Rumors of staff cuts at All Def emerged earlier this month, after Tubefilter reported that the company was soon to shut down, citing anonymous sources. All Def Digital president and CEO Chris Blackwell, who was promoted to the role in January 2018, told Billboard over email at the time that the company was “reorganizing in advance of a strategic deal.”
One freelance videographer, who asked not to be identified for fear it could hurt his business, says he is personally owed more than $3,000 in outstanding payments from All Def Digital for his work shooting a video series for the company in May. The shoot was abruptly canceled and the video crew was told that the series would “go dark” for the following three weeks.
Then, he says, “phones stopped being answered.”
Another freelance producer, who also requested anonymity, says she submitted several invoices totaling roughly $13,000 through June and July, including kill fees for canceled projects, but has only been paid for one. In late June, a representative for All Def told her that the company was “folding,” but declined to provide more detail.
When she and other members of a video crew pressed All Def for more information, they were advised to reach out to Armanino -- which recommended they take the issue to the California Labor Board.
When contacted by Billboard, a former All Def Digital executive with knowledge of the current process said that the company fully intends on paying all independent contractors and freelancers, but declined to comment on the company's financial status.
All Def Digital was launched in 2013 by Simmons, who also co-founded Def Jam Recordings in the 1980s. The company is known for producing youth-focused web video series spanning comedy, hip-hop and social justice-related programming, and has inked deals with YouTube, Universal Music Group, HBO and others.
Simmons himself stepped down from All Def in 2017 after multiple women accused him of sexual assault; he has denied the allegations.
Robert Marticello, a business bankruptcy attorney and partner at Smiley Wang-Ekvall in Los Angeles, says companies typically choose to file an ABC as an alternative over a bankruptcy when their intention is to either sell or to close down a company.
“ABCs usually do not involve a continuation of the business,” Marticello says.
An ABC is also less transparent than a bankruptcy filing: In California, where All Def is based, there is no requirement for a court filing or for any prior to notice to creditors. “That is the concern with creditors -- you don’t know that the person or company that owes you money has gone through an ABC until it’s really too late to take any action,” he adds.
As such, Marticello says companies may also choose to go the ABC route when they would prefer there to be less public knowledge or notice of their financial troubles.
“It doesn’t have to be for nefarious reasons; it can be that some people feel filing bankruptcy has a stigma to it,” he says. “An ABC is a less-public insolvency device.”
Additional reporting by Claudia Rosenbaum.