Last week, the BeBop Corporation, the owners of Madavor Media, filed a lawsuit against online rental studio platform Giggster for $25 million, alleging breach of contract and fraud over the sale of Madavor Media’s photo properties, including Outdoor Photographer and Imaging Resource. It has been a tumultuous four months for Madavor’s photo properties, and it deserves a closer look. Buckle up, as even scratching the surface is a lengthy undertaking.
February: The BeBop Corporation Purchases Madavor Media
BeBop purchased Madavor Media on February 16, 2023. In the original press release announcing the acquisition, the BeBop Channel Corporation (OTC PINK:BBOP) framed the acquisition of Madavor Media LLC as part of its overall expansion plans, paying particular attention to iconic jazz magazine, JazzTimes.
Despite BeBop’s emphasis on jazz, theater, and the arts, BeBop’s interim CEO Gregory Charles Royal and BeBop executive Sue Veres Royal expressed excitement about acquiring Outdoor Photographer as part of the purchase.
Gregory Charles Royal also outlined BeBop’s aspirations to expand its video properties, including live streaming and new scripted television, noting that there is no commercial television station dedicated to jazz, dance, and theater advertisers or audiences in the United States.
Madavor Media is not publicly traded, so precise details of the purchase were not available at the time. However, in the months following the transaction, protected sources have told PetaPixel that the acquisition didn’t involve an upfront cash payment. File that information away for now, as it will come up again.
May, Part I: Chaos, Missed Payments, Mismanagement, and Sites Going Offline
After a relatively quiet March and April, at least from the outside, May was a big one for BeBop, Madavor, and Madavor’s photo properties.
PetaPixel has learned that many people at Madavor lost their jobs in the two months following BeBop’s purchase of the company. Per recent filings, it appears that as little as around 25 percent of Madavor’s former staff remains in employ today. Cursory searches around LinkedIn show many former Madavor staffers as having left the company in March and April.
On May 5, Imaging Resource, which had last been updated in mid-April, was abruptly taken offline with no explanation from Madavor or BeBop.
On May 8, the Imaging Resource domain began redirecting to Outdoor Photographer, presumably in a move to bolster Outdoor Photographer’s value in a potential sale or to at least prevent Imaging Resource from returning redirect errors.
In an exclusive for PetaPixel, Imaging Resource’s founder, Dave Etchells, shared his story of the site’s untimely demise.
Etchells explained how Imaging Resource grew over decades before eventually being caught up in a major contraction of advertising revenue in 2019. On the brink of total collapse, Madavor swooped in and purchased Imaging Resource, bringing it under the media publisher’s larger photography catalog, including Outdoor Photographer, Digital Photo, and Digital Photo Pro.
On May 18, PetaPixel learned that numerous photographers and writers for Outdoor Photographer had not yet been paid for work dating back to last year, before BeBop acquired Madavor.
May, Part II: Imaging Resource Returns and BeBop Announces a Sale to Giggster
On May 26, Imaging Resource suddenly came back online, signaling that perhaps a buyer had been found, or BeBop simply wanted to make the site more attractive to potential buyers.
As it turns out, it was the former. On May 31, PetaPixel reported that Giggster had acquired Imaging Resource from the BeBop Corporation, alongside Madavor’s other photo publications.
BeBop’s COO Sue Veres Royal confirmed to PetaPixel on May 31 that Imaging Resource had been sold on Friday, May 26, to Giggster. At that time, Royal expected Giggster to make an official announcement on June 2.
Giggster did not respond to PetaPixel’s request for comment.
June, Part III: A Failed Sale and a Massive Lawsuit
The days turned to weeks with still no additional news of Giggster’s big purchase. Imaging Resource remained online, and the “for sale” advertisements on Madavor’s other photo websites had vanished. However, Giggster never said anything about the supposed acquisition.
As with many things since BeBop purchased Madavor, communication was minimal, and confusion was immense.
The deafening silence was broken last week when BeBop emailed PetaPixel with information about a lawsuit the company filed in New York against Giggster, alleging fraud and demanding $25 million in compensation.
Highlights from the Lawsuit
Within the lawsuit, the BeBop Channel Corporation alleges that a contract between BeBop and Giggster was signed, and the defendants, Giggster, subsequently failed to pay the agreed upon $400,000 in cash and $491,000 in other liabilities at closing. Further, BeBop claims that Giggster “engaged in a scheme to defraud the Plaintiff of the substantial proprietary assets which comprise its photo publication and website properties (assets), including but not limited to content, company records, websites, logins, trademarks, licenses and subscriber and advertiser data.”
The lawsuit also alleges that Giggster “engaged in a theft of service with regard to obtaining the components of Plaintiff’s photo properties from Plaintiff’s technical team behind their security firewall as the team compiled, configured, and transmitted intellectual property to honor Defendant’s customized requests.”
Finally, rounding out the claims, BeBop says that Giggster effectively strung BeBop along with no intention of honoring the payment terms.
There is a lot to unpack there, some of which go well beyond the scope of this recap, but it is important to briefly take a closer look at that first claim. “…substantial proprietary assets which comprise its photo publication and website properties…”
That claim rings a bit hollow given that BeBop saw such little value in Imaging Resource that it didn’t even bother to keep it online, an act that, while not free, is far from expensive, especially when trying to sell the website. The photo properties are apparently worth enough to sell and sue over, but not valuable enough to be kept online.
BeBop’s actions over the preceding months suggest that its photo properties were not valuable enough to protect them from being effectively gutted and slapped together in an “as is” for-sale bundle, a bundle that only became available when the photo community became upset following Imaging Resource being taken offline and Outdoor Photographer contributors started making noise about not being paid.
Summarizing the Lawsuit’s Factual Allegations
Among the many pages of factual allegations in the lawsuit, there are a handful of especially interesting bits of information.
Giggster contacted BeBop on May 25 to purchase Madavor’s photo properties. Later that day, an expedited “Asset Purchase Agreement” was written and sent to Giggster. Giggster’s lawyer began reviewing the document within hours.
While that process was underway, Giggster asked if BeBop could begin the asset transfer purchase before the deal closed on June 2. At that time, Giggster also asked if Imaging Resource could be brought back online, as it being offline hurts its value — especially concerning Google search engine results.
BeBop claims it replied in the affirmative to Giggster’s numerous requests. And as PetaPixel reported, Imaging Resource came back online. Again, on May 31, BeBop also told PetaPixel that Madavor’s photo properties had been purchased. As evidenced by the lawsuit, the purchase agreement was still numerous days from being finalized, and money had not yet changed hands.
Returning to the night of May 25, Giggster’s lawyer “came back with a lot of red lines around reps, warranties, and indemnification.”
Giggster’s CEO and founder, Yuri Baranov, writes, “I know we won’t get this done if we follow her advice. Her only reasonable ask was to clarify the ownership of the assets by BeBop, maybe get the original asset purchase agreement that assigns the rights to BeBop. More importantly, with every day that passes by, the value of the assets diminishes because search engines de-index content, and permanent damage is done. Here’s what makes sense to unblock it. Drop the cash price to $400K so that we can create an internal special circumstances fund to address all types of crap related to this purchase, and we’ll countersign ASAP and rush to restore assets to reduce the damage and will work towards closing on the 2nd as per the original agreement. Deal?”
BeBop agreed, although later clarified that the actual purchase agreement Giggster requested could not be sent due to “non-public components,” adding that public disclosures on OTC Markets prove that Madavor is a “wholly-owned subsidiary of The BeBop Channel Corporation.”
It appears that BeBop claims that a press release on OTC Markets proves that BeBop wholly owns Madavor, as releases on OTC Markets “are highly regulated and subject us to criminal liability if they were false.”
Satisfied with this reasoning, Baranov agreed to move forward with an amended agreement. After fixing a typo in the purchase price — which added $100,000 to the tally — Giggster countersigned the agreement. Almost all of this happened on May 25, with a slight bleed over to May 26 (eastern time).
Gregory Charles Royal then sent an email to his team, asking that Imaging Resource be brought back online, and announcing the sale of Madavor’s photo properties.
The revised purchase agreement required that $400,000 be wired to BeBop on June 2. That deadline passed and the payment was not received, and BeBop immediately said it was forced to proceed with legal action:
Please be advised that the deadline for the June 2, 2023 required payment has passed. Therefore, we are forced to proceed with action against you both civilly and criminally. Your brazen and shocking conduct leaves us to conclude that you have conspired with each other to commit fraud and theft against our company — a scheme to get Imaging Resource back online. As you have engaged in these actions against a public company registered in the state of New York — and that these actions occurred via electronic communications — we will be engaging with the US Attorney’s Office for the Southern District of New York; additionally, we will be engaging private counsel to pursue all relevant claims/charges against you — as a corporation and individually. We will be filing with the US Attorney’s office at 12:00pm EST on Monday, June 5, 2023.
These are serious allegations.
The following day, June 3, Giggster responded with what Royal describes as a “Jedi Mind Trick” and “GasLighting.” Giggster expressed disappointment with the tone of the communications and reaffirmed its sincere interest in completing the purchase of Madavor’s photo properties.
In its response, Giggster described concerns raised by its legal team, including a lack of communication concerning copyrights, trademarks, intellectual property, business records, and subscriber records.
Giggster also wrote, “Furthermore, over the past week we witnessed a lack of proper corporate governance, negligence, and mismanagement, all of which are unacceptable in highly regulated entities such as public companies, their subsidiaries, and affiliated companies.”
Giggster also said that BeBop can revoke any access that it had previously granted and that its team would be happy to assist BeBop and Madavor in this process.
‘Method of Scheme’
“Defendants enter into a contract to first obtain total access and data only to then allege a technical flaw in the contract which they would claim makes the contract null and void — Gaslight the terms — and withhold any payment. Then defendants would proffer a ‘solution’ to the fallaciously void contract by renegotiating a new contract which if Seller agrees, would confirm the original contract’s cancellation for which Defendants would not be obligated to enter into as a new contract; all the while reaping the benefits of receiving the properties for which they could extract the trove of information, including subscriber data, and simply ‘return’ the files — which is impossible for an electronic receipt — when in fact, no new contract comes to fruition.”
That is how BeBop describes Giggster’s actions during negotiations to purchase Madavor’s photo properties. As far as BeBop is concerned, Giggster’s reported attempt to continue negotiations on June 6 is further evidence that Giggster was embroiled in a scheme to defraud and steal from BeBop.
Nonetheless, despite this alleged belief that it was being defrauded, BeBop said it would review an amended agreement with specific conditions, including a $200,000 deposit the following day, June 7.
Giggster did not agree to these terms, and as of the lawsuit filing on June 9, had not made any payment to BeBop.
Claim for Relief
Shortly following the lawsuit filing, BeBop contacted PetaPixel and provided access to a press release concerning the lawsuit and a download link for the lawsuit itself. PetaPixel is aware that it is possible this open communication is an attempt to control the narrative.
The final part of this recap wants to look at BeBop’s demand for compensation. The company demands a trial by jury and is asking for some lofty relief. BeBop wants the entire amount that Giggster was going to pay for Madavor’s photo properties, $891,827.40, plus $4,000,000 in other economic damages, and $20,000,000 in punitive damages. BeBop also wants interest payments and legal fees covered.
Of course, lawsuits often set the bar very high on compensation requests, and it gets whittled down. However, perhaps there is another motivation here, an out-of-court settlement. Lawsuits are expensive, and they take up considerable time. Would BeBop consider a settlement, or will it continue to demand a full trial, assuming that the case is even admitted into court?
BeBop’s Debts and Liabilities
A cursory look at The BeBop Channel Corporation’s Consolidated Financial Statements for the nine months ending on March 31, 2023, shows that the company has rather sizable outstanding liabilities. It is important to note that liabilities do not always equal debt.
Nonetheless, sources tell PetaPixel that BeBop’s acquisition of Madavor did not involve a cash payment, and it seems that the transaction created serious debt on behalf of BeBop to Madavor’s prior owner, Zilpin.
In the financial report, the acquisition of Madavor Media LLC is described as follows:
Madavor Media, LLC was acquired from Zilpin Group, LLC with which The BeBop Channel Corporation had no prior relationship or affiliation for 2.0 million shares of BeBop Common stock and 2 (two) promissory notes issued to Zilpin for $3,000,000 and $475,000 (Note 3). 1.5 million shares of BeBop Common stock were transferred to Zilpin Group, LLC and 0.5 million shares of BeBop Common stock were provided to certain key executives of Madavor Media, LLC.
The promissory notes in question are outlined in the financial disclosures, and so far total nearly $3.5 million. There are two notes, one is short-term, and the other is long-term.
The short-term note totals $475,000, plus interest, and is due on October 1, 2024.
The principal amount of the $475,000 promissory note will be repaid in nineteen (19) equal consecutive monthly payments on the first day of each calendar month commencing on April 1, 2023. Each monthly principal payment shall equal $25,000. All accrued interest then outstanding shall be due in one payment on October 1, 2024 (the date of the last monthly principal payment hereunder). Interest is accrued on the outstanding principal balance of this Note at a fixed interest rate per annum equal to fifteen percent (15%). Interest is calculated on the basis of actual days elapsed and a 365-day year.
As of the end of this quarter, BeBop has paid $25,000 of its short-term promissory note.
The larger, long-term promissory note is to be repaid in one payment on February 15, 2026, plus interest. The interest rate is nine percent per annum. That is a lot of money and potentially significant interest.
As of the end of its most recent quarter, BeBop claimed cash and cash equivalent assets of $466,178. A cash influx of nearly $900,000 from Giggster would certainly have been a major asset.
While an accountant is needed to fully unpack the financial disclosures, an accountant is not required to see that much of BeBop’s assets and liabilities concern its acquisition of Madavor Media LLC, an acquisition that has thus far resulted in significant cuts to Madavor Media’s employment and properties, which doesn’t seem like a surefire way to create the content required to generate substantial revenue.
Perhaps in the short-term, cutting costs while reaping the benefits of prior revenue streams works out, but what happens when the content disappears? The revenue streams will undoubtedly dry up. How then will BeBop fund its ambitious television plans?
As Gregory Charles Royal said when blaming Outdoor Photographer’s contributors and Madavor’s prior management for his inability to pay people what they’re owed, “The chickens come home to roost.”
On February 15, 2026, the chickens will come home to roost in a very expensive way.
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