Former Maker Studios Chief Executive Danny Zappin has filed suit against the digital studio’s co-founders and board members, alleging that he was the victim of a conspiracy to oust him from the board.
Zappin contends in a civil suit filed Wednesday in state Superior Court in Los Angeles that Maker’s founders -- Lisa Donovan and Ben Donovan -- and others at the company participated in an alleged scheme that changed the composition of its board, and resulted in his removal as a director.
He stepped down as chief executive on April 16, with former Endemol executive Ynon Kreiz assuming management responsibilities for the company. Zappin remained on the board, and served as a consultant to the new media company he helped launch in June 2009.
Zappin attracted headlines in December, when he engaged in a highly publicized spat with one of Maker Studios’ biggest stars, Ray William Johnson, who left the network.
Upon his departure as chief executive, Zappin lauded Kreiz as a seasoned executive well equipped to manage the budding studio, which had received $36 million in funding through an investment round led by Time Warner Investments.
“As the former CEO and chairman of Endemol, the world’s largest independent production company, and as the co-founder and CEO of Fox kids, Ynon has the specific media exec experience that we need to take Maker to the next level,” Zappin wrote at the time.
Zappin was voted off the Maker board in June.
In court documents, Zappin alleges that Kreiz and board members who represented the company’s financial backers hatched an elaborate scheme involving the buying and selling of shares to gain control of the company, and misled Zappin about their intentions.
“Among other things, the [venture capital funds] wanted to rapidly create a ‘liquidity event’ so they could sell Maker and obtain significant returns on their investments irrespective of the best interests of Maker,” the suit alleges. “Kreiz ... touted ... that he could turn Maker into a $1 billion company in three years.”
Maker issued a statement, denying the suit’s allegations of breach of fiduciary responsibility, fraud, concealment, misrepresentation and conspiracy.
“The lawsuit is without merit and the allegations are baseless,” Maker said in a statement. “We regret that Danny is taking this step and involving the Company he co-founded in litigation.”
Zappin is asking the court to unwind the actions of the board and install new directors.