Lawsuit puts sale of Weinstein’s company up in air

Michael R. Sisak
Associated Press

New York – A proposed deal to sell Harvey Weinstein’s movie studio would have rewarded an executive accused of covering up for the Hollywood mogul while skimping on compensation for dozens of women who have accused him of sexual misconduct, New York’s attorney general said on Monday.

Attorney General Eric Schneiderman filed a lawsuit against The Weinstein Co. on Sunday as a group led by former U.S. Small Business Administrator Maria Contreras-Sweet was expected to close on a deal to take over the studio behind Oscar winners “The King’s Speech” and “Silver Linings Playbook.”

Schneiderman said Contreras-Sweet’s offer would have put Weinstein Co. president David Glasser in charge of the company despite evidence that he failed to stop Weinstein and never had the studio’s human resources department launch a formal investigation into allegations against him.

Schneiderman, a Democrat, said he did not oppose a sale but said any deal must rid the company of executives who covered up Weinstein’s misconduct.

“If any prospective buyers are interested in turning the page and doing right by (Weinstein Co.) employees and victims who were abused for years, they can and will fix these problems with the deal,” Schneiderman said. “We will not stand in their way.”

He said documents reviewed by his office showed that the Contreras-Sweet offer did not include any reference to a dedicated victim compensation fund and instead relied on insurance policies and a letter of credit that he said would be eaten up by legal fees and other expenses.

The deal also would have kept non-disclosure agreements in place that have been keeping Weinstein’s accusers from speaking publicly about his alleged misconduct, Schneiderman said.

Glasser and The Weinstein Co. did not immediately respond to messages.

Representatives for Contreras-Sweet did not respond to emails and phone messages requesting comment.

Schneiderman’s lawsuit, filed in state court, accused Weinstein of persistently sexually harassing female workers and creating a corporate culture that enabled years of abusive conduct.

“We have never seen anything as despicable as what we’ve seen here,” Schneiderman said.

Gloria Allred, a lawyer for some of Weinstein’s accusers, said Contreras-Sweet’s group is “100 percent committed to helping victims” and that she is “extremely disappointed” by Schneiderman’s action. Allred said she worried stopping the sale would lead the Weinstein Co. to file for bankruptcy protection, making it difficult for victims to get any compensation.

Harvey Weinstein has repeatedly denied all accusations of nonconsensual sex. His New York attorney, Ben Brafman, released a statement Sunday evening saying many of the allegations against his client are “without merit.”