Business

DEO Setting Aside Money to Sue Digital Domain

By: Michael Peltier News Service of Florida | Posted: October 19, 2012 3:55 AM
Digital Domain

Digital Domain in Port St. Lucie | Credit: TCPalm

State officials are planning to ask lawmakers to set aside money to go after a bankrupt company that received millions in government aid.

The Department of Economic Opportunity said in a legislative budget request made public this week that it will ask legislators to earmark $500,000 to hire outside counsel to try to recoup at least some of the $20 million in incentives doled out by the state to Digital Domain.

Florida is in line with other creditors, though, joining a growing list that includes local and county governments that provided more than $60 million total in land, buildings and other incentives to lure the animation company to South Florida in 2009.

DEO will use the funds to pay lawyers who are licensed to practice law in Delaware, where Digital Domain is chartered and where bankruptcy proceedings are being held since the company filed for Chapter 11 protection in September, according to agency spokeswoman Carolyn Gosselin.

The agency on Sept. 29 filed its claim with the U.S. Bankruptcy Court for the 3rd District, which has set up a processing center to handle the claims.

The state is seeking "all monies owed under the grant funding agreement executed by and between the parties on June 30, 2009, and to protect other interests of the state of Florida," Gosselin said in an email.

In September, the company announced it was largely shuttering its Port St. Lucie facility, laying off most of the 300 employees who worked there.

Port St. Lucie officials in 2010 sold $40 million of revenue bonds to help build a 150,000-square-foot digital animation studio. It also gave the company $10 million and provided 15.5 acres of land where the studio was built.

The state, meanwhile, turned over $20 million in cash to the company under a program established to give the governor quick access to funds for economic development. The company was vetted by Enterprise Florida.

On Sept. 25 a U.S. Bankruptcy Court approved a $30.2 million sale of Digital Domain assets to a group of investors from China and India.

The bankruptcy has spawned a number of lawsuits. Investors have gone to court to recoup their losses and former employees have also gone to court, saying the company violated federal work laws by not giving employees adequate notice of the plant shutdown.

Local officials, meanwhile, have been on the defensive for weeks as they try to justify the decisions to offer tens of millions of dollars to the company even though its financials were shaky from the start.


Tags: Business, News

Comments (1)

Thomas F Reynolds
9:27AM NOV 2ND 2012
Good Luck ! $500,000.00 is going to get sucked up faster than steak and lobster dinner at homeless shelter . Do the people running Flor a da think we don t understand what is going on here ? The state might recover some unused pencils . This guy running DD knows what he is doing and has done . HOLD ALL THE PEOPLE WHO GAVE THE FARM AWAY ACCOUNTABLE ! The farm is the taxpayers money . Can you hear that ............................. That is the lawyers in Delaware laughing all the way to the bank . Send more money we think we get can money back for the State of Florida ................ $ 1 , 000 , 000 , 000 .00 more is what we will need . We are only charging you $ 1, 0000 .00 an hour . We will load up your cofers during the 2014 election cycle !
LOVE YOU GUYS
Delaware BK LAWYERS

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