SAN FRANCISCO – COLT Studio founder Jim French has filed a breach-of-contract lawsuit against the studio’s current owners. The suit names Prowest Media Corporation, president John Rutherford, chief financial officer Thomas Settle and several “Does” as defendants and seeks the balance outstanding on a promissory note, plus interest, or the public sale of COLT’s assets to satisfy the debt plus attorneys fees and costs.
According to documents filed with the California Superior Court, in May 2003 French transferred COLT to Prowest in exchange for about $400,000 and a promissory note for slightly more than $1.8 million. Under the terms of the deal, Prowest was to repay the note, at an annual interest rate of 7 percent, on a graduated scale that increased the size of payments annually. Initially payments were set at $25,000 monthly. The final payment of about $129,000 was to be due in July 2009.
In the suit, French alleges the defendants fell behind on payments in July 2005, at which time the payment plan was renegotiated. According to the lawsuit, the defendants fell behind again in early 2007, leaving an outstanding balance of about $1.2 million as of Feb. 13, 2009. Although the lawsuit indicates French may have repossessed some COLT assets, he has asked the court to order forfeited the remainder of the collateral.
"There are two sides to every story," Rutherford told GAYVN.com. "We regret that Mr. French has chosen to pursue his differences legally where only lawyers will prosper in this current economy.
"After nearly 20 years of building an honest and loyal reputation I have every intention of working out our differences."
French, who now owns Los Angeles-based Jim French Studios Inc., founded COLT in 1967. Rutherford and Settle, both formerly officers with Falcon Studios, are believed to be COLT’s only shareholders. Since acquiring the studio from French, they have expanded its scope by adding subsidiary gay adult video lines Buckshot Productions, Minute Men and Olympus. In addition, the COLT brand now appears on apparel, leather gear and novelties.
