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In a scene from The Birth of a Nation, Nate Parker, centre, in the role of rebellion leader Nat Turner, is flanked by actors Armie Hammer, left, and Jayson Warner Smith.

The Toronto International Film Festival has always been a close friend of controversy. From its censor-defying cut of 1978's In Praise of Older Women to its police-heavy 2006 premiere of Death of a President (which imagined the assassination of George W. Bush), TIFF courts headlines as much it does filmmakers. But never before has the festival encountered such a toxic cloud of scandal as the one hanging over Nate Parker's The Birth of a Nation.

The film, which will have its international premiere Friday night in Toronto, was once positioned as Hollywood's answer to its rampant diversity problem. Here, finally, was a film directed, written, produced and starring a black man, with a largely black supporting cast, and chronicling one of the great heroes of African-American history. But just as it was being positioned as one of the year's most important films – and just as TIFF was preparing to launch it into the Oscar race – the movie has become inextricably linked with the ugly past of its creator. A past that may overshadow not just the film, but the entire movie industry itself.

The details have been rehashed over and over in the industry press over the past three weeks: In 1999, Parker and his Penn State roommate (and Nation co-writer) Jean Celestin were charged with sexually assaulting a fellow student. Parker admitted to having sex with the 18-year-old woman after a night of drinking, but said it was consensual. The woman, whose identity has not been revealed, told police she was unconscious and could not have consented. In 2001, Parker was acquitted. Celestin was found guilty, but appealed and had the verdict thrown out after the woman refused to testify at a second trial in 2005.

The case was not exactly buried, but it was long-forgotten – until, that is, Parker's film was weeks away from coming to TIFF. A film, it should be noted, whose narrative pivots on one scene of a brutal sexual assault. Now, as Parker and his cast head to Toronto, it is no longer any use pretending that The Birth of a Nation is simply a film. It is instead a Rorschach test – whatever problems you want to see in the industry can be found in it. And what was once intended as a noble lesson on a forgotten hero has now become the story of how Hollywood put its hopes on the back of a single film, and how a Nation fell apart.

Nate Parker came into Sundance an optimistic man. It was late January, and just two weeks earlier, the Academy of Motion Picture Arts and Sciences revealed the nominees for this year's Oscars – a lily-white slate that sparked the resurrection of the infamous #OscarsSoWhite debate. Parker's film – a tale of power and freedom, all wrapped around a title cannily designed to reclaim history from the grip of oppression – represented hope for the industry. Cautious hope.

After all, The Birth of a Nation was Parker's feature directorial debut. He didn't have much in the way of leading-man credentials. His one writing credit was a "story by" blip for the thriller Eden, which bills itself as a "modern-day Lord of the Flies" involving a U.S. soccer team (don't worry, you haven't heard of it). In other words, The Birth of a Nation – in which Parker is the director, star and writer – did not exactly come with a high pedigree. But it did boast a remarkable back story.

Parker started writing its screenplay seven years ago, working under a fellowship at the Sundance Institute and, eventually, pouring $100,000 (all figures U.S.) of his own money into the project. He ended up taking time out from his acting career – which was gaining heat after roles in Spike Lee's Red Hook Summer and the romance Beyond the Lights – for two years as he struggled to raise funds. Eventually, he convinced enough financiers, the NBA's Tony Parker among them, to invest in his vision to the tune of $10-million.

He put together a solid supporting cast – Armie Hammer, Jackie Earle Haley, Colman Domingo, even a wordless cameo from Gabrielle Union – and set to work, turning around the film in a tight 27-day shoot. For Parker, it was a chance to highlight the story of an African-American hero, something that could one day be edited down to show children in schools. For Hollywood, it was a chance to redeem itself after years, decades really, of turning a blind eye toward diversity. For studio suitors, it was a chance to win Oscars and make some serious money.

By the night of its Sundance premiere, the film was already a source of high anxiety. Would it play well? Would it sell? Would it change the game? Just before the world premiere at Sundance's Eccles Center theatre was ending, Parker left the screening to catch himself. "I took a couple of deep breaths to just sit with my thoughts, pray a little bit," he told The Hollywood Reporter. And then, an explosion.

The hot-house atmosphere of Sundance can breed hyperbole. The entire fest revolves around the constant chase of undefinable buzz. But the extended standing ovation for The Birth of a Nation was like nothing the festival had ever seen. The reviews were almost unanimously ecstatic. "The Birth of a Nation exists to provoke a serious debate about the necessity and limitations of empathy, the morality of retaliatory violence, and the ongoing black struggle for justice and equality in this country. It earns that debate and then some," Variety wrote. "More than a movie about a slave rebellion, it's about the difficulty of reconciling the great moral chasms between thought, vision, and deed," New York Magazine raved. Hollywood had its saviour – now all it had to do was buy it.

The bidding war was intense. Super-producer Harvey Weinstein reportedly offered $14-million. Sony, Netflix, Paramount and Lionsgate all circled it. Finally, Fox Searchlight won after a long night of back-and-forth, purchasing Parker's film for $17.5-million – a Sundance record. (It also remains the most money ever paid at any festival for a completed film.) While that figure may look extreme, Fox executives surely thought they had the next Best Picture contender on their hands. The new 12 Years a Slave, to put it crassly – and crassly is just how these things tend to work.

Now, all Fox Searchlight, and Parker, had to do was ride out the next few months by steadily building up hype, taking the movie to smaller film festivals (such as June's L.A. Film Festival) and biding their time until a larger roll-out could be had at somewhere such Toronto, where the international press is watching, eager to crown an Oscar front-runner. Everything seemed to be going according to plan, and an especially weak summer helped further build anticipation for legitimately daring, provocative, quality cinema.

But then Parker's past came into play. The accusations. The trial. The mistrial. A narrative that seemed both strange and too familiar for too many.

When confronted with the details of the case last month, Parker sidestepped the incident. "Seventeen years ago, I experienced a very painful moment in my life," the filmmaker, now 36, told Variety. "It resulted in it being litigated. I was cleared of it. That's that. Seventeen years later, I'm a filmmaker. I have a family. I have five beautiful daughters. I have a lovely wife. I get it. The reality is I can't relive 17 years ago. All I can do is be the best man I can be now."

More devastating details started to leak out. Variety reported that the woman committed suicide in 2012. Deadline obtained a queasy transcript of a long-ago phone call between Parker and the woman where he told the accuser "to call me back when you are ready to talk to me like an adult."

Parker's name became anathema – a symbol not of artistic perseverance, but of toxic male privilege. Roxane Gay wrote a powerful op-ed in The New York Times titled "Nate Parker and the Limits of Empathy," in which she proclaimed she would skip The Birth of a Nation. The American Film Institute cancelled its screening of the film. Trade publications drowned in report after report of how the film was now a hindrance, rather than a boon. And, of course, its Oscar potential was debated back and forth, to the point of morbid absurdity.

Fox Searchlight stood behind Parker, issuing a statement saying it was "proud to help him bring this important and powerful story to the screen." And instead of hiding Parker behind a wall of secrecy, the studio took an unexpected route – they put him front and centre. Parker gave an interview with Ebony in late August, his message now undeniably torqued: "You asked me why I wasn't empathetic? Why didn't it come off more empathetic? Because I wasn't being empathetic. Why didn't it come off more contrite? Because I wasn't being contrite. Maybe I was being even arrogant. And learning about her passing shook me, it really did. It really shook me."

We were witnessing Nate Parker, truth-teller. Perhaps that was the Parker that Fox Searchlight could sell to skeptical audiences. But even before anyone could even pose such a question, Parker had an answer at the ready for that, too: "People may say that, 'Oh, now is good timing.' I don't know what to say to them except I'm trying," he told Ebony. "I'm trying to transform behaviours and ideas that have never been challenged in certain ways in my life. I'm not the kid that I was at 19."

Yet the timing was not entirely in Parker or Fox Searchlight's hands. For every move forward in the film's campaign – a planned appearance at the BFI London Film Festival, a plea from Academy president Cheryl Boone Isaacs that "people need to see this movie" – there was a step back – a hard-hitting op-ed from Parker's co-star Gabrielle Union, a confusion over media availability at TIFF.

And now the film rolls into Toronto with a charged history behind it, and the future of Hollywood in front of it.

For its part, TIFF stands behind the work. "This film is obviously seen in context of everything that happened at the Oscars last year, and it's an important statement," Piers Handling, director and CEO of the festival, told The Globe and Mail. "Obviously the controversy is a painful one, but at this point in time we're completely committed to screening the movie."

Added Cameron Bailey, TIFF's artistic director: "We saw the film months ago and found it told a powerful story, and that's why we invited it – and I still think that it's a powerful story that deserves to be told. There's no denying that this is a painful story all around surrounding the director, but we did want to keep the focus on the work of art, the film that has been made."

But there is also the question of whether that film is actually any good. Although there were a few detractors at Sundance, critics like Lanre Bakare at The Guardian ("heavy-handed, with subtlety nowhere to be found") and Eric Kohn at Indiewire ("alternately engaging and overly blunt") found their concerns drowned under a sea of hosannas. TIFF's Friday night premieres – there are two, one at the Winter Garden Theatre at 8 p.m., and one an hour later at the Elgin's Visa Screening Room, seven storeys below – will offer the global press (including the all-powerful Hollywood Foreign Press Association) their first real look at the film as a film, and not just a marketing exercise or societal flashpoint.

But even if The Birth of Nation lives up to the reputation it earned those eight months ago in Sundance, it may never live as its own unique thing: a singular work of cinema. Although given the gargantuan hopes first placed upon it – for Parker, for diversity, for the entertainment industry – perhaps it never could.