Question(s) about the Livent Fraud
Question(s) about the Livent Fraud
BroadwayMouth
Chorus Member Joined: 11/7/11
#1Question(s) about the Livent Fraud
Posted: 11/17/13 at 11:56am
I am working on a paper for grad school concerning ethics in business. I am doing an analysis of the Livent debacle. I am curious if anyone has any insights on a few details related to the fraud.
Drabinsky and Gottlieb vehemently deny any intentional wrongdoing, with Drabinsky suggesting that he was not driven by greed, didn't know it was happening, and never intended to cook the books. However, the SEC reports that Drabinsky and Gottlieb both received sizeable kickbacks, arranging with vendors to submit invoices for services never rendered. When Livent paid the invoices, most of the money went into Drabinksy's and Gottlieb's pockets. Has Drabinsky ever offered an explanation for these kickbacks and how they don't qualify and greed or fraud? I've read a number of articles on this, including the SEC summary and a professional accounting summary as well as articles featuring quotes from Drabinsky, none of which addresses it. Anyone know of any insight on his explanation for this?
And is fair to say that Livent became known for producing expensive, lavish productions on a grand scale (i.e. PHANTOM, RAGTIME, SHOW BOAT).
The paper is due on Thursday, so if you comment after, I'll appreciate it, but it won't be as necessary. Thanks for reading!
My Movie Blog: The Back Lot
Updated On: 11/17/13 at 11:56 AM
BroadwayMouth
Chorus Member Joined: 11/7/11
#2Question(s) about the Livent Fraud
Posted: 11/17/13 at 1:09pm
One more question. According to the SEC, Livent fraudulently inflated its RAGTIME earnings in Los Angeles by purchasing tickets through a third party and then reporting those self-purchased tickets as income. The SEC reports that RAGTIME was not successful in Los Angeles.
The show ran for 2 years on Broadway. Does anyone have a sense of how successful/unsuccessful the show was? I guess what I'm trying to figure out is . . . Is there a sense that the show should have run for 2 years? How much money was lost on it (does anyone really know?)? I feel like I should search old Broadway grosses (if they are online), but if they are inflated, it won't help. If people were in the audience at the 1.5 year mark to a vastly under-filled house, it give me a feel. Some of this question is just out of curiosity.
dramamama611
Broadway Legend Joined: 12/4/07
#2Question(s) about the Livent Fraud
Posted: 11/17/13 at 1:24pm
The grosses are published...use the link below to get there. then you can click on the show itself and look year by year....or week by week.
all in black and white.
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#3Question(s) about the Livent Fraud
Posted: 11/17/13 at 4:03pmIt could be that there was never any proof of the kickback scheme, even though it had been alleged. It's well to remember that, in a securities fraud case, the actual focus is on the specific fraud that exists between the issuer of the security and the buyer of the security. So once you prove that there were material misrepresentations of financial information about a company, no matter whether the result of overstated profits, understated losses, inflated assets, or some fancier scheme, you've established the causal link. It doesn't matter how many times, or in how many ways, you swindled, and the measure of the loss for which you are culpable is that of the security buyer. It doesn't matter what the crook says-most deny responsibility-but what the proof is. It also doesn't matter what the motivation was. Maybe Garth was greedy; maybe he just wanted to create great theatre regardless of what he had to do to make it. It's not ok to rob a bank even if you do so to fund a cure for cancer.
#4Question(s) about the Livent Fraud
Posted: 11/17/13 at 7:02pm
You may want to check out the documentary "Show Stopper: The Theatrical Life of Garth Drabinsky"
http://www.imdb.com/title/tt2184315/
Interview with documentary director Barry Avrich: http://www.youtube.com/watch?v=tGz_8YNWsII
Coach Bob knew it all along: you've got to get obsessed and stay obsessed. You have to keep passing the open windows. (John Irving, The Hotel New Hampshire)
Broadway Legend Joined: 12/31/69
#5Question(s) about the Livent Fraud
Posted: 11/17/13 at 7:55pmDrabinsky & Gottlieb chose an OUTLANDISH topic to adapt then sold several hundred percent of the show to a huge number f investors. If Ragtime had flopped, they would have made a killing
#6Question(s) about the Livent Fraud
Posted: 11/17/13 at 11:47pmwow that interview with the documentaarian is pretty offensive-comparing what garth did to the typical risk in a broadway show.
