Motion Picture Studio That Planned 1,560-Acre Advancement is Bought to Pay $1.8 Million After SEC Declares Fraud
Courtesy: Georgia Governor’s Office.When Medient
Studios Inc. announced five years ago it would build the country’s largest movie studio on 1,560 acres near Savannah, Georgia, it seemed like a field of dreams. In the end, a dream is all it was.
The motion picture studio, called Studioplex, never started, the federal government accused its two magnates, its chairman and its president, of trying to commit scams, and today the U.S. Securities and Exchange Commission said a federal court reached a judgment against the studio and its former top executive.
On Tuesday, the SEC said the U.S. District Court for the Southern District of Georgia entered a $1.8 million default judgment against Medient Studios, a business with securities that traded over the counter. The company likewise was referred to as Moon River Studios, named after the 1961 song from the motion picture “Breakfast at Tiffany’s.” Johnny Mercer, the lyricist who died in 1976, was a Savannah native.
The SEC likewise said the District Court entered a final judgment by permission against Joel A. “Jake” Shapiro, a former chief executive and director of Medient and its follower company known as Fonu2 Inc.
. The federal action against Medient and its executives, in addition to the failure of Studioplex, shows an unusual unfavorable side of Georgia’s push to draw significant movie studios together with movie and TELEVISION production. Simply recently, Georgia Gov. Nathan Offer said production companies spent $2.7 billion shooting a record 455 films and television shows in the state during fiscal 2018, which ended June 30. Movie and TV productions created a total economic impact of $9.5 billion on Georgia’s economy, Offer stated.
In 2008, the state signed into law the Georgia Entertainment Industry Investment Act that provides a 20 percent tax credit for companies that invest $500,000 or more on movie and TV production and post production, whether in a single shoot or several productions. If a promotional logo design from Georgia is included in the finished item, the state offers an additional 10 percent tax credit.
Georgia benefited when North Carolina let its 25 percent tax credit end at year end 2014, and much of the production work and talent needed to make the films and TELEVISION programs moved south to Georgia. Specifically, the shift helped Pinewood Atlanta Studios, a joint venture in between United Kingdom-based Pinewood Studios and River’s Rock LLC, a trust managed by the Cathy household that owns the Chick-fil-A chain of chicken restaurants.
With 18 sound stages spanning 700 acres in Georgia’s Fayette County, Pinewood Atlanta has emerged as a top shooting location in the United States. A number of hits consisting of “Avengers: Infinity War” and “Spider-Man: Homecoming” were recorded at Pinewood Atlanta.
When Medient Studios, a worldwide movie production company with operations in India and The United States and Canada, revealed plans in March 2013 for a big movie studio 15 miles from the Savannah/Hilton Head International Airport, there was reason for optimism. On that day, Medient founder and its previous chairman, Manu Kumaran, said his company’s task would be a “Disneyland meets Google” megacampus and become a model for others to follow.
Medient started its doomed effort by revealing it was participating in a memorandum of understanding with the Effingham County Industrial Advancement Authority to establish the $90 million studio complex. After that, little occurred on the site, and the business released news release that the SEC argues were developed to defraud potential financiers in the motion picture business.
In a June 2013 news release, Medient stated the advancement authority authorized a resolution to provide approximately $300 million in Industrial Development Bonds to “assist in the capital investment of the project.” In a release dated Sept. 24, 2014, Medient stated it engaged Atlanta basic professional Choate Construction Co. as its construction manager. Choate didn’t right away comment.
However the press releases were in fact part of an effort by Medient to cause financiers to buy its stock, inning accordance with the SEC. In September 2016, the SEC filed a problem versus Medient, declaring that Shapiro and Kumaran “schemed to make a selection of incorrect and deceptive statements in Medient’s press releases and business filings.” The SEC likewise said Shapiro and Kumaran “backdated and falsified promissory notes as part of a plan to issue Medient and Fonu2’s common stock in exchange for financing.”
Earlier this month, the U.S. District Court for the Southern District of Georgia got in the default judgment versus Medient Studios after the company didn’t react to the problem. It also participated in a final judgment by authorization including Shapiro, who settled with the SEC without confessing to or denying the accusations against him. The agreement forbids Shapiro from acting as an officer or director of a public business or participating in a cent stock offering for 5 years. He likewise was purchased to pay a civil charge of $75,000.
The SEC’s lawsuits versus Kumaran is continuous. E-mails sent to representatives of Medient noted on some business news release did not get instant replies.