Welcome to Lowpass! This week: A new lawsuit alleges Redbox fell victim to “mismanagement and pillaging by insiders,” and President Trump’s Liberation Day didn’t feel so liberating for consumer electronics makers.

New lawsuit aims to claw back millions from Redbox corporate parent’s former leadership

The executive leadership of Chicken Soup for the Soul Entertainment, the corporate owner of Redbox and a handful of streaming ventures, is being targeted by an explosive new lawsuit: George L. Miller, the trustee put in charge of Chicken Soup for the Soul Entertainment’s bankruptcy case, alleges in a complaint filed last month that the company’s former CEO Bill Rouhana treated Redbox and its sister companies “as his personal piggy bank [...]  while neglecting the most basic corporate duties.”

Redbox, Chicken Soup for the Soul Entertainment and related companies were “victim of mismanagement and pillaging by insiders on a scale rarely seen with public companies,” the filing alleges.

Miller’s complaint targets Rouhana, his wife Amy Newmark and other key company executives as well as Chicken Soup for the Soul Entertainment’s board members and its corporate parent, book publisher Chicken Soup for the Soul. 

Among other things, it alleges that Chicken Soup for the Soul Entertainment paid “tens of millions of dollars in dividends to its preferred shareholders when the company was insolvent” and that it failed to pay “millions of dollars in employee wages, medical benefits, and payroll taxes, while transferring millions of dollars to the company’s shareholders.”

Miller also has a remedy in mind to right the alleged wrongs: