Malaysiakini NEWS

Red Granite seeks third party to look into its operations

Published:  |  Modified:

Red Granite Pictures Inc, co-founded by Riza Aziz, the stepson of Prime Minister Najib Abdul Razak, is reported to have asked a United States court to appoint a third party to oversee its operations and management.

This is while the company is continuing negotiations with the US government over the civil forfeiture action.

According to an article published by The Hollywood Reporter (THR) last Thursday, both Red Granite and the US government have agreed to appoint an independent operational fiduciary to oversee the company's operations and management.

The third party, THR reported, would have the authority to inspect the company's books, monitor transactions, open bank accounts and consult with the management and preserve the company's assets.

“The person would not be empowered to take out loan facilities, acquire capital assets, withdraw from contracts, hire or fire staff or access attorney-client privileged information,” the US-based online entertainment portal reported.

The US Department of Justice filed its first civil forfeiture action in July last year, estimating that more than US$1 billion was misappropriated from 1MDB but the figure was revised to US$4.5 billion in its third suit, which was filed last month.

The action was filed against Red Granite, the company that produced The Wolf of Wall Street, Dumb and Dumber To and Daddy's Home, to seek rights to profits, royalties and distribution proceeds that are owed to Red Granite, following alleged diversion of Malaysian funds into shell companies used to fund those films.

“There are ‘productive settlement discussions’ between Red Granite and the US government relating to the Malaysian embezzlement investigation,” the report stated on the ongoing action.

Red Granite's lawyer Matthew Schwarts, in a joint stipulation filed last Wednesday, said:

“It is not the intention of the US in joining this application to prevent any third parties, including but not limited to financial institutions, motion picture studios or distributors, or trade vendors, from doing business with Red Granite, or to otherwise interfere with Red Granite’s ordinary business operations.

“The US government was actually hoping for the opposite: ‘that the appointment of this independent operational fiduciary will facilitate and support Red Granite’s ongoing business operations’.”

THR said Red Granite's latest move may seem a reasonable request, but US District Judge Dale Fischer was reportedly not agreeing to sign off the order.

"Along with the stipulations, the parties filed proposed orders for the court’s signature," Fischer's brief order, filed Thursday, states.

"Those proposed orders merely state that 'pursuant to the stipulation and request of the parties, and good cause appearing, therefore, the attached stipulation is so ordered. This makes no sense. The court does not 'order' a stipulation. It is unclear what the parties want the court to order or what the purported effect of that order would be," Fischer was reported to have written.

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