Business News Legal Media

Legal battle between Idol maker and its former creditors continues

By | Published on Tuesday 1 May 2018

CORE

The legal wrangling continues in relation to Robert FX Sillerman’s failed entertainment business. No, not that one. The other one.

What became known as Core Media was the company established by Sillerman in between him running the original successful SFX business and the one that went bankrupt.

The entertainment industry veteran bought stakes in the Elvis Presley and Muhammed Ali brands and acquired various media assets, principally Simon Fuller’s 19 company and the ‘Idol’ talent show franchise it had developed.

He then successfully exited the business, which was bought by private equity company Apollo Global Management in 2011, freeing him up to go and play with all those EDM stars and launch the doomed SFX v2.

Back at Core Media, the new owners sold off the stakes in the Presley and Ali brands to focus on telly shows, later forging an alliance with another Apollo-owned media firm, Endemol, and 21st Century Fox’s Shine Group.

Over time its flagship media brand – ie the ‘Idol’ franchise – started to wane, and with it the company’s fortunes began to slip too. In 2016 it filed for bankruptcy protection. In September that year, the bankruptcy court in New York approved a reorganisation plan, which saw the firm’s moneylenders receive significantly less than they were owed, in some cases pennies on the dollar.

Said money lenders were unsurprisingly¬†unhappy with that outcome, and litigation then followed at the end of 2016, in which a group of Core’s creditors accused Apollo of dodgy dealings, especially in relation to the merger with Endemol and Shine.

The creditors argued that Apollo and its directors at Core had made a number of decisions that deprived the money lenders of protections that had been included in terms associated with loans that enabled the original Core acquisition in 2011.

The case has been going through the motions ever since, and legal reps for the creditors were in court last week to run through their various grievances.

Those grievances include Core’s decision to sell off the stakes in the Presley and Ali brands, and to then not re-invest the funds those sales generated. They also criticise the way the company settled a shareholder lawsuit and accuse the firm of improperly transferring the foreign distribution rights of one of its telly franchises – game show ‘The Wall’ – to its new business partner Endemol.

Summarising all those grievances, the creditors told the court –¬†according to Law360¬†– “Apollo and the director defendants acted in their own self-interest rather than in a manner to preserve Core Media as a going concern”.



READ MORE ABOUT: |

SIGN UP GO PREMIUM CMU NEWS CMU DAILY CMU DIGEST CMU TRENDS SETLIST