Los Angeles Ballet filed suit against MovieCoin on Thursday, accusing the film finance startup of trying to pay a $200,000 pledge in worthless tokens.
MovieCoin was founded in 2017 by producer Christopher Woodrow, the former CEO of Worldview Entertainment and Vendian Entertainment. The company offered the chance to invest in films using a blockchain-based token.
According to the lawsuit, a MovieCoin representative, Igor Khmel, attended the ballet company’s annual gala in February 2018 and agreed to donate $200,000. In September 2018, Woodrow signed a gift agreement, in which MovieCoin agreed to give $200,000 either in cash or the equivalent value in MovieCoin tokens. In return, MovieCoin would be listed as the official sponsor of Los Angeles Ballet’s arts and education programs.
The suit alleges that MovieCoin agreed to provide the tokens in late December 2018, “but concurrently advised that the MovieCoin Tokens were useless and any attempt to dispose or otherwise sell them would be futile as there was no market to facilitate same.”
“LAB declined to incur the expense necessary to establish a ‘wallet’ in light of the worthlessness of the proposed content,” the suit alleges.
The suit states that MovieCoin has been repeatedly asked to provide the gift in a monetizable form, and has refused to do so.
MovieCoin made a number of announcements in 2018, and attracted some news coverage. In November, the company called off a public sale of tokens due to “overwhelming interest during the company’s private pre-sale.” The company has not made announcements since then, and its PR firm, Prosek Partners, said it is no longer working with the company.
A company representative told Variety on Thursday that the company is “reorganizing.” In a statement, the representative blamed the ballet dispute on Khmel, who is said to no longer be involved with the company.
“The pledge was made by a former principal at MovieCoin Holdings Inc. who is no longer with the company. When MovieCoin parted ways with the individual, he declined to honor the pledge. The company is currently in the process of reorganization and therefore an offer to transfer the pledge to a new entity was proposed but the LA Ballet flatly declined. It’s an unfortunate situation for everyone, and although initially rejected by the LA Ballet, the offer to make a donation through a surviving entity still stands.”
The suit seeks the $200,000 gift, plus $1 million in incidental damages, plus interest.
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