A lawsuit is brought against Gigapix Studios in Los Angeles Superior Court alleging securities fraud and breach of contract over a $700,000 loan related to a planned computer-animated version of “The Wizard of Oz.”
Daniel Zucker is suing Gigapix Studios in the Los Angeles Superior Court and alleging securities fraud and breach of contract over a $700,000 loan related to a planned computer-animated version of The Wizard of Oz, according to a report by The Wrap.
Zucker, who also invested money in the film and is seeking $1.2 million in damages and attorney's fees, claims Gigapix never repaid the money in his lawsuit.
Gigapix is under investigation by the Federal Bureau of Investigation, which is trying to determine whether it improperly raised funds. According to a notice on the FBI's website, Gigapix Studios Chief Executive Officer Chris Blauvelt and others received cease and desist orders from numerous state regulatory agencies, including ones in Oregon, Alabama, Washington, Colorado, and California.
Zucker claims that Gigapix President David Pritchard convinced him to loan the studio money in January 2011 at 12 percent interest. In addition, he promised to provide Zucker with a 1.5 percent stake in the profits from the Oz film, telling him he would earn between 10 to 20 times the amount of money he loaned.
Their agreement stated that the money was to be repaid in full by June 2012, but that date came and went without any payment.
"They were well funded with millions of dollars," Peter Bronstein, an attorney for Zucker, reportedly said. "To my understanding, nobody knows where the money went."
Jennifer Wolfe is Director of News & Content at Animation World Network.