The Los Angeles Times has a good follow-up to the Axium story today that spells out the ramifications of the company's closure on those who have payroll funds deposited there.

From the piece:

"It's a mess," said writer-producer Jody Savin, who with her writer-director husband, Randall Miller, had "tens of thousands" of dollars frozen in an Axium payroll account for their upcoming feature film, "Bottle Shock."

Still, they consider themselves better off than some other Axium clients who were required to deposit a percentage of payroll amounts to be processed by the Los Angeles company.

"We have a friend who had just wired them $500,000 to do payroll when they went down," Savin said. "For a small movie, that's crippling."

When might Savin and others see their money again?

The short answer is "not in the immediate future," said Howard Ehrenberg, the court-appointed bankruptcy trustee who now oversees Axium's finances.

He said Axium's largest creditor, Golden Tree Asset Management, a New York investment firm, seized $22 million from company accounts that had secured a $140-million loan on which Axium defaulted.

"Those were funds that belonged to all of the customers of Axium as well as Axium's own funds," Ehrenberg said of the seized cash.

Golden Tree declined to comment Wednesday.

Ehrenberg said he was now trying to sell company assets, including a proprietary software program known as RightsMax, to recoup money for creditors. Among the largest, apparently, is the Internal Revenue Service.

"I understand that the IRS is owed tens of millions of dollars in unpaid payroll taxes," he said.

# posted by Scott Macaulay @ 1/10/2008 10:07:00 AM

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