Redbox‘s signature DVD kiosks will soon light up again, at least in a legal sense.
The video retailer went bankrupt last year along with the rest of its parent company, Chicken Soup for the Soul Entertainment.
Later this month, the trademarks and assets of the company (including those signature kiosks) will go on sale at the offices a New York City law firm. Along with Redbox, one notable brand in the mix is Crackle, an ad-supported streaming service launched 20 years ago and long operated by Sony Pictures Entertainment. Hundreds of films formerly under the control of Screen Media, a longstanding specialty film label, are also included in the foreclosure sale. (See a full list of assets HERE.)
The auction will take place at 10 a.m. on April 23 at the Hudson Yards offices of Milbank LLP.
After investors opted to cut their losses on the enfeebled Chicken Soup entertainment group (a spinoff from the still-extant publishing company), the company wound up in a Chapter 7 bankruptcy. It abruptly liquidated, laying off 1,000 employees with no severance or benefits, and idling about 24,000 Redbox kiosks.
Separate from the bankruptcy, employees are pursuing legal action against Bill Rouhana, the former chairman and CEO of Chicken Soup for the Soul Entertainment. In addition to engineering the reckless $375 million acquisition of Redbox, with most of the purchase price coming in the form of debt, Rouhana is accused by former workers of acting “in his own self-interest” and is alleged to have “deceived and manipulated the company” and its employees.
Auctions are a staple in all bankruptcies, but they have a colorful history in the entertainment business. One recent example followed the meltdown of the Weinstein Co. following the litany of accusations against Harvey Weinstein. The company’s assets ended up being acquired out of bankruptcy in 2018 by Lantern Capital. Lantern, previously unknown in entertainment circles, then teamed with veteran production executive Gary Barber to launch Spyglass Media Group.
