Dallas Jenkins, creator of “The Chosen,” responded to allegations that the studio behind the hit biblical drama improperly cashed out minority shareholders, saying that the claims are “categorically false.”
A man who invested $300,000 in 5&2 Studios is suing, claiming the company’s leadership froze him and thousands of other shareholders out of the profits.
Every season of “The Chosen,” a biblical drama about the life and ministry of Jesus Christ, has been largely financed through crowdfunding, a model which allows fans to financially support the series. Supporters have donated more than $44 million to fund the seventh and final season of the series, per Come and See.
Since its launch nearly a decade ago, the series has grown into a global phenomenon, reaching hundreds of millions of viewers around the world in a record-breaking 125 languages.
Christopher Garabedian, chief executive of life sciences accelerator Xontogeny, was among early investors who backed a predecessor to 5&2 Studios, investing $300,000 in 2019. Last month, he filed a class-action lawsuit in the Delaware Court of Chancery, alleging the company forcibly bought out more than 16,000 minority shareholders.
According to the lawsuit, the company paid minority shareholders $3.75 per share, a move that left insiders in full control as “The Chosen” heads into its final seasons. Garabedian, who held 150,000 minority shares, alleges he objected to the transaction but was still cashed out. He received about $560,250 from his original $300,000 investment.
“As with other investors, Garabedian’s deep involvement in 5&2 was due both to his strong belief in the project as an evangelical tool and his expectation that he would be a long-term stockholder,” the complaint says, per The New York Times.
Jenkins, executive chairman and co-founder of 5&2 Studios, denies the allegations.
“We can’t say much because of litigation, but we also won’t hide behind ‘No comment,’” Jenkins said in a statement. “We’ve been transparent and accountable from the moment we formed our company and have gone above and beyond to follow all legal and financial requirements.”
“Any suggestion of impropriety is categorically false, and the full record thoroughly addresses every concern,” he continued. “We’re eager for the court’s review to affirm that.”