Filmation Shuts Plant, Beats Closing Law Deadline by 1 Day

Westinghouse Electric’s Group W Productions shut down its Filmation cartoon factory in Woodland Hills last Friday and fired nearly all of the studio’s 229 employees just one day before a federal plant closing law took effect that would have required it to give workers 60 days’ written notice or face stiff fines.

The firings, confirmed by Group W, came after the company reached a tentative, long-negotiated agreement to sell Filmation for about $30 million to a European investor group backed by the French cosmetics giant L’Oreal.

Union Official Angry

Since the studio is largely shut, the main asset the European group is getting is the studio’s library of cartoons featuring such popular characters as Fat Albert, He-Man and She-Ra.

The sudden closing and firings brought an angry response from the Motion Picture Screen Cartoonists Union Local 839, which represented 149 of Filmation’s cartoon production workers. The local has filed a grievance with Filmation that questions the timing of the firings just before the law took effect.

“They had to rush it through in a hurry to get it done in that time. There was a deadline here. Otherwise, they would have had to give 60 days’ notice,” said Harry Hester, business representative for the North Hollywood-based local.

Owen Simon, Group W vice president for creative services, declined to comment Tuesday on whether the timing of Filmation’s closing and the firings were related to the plant closing law taking effect.

He said Filmation’s production work has been stopped, adding that a small group of executives was still at Filmation’s headquarters working during the transition.

In the debate surrounding passage of the plant closing law, unions and other groups had warned that companies might try to fire workers before the law took effect Saturday.

The controversial law requires companies with 100 or more employees to provide at least 60 days’ written notice of major layoffs or plant closures. Penalties for violating the law include providing back pay and fringe benefits to workers and fines of up to $500 a day, to a maximum of $30,000.

Workers Shocked

Westinghouse bought the studio in 1981 from the cable concern Teleprompter.

The studio’s sale had been expected ever since Filmation last summer confirmed that the L’Oreal group was interested.

But the closing of the studio came as a shock to workers and industry executives, who had expected that cartoon production would continue.

Hester said Filmation hired workers within the past two months for two new cartoon series, “Bugzburg” and “Bravo,” telling some that they would probably work on them for one to two years.

Bucking an industry trend, Filmation was the last U.S. cartoon studio to keep all of its production work in the United States rather than contract with lower-cost Asian production houses.

Filmation President Lou Scheimer, who founded the studio in 1962 with a $5,000 loan from his mother-in-law and sold it to Teleprompter for stock in 1969, has been the industry’s most outspoken critic of shipping work overseas, arguing that quality has suffered to save money.

One industry publication reported that Scheimer tried to buy the studio himself at the last minute and was furious when the deal fell through.

Scheimer did not return telephone calls Tuesday, but one person familiar with the sale denied that Scheimer tried to buy the studio.

“Lou acquiesced to the purchase. He didn’t own the company, so there wasn’t much he could do,” the source said.

The source, who is familiar with the sale, said that although L’Oreal is backing the purchase financially, British financier Michael W. Stevens led the group that made the purchase.

Stevens, who controls the French entertainment firm Parafrance Communications, last year formed a company that bought the foreign television, video and cable rights to De Laurentiis Entertainment Group’s film library for about $69 million.

Officials from the group, which is expected to complete the purchase by July, could not be reached for comment.

Executives familiar with their plans say the group is buying Filmation because the television business is expanding rapidly in Europe and and because cartoons are extremely popular there. The group is expected to find a producer, probably overseas, to complete work on Filmation shows now being made.

Filmation has been troubled for at least three years, largely because of rising production costs and a glut of cartoons on the market.

In 1987, when the company was considering moving work to the Far East, sources familiar with the studio said it was losing millions of dollars a year on about $20 million in annual revenue.

Free-lance writer Charles Solomon contributed to this story.