstein Company Holdings LLC, US Bankruptcy Court, District of Delaware, No 18-10601.
For The Weinstein Company: Paul Zumbro, Lauren Moskowitz and Salah Hawkins of Cravath Swaine & Moore and Mark Collins, Russell Silberglied, Paul Heath, Zachary Shapiro, Brett Haywood and David Queroli of Richards Layton & Finger
For the committee: James Stang, Robert Feinstein, Debra Grassgreen, Bradford Sandler and Colin Robinson of Pachulski Stang Ziehl & Jones
For the objecting claimants: Zhao (Ruby) Liu and Frederick Rosner of The Rosner Law Group, Kevin Mintzer of The Law Office of Kevin Mintzer, Douglas Wigdor and Bryan Arbeit of Wigdor LLP and Thomas Giuffra of Rheingold Giuffra Ruffo & Plotkin.