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Durham trailer-maker sued for nearly $1M

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First Merchants Bank is seeking nearly $1 million from Tim Durham and his companies through a recently filed loan-default lawsuit.

The suit says First Merchants in 2008 provided a $1 million line of credit and a $225,000 loan to Sturgis, Mich.-based Classic Manufacturing Inc., a trailer-maker that Durham’s buyout firm, Indianapolis-based Obsidian Enterprises Inc., bought in 2004.

Classic is in default on the loans, which have an outstanding balance of $826,000, according to the suit filed Dec. 10 in Allen County. The complaint seeks to foreclose on the company’s inventory and other collateral. It also seeks to collect on guarantees provided by Durham, Obsidian and Bristol, Ind.-based United Expressline Inc., another trailer-maker owned by Obsidian.

Attorneys for Durham could not be reached for comment. An attorney for Muncie-based First Merchants declined to comment.

The legal tangle provides further evidence that Durham’s financial challenges extend beyond Fair Finance Co., the Akron, Ohio, firm that federal prosecutors have alleged operated as a Ponzi scheme.

That firm, co-owned by Durham and Jim Cochran, hasn’t reopened since FBI agents swooped in Nov. 24 and seized documents and computer equipment.

Securities records show that Durham, Cochran and related parties have borrowed more than $168 million from the firm since buying it in 2002. An IBJ investigative story in October questioned whether Fair has the financial wherewithal to repay Ohio investors who purchased about $200 million in investment certificates.

Other firms where Durham is a major investor also are struggling. Those include Dallas-based CLST Holdings Inc. and Los Angeles-based National Lampoon Inc. He also is facing a lawsuit over a partly completed restaurant he planned to open in Charlotte, N.C.

Durham oversaw Obsidian and the rest of his business empire from the top floor of the 48-story Chase Tower, the state’s tallest building. But the firms moved out of the space this month, and it is available for lease.


 

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  • How About AllModelZone.com?
    Let us not forget other businesses like AllModelZone.com that Tim Durham has stolen money from and destroyed. Using National Lampoon to defraud sellers and issue them worthless stock, and not pay the money as well, put this mighty website on the brink.
  • What??
    What was a supposed Indiana bank doing lending money to a manufacturer in Michigan? Seems like First Merchants is no smarter than the Irwin Union boys in Columbus.

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  1. A Tilted Kilt at a water park themed hotel? Who planned that one? I guess the Dad's need something to do while the kids are on the water slides.

  2. Don't come down on the fair for offering drinks. This is a craft and certainly one that belongs in agriculture due to ingredients. And for those worrying about how much you can drink. I'm sure it's more to do with liability than anything else. They don't want people suing for being over served. If you want a buzz, do a little pre-drinking before you go.

  3. I don't drink but go into this "controlled area" so my friend can drink. They have their 3 drink limit and then I give my friend my 3 drink limit. How is the fair going to control this very likely situation????

  4. I feel the conditions of the alcohol sales are a bit heavy handed, but you need to realize this is the first year in quite some time that beer & wine will be sold at the fair. They're starting off slowly to get a gauge on how it will perform this year - I would assume if everything goes fine that they relax some of the limits in the next year or couple of years. That said, I think requiring the consumption of alcohol to only occur in the beer tent is a bit much. That is going to be an awkward situation for those with minors - "Honey, I'm getting a beer... Ok, sure go ahead... Alright see you in just a min- half an hour."

  5. This might be an effort on the part of the State Fair Board to manage the risk until they get a better feel for it. However, the blanket notion that alcohol should not be served at "family oriented" events is perhaps an oversimplification. and not too realistic. For 15 years, I was a volunteer at the Indianapolis Air Show, which was as family oriented an event as it gets. We sold beer donated by Monarch Beverage Company and served by licensed and trained employees of United Package Liquors who were unpaid volunteers. And where did that money go? To central Indiana children's charities, including Riley Hospital for Children! It's all about managing the risk.

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