Irish film producers accused of ‘diverting’ up to €50m in funds
TWO well-known Irish film producers have been accused of diverting between €40m and €50m of funds out of a production company to either themselves personally or corporate entities controlled by them.
The claim is made by Berlin-based W2 Filmproduktion Vertriebs GmbH against producers Morgan O’Sullivan and James Flynn. It is claimed they diverted the funds out of Octagon Films Ltd, a company they are all shareholders in.
W2 is taking proceedings in the High Court against Mr Flynn and Mr O’Sullivan who are directors of Octagon.
It is seeking an order from the High Court for damages for alleged breach of duty, alleged fraud and alleged conspiracy.
W2 invests in international film productions. It says in 2002 it acquired 49pc of shares in Octagon under a shareholders agreement. It said it considered Octagon to be a successful start-up company.
The German company is also seeking a declaration the defendants are obliged to account to the plaintiff in respect of all profits made through the producers’ and Octagon’s alleged involvement in dozens of TV and movie productions.
These include ‘Vikings’, ‘The Tudors’, ‘Penny Dreadful’, ‘The Borgias’, ‘Love/Hate’, ‘Calvary’,
‘Ondine’, ‘PS I Love You’ and manymore.
The claims are denied. Mr O’Sullivan and Mr Flynn say they did not divert any fees, income or opportunities that were due to Octagon to themselves personally or to any corporate entities controlled by them personally.
Mr O’Sullivan, of Ardmore Park, Bray, Co Wicklow, and Mr Flynn, of Ballyedmonduff Road, Stepaside, Dublin, who between them own 51pc of Octagon’s shares, deny they traded as Octagon and used the company’s name and reputation.
Octagon, they claim, benefited from the defendants’ association with projects which were not part of Octagon’s business. They also say they will produce forensic accountancy evidence to demonstrate that the alleged losses claimed by W2 are misconceived and misstated.
The hearing continues.