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As noted elsewhere on PWInsider.com, a hearing was held today in Nashville, TN at Chancery Court regarding Billy Corgan's request for a temporary injunction against Impact Ventures, Dixie Carter, TNA Entertainment, Serg Salinas and Dean Broadhead. Here are some notes from the hearing:
*Corgan was not in attendance.
*Carter, Salinas, Broadhead and several other TNA staffers were in attendance at the hearing.
*There was no testimony from witnesses, simply lawyers from each side explaining their client's standing on the argument.
*As Corgan's attorney Scott Sims explained his position, the Chancellor overseeing the case asked about how he was applying the law of the State in terms of their claims, There were several times the Chancellor interrupted to ask about the application.
*Corgan's position was that the company, as it was run, was now insolvent and that Corgan had not been properly told about the level of debt and other aspects of the company. Corgan, despite being named President, had not been included in company decision-making and was not told of other potential suitors looking to buy the company.
*TNA's attorney argued that Corgan had only loaned money to the company and does not have an ownership stake. He had a note promising a repayment of the loan, plus 6% interest.
*At one point, Corgan's attorney, slipping as he spoke, stated that Corgan's loan was for $1.8 million.
*It was also noted that the fee that Corgan would receive if a "Corporate Transaction" fee took place before repayment was 50%, meaning 50% of his loan. So, if TNA had that transaction fee, Corgan would be in line, based on the number stated by his attorney, for something in the area of an additional $900,000.
*It was argued by TNA's attorney Travis Parham that Corgan's agreement with Dixie Carter was drawn up under California law, but under that State's law, a percentage over 10% is not legal in such cases, therefore Corgan's agreement was not enforceable. He called Corgan's agreement with Carter "predatory lending at its worst."
*TNA's attorney did note that the company is not insolvent but does have negative cash flow at the moment. It was noted that in the course of business, that does happen, with Uber being used as an example of a company that is valued at a certain level but currently has negative cash flow from recent losses. He described the company as having goodwill, licensing and merchandising.
*TNA's attorney also categorized all of the recent lawsuits and chaos around the company as being Corgan's fault, stating that there were entities that had worked with TNA and were willing to work with them to take care of the debts but Corgan's actions and statements started a panic. It was stated that because he had done so while President, there may be issues that need to be pursued when it comes to Corgan disclosing information about the company publicly and whether he, as President, caused some of the company's current issues.
*In regard to Corgan's allegations that he was kept in the dark as TNA negotiated with others (including WWE, who were given the code name ACME at the hearing), TNA's attorney claimed there was a conflict of interest there as why would the company give insider information regarding bidding for the company to someone who was an active bidder.
*TNA's attorney also argued against Corgan claiming the company was insolvent, noting that a month before, he had made an offer to purchase the company based on a certain valuation but now was claiming its not worth anything. Corgan was described as an "opportunistic rock star who was a huge wrestling fan that wanted to be in the wrestling business" and that it was his actions causing the company's current financial crisis.
*An attorney for Anthem Media was also present at the hearing and stated to the cut that the company was willing to cover Impact's repayment of Corgan's note as well as the interest (6%) but not the "Corporate Transaction" fee. They also stated that they also wanted a release from Corgan exempting them from that transaction fee.
As noted previously, the decision regarding the Injunction will be handed down on Monday 10/31. From that point on, unless there is a settlement, we are heading to all the back and forth wrangling that comes with a lawsuit.
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