On Sunday night, the Weinstein Company issued a statement declaring that it would be filing for bankruptcy.
The news follows a breakdown in negotiations with Maria Contreras-Sweet, who is representing an investment firm that was pegged to purchase the studio from Mr. Weinstein.
According to Reuters, the Weinstein Company has been scrambling to come to an agreement since October last year, when Harvey was accused of sexual misconduct and rape by over 70 women who had previously worked with the film producer. Thus far, Mr. Weinstein has denied the accusations.
The liquidation application would be filed "in the coming days," according to the statement issued by the company.
"While we recognize that this is an extremely unfortunate outcome for our employees, our creditors and any victims, the board has no choice."The New York Times reports that Ms. Contreras-Sweet's team was unable to secure critical short-term financing that was to be used to keep the Weinstein Company operating during negotiations as well as the eventual transfer of ownership procedure.
Bob Weinstein, a founding member of the filmmaking company and a board member, revealed to the media a letter that he had sent to Ms. Contreras-Sweet on behalf of the entire board. Mr. Bob Weinstein alleges that despite working "tirelessly" to ensure that "virtually every demand you imposed" and all requests, as stipulated in the deal, would be honored, they were not able to reach an agreement.
"Late last night, you returned to us an incomplete document that unfortunately does not keep your promises. That is regrettable, but not in our power to change."On February 11, New York's Attorney General Eric T. Schneiderman added to the Weinstein Company's troubles when he filed a lawsuit against the studio's founders accusing them of breaking local laws that prohibit discrimination based on gender, sexual harassment, and abuse.
Harvey Weinstein has been beset with sexual misconduct allegations ever since the start of the #MeToo campaign on social media that encouraged women in Hollywood to speak out against any abuse they have had to endure in the industry. The Weinstein Company has reportedly not been able to recover from the scandal and has, as such, racked up a whopping $225 million in debt.
Meanwhile, in an in-depth look at Weinstein's latest whereabouts, the Los Angeles Times has revealed that he is currently spending time in an Arizona rehabilitation center. The report further alleges that the studio mogul has been attending regular sessions with a life coach. On one occasion, Mr. Weinstein was spotted wearing a blonde wig to dinner, supposedly in the hopes that nobody would recognize him.
Mr. Weinstein is also said to be receiving treatment for sex addiction at a clinic located near Phoenix.