LOS ANGELES (CN) - A film investor claims in court that three men "swindled" him out of more than $10.9 million for four movies, using his money to "go on an out-of-control personal spending spree."
Bill A. Busbice Jr. claims in Federal Court that he invested $10.9 million in four movies: a documentary, "Made In America;" and feature films "The Letters," "Left Behind" and "Angels Sing," for which he says he was promised return of capital, interest and a share of profits.
Busbice claims that the defendants behind the "bold and brazen securities fraud" are James David Williams, Steven Brown and Gerald Seppala, who, Busbice claims, "held themselves out as experienced film industry insiders."
"Williams and his co-conspirators falsely represented that they had already invested millions of their own funds in each film, that more money was needed, and that Busbice could take advantage of the lucrative deal by investing his own money. Williams and/or one of his co-conspirators were set up to manage the deals, whereas Busbice's role was that of a passive investor," the lawsuit states.
In April 2013, Busbice says, he invested $500,000 in "Made in America," $6 million in "Letters" a movie about Mother Teresa, $2.4 million in "Left Behind" and $2 million in "Angels Sing," a Christmas movie to star Harry Connick Jr.
Busbice says he later discovered that Williams had strung him along by using bogus financial statements to "convince Busbice that a solid financial foundation existed for each investment," and falsified bank records to make it look like millions of dollars had been committed to the movies.
Busbice says his money was never used to the fund the movies, and that Williams never invested a penny of his own money in the projects.
"In short, it appears that most, if not everything that Williams and his co-conspirators told Busbice and presented to Busbice to induce plaintiffs' investments and to conceal the frauds that had been perpetrated, was flagrantly false and designed to cheat plaintiffs out of millions of dollars," the 59-page complaint states.
It adds: "Instead of investing in the four films as had been represented, defendants used plaintiffs' money to go on an out-of-control personal spending spree."
Busbice claims the defendants have spent at least $7 million of the money he invested, spending tens of thousands in "fancy hotels and restaurants and hotels across the country."
According to the lawsuit, Williams has made "hundreds of thousands of cash withdrawals, ATM and debit card withdrawals of at least $214,000, an $87,825 payment at a Jaguar dealership; an $89.394 withdrawal to pay down loans on his residence and boat; at least $37,658 in payments for his child's private school tuition; a $22,354 payment for an unidentified time-share property, over $4,000 at Louis Vuitton and over $5,000 at Neiman Marcus; tens of thousands of dollars on family vacations, hotels, restaurants and car rentals; and numerous other such expenditures."
Also named as defendants are Legacy Film Crest, Moment Factory, Luxe One, Visions, Bipartisan Coalition for American Security Corp., Highgate Pass, and Garuda Partners.
Busbice claims that Williams owns or is affiliated with Legacy, Bipartisan Coalition and Highgate Pass.
Busbice's Olla Productions and Ecibsub are also named as plaintiffs.
Busbice seeks more than $10.9 million in damages for violation of federal securities laws, common law fraud, breach of fiduciary duty and nine other counts.
He is represented by Paul Gale with Troutman Sanders of Irvine.