Studio head intends to repay $1.9M
NEW ORLEANS -- The head of a movie studio said he intends to repay members of the New Orleans Saints and others the nearly $1.9 million he received from them -- after he finds other investors.
Coach Sean Payton, quarterback Drew Brees and Hall of Famer Archie Manning were among those who bought what they thought were state film industry tax credits. A state official, however, said the studio never applied for them.
In a statement issued by a public relations firm Friday, Wayne Read, chief executive of Louisiana Film Studios LLC, said money became tight because of higher-than-expected expenses and lower-than-expected revenue during the project's startup.
A list of investors accompanied a copy of the proposals that was obtained July 2 by The Associated Press identified 27 people. Among them are defensive lineman Charles Grant, with a $425,000 investment, Payton, $144,000; Brees, $100,000; and Manning, $100,000. Kevin Houser, the Saints former long snapper who was cut on June 29 and who had involved others in the deal, said he invested $125,000.
The investments, which were due to be repaid on March 31, basically would have given the investors a 33 percent return on their money.
"The Saints players made their investments in November 2008. I was hoping to repay their investments in five months," Read said in the statement. "Unfortunately, the current economy is the worst seen in the U.S. in many decades and has slowed my ability to repay the investors as quickly as I would like."
Read said he intends to repay the investors with either cash or with tax credits acquired from a broker. He also said he hopes to reach an agreement with other investors shortly.
"Their investment will give me the funds needed to satisfy our debt and provide a firm foundation for the further development of the studio," Read said.
Spokesman Allan Katz said Read was not available for a telephone interview Friday.
The head of the state office that promotes film industry development in Louisiana and administers the program, Sherri McConnell, earlier said the studio didn't have the credits to offer in the first place -- because it never applied for them.
In his statement, Read said he soon plans to apply for tax credits, saying there was "some confusion" in late 2008 over what studio expenditures qualified for the credits.
According to a lawsuit filed in state court in suburban Jefferson Parish, where both the studio and the Saints are based, 47 Construction Co., owned by Houser's wife, Kristen, and a partner, Toni Wendel, claims Read has not paid the company $681,418 for renovation work done on the studio.
Read said he intends to settle that suit.
Rob Couhig, an attorney for Houser, said Read has long been promising to repay investors.
"All we want is for our people to get repaid," Couhig said. "All they want is to be made whole."
Manning earlier told The Times-Picayune of New Orleans that he has been contacted by the FBI about the investments. Houser said he had been contacted by a law enforcement agency that he refused to identify. Both the FBI and the U.S. Attorney's Office have refused to confirm or deny that an investigation has started.
Copyright 2009 by The Associated Press
MORE NFL HEADLINES
- Nike Men's Home Game Jersey New Orleans Saints Drew Brees #9