New York's attorney general is suing the Weinstein Company and Harvey Weinstein alleging years of sexual harassment and misconduct by the movie producer.
Insiders say the case could jeopardise talks on a potential sale of the studio.
What does the civil suit allege?
That the company's executives and board repeatedly failed to protect employees from Weinstein for years, according to Attorney General Eric Schneiderman.
It also names Weinstein's brother Bob, who co-founded the company. Weinstein Company executives, it is alleged, failed to act despite being repeatedly presented with credible evidence of Harvey Weinstein's behaviour.
Schneiderman also said he sued the company in part because of reports that a sale could be imminent.
"Any sale of the Weinstein Company must ensure that victims will be compensated, employees will be protected going forward and that neither perpetrators nor enablers will be injustly enriched."
The state is seeking an unspecified amount of restitution and damages, plus penalties, for harm to victims.
What does Weinstein say?
His attorney Ben Brafman says a fair investigation will prove that many of the allegations against his client are without merit.
"While Mr Weinstein's behaviour was not without fault, there certainly was no criminality and at the end of the inquiry, it will be clear that Harvey Weinstein promoted more women to key executive positions than any other industry leader and there was zero discrimination at either Miramax or TWC."
"If the purpose of the inquiry is to encourage reform throughout the film industry, Mr Weinstein will embrace the investigation. If the purpose, however, is to scapegoat Mr Weinstein, he will vigorously defend himself."
Weinstein, the co-founder of the Miramax studio, was one of Hollywood's most influential men.
However, more than 80 women have accused him of sexual misconduct, including rape.
In October, the New York Times reported on multiple allegations of sexual misconduct by Weinstein.
He denies having non-consensual sex with anyone. His lawyer says many of the latest allegations will turn out to be unmerited.
The studio has been in talks to sell itself to a group of investors led by former Obama administration official Maria Contreras-Sweet. Insiders say the civil suit has put negotiations on hold.