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DIXIE CARTER RESPONDS TO CHARGE TNA IS 'INSOLVENT' AND MORE

By Mike Johnson on 2016-10-21 20:58:00

 Some additional notes from unsealed documents that were released today in the Billy Corgan lawsuit against TNA, it's parent company Impact Ventures LLC, TNA Chairman Dixie Carter-Salinas, her husband Serg Salinas and TNA Chief Financial Officer Dean Broadhead.

On 10/19 Corgan filed a motion to compel Dixie Carter-Salinas and Impact Ventures, LLC to "provide full and fair responses" to the discovery requests we wrote about earlier today on PWInsider.com after being unsatisfied with responses given by the the two defendants on 10/18.   In the motion to compel, it was noted that the Court had previously denied a request from Corgan's attorneys that Dixie Carter and a "corporate representative of Impact Ventures" be deposed.

The responses from Carter-Salinas and Impact Ventures, LLC were from the previously reported expedited discovery request.  In that response, Carter denied that the company was "as the term is used in the Section 7 (e) (i) of the Pledge Agreement at issue in this action."  

It was noted by Carter in her response: "The term 'insolvent' is not defined in the Pledge Agreement.   Under Tennessee law, an entity is insolvent only if the sum of the debtor's debts is greater than all of the debtor's assets, at a fair valuation.  Impact Ventures' assets are of greater value than its debt."

Carter also denied that Corgan informed her "of an Event of Default under Section 7 of the Pledge Agreement on 9/29/16" and also denied that Corgan has the right, under the Pledge Agreement and the Operating Agreement to remove the managers of Impact Ventures and replace them with designees of Corgan's choosing. 

Carter's response to the latter noted, "The transfer of governance rights is invalid under Tennessee law and the Operating Agreement.  There has also not been an Event of Default as that term is used in the Pledge Agreement.  Impact Ventures LLC has not been insolvent since August 11, 2016 and is not insolvent at present."

Carter and Impact Ventures LLC (with Carter signing on behalf of the LLC) each gave "identical answers that simply stated that Impact Ventures is not insolvent and that 'Impact Ventures' assets are of greater value than its debt.  Corgan's filing noted that since they were not allowed to depose Carter and since Carter and Impact Ventures did not provide "factual basis" for their assertion that the company was not insolvent and "no supporting documents or witnesses were identified."

In regard to the documentation requested of Carter (documents backing up her statements, all documents related to Impact Ventures being insolvent or unable to pay all of its debts in full as it came due from January 1, 2016 to the present, all documents sent to or received from World Wrestling Entertainment or any of its representatives from January 1, 2016 to present, and all documents sent to or received from "any third party" regarding that third party's potential acquisition of Impact Ventures LLC, TNA Entertainment LLC or any of the assets owned by either entity), Carter responded:

"Ms. Salinas objects to this request on the grounds that it seeks information that, at least in part, can be obtained from some other source that is more convenient, less burdensome, and/or less expensive, named Plaintiff.  Subject to, and waiving that objection, and consistent with the Tennessee Rules of Civil Procedure, Ms. Salinas is producing responsive documents herewith."

Some of Carter's responses also claimed that documents requested were also "overly broad", "not relevant", and "not reasonably calculated to lead to the discovery of admissible evidence because it is not limited to any period of time."

Noting that they will not be able to get a deposition from Carter prior to the next hearing on 10/26, Corgan's attorneys stated their "plaintiff will be left to guess the basis" of the claims that the company is solvent until the defendants file their own brief on 10/24, just 48 hours prior to the next scheduled hearing.  That leaves Corgan's attorneys just that amount of time to prepare for the hearing.

It was noted that TNA and the other defendants have handed over 17,000 pages worth of documents that are currently being "reviewed and assessed" by Corgan's attorneys.

More as we get it.

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