TALLAHASSEE - Today, the parties to a Delaware Bankruptcy proceeding agreed that Digital Domain must release $18 million in film project tax credits back to the state. Digital Domain did not complete the requirements to receive the award of the tax credits because it filed bankruptcy before completing the film projects at issue. This is a win for Florida and DEO is pleased with the agreement as these tax credits will be available for legitimate job-creating film projects in Florida.

William Scherer said, “This great news from Delaware boosts our case as we fight to shed light on the scheme that led to tens of millions in taxpayer money being stolen and then given away to the politically connected allies of the previous administration. This fraud would not have happened without the active support of Tallahassee insiders in 2010, and we will depose each and every person involved in this scam.”

Background on lawsuits against Digital Domain

In September 2012, DEO filed a claim in the Digital Domain bankruptcy proceeding pending U.S. Bankruptcy Court for the District of Delaware to seek the return of all monies owed to the state. In September 2014, the state filed a motion seeking to recoup Florida film tax credits held by Digital Domain. The release of these tax credits is a result of DEO’s motion and favorable agreement of the parties to the bankruptcy.

The bankruptcy proceeding is in addition to the lawsuit filed in July 2014 by DEO to seek recoupment of millions of dollars of economic incentives that were fraudulently gained through false assurances, material misrepresentation, and an organized scheme to defraud Florida taxpayers. In July 2014, Florida filed suit in St. Lucie Circuit Court against those associated with the Digital Domain Media Group. In 2009, DEO’s predecessor agency distributed tens of millions of incentive funds to Digital Domain and as noted in the 2013 Inspector General Report (Report Number 2013-11), the usual state regulatory processes governing the award of such funds were thwarted. In 2012, Digital Domain filed bankruptcy and laid off all of its employees – thereby breaching the economic incentive agreement with the state. DEO has hired Fort Lauderdale attorney William Scherer to represent Florida against the principals of Digital Domain and any other individuals or entities involved in the wrongdoing related to this deal. DEO is committed to recouping all monies owed to the state, including approximately $20 million in incentive funding.

About DEO

The Florida Department of Economic Opportunity combines the state’s economic, workforce, and community development efforts.  This new approach helps expedite economic development projects to fuel job creation in competitive communities.  For more information, including valuable resources for employers and job seekers, please visit www.floridajobs.org.

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