Studio project faces new queries
Some voice support but Galvin to look at firm’s papers
Some Plymouth officials said yesterday that they have lost confidence that the leaders of a plan to build a $650 million movie and TV studio can deliver the project billed as an economic engine that would create thousands of jobs.
After a Globe Spotlight report Sunday that raised financial and legal questions about Plymouth Rock Studios and tracked its troubled history, some town officials are now asking why the studio did not share more financial and business information as it pursued, and won, expansive zoning changes and generous tax breaks from Plymouth.
“They told you what they wanted you to know and withheld what they didn’t want you to know,’’ said Lawrence Rosenblum, a member of the Planning Board.
State officials are asking questions, too.
Secretary of State William Galvin’s office said yesterday that he is reviewing the incorporation papers of Plymouth Rock Studios to ensure that the company has clear ownership of the studio project.
Officials from a second company have asserted that Plymouth Rock stole the project from them when they were in financial distress.
The Spotlight Team reported that the grand vision for an entertainment city with 14 sound stages, a 600-seat theater, hotel, and retail village rests on a shaky foundation. Studio founder David P. Kirkpatrick and his current and former team members have been sued at least 11 times in the past three years by investors, consultants, writers, and others who said they haven’t been paid.
A company called Good News Holdings legally incorporated a studio proposal in Delaware in May 2007 under the name “Project Julia,’’ and set up an office in Plymouth, intending to make movies with Christian values.
Seven months later, Kirkpatrick, one of the cofounders of Good News, incorporated another Project Julia in Massachusetts along with former Boston Celtics executive Joseph G. DiLorenzo and a second Good News founder.
“Basically, at this point, the secretary is reviewing to make sure they are compliant,’’ said Galvin’s spokesman, Brian McNiff.
The Globe reported that an obscure Florida company the studio was counting on for financing until they parted ways last week, Prosperity International LLC, is run by a man whose former business partners from a separate venture are in jail for bank fraud.
Before Prosperity came along, Kirkpatrick sought financing in 2007 from a former investment adviser who had pleaded guilty to stealing at least $600,000 from his clients. Kirkpatrick said he didn’t know about the man’s criminal record.
Rosenblum said he was astonished about the reported state of studio finances. Project officials acknowledged that they have raised just $11 million and spent $15 million.
Rosenblum said that is not what the studio’s chief financial officer told him over a beer at the East Bay Grille in Plymouth late last winter.
DiLorenzo “said to me, ‘We’ve raised $97 million,’ ’’ Rosenblum recalled.
“I have no idea what he’s talking about,’’ DiLorenzo said yesterday, stating that he never said he had any such sum. “I know to the penny every day what I’ve raised.’’
DiLorenzo said he remains optimistic about the project.
“Numerous bankers have called since yesterday offering advice,’’ he said. “They are offering to make introductions both here in the US and abroad.’’
And some top officials remain supportive of most of the studio team.
Senate President Therese Murray released a statement affirming the “wide-ranging support and expectation’’ that remains for the studio.
“One person doesn’t make or break a project of this magnitude,’’ the statement said, a reference to Kirkpatrick. “There are a lot of good people involved in this project, and it is up to the studio to go out and find other financing.’’
Dick Quintal, chairman of the Board of Selectmen, said he still supports the project. “These are serious people,’’ he said of the studio team.
Quintal said it is not the town’s place to get involved in vetting a private company’s financing.
But others are more alarmed.
“I would find it hard to believe that a reputable financier would give this group money . . . after what they might have already known and what they certainly know now,’’ said Paul Luszcz, who chairs a committee of Town Meeting members.
As for the town’s relationship with the studio, Luszcz said, “How do we become comfortable with these people and trust them given everything that we know?’’
Rosenblum and Luszcz said their panels had pushed the studio in vain for information on its financing and business plan. The studio deemed the business plan confidential because of a rival proposal in Weymouth, Rosenblum said.
The studio met privately with a handful of people, including two selectmen, in June. Studio executives showed 50 or 60 pages of documents detailing $550 million in financing they were going to secure from a European bank, said Selectman John Mahoney, who attended. Specifics, including the name of the bank, were blacked out, he said.
Meanwhile, Mark Ridder, owner of the 240-acre golf course that the studio was scheduled to purchase earlier this month for $16.5 million, said he has a nonrefundable deposit from the studio for at least $1 million.
“The studio has done everything they said they were going to do with me,’’ Ridder said. Bill Wynne, president of the studio’s real estate arm “has been fabulous and up front with me.’’
But, he said, if the studio project were to collapse, he would continue to collect green’s fees at the 11-year-old Waverly Oaks Golf Club.
“We have a good business there,’’ Ridder said. “Waverly wasn’t for sale.’’
Thomas Farragher and Scott Allen of the Globe Spotlight Team contributed to this report.