With the American Film Market less than a week away, the closure of do-it-yourself digital distributor Distribber remains a cautionary tale for the independent film world.
Bankruptcy specialist GlassRatner, which was hired in September to handle claims, recently notified creditors that it would take nine to 12 months before any refunds would be distributed.
Reports began emerging in September that Distribber and parent GoDigital Inc. had closed down without explanation. The website currently says, “At this time, Distribber is not accepting any new orders. For questions, contact [email protected].”
Los Angeles-based Distribber was launched more than a decade ago as a means of allowing filmmakers to access digital distribution platforms and to monitor their earnings in exchange for an upfront flat fee. Filmmakers would keep 100% of all revenue generated.
GoDigital Inc. bought Distribber in 2015 for a low seven-figure price in cash and stock. At that point, Distribber was acting as a go-between for filmmakers, charging a one-time fee of $1,595 for iTunes placement, then $150 per year for account access, collection and sales stats. Its titles included Tribeca Film Festival pic “An Honest Liar,” James Colquhoun’s “Food Matters” and Kimberly and Foster Gamble’s “Thrive.”
News of Distribber and GoDigital’s difficulties began emerging when producer Alex Ferrari said in his Indie Film Hustle podcast in mid-September that Distribber and GoDigital had closed their physical offices. Ferrari also said Distribber still owed him around $4,000 in back pay. At the same time, he also launched the Facebook group Protect Yourself From Distribber.
Seth Freeman, a senior managing director at GlassRatner, told Variety that the recent notification was the official “notice of commencement” of the Assignment for the Benefit of Creditors.
“We have since set up an informational website http://www.gdabcllc.com with an online proof of claim form,” he said. “It seems the site has been well received and film owners are using it to send questions and submitting their claims and supporting information.”
“If we can identify a new aggregator to step up and essentially take over Godigital’s account at the platforms, then the film owners may not need to take down their films and incur new costs and down time,” Freeman added. “However, the new aggregator will need to enter into new license agreements with each film owner.”
Freeman said he hopes the platforms will step up, and even though they paid GoDigital, they should make the film owners whole.
“There may be a legal argument that since the film was exploited on their platform and they received payment, the platform is responsible to pay the film owner,” he added. “Absent any legal duty, the reality is that the platforms need the content and the amounts needed to take care of the unpaid licensing fees is tiny for them, but still important to the film owners. From a PR and goodwill standpoint, the platforms would greatly benefit.”
Ferrari had previously promoted Distribber to his Indie Film Hustle audience, but became suspicious earlier this year when the process of working with the company had bogged down. An executive told Ferrari that there was no guarantee that the films he had paid for would be placed and referred him to GlassRatner regarding a possible refund. At that point, Ferrari went public with his story.
Ferrari told Variety that he’s become discouraged about the situation. He warned that other companies using a similar model to Distribber are in jeopardy.
“None of the platforms have said a word about this,” he said. “A lot of people got hurt. The online platforms haven’t said a word about fiduciary responsibility or setting up escrow accounts for film aggregators to protect filmmakers’ money in the future. The business model that Distribber used did not make any sense. If the system that the major platform set up doesn’t change, this will happen again.”
Popular on Variety
Source: Read Full Article
