Great set of posts on this subject, Dave.
Thanks for your insight and offerings.
Jeff
On Jun 23, 2012, at 10:29 PM, David Kusumoto wrote:
* According to my sources, several business news editors in L.A.,
London and New York - are in the midst of deciding whether they
too, will go forward with their own versions of this story. If you
do a Google search with the words, "Metropolis poster" - you'll
already get back several pages of results, most of them copy-and-
paste jobs of what Andy Lewis wrote yesterday for the Hollywood
Reporter. I expect the search results will get larger after this
weekend - and then become humongous IF other mainstream news
organizations get involved, including TV. But the Hollywood
Reporter was the first to publish what the hobby has been talking
about for months. News interviews were conducted last week with
the key players, which included investor Robert Mannheim himself,
who is central in that he appeared to have no recourse when he
couldn't get his money back. This publicity actually helps him.
* In my view, there's tremendous irony that while Sean alerted the
press several months ago to drive traffic to his website - that
this action led to the poster being seized - and helped Mannheim
and the bankruptcy trustee - bolster their case against Schacter, a
former MoviePosterExchange founder who kept Peter and Sean in the
dark about Mannheim's claims. This very publicity was oddly
responsible for doing some "good" for an investor who was fleeced.
(There is no legal dispute that money was loaned to Schacter.)
* I know some of you are personal friends of Schacter and most, not
including the always vocal Rich Halegua, will stay silent. While
it was already unfortunate what happened to Schacter's life before
"Metropolis" became an issue, e.g., the personal tragedy he
experienced, becoming a single father, etc. - his decision to
declare bankruptcy to avoid paying Robert - backfired the MOMENT
"Metropolis" was used to help launch the MoviePosterExchange.com
site. Why it didn't happen sooner is obvious to me. The
bankruptcy proceedings continued uneventfully - UNTIL "Metropolis"
surfaced "for sale" on Sean and Peter's site. Schacter had a blind
spot about the risk to his prized collection, even as he began
Chapter 11 proceedings in December 2012. The news publicity in
early March 2012 was short-term glorious for the site - but within
10 days after those stories appeared - "Metropolis" and Schacter's
fortunes were doomed.
* Now with the press in "full alert" mode, the story is
uncontrollable. It will stay that way until AFTER the poster - and
the rest of what remains of Schacter's collection - is sold for no
reserve. There have been several high-profile stories I've watched
unfold in the mainstream press about our hobby during the past 15
years. This joins the list as being the biggest and will be among
the most unforgettable. But given the names involved - and its
impact on the hobby - it's also the darkest and saddest. Whenever
you hear the cliché, "there are no winners in this fight," it's
mostly true when the fight involves molesters, murderers and
Madoffs. In all other disputes, there's always winner and a loser
in the eyes of the public. Victims of all stripes - deserve to
"win" something - even if it's a Pyrrhic victory. -d.
Date: Sat, 23 Jun 2012 18:20:45 -0700
From: [email protected]
Subject: Re: "Metropolis" Poster's Troubles Featured in the
Hollywood Reporter
To: [email protected]
my answer to this is, and with a nod to David Koos.....
Kenny, you may be my friend and I don't want you to be
insulted...... but man-o-man was this stupid
At 06:13 PM 6/23/2012, Franc wrote:
Someone explain to me what I'm missing in this story so far. Why
would Ken file for bankcruptcy, if he owned a repayment of a $500K
loan, when it is well-known that his collection is worth probably
close to $5 million dollars? Why would he risk his collection so
that he could attempt to default on this loan? Did he not presu,e
hat his assets would be seized? FRANC
Date: Sat, 23 Jun 2012 15:56:40 -0700
From: [email protected]
Subject: Re: "Metropolis" Poster's Troubles Featured in the
Hollywood Reporter
To: [email protected]
I think "Metropolis" will be sold by Heritage with NO RESERVE and
will generate a lot of advance publicity in the months ahead.
Why? Because the bankruptcy trustee will demand whatever the
market will bear. If Heritage, for argument's sake, wanted to post
a reserve or offer a "guarantee" - or even buy the poster outright
for, let's say, $500,000 for a future sale - I think the trustee
would say no. The trustee is the "consignor" in this case, bound
by law. Why would the trustee accept $500,000 - or ANY price -
when there's a potential upside to get more than that? One never
knows. Remember, I could be wrong, but I seem to recall this
poster was once listed on Kenny's and Peter's old defunct Majestic
Posters site for around $2 million, a "fishing price" just thrown
out there for the right millionaire with money to spend.
It's not a happy situation for Kenny, but when was the last time a
high ticket, nearly one-of-a-kind poster like this - was offered on
the open market with NO RESERVE? Under normal circumstances,
Heritage would insist on a reserve or want to buy it outright as an
investment for whatever price the market would bear, whatever Texas
laws would allow. But that would be a little odd because there's
no doubt Heritage would want to capture the most dollars NOW - in
relation to its planned big-budget marketing of this poster. This
is big-time news for the hobby. -d.
Date: Sun, 24 Jun 2012 08:14:31 +1000
From: [email protected]
Subject: Re: "Metropolis" Poster's Troubles Featured in the
Hollywood Reporter
To: [email protected]
........he estimates its value at just $250,000, a number most
observers view as comically low. High-end estimates put the value
of the poster at more than $1 million, which would make it the
first poster to cross that barrier in a public sale. Conversely, a
sale at Schacter's low estimate of $250,000 or even any number
below $690,000 would represent a softening of the poster market at
a time when other collectibles such as movie props and rare comics
are selling for record amounts.
If this poster is to be sold as part of a "liquidation sale"
presumably with no reserve, the "comically low" estimate of
$250,000.00 might be not far off the mark.
Regards
John
Date: Sat, 23 Jun 2012 14:58:06 -0700
From: [email protected]
Subject: "Metropolis" Poster's Troubles Featured in the Hollywood
Reporter
To: [email protected]
I'm not surprised that the "splash" publicity surrounding the
infamous "Metropolis" 3-sheet - and its brief offering for sale for
$850,000 before it was suddenly pulled from Sean and Peter's
MoviePosterExchange site - could lead to to more stories, albeit
nearly four months later. There are many interesting things in the
article below that - while NOT NEW to hobbyists - are still "new
news" to the rest of the world. I find it intriguing that The
Hollywood Reporter boldly takes credit - asserting media publicity
about the poster - and the publication of its own story in March
2012 - led to its seizure by federal authorities. The update below
cuts through the tedium of going through reams of court documents
posted elsewhere. I now wonder if editors at other news
organizations - might "piggy-back" or "copy-cat" the Hollywood
Reporter - with updated stories of their own. -d.
World's Most Expensive Movie Poster Seized in Bankruptcy Case
One of four surviving "Metropolis" posters along with valuable
"King Kong" and "Invisible Man" posters will be sold as part of a
liquidation auction.
12:01 PM PDT 6/22/2012 by Andy Lewis
A rare and coveted Metropolis movie poster -- one of only four
known surviving copies from the 1927 silent classic -- has been
seized as part of a Chapter 7 liquidation bankruptcy case involving
its owner Kenneth Schacter, a well-known collector. The poster will
be auctioned off soon.
The case is being overseen by the U.S. Bankruptcy Court in Los
Angeles, with John Menchaca serving as the bankruptcy trustee.
The historical importance of the Fritz Lang-helmed movie and
the rarity and beautiful art deco design of the Metropolis poster
combine to make it “the crown jewel of the poster world," according
to Sean Linkenback, a well-known poster dealer. (See the full
poster below.)
The poster had been offered for sale in March for $850,000 by
Movieposterexchange.com.
Estimates vary as to what it would fetch on the open market.
Schacter paid a still-record $690,000 for it in 2005.
In the bankruptcy filing, he estimates its value at just
$250,000, a number most observers view as comically low.
High-end estimates put the value of the poster at more than $1
million, which would make it the first poster to cross that barrier
in a public sale.
Conversely, a sale at Schacter's low estimate of $250,000 or
even any number below $690,000 would represent a softening of the
poster market at a time when other collectibles such as movie props
and rare comics are selling for record amounts.
Other key items in Schacter's collection include a King Kong
poster from 1933, which is considered by experts to be nearly as
valuable as the Metropolis poster, and a 1933 one-sheet teaser from
The Invisible Man.
The total collection could be worth as much as $5 million,
according to court filings, but the exact value is uncertain
because Schacter has ignored court orders to provide a full and
complete inventory.
It was THR's reporting about the poster being offered for sale
that pushed Schacter from a Chapter 11 reorganization bankruptcy to
a Chapter 7 liquidation bankruptcy.
Schacter had filed for bankruptcy protection on Dec. 12 to
avoid a judgment over a roughly $500,000 loan from Robert Mannheim,
an investor who provided money for Schacter to invest in posters to
sell for a profit.
When Mannheim learned about the possible Metropolis sale via
Movie Poster Exchange, it reinforced his belief that Schacter was
trying to conceal assets to avoid repayment.
(The owners of Movie Poster Exchange were unaware of the
bankruptcy case when Schacter consigned the poster to them for sale
and immediately withdrew it from the site when they learned of the
dispute.)
Mannheim filed a motion to force a conversion to a Chapter 7,
which the court granted March 12, concluding that Schacter had
indeed abused the Chapter 11 process by failing to disclose his
full inventory or complete financial assets.
Schacter was required to immediately turn over his entire
collection to a court-appointed bankruptcy trustee, which he failed
to do.
On May 16, the court found Schacter in contempt, ordering him
to submit a list of his holdings by May 31 or face a $2,000-a-week
contempt fine.
Schacter submitted an inventory of his collection, but the
bankruptcy trustee still is trying to assess whether it represents
his full and total holdings at the time he filed for bankruptcy (to
account for any sales he may have surreptitiously made after filing).
The trustee is in possession of the Metropolis, King Kong and
Invisible Man posters but only has a list of many of the other items.
Once the inventory investigation is complete and creditors
have submitted timely claims, the bankruptcy trustee intends to
hold a liquidation auction.
If the court approves the request, the trustee is likely to
use Heritage Auctions, one of the largest auctioneers of movie
posters, to conduct the liquidation sale.
Given the size of the Schacter's collection, Heritage might
auction it in waves, but no final decision has been made.
The liquidation is expected to begin before the end of 2012,
but the exact date is dependent on the speed of the inventory
assessment and the court's ruling on the application to conduct the
sale.
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