UPDATE 12:13 PM: Apparition just made official its restructuring plans after Deadline broke the story.

EXCLUSIVE: Bill Pohlad has begun the first phase of restructuring Apparition, apparition_logothe indie distribution company that was thrown into disarray when co-founder Bob Berney exited in bombshell fashion just before the Cannes Film Festival. The first step is painful: 60%, or approximately 15 staffers were informed moments ago they are being let go and receiving severance packages. Last day for those staffers is this Friday.

I’m told this is not a first step toward permanently shuttering the company, which many feared. The company is shifting operations from New York to Los Angeles. Pohlad has enlisted ex-Lionsgate president Tom Ortenberg as a non-exclusive consultant who’ll help the transition. Ortenberg had been rumored as a potential replacement for Berney, but that hasn’t happened. His role is to help plan the release of the Terrence Malick-directed The Tree of Life, the Brad Pitt-Sean Penn-starrer that was Apparition’s highest profile film. Pohlad, who financed it through his River Road label, plans at least for now to leave it with Apparition. It will be released in late 2010, in Oscar season.

[Pohlad later explained in a statement: "Over the last few weeks, circumstances have forces us to rethink the direction and operations of the company, and regrettably this has resulted in layoffs impacting our staff and changes for our colleagues. Still, we very much believe in the mission set forth with Apparition, and welcome Tom Ortenberg's expertise and consultation in the coming weeks and months. In addition, he will be a valuable asset for us on preparing to bring The Tree of Life to audiences."]

Most of the Apparition staff leaving are Berney loyalists, and some of them might well land with him if Berney closes as expected a deal to form a new distribution company with GK Films partners Graham King and Tim Headington. This is tumultuous stuff, considering that Pohlad was on the verge of closing a P&A fund when Berney stunned him by leaving.

F.
4 years
It's true - we need real indie distribbers these days.
John L Mendez
4 years
Not only is Bill Pohlad a real guy paying people’s mortgages, but he also has Integrity... something...
con ed
4 years
any other relatives on the payroll?

Pohlad has observed radio silence while figuring out his next move. The silence of both men left the independent distribution community to speculate on reasons behind Berney’s exit.

Pohlad formed Apparition with Berney after Picturehouse folded. Pohlad wound up fully funding a venture that originally was expected to have three backers that were supposed to invest $25 million each and run their prestige films through the label. After a long attempt to raise money during the credit crunch, the shingle got off the ground in rocky fashion with the Jane Campion-directed Bright Star and the Kristen Stewart-Dakota Fanning rock film The Runaways, neither of which found an audience. Pohlad kicked in his plum River Road-financed production, Tree of Life.

Pohlad was as surprised by Berney’s exit as everyone else. Berney left just before he and the Apparition team got on planes to fly to the Cannes Film Festival. There were rumors that Berney felt constrained–one theory had him frustrated that he could not react fast enough after The Kids Are All Right premiered at Sundance. The deal went to James Schamus and Focus Features within hours of the screening, and the film will be released July 9. I’ve heard there was also a disagreement over how to market The Runaways. Berney wanted to go wide, but the film ended up with a platform release and a viral  promotional campaign, much to the disappointment of cast and their reps, who expected more.

Closing a P&A fund–I’m told it was as high as $50 million–might have helped by giving Berney better leverage to make acquisitions, but that deal was halted when Berney left.

Pohlad immediately appointed business affairs exec Valerie Bruce as interim COO and reassured the staff (many of whom just got sacked) but he took his time to absorb the blow and figure out his next move. Pohlad went to Cannes for the competition premiere of the Doug Liman-directed Fair Game, which River Road financed and Summit Entertainment will release. Berney flew to Cannes to work on his next job and mingle, supplying few details on what happened. His plans came into clearer focus with the news of the GK Films talks.

While Pohlad regrouped, the Sony Pictures Worldwide Acquisitions Group moved the Kristen Stewart-James Gandolfini drama Welcome to the Rileys and made a new distribution deal with Samuel Goldwyn. SPWAG and Apparition originally acquired the film following its Sundance Film Festival premiere.

If Pohlad gets past this period and rebuilds Apparition–the fact that he’s left his most valuable film release Tree of Life gives cause for hope–it would give the independent community reason to cheer, particularly with Berney launching the new label with King and Headington shortly.

The Jim Carrey-Ewan McGregor drama I Love You Phillip Morris was recently taken away from upstart indie Consolidated Pictures Group after the distributor cancelled three release dates as the film played in territories around the world. And the backers of the Kevin Spacey-starrer Casino Jack this week confirmed they will pull that film away from new distribution company Metropolitan.

Sellers would be excited to have two more outlets for their films, funded and operated by principals with proven track records. Pohlad obviously has work to do to convince the community he’s serious about rebounding.

Berney Exit Blindsides Apparition

Bob Berney Flies To Cannes Amid Rumors; More Insight Into Why He Exited Apparition

Bill Pohlad Reassures Apparition Staff

How Would Bob Berney Fit Into GK Films