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Lampoon: Durham used $1M from company to pay attorney

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Comedy film producer National Lampoon Inc. is suing Indianapolis financier Tim Durham for allegedly transferring $1 million from the company to his defense attorney.

Durham, the former CEO of National Lampoon, was sentenced in November to 50 years in federal prison on securities fraud and other crimes related to the collapse of Akron, Ohio-based Fair Finance Co.

The lawsuit, filed Thursday in a state court in Los Angeles, where National Lampoon is headquartered, follows a similar allegation made in January by the bankruptcy trustee for Fair Finance.

National Lampoon has also sued Indianapolis attorney John Tompkins, who represented Durham unsuccessfully in the Fair Finance case, and unknown individuals it says helped make the wire transfer possible.

National Lampoon claims that one week after agreeing to a settlement with Warner Bros. over the distribution of the National Lampoon’s "Vacation" series of  movies—a deal that paid National Lampoon $2.7 million—Durham transferred $1 million of that money into the bank account of Tompkins’ Indianapolis law firm, Brown Tompkins Lory & Mastrian.

The lawsuit also claims that Tompkins was listed as the beneficiary of that transfer, which allegedly occurred on July 28, 2011. Durham covered his tracks, the lawsuit alleges, with "false, fraudulent and deceptive entries in the business records of National Lampoon." The company claims it did not discover the $1 million transfer until April 2012.

Durham resigned as CEO of National Lampoon in January 2012 after leading the company for three years.

A call to Tompkins Monday morning was not immediately returned. In January, when Fair Finance trustree Brian Bash claimed that National Lampoon had financed Durham’s defense, Tompkins gave a brief statement to IBJ.

"I don’t think it’s accurate that Lampoon funded his defense,” he said on Jan. 23. “Beyond that, I don’t have anything to say."

Tompkins is no longer representing Durham. Instead, James H. Mutchnik, a white-collar criminal defense attorney at Chicago-based Kirkland & Ellis, has agreed to represent Durham for free during an appeal of his conviction.

Bash has claimed in a lawsuit against National Lampoon that Durham propped up the company by transferring $9 million, over the course of a decade, from investors’ holdings at Fair Finance.

A federal jury in June found Durham guilty on all 12 counts stemming from the collapse of Fair. Prosecutors charged that Durham looted the company to fund a lavish lifestyle and support other failing businesses he owned.

Fair co-owner Jim Cochran, who was convicted on eight of 12 counts, received a 25-year sentence, and Rick Snow, the chief financial officer, received 10 years.

Money for the scheme came from 5,000 Ohio investors who purchased unsecured notes from Fair boasting interest rates as high as 9 percent.

Bash has been trying to recover money for the investors for nearly three years, but so far has been unable to make a distribution.

Bash sued Fair for more than $150 million and wrested a proposed $3.55 million settlement from former owner Donald Fair.

All of IBJ's coverage of Tim Durham and Fair Finance can be found here.
 

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  • Snitch
    Nice comment just shows you have no idea what you are talking about. The trustee in Ohio is trying to recover money and has nothing to do with the conviction. You probably think he is innocent as well. Keep drinking the punch
  • Lawyer
    Please take the money back.....Didnt appear he earned a thing. NO defense whatso ever. Did this guy even get a law degree
  • Jeff Osler
    For those of you that are wondering why Jeff Osler is not being indited is because he spent 3 days in Ohio turning state evidence against his brother-in-law better known as Tim Durham in order keep his looser butt out of jail. But what I don't understand is how Henri Najem has been kept out of jail or at least have to return the millions that he received from Tim. Is that why Bella Vita changed it's name?
    • What about the rest of the money?
      OK, he took $1M from Lampoon. Where's the rest that's missing. Only an idiot could have lost hundreds of millions without a trace! I don't know if even he is that stupid. The trustee doesn't seem to be asking how Tim's family is paying their bills. Why isn't Geist Sports Academy foreclosed? Why isn't Jeff Osler in jail? Has anyone noticed that Tim's father disappeared without a trace just before Tim was arrested? Has anyone noticed that the money disappeared without a trace too?
      • Timmy
        Tim? Stealing? No Way! We all know that Tim would never steal anything! Just ask the legions of business execs in Indy that he stole from/tried to steal from. It is nice that this Tompkins loser is going to get some of those legal fees yanked from under him. They should pay him paralegal wages for the crap job he did defending his client, the honest and noble Tim Durham! LOL talk about poetic justice! I wonder how Brizzi will pay for his defense when he finally goes down. Perhaps Page and Bales will give him a loan. Oh wait, Bales might be pretty angry at Carl for all that heat he brought on him which took him all the way into a federal indictment. God these guys are sorry excuses for crooks. All they wanted was to be big shots. Congrats guys, you're famous and everybody knows who you are now! Isn't that just great?
      • Thompkins
        So this guy takes $1MM that you have to believe he knew was dirty, does a crappy job of defending his client, and then bails on the appeal because his client is out of allegedly ill-gotten booty with which to pay him. Nice.
      • Uh Oh
        This is gonna look GREAT at his appeal hearing!!!! HaHa, embezzling another public company's money for your fraud case. Genius! Didn't he originally say that his father-in-law was paying his lawyer fee? UH OH!
      • The Beat Goes On
        Is anyone really surprised that Dunham would pull such a stunt. National Lampoon should have known something was up long before April if the transaction occurred 11 months prior????
      • Geeeesh...
        Shady all the way up until the end!!! Figures, lol

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