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I recently checked again into Central Park Media’s current bankruptcy case and found some new documents from the past month: a Stipulation for Payment of 11 U.S.C. Section 506(c) Expenses and a signed order by presiding judge Shelley C. Chapman approving the sale of the “Anime Channel” trademark, the text of which was basically the same as the Order Pursuant originally submitted in April. Chapman signed both orders on May 3rd.

The Stipulation contains details about CPM’s relationship as a debtor to Bank of America. BofA had lent CPM “approximately $888,651.40″ and holds a lien against them because of that – as of the Stipulation’s filing, CPM owed $924,722.56 inclusive of all accrued interest and fees. The net proceeds from the Anime Channel trademark sale will be distributed to BofA because it was part of CPM’s Estate Assets (basically all their accounts, intangibles and inventory).

BofA then agreed to be “bound by the terms of 11 U.S.C. § 506(c) to pay the reasonable, necessary costs and expenses…of preserving, disposing of, or attempting to dispose of the Trademark subject to BofA’s lien” with the costs not to exceed 40% of the gross proceeds from the sale. If costs did surpass 40% of gross proceeds from the sale, BofA and the Trustee would “attempt to negotiate a reasonable increase to such amount” of the costs. Both parties agreed that the costs will only be payable from the gross proceeds from the trademark’s sale and no costs will be owed if the sale is not approved by the Court.

I hope you don’t mind me not reporting this last week when I first downloaded the documents because frankly, this is not a fast-moving case, the company’s already folded and the subject matter is very dry. I’m mainly doing it because I haven’t seen anyone else digging around for this information.

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The saga of Central Park Media’s Chapter 7 bankruptcy proceedings continued Tuesday with more documents submitted relating to the sale of the “Anime Channel” trademark (Reg. No. 2,870,643), which I first reported on last month.

The initial sale approval & effective date was to be March 29th but, prior to that date, Griffin Vance contacted the Trustee on behalf of a different undisclosed client. After some negotiation and discussion with the Trustee, Vance tendered an written offer for $8,000 on April 9th, saying his firm “believe[s] this offer reflects a substantial premium over other available offers and would provide an enhanced recovery for stakeholders vis a vis this asset”. Vance’s law office is located in Houston, TX, so that makes me curious if one of the well-known Texas-based anime distributors put forth this counterbid.

On April 16th, the initial bidder represented by Smith Patent Office (“SPO”) expressed their intention to bid $10,000 for the trademark. Vance was informed about the SPO client’s second bid and Vance’s client “decided not to place any higher bids for the Trademark”.

According to the Supplemental Affidavit of Melissa L. Steinberg in Support of Sale of the trademark (the “Steinberg Affidavit”), Bank of America (“BofA”) holds a secured claim against CPM’s estate and that the trademark is included in BofA’s collateral. Therefore, the net proceeds of the sale will be distributed to BofA pursuant to the 506(c) agreement executed by the Trustee and the bank on April 20th. A revised Order Pursuant was submitted with the Affidavit and stated that the Trustee will forward to SPO a Bill of Sale upon the Trustee’s receipt of $9,000 balance due. (A $1,000 deposit check had been sent to the Trustee on March 10th.) The Trustee is seeking Court approval of the sale so it’s not completely done but the deal seems finalized, unless a higher bid is submitted.

One other document submitted in the case was a Certificate of Service signed by Steinberg and notarized by Stephanie Pender on April 20th, certifying that the Supplemental Affidavit had been served by first class mail to the Office of the US Trustee, CPM’s creditors, Smith Patent Office, and Griffin Vance’s law office.

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UPDATE 2 – 4/11 3:40PM PDT: Manga Entertainment titles are still streaming as of April 11th.

While watching Ninja Scroll through Netflix’s Instant Watch service last night on my Xbox 360, I noticed that it and Blood: The Last Vampire were both expiring on April 1st. I decided to see how many other Manga Entertainment titles would no longer be streamed after that date and I came up with a list, thanks to instantwatcher.com.

It doesn’t look like there will be any Manga Ent. titles to remain streaming after April 1st but most of the ones that are expiring still have DVDs available through the mail. (Yes, physical discs that you send back when you’re done!) I’ve indicated which titles currently do not DVDs available with [ND] for “no DVD”.

  • Black Jack: The Movie
  • Blood: The Last Vampire
  • Dead Space: Downfall
  • Ghost in the Shell
  • Ghost in the Shell: Stand Alone Complex (season 1)
  • Ghost in the Shell: Stand Alone Complex: 2nd Gig: Individual Eleven
  • Ghost in the Shell: Stand Alone Complex: The Laughing Man
  • Kai Doh Maru
  • Karas: The Prophecy
  • Karas: The Revelation
  • Macross 2: The Movie [ND]
  • Macross Plus [ND]
  • Ninja Scroll
  • Noein
  • Perfect Blue
  • Psychic Wars
  • Read or Die
  • Street Fighter Alpha
  • Street Fighter Alpha: Generations
  • Street Fighter II: Animated Movie
  • Street Fighter II: V
  • Sword for Truth [ND]
  • Tokko
  • Vampire Wars
  • Virus: Virus Buster Serge

I think these are part of a bigger deal that Starz Media, of which Manga Entertainment is a subsidiary, has with Netflix because Stan Lee Presents: Mosaic and Stan Lee: The Condor are also expiring Apr. 1st and both were released by Anchor Bay Entertainment, another Starz Media component.

UPDATE 9:15 PM PDT: I forgot to mention that Manga Entertainment is still streaming its series (such as Virus Buster Serge) along with other publishers’ series (such as Gurren Lagann) on its YouTube channel, on Hulu, and on Manga.com.

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Source: Statement of Use correspondence from trademark application

It has been many months since I last wrote about CPM’s bankruptcy case and Prede of Central Park Media News reminded me of that fact over Twitter a few nights ago. So I went into PACER and saw that there was a “Response Due Date” action filed on March 17th with a March 29th Due/Set date. The related documents detail the sale of U.S. Trademark No. 2,870,643, “Anime Channel”, to “an undisclosed Japanese client” represented by Smith Patent Office for $5,000.

The Motion Pursuant to Bankruptcy Code Section 363(b)(1), Federal Rule of Bankruptcy Procedure 6004(f)(1) and Local Bankruptcy Rule 6004-1(a) to Sell Trustee’s Right, Title and Interest in U.S. Trademark Registration Number 2,870,643 – I’ll shorten it to just Motion Pursuant – reveals the main reason why there has not been an auction announcement yet: “[t]he Trustee’s professionals performed a thorough inventory and analysis of [CPM's assets] and determined that there exists insufficient equity…to make an estate sale of the Assets under current market conditions.” However, the trustee, David R. Kittay, knew some of those assets “might still be of value to particular purchasers” and therefore “remained open to entertaining offers” for them “in whole or in part”.

Regarding the Trademark, the trustee “firmly believes” a private sale, rather than a public auction, is “in the best interests” of CPM’s bankruptcy estate; the trustee hasn’t received any other offers and doesn’t believe “there would be sufficient interest [in it] to justify the expense of marketing and auctioning [it].”

Also among the documents is some correspondence sent from Smith Patent Office (SPO) to the trustee firm Kittay & Gershfield, P.C. According to a December 17th e-mail, the client’s initial offer was for $800. (The Motion Pursuant states the Trustee rejected the $800 offer as too low because “the costs of consummating such sale, including seeking Court approval of such sale, would easily exceed $800.”) After some telephone conversations between the two firms, SPO sent an e-mail on January 22nd to report the client’s offer had risen to $5,000. Finally, a Federal Express was sent on March 10th with a $1,000 check enclosed as a deposit toward the trademark purchase; SPO will provide the remaining $4,000 balance upon Court approval of the sale, according to a Notice of Presentment.

So what will happen next? The Notice of Presentment of the Motion will be served by the Trustee to a number of parties including the Office of the U.S. Trustee, CPM’s counsel, each of CPM’s secured and unsecured creditors, and all parties who have filed a Notice of Appearance in the case. That notice states Kittay will present the proposed order to approve the Trademark’s sale to Hon. Shelley C. Chapman, newly sworn in U.S. Bankruptcy Judge, for signature at noon on March 29.  Any objections to “the relief requested in the Motion” (the $5,000 sale) must be received in writing no later than 10 a.m. that same day.

Background on the Trademark
I’ll conclude this post with some information about CPM’s use of the “Anime Channel” trademark based on documents I downloaded from TESS, the Trademark Electronic Search System. CPM initially applied for the trademark on August 10, 1999, and in a July 10, 2000 response to the Assistant Commissioner of Trademarks, CPM’s in-house counsel Gamal Hennesy provided the following additional information:

  • Anime Channel is a unique portion of the animeone.com web portal.
  • Anime Channel is one of the largest free sites for anime video and audio streams, available in either Real Player G2 configurations.
  • Anime Channel provides trailers of anime programs available in VHS and DVD formats. Prospective customers who access Anime Channel can purchase the VHS and DVD formats of the programs as they view the trailer.
  • The prospective customer for Anime Channel is primarily males and females ages 13 and up who have access to the World Wide Web.
  • The channel of trade for Anime Channel is exclusively the internet and World Wide Web.
  • The words Anime Channel do not have any significance in the anime industry.
  • Anime Channel provides only Japanese animated programming. The subject matter of the programs include various fantasy and science fiction related programs available for sale on VHS or DVD formats.

The trademark registration among the correspondence states CPM first used it in commerce on November 4, 2002 – that date comes from Statement of Use documents signed by CPM president John O’Donnell, stating that it was first used “in connection with the goods at least as early as November 4, 2002″, the goods being. (It seems like an interesting coincidence that ADV’s Anime Network channel was announced soon after on November 6.) An Internet Archive snapshot of the animeone.com home page on February 29, 2000, shows “Anime Channel” in the left sidebar.

So who is this Japanese client buying the trademark and will they actually put it to use? I have a feeling that it could be Kadokawa – there already exists the Anime Newtype Channel website with some Bandai Channel integration and Kadokawa’s YouTube channel is branded “KADOKAWA Anime Channel” – but I’m wondering what other companies might have been that sole interested party.

UPDATE 3/20 2:30pm PDT: Dave of Subatomic Brainfreeze pointed out on Twitter that the YouTube channel Bandai is using to promote Gundam Unicorn is under the account name AnimeChannel. That seems to be an extension of Bandai Channel based on the b-ch.com links in the Gundam video descriptions and Top wo Narae! (aka Gunbuster) videos being region-blocked because they contain content from BandaiChannel, which is a Japan-only service.

I don’t think there would be any problems with that channel’s name and URL because I feel like the trademark being sold may have lost some distinctiveness over the years – FUNimation and Section23 (through Anime Network) have their own video portals along with their own respective YouTube channels and Crunchyroll has developed into a notable simulcast website. If the new owner did decide to enforce the trademark, they would have describe how a particular use by someone else is likely to be confusingly similar to consumers.

I should remind readers that I am not a patent or trademark lawyer so this is just an informed opinion.

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A number of anime series will not be available for streaming through Netflix’s Watch Instantly service beginning on Wednesday and Thursday. Many of these began streaming on October 1st, 2007 (some ADV) and some others began December 31st, 2006 so these expirations seem contractual. Exceptions are Desert Punk (Oct 1, 2008), GitS: SSS (April 1, 2008), Castle of Cagliostro (May 1, 2008), Megaman Upon A Star (July 1, 2006), Parasite Dolls (Jan 1, 2007), and Super Milk Chan Show (July 1st, 2006).

I used instantwatcher.com to compile this list and get the dates each began streaming. The two dates given below are when a particular title will no longer be available to watch through their streaming service.

Sept. 30 (last day is Sept. 29):
Legend of Lemnear
Takegami: Guardian of Darkness: War God

Oct. 1st (last day is Sept. 30):
Ah! My Goddess 2: Flights of Fancy
Air Gear
Air TV
Ayane’s High Kick
BASToF Syndrome
Battle Arena Toshinden
Black Jack
Chance Pop Session
Comic Party Revolution TV
Descendants of Darkness
Desert Punk
Doggy Poo (Korean)
Dominion Tank Police Part 1 & 2
Ellcia
Fullmetal Alchemist: The Movie: Conqueror of Shamballa
Garaga
Ghost in the Shell: Solid State Society
Gilgamesh
Jinki: Extend
Kakurenbo: Hide & Seek
Kurau Phantom Memory
Lady Death
Lupin the 3rd: The Castle of Cagliostro: Special Edition
Magical Play
Martian Successor Nadesico: The Motion Picture: Prince of Darkness
Megaman: Upon A Star
Mezzo
Munto
Negadon: The Monster From Mars
Nurse Witch Komugi
Odin: Starlight Mutiny
Otaku Unite! (documentary on US fan culture)
Paniponi Dash!
Parasite Dolls
Project A-ko
Project A-ko: Love and Robots
Project A-ko: Uncivil Wars
Revolutionary Girl Utena: The Movie
Saiyuki
Sin: The Movie
The Super Milk-Chan Show
Utawarerumono
Vermilion Pleasure Night: Vols 1-3 (live action)
Voltron
Xenosaga

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