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Tugger Director Responds to Fraud Charges

AWN reported on August 18, 2010 that Jeffrey James Varab, the director of TUGGER: THE JEEP 4 X 4 WHO WANTED TO FLY, had been arrested in Osceola County, Florida on charges of securities fraud, which was originally reported in the ORLANDO SENTINEL. Varab has written the following letter to give his side of the accusations against him.

AWN reported on August 18, 2010 that Jeffrey James Varab, the director of TUGGER: THE JEEP 4 X 4 WHO WANTED TO FLY, had been arrested in Osceola County, Florida on charges of securities fraud, which was originally reported in the ORLANDO SENTINEL. Varab has written the following letter to give his side of the accusations against him.

To anyone who is thinking, planning or just dreaming of producing and/or directing a independent animated feature film, this rebuttal is a must read!

(A Case Study of how one little Independent Animated Film was made and failed!)

I've been in the animation industry since being recruited by Eric Larson, one of Disney's original "nine old men" back in 1977. I spent my first almost five years at the Disney Burbank studio, (as noted in “Waking Sleeping Beauty”) and the following 12 years working in Europe for studios in Denmark, Ireland, France, and Sweden and for Universal Studios at the Amblin Animation Studio in London.

It was the Amblin studios that gave me the opportunity to be trained in the emerging CG industry when I was asked to move to San Rafael California to work at ILM on Spielberg’s "Casper" movie in 1993. When that film ended I was invited to return to Disney as supervising animator on “Mulan” and later as one of the first three people to develop the story, which became "Brother Bear." After Disney I worked for 20th Century Fox on "Titan A.E." and for Sony on "Eight Crazy Nights" as well as freelance animation on films such as “The Tigger Movie” and European features.

It was after working on “Eight Crazy Nights” that a dear friend of mine, George Parson, asked me to read an original story he had written some years earlier that he thought would make a nice low budget animated film. George knew that at that stage of my career I was looking for a story to direct in Orlando as an independent filmmaker. And I fell in love with the simplicity of George's original story "Tug the Tug Tractor That Wanted To Fly"!

As with most independent filmmakers, we had no money to make the film, but like many fool-hardy artists before, I and a four artists used our talents and passion as investments to create a "teaser trailer" that we hoped would help raise funding for the film. If you’re setting out to produce a film that you want to make its money back, the one thing I learned from the major studios and from Spielberg over the years was that well branded “concepts” have a better chance of succeeding in the marketplace, as well as securing good distribution deals. And with the encouragement of our head storyboard artist on Tugger, (Woody “Beryl” Woodman) who also happened to be a Jeep fanatic, I decided (with George's blessing) to change our "TUG" character to “Tugger” a Jeep!

With this one character identity change, a door of opportunity opened for us to secure major marketing partnerships. And over the coming 12 months I personally proceeded to successfully approach Chrysler/Jeep, Shell Oil and the United States Air Force Thunderbirds, who all signed on as contracted marketing partnership with our little (now titled) “Tugger the Jeep Who Wanted To Fly” movie.

Our movie was still structured on George's original story and character, but we were now making a film that we all saw as a once in a lifetime opportunity. Excitement kept building as new corporate partners and organizations joined our project. With this excitement of corporate partners came the investment funding we needed. Not in one single investment, but in small pieces over more than a year, that often caused us to run out of funding in mid production for weeks at a time.

Through one of our investors, (and eventual board member) we were able to secure the services of one of Orlando's top law firms, who managed our investor notes and reviewed all distribution and marketing contracts, and our business in general. We hired a top financial expert to draft the proper documents for investors, and even signed the famed "Arnold Palmer's Children's Hospital" as our charitable partner, as we always intended portions of profits to be directed to children's needs.

As we got closer to completing the film, we secured the talents of Jim Belushi to do the voice of Tugger after abandoning early voice tests with Donny Osmond. And Scott Thompson (AKA: "Carrot Top") agreed to voice Tugger's sidekick character.

Finally in the spring and early summer of 2005 we raised the last "post production" funds we needed to package the film ready for distribution! “Tugger the Jeep Who Wanted To Fly” was premiered on July 4th 2005!

Through the process of making the film, a dear friend and supporter of Orlando animation, Roy Disney would often (when asked) offer his opinions and reviews of the film. Roy was even at our first Los Angeles 20th Century Fox screening of "Tugger," which resulted in our first distribution contract. But, as Roy would reveal to me after the film was completed, distribution is a monster that often eats up 90 percent of all independent filmmakers and production companies if they are not prepared and/or properly protected.

And that is was happened to "Tugger!" 20th Century Fox Home Video was happy to give us a contract with a million dollar up-front payout, but primarily because our contract with Chrysler gave them the option to purchase 250,000 DVD units at a set price. When Chrysler balked at the idea of shelling out to Fox for the purchase before the film was completed Fox got scared and did everything possible to get out of our signed contract!

We quickly received other offers from Paramount Home Video and The Weinstein Company, but eventually settled happily with the then smaller Anchor Bay in 2006. It was at this time that we suddenly discovered that two investors had moved to force our film and company into chapter 7. Our law firm moved quickly and was able to protect the majority of investors by keeping the film in Chapter 11.

I resigned from the company I had started and that made the film shortly after the bankruptcy in was filed in 2006 and gave up any and all ownership and rights.

The combination of being crippled by this bankruptcy and the deliberate attacks by these two investors were devastating to everything we had hope “Tugger” would be! Over the following years I had to fight off personal lawsuits by these two investors and Tugger’s former story board artist Woody “Beryl” Woodman, (who falsely claimed he created the Tugger story) and successfully had them thrown out and reversed, but the damage had been done! These actions also hurt the films chances of attaining a fair and honest distribution deal by a qualified distributor. The bankruptcy court initially abandoned our signed Anchor Bay deal, only to reinstate a new deal with the same Anchor Bay over a year later, but on terms weaker for the investors than in the original deal!

As the financial records and contracts were meticulously reviewed by all sides both legal and private over the following five years, at no time was there even the hint of evidence of any fraud. But through all this, the same two investors who brought down this little film and company never stopped trying to cause continued damage. In fact, they had threatened the board of directors early in 2006 that they would destroy the film and company, (as confirmed in notarized sworn statements by the board members at the time) because as they said at the time “we don’t care about the money, the film or the other investors.” It was a personal vendetta against me for failing to have secured distribution of the film in the timeframe they had expected.

Earlier this year, about six months ago, friends of mine notified me that after all these years the state's attorney's office had decided to re-examine the complaint by these same two investors. My lawyer contacted the attorney who at that time stated that they saw no real issues to pursue. Then just a few months ago my lawyer was notified that after five years they would now pursue a case against me. Late last month I arrange a simple “walk through” which was quick and respectful, (I was not chased down and arrested as the Orlando headline implies!) and I declared my innocence.

“Tugger the Jeep Who Wanted To Fly” is no masterpiece, it is no great feat in 3D animation and it doesn’t even run longer than 65 minutes! What the movie is is a testament to both the best and worst of human potential. On the positive side, for the many people like me who invested so much time, energy and talent into “Tugger,” it was NOT for the money, it was a creative passionate statement. On the negative side, for a few investors who because of the big corporate names and talents attached to the little film, it was the goal of local fame and fortune.

Both sides can and do co-exist in Hollywood today! Both sides, (in the real business world of Hollywood) understand that there is a co-existing relationship that must flourish if anyone is to be successful. We have seen this struggle of opposites in Hollywood since D.W Griffith and Charlie Chaplin battled the then major studios in the 1920s and 30s. In more resent history we have seen disgruntled studios and even crew members spread negative word and refuse credit on films such as “Rocky.” We’ve seen great directors like James Cameron verbally trash for years by the press, studios and film crews, yet continue to deliver masterpieces like “Avatar.” And trust I do NOT compare my talents to these great men and films!

My point, my rebuttal to the stories about the “Tugger” film and myself is; that there are many unknown struggling artists just like me out there today who with the same passion will always strive to make the seemingly impossible film a reality. Artists and filmmakers will today and forever continue to go after their dreams with the greatest of intent, honesty and passion. Making "Tugger" was my dream, but it was also a dream come true for the artists who worked so hard with me to make sure we completed it. And we faithfully completed the film not just for ourselves, but for the investors who put their money and faith into our dreams.

All aspects in the making of the "Tugger" film were transparent and upfront! We started with a dream but no funding. And ended up with a completed movie that in the process of making it secured some of the most amazing corporate branded partners and voice talent a little independent film could wish for! And all for $2.5 million dollars! Did I fail in our end goal of the filmmaking back its cost? Yes! Was I naïve to the realities of the distribution business? Yes! But even with its shortcomings I am also proud of the little film we did make, AND the artists who I was honored to be able to work with five years ago!

To anyone reading this rebuttal that is even thinking of making an independent animated film I say; make your film! Do not let the problems I faced, and continue to face discourage you! Learn from the experiences of mine and others, because if you are honest, (regardless of what others might say) it will show in the body of your work! For the independent filmmaker, movies are a medium of artistic truth! If the filmmaker is honest it will show in your work, in the stories you have chosen to tell!

In closing I wish to thank AWN for giving me this opportunity to rebuttal. For the past five years I have sat back while certain articles and blogs have spread gross misinformation about the "Tugger" movie and me, I hope that this rebuttal helps shed light on the truth.

Rick DeMott's picture

Rick DeMott
Animation World Network
Creator of Rick's Flicks Picks