Steve:

Here's the true scoop. EWP planned to reap major subscription revenues from the Internet live broadcast of the contest. From day one, the supplier of the network feeds failed to deliver proper service and despite frantic calls seeking technical support to remedy the problem, all pleas were totally ignored so the live feed never happened with any quality. This destroyed any hope of getting subscriptions and no revenue was realized from that source whatsoever. This created a severe cash flow problem wholly beyond EWP's control.

To add to the harm, it turned out that many of the other suppliers overcharged EWP for equipment. Others having access to the site during the shoot stole cameras, tapes, etc. Certain suppliers use threats to exact payments that also were not foreseen and are probably rip offs as well. What amount of cash would have been available had these additional fraudulent and extortionate acts not occurred would have been used to pay small creditors as a priority. At the top of that list were [Robert] Lombard and AIM [Adult Industry Medical Foundation].

The sponsors of the contest have poured over $2,000,000 into its production, much of that under grave duress simply to save the production from being a total loss for everyone. Because these sponsors took this added risk, the production was able to be finished so that a product for sale down the road would be available. With the sale of the product, EWP intends to pay off all creditors, has so advised them in writing, and is treating the unpaid amounts as loans so that interest at 2% above prime will be paid once sufficient funds are obtained from the sale of the production.

EWP has contracted with CED as its exclusive agent to sell the product worldwide. That contract was only recently executed which has delayed capitalizing on the product for several months. The reason for the delays in executing the contract is that the sponsors of EWP have witnessed tremendous dishonesty and fraud from those associated with the production so that their ability to trust anyone with any aspect of handling post production sale was greatly shaken. The sponsors spent the added time to explore being able to market the production themselves because of the fear of being ripped off once again. And if the sponsors are ripped off, it will mean no one will get their debts paid, but it won't be the fault of EWP.

EWP and its sponsors have exercised great restraint in responding to the criticisms and complaints levied against it and its owner. At the same time, EWP's sponsors believe that fuel was added to the fire by some of the owner's conduct, and the owner admits as much. But those actions in no way have any lasting effect on the value of the product created or its salability. What needs to happen is for everyone to understand these facts and help, not hinder, the sale of the product as soon and in as many lucrative ways as possible so monies are realized to address the debts outstanding.

One party has gone overboard in his attacks and they are Counterproductive to his own interests. More importantly for all other creditors and the contestants his actions are hurting them all. His selfishness is to be condemned, particularly since his focus is on a check which was marked NSF, apparently something in the past that he himself did and was prosecuted and convicted for. While his personal experience may explains his vehemence, it doesn't excuse his foolhardiness in attempting to damage everyone's chances to obtain as prompt a cure for their financial situations as possible.

Finally, there are ample legal rights EWP can choose to exercise to Protect itself and therefore any actions brought against EWP will (1) be vigorously defended, (2) will results in significant counterclaims where they exist; and (3) will only chew up more assets once realized, that will deplete the ability of EWP to retire its debts.

Your industry wouldn't claim I am sure to be populated with rocket scientists, but hopefully, it does contain some people with good common sense, enough to recognize their own best self-interests. EWP has not run and hid, nor has it denied it has obligations to take care of. It is doing all in its power to achieve the resources needed to do just that. But it needs time and the support of those whose interests it is seeking to protect beyond its own.

In conclusion, not only did EWP hit upon an innovative programming Concept and distribution system never before seen or attempted in your industry, its response to a terrible disaster totally beyond its control, was also unique, that instead of simply saying too bad and disappearing, EWP has stood by its commitments and is working diligently to meet them. It would seem your industry would find this commitment level as unique as the program EWP tried to bring off despite being victimized in doing so by the entities on which it relied and had a right to rely.

The Helein Law Group
Counsel to EWP