Capitol Films nears bankruptcy

Judge to decide fate of David Bergstein company

By RACHEL ABRAMS
Variety.com

Creditors want David Bergstein's Capitol Films Development put in bankruptcy, soon, and Bergstein isn't fighting.

Bergstein and company had until Tuesday to oppose a motion for summary judgment, allowing a federal judge in Los Angeles to decide whether Capitol should be placed into bankruptcy. They did not act before the deadline.

Attorneys for the creditors said they expect Judge Barry Russell to move ahead with the bankruptcy, likely appointing Donald Durkin as the permanent trustee.

Durkin, who has acted as a temporary trustee until now, would then begin assessing and reorganizing Capitol's assets.

"We're just excited to move forward," said Edward Lyman of the Cochran Firm, which represents creditor Steven-Elliot Altman.

Construction magnate Ronald Tutor, who guaranteed a loan to Capitol parent company CT-1 Holdings in 2008, has distanced himself from the embattled financier in recent weeks. Tutor has said that he divested himself of interest in Bergstein's companies the following year.

Tutor is a major player in the group that is purchasing Miramax from Disney.

Judge will likely address the order at Capitol's next hearing Oct. 19.

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