COLT Founder Jim French Says He's Taking Control of Company
But an attorney for COLT parent company Prowest Media Corp. says a judge hasn't yet determined the extent of what is owed to French's Jim French Studios Inc., which says it wasn't paid the bulk of a promissory note related to the sale of the company.
In a statement to XBIZ, French said, “I am very pleased with a decision turning over the COLT brand and assets back into my control. I’ve spent the past several years fighting to get what I was rightfully owed, and in the end I have prevailed."
In 2003, French sold the company to Prowest, whose sole shareholders are Thomas R. Settle and John Rutherford, the former president and head of production for Falcon Studios.
David N. Chandler, an attorney for Prowest who is handling its Chapter 11 filing, told XBIZ that while a federal judge ruled against Prowest, the case over who will own COLT's assets hasn't been determined.
U.S. Bankruptcy Judge Alan Jarosolvsky ordered Thursday that an automatic stay be terminated and that secured creditor Jim French Studios could exercise all of its rights against tangible and intangible personal property collateral held by Prowest.
"There is dispute over what really is owed to him," Chandler said. "With the judge's rulings, he thinks it's 'game over'; well, he is not well-informed. There are many issues in dispute, such as the value for some of the assets and the issue of assets that Prowest never got."
In the Chapter 11 bankruptcy filing, Prowest included assets of $105,000 and liabilities of $2.9 million.
Its largest creditor is Jim French Studios at $1.49 million, although the " validity of security interest is disputed," according to the filing.
Other creditors include Paladin Video Inc. at $282,000, Internap LLC at $30,000, Stan Loeb at $130,000 and the Internal Revenue Service at $632,000.
One asset, Prowest claimed, is a pending counterclaim against French for copyright and trademark infringement worth $2.5 million.
Prowest noted that it had revenue from operations of $2.2 million in 2008, $1.6 million in 2009 and $433,000 in 2010 through June.
Jeffrey Turner, a French spokesman, told XBIZ that he could not elaborate further on Jim French Studios' plan.
But French noted in his statement to XBIZ that "current licensees of the Colt/Buckshot brands will be contacted to implement a smooth transition of existing licenses, contracts and royalty payments to Jim French Studios.”
COLT Studio is one of gay adult's oldest operating companies. French, a photographer and adult industry pioneer, founded the company in 1967.
In addition to its COLT Studio flagship titles, subsidiary labels include Buckshot Productions, Minute Men and Olympus. The extensive COLT branded line of products includes apparel, leather gear and numerous novelties as well as cards, calendars and books.