Business News Gigs & Festivals Legal Live Business Top Stories

Woodstock 50’s ex-backer told to put disputed monies in escrow

By | Published on Thursday 23 May 2019

Woodstock 50

The Woodstock 50 saga continues, with organisers of the festival returning to court in a bid to force their former financial backer to return $17.8 million to the event’s bank account.

The Woodstock company was initially working with a division of marketing group Dentsu in order to stage an event celebrating the 50th anniversary of the original Woodstock festival. But then last month Dentsu bailed on the project and duly announced that the festival was therefore cancelled.

That then resulted in legal action from the Woodstock company, which said that its financial backer had no right to unilaterally cancel the festival, which is due to take place in August. And last week a New York judge agreed that, while the contract between Woodstock and Dentsu included provisions for the latter to either cancel the partnership or take more active control of the event, it didn’t allow the marketing firm to cancel the whole show.

Team Woodstock declared that court ruling a victory and insisted that Woodstock 50 would now go ahead in August as planned. However, to make that happen they still need to fill the hole in their budget that was left by Dentsu’s departure from the project, something the bankers at Oppenheimer & Co were brought on to do last week.

One thing that would help with that budget hole filling task is if Dentsu was forced to return nearly $18 million that was sitting in the event’s bank account at the point it pulled out of the project. The marketing group took those funds out of the account as it announced the (non) cancellation of the festival, but Woodstock argues that it didn’t have the right to do that and should be forced to return the cash.

In last week’s ruling, the judge overseeing the Woodstock/Dentsu dispute declined to order the latter to return that money at this time. Said judge concluded that the Woodstock company had failed to meet “the high burden entitling it to a mandatory injunction forcing [Dentsu] to provide W50 with access to the $17.8 million W50 is not contractually entitled to control”.

On Tuesday, Woodstock’s lawyer, Marc Kasowitz, filed an appeal with the court over that element of last week’s judgement, again seeking an immediate injunction forcing the return of that money. The court has not, as yet, provided any such injunction, but has told Dentsu that it must put the disputed cash (and a little bit extra) into an escrow bank account, pending further court consideration on what should ultimately happen to those funds.

Welcoming that development, Kasowitz told reporters yesterday: “Today, in an important step, Justice David Friedman of the Appellate Division, First Department, issued an order requiring that Dentsu and Dentsu Aegis deposit into escrow by Friday at 5pm the [money] that Dentsu swept from a Woodstock 50 Festival account. Justice Friedman issued this order pending the decision of a five judge panel on Woodstock 50’s motion to return the funds to the Woodstock 50 festival account”.

And so, the dispute goes on as the clock continues to tick towards Woodstock 50’s 16 Aug showtime.



READ MORE ABOUT:

SIGN UP GO PREMIUM CMU NEWS CMU DAILY CMU DIGEST CMU TRENDS SETLIST