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Slideshow Judge blocks fast sale of bankrupt special-effects firm Tweet Share this Email Print Related News Judge skeptical of quick sale of special-effects firm 1:58pm EDT "Avatar" special effects shop weighs Digital Domain bid Tue, Sep 11 2012 "Titanic" effects creator Digital Domain bankrupt, sale agreed Tue, Sep 11 2012 CORRECTED-UPDATE 2-"Titanic" effects creator Digital Domain files for bankruptcy Tue, Sep 11 2012 Analysis: ResCap bidders line up for rare subprime mortgage sale Wed, Sep 5 2012 Analysis & Opinion Open courts healthy for Delaware and dealmakers Related Topics Entertainment » Fashion » Deals » Global Deals Review: 2011 Q3 » Global Deals Review: 2011 Q2 » Global Deals Review » Inflows Outflows » By Tom Hals WILMINGTON, Delaware | Wed Sep 12, 2012 4:13pm EDT WILMINGTON, Delaware (Reuters) - A bankruptcy judge refused on Wednesday to approve a sale next week of Hollywood special-effects company Digital Domain Media Group Inc, which says it risks losing its movie studio clients if it fails to hold a fast auction. The Oscar-winning company filed for bankruptcy on Tuesday with only $50,000 in the bank and unable to meet Friday's payroll, its attorney, Robert Feinstein, told the U.S. Bankruptcy Court in Delaware. Digital Domain Chief Executive Ed Ulbrich told the court that studios would begin pulling work from the company on Thursday unless it had an emergency loan and an agreement to auction the company to a better-financed owner next week. Judge Brendan Shannon called the speed of the proposed sale "unprecedented" and said he was worried about giving creditors time to assess the fairness of the process. "I'm aware of the consequences of my decision," Shannon said. He said it was the company's choice to wait until its finances were extremely dire before filing for bankruptcy. Shannon suggested the company hold an auction on October 2. He also suggested holding a hearing on September 20 to approve the rules for bidding at the auction. Digital Domain won an Academy Award for its work on "Titanic" and has created effects for more than 90 major films including "Pirates of the Caribbean: At World's End." Private equity firm Searchlight Capital has proposed an initial bid of $15 million for the company. (Editing by Martha Graybow, Matthew Lewis and Tim Dobbyn) Entertainment Fashion Deals Global Deals Review: 2011 Q3 Global Deals Review: 2011 Q2 Global Deals Review Inflows Outflows Related Quotes and News Company Price Related News Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. 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