Weinstein Company declares bankruptcy after sexual assault allegations

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The Weinstein Company announced its plans to file for bankruptcy late Sunday evening after a $500 million deal to sell the company fell through.

The financial distress of the company comes months after co-founder Harvey Weinstein resigned from his position due to multiple allegations of sexual assault. More than 70 women have come forward accusing Weinstein of the sexual misconduct according to the Huffington Post. Weinstein has denied these allegations.

According to Variety, the studio’s board released a letter stating the company’s dire need of financial stability.

“We will now pursue the board’s only viable option to maximize the company’s remaining value: an orderly bankruptcy process,” the company stated.

The recent reports caused many of the company’s business partners and investors to cease support.

Lead investor Maria Contreras-Sweet proposes her own solution. The former head of the U.S. Small Business Administration told CNNMoney about her idea of a brand-new studio headed entirely by women. Representatives of Contreras-Sweet also say the deal would “create a real compensation fund for victims.”

New York Attorney General Eric Schneiderman, who has been investigating the Weinstein company for the last four months, is not opposed to selling company, but is not a fan of Contreras-Sweet’s proposal of a female-run studio, stating that the proposal was “completely contradicted by the documents presented to us.”

In the meantime, remaining owners of the studio are attempting to keep doors open and continue to pay their employees through various financial tactics; but the fate of the studio is still up in the air.

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