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Tue January 29, 2013
State Asks For Half A Million To Reclaim $20 Million From Bankrupt Company
The Florida Department of Economic Opportunity is asking state lawmakers for half a million dollars in order to recoup a $20-million investment in the now-defunct digital animation studio, Digital Domain.
And according to local experts, Florida has a tough fight ahead to get its money back.
The state originally gave Digital Domain $20 million in incentives in order to lure the company--and jobs--to Port St. Lucie. Four months ago, the firm filed for bankruptcy, shut down and let go 300 Florida workers.
"We still put great importance on the protection of recouping our taxpayers' dollars,” said James Miller, a spokesman for the DEO. “Which is why we are requesting the money and have hired outside counsel to help us get back these dollars."
But, according to Nova Southeastern law professor Isahq Kundawala, that may be difficult.
Digital Domain sold the company's assets for a little more than $30 million shortly after it filed for bankruptcy. Kundawala said it's unusual for a court to allow that.
"The reason why this asset sale of essentially all the assets is typically not done in bankruptcy cases is because it sidesteps all the creditor protections that are in place through the Chapter 11 plan process,” explained Kundawala.
He estimates it could be a little over a year before the case is settled.
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