Hollywood Uneasy as SEC Remains Silent
Nearly a year after the U.S. Securities and Exchange Commission began an investigation into the business practices of Hollywood film companies in China, The New York Times reports that the government has neither announced any action nor given any indication about the scope of its ongoing inquiry:
Some who are involved in Hollywood’s entry into China are privately expressing hope that the Justice Department inquiry will be resolved before they run out of time on what one of them last week called a “ticking clock,” as Chinese consumers outgrow their receptivity to Hollywood fare.
The squeeze started last year when they began to spend more money on some homegrown films than on the American blockbusters.
But Michael W. Emmick, who was formerly a prosecutor with the Justice Department, and now focuses on the corrupt practices cases, among other things, in his private law practice, said a resolution could be a long time coming.
“This is still early in the game,” he said.
While Mr. Emmick is not representing clients in the investigation, and said he had no direct knowledge of it, he said that regulators sometimes use such industrywide inquiries as a “cost effective” way of putting an entire business sector — like the pharmaceuticals industry or the portion of the financial industry dealing in sovereign debt — on notice.