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Fair Finance trustee sues National Lampoon

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Fair Finance Co.’s bankruptcy trustee this week sued National Lampoon Inc. seeking to recover millions of dollars that indicted financier Tim Durham provided the ailing Los Angeles-based comedy business over the past decade.

Durham, who served as CEO of Akron, Ohio-based Fair before its collapse two years ago, “fraudulently transferred at least $9 million of Fair’s money to National Lampoon," where he is a major investor, according to the suit filed in the U.S. District Court for the Central District of California.

“To disguise the origin of the transfers to National Lampoon, Durham typically funneled” the Fair funds through a variety of other companies he controlled, the suit alleges.

Durham has been on Lampoon’s board since 2002 and has been its CEO since 2008. The money went toward covering Lampoon’s losses, the suit alleges. The company lost $37 million from 2002 until it ceased filing financials with the Securities and Exchange Commission two years ago.

In his lawsuit, Fair Trustee Brian Bash acknowledges it’s unlikely National Lampoon would be able to fully repay the transfers. He asked the court to impose a permanent injunction barring the firm from selling assets without court approval and preventing the transfer of funds to insiders.

A federal grand jury in March indicted Durham and fellow Fair insiders Jim Cochran and Rick Snow on 12 felony counts.

Authorities say that after Durham bought Fair in 2002, he doled out  related-party loans with abandon, leaving the company unable to repay Ohio residents who purchased unsecured investment certificates boasting interest rates as high as 9.5 percent. More than 5,200 investors are owed more than $230 million.

Durham, Cochran and Snow have denied wrongdoing.

Bash, the Fair bankruptcy trustee, alleges Durham “utterly looted” Fair, burning through millions of dollars to support a lavish lifestyle and insolvent businesses he controlled.

Bash said this month that he has recovered about $2 million since he began filing lawsuits and taking other steps to recover money for investors in early 2010. The investors have not yet received a distribution from the recovery.




 

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  • Sue Cindy Landeen too
    Why don't they Cindy Landeen for the $750k that Durham loaned her for running the Alternate Billing Corp. in Minnesota. The FBI shut it down and I think they are still investiagating the camming scam they were running.
  • Shades of Animal House
    To quote National Lampoon's greatest movie, "Fat drunk and stupid is no way to go through life"
  • Sue Mitch Daniels too
    Why don't they sue Mitch Daniels for the $200k of Durham contribution that he refuses to return, even now that he currently claims he won't be running for another office??
  • Durham, Cochran and Snow?
    Durham, Cochran and Snow? Sounds like Dewey, Cheatem and Howe.

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  1. Cramer agrees...says don't buy it and sell it if you own it! Their "pay to play" cost is this issue. As long as they charge customers, they never will attain the critical mass needed to be a successful on company...Jim Cramer quote.

  2. My responses to some of the comments would include the following: 1. Our offer which included the forgiveness of debt (this is an immediate forgiveness and is not "spread over many years")represents debt that due to a reduction of interest rates in the economy arguably represents consideration together with the cash component of our offer that exceeds the $2.1 million apparently offered by another party. 2. The previous $2.1 million cash offer that was turned down by the CRC would have netted the CRC substantially less than $2.1 million. As a result even in hindsight the CRC was wise in turning down that offer. 3. With regard to "concerned Carmelite's" discussion of the previous financing Pedcor gave up $16.5 million in City debt in addition to the conveyance of the garage (appraised at $13 million)in exchange for the $22.5 million cash and debt obligations. The local media never discussed the $16.5 million in debt that we gave up which would show that we gave $29.5 million in value for the $23.5 million. 4.Pedcor would have been much happier if Brian was still operating his Deli and only made this offer as we believe that we can redevelop the building into something that will be better for the City and City Center where both Pedcor the citizens of Carmel have a large investment. Bruce Cordingley, President, Pedcor

  3. I've been looking for news on Corner Bakery, too, but there doesn't seem to be any info out there. I prefer them over Panera and Paradise so can't wait to see where they'll be!

  4. WGN actually is two channels: 1. WGN Chicago, seen only in Chicago (and parts of Canada) - this station is one of the flagship CW affiliates. 2. WGN America - a nationwide cable channel that doesn't carry any CW programming, and doesn't have local affiliates. (In addition, as WGN is owned by Tribune, just like WTTV, WTTK, and WXIN, I can't imagine they would do anything to help WISH.) In Indianapolis, CW programming is already seen on WTTV 4 and WTTK 29, and when CBS takes over those stations' main channels, the CW will move to a sub channel, such as 4.2 or 4.3 and 29.2 or 29.3. TBS is only a cable channel these days and does not affiliate with local stations. WISH could move the MyNetwork affiliation from WNDY 23 to WISH 8, but I am beginning to think they may prefer to put together their own lineup of syndicated programming instead. While much of it would be "reruns" from broadcast or cable, that's pretty much what the MyNetwork does these days anyway. So since WISH has the choice, they may want to customize their lineup by choosing programs that they feel will garner better ratings in this market.

  5. The Pedcor debt is from the CRC paying ~$23M for the Pedcor's parking garage at City Center that is apprased at $13M. Why did we pay over the top money for a private businesses parking? What did we get out of it? Pedcor got free parking for their apartment and business tenants. Pedcor now gets another building for free that taxpayers have ~$3M tied up in. This is NOT a win win for taxpayers. It is just a win for Pedcor who contributes heavily to the Friends of Jim Brainard. The campaign reports are on the Hamilton County website. http://www2.hamiltoncounty.in.gov/publicdocs/Campaign%20Finance%20Images/defaultfiles.asp?ARG1=Campaign Finance Images&ARG2=/Brainard, Jim

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