(CN) – An investor claims a disbarred attorney induced him to sink $725,000 into two movies by lying about the terms and the risks. Alan Fraze sued LA Pictures and Jeffrey Parsley in Arapahoe County Court, Englewood, Colo.
Fraze claims he invested $250,000 in the movie “Tears on the River Kwai” in 2008 after Parsley and his production company, LA Pictures, claimed to have the expertise and the money they needed to complete the movie.
Fraze claims Parsley promised him 50 percent returns: $375,000, plus 5 percent of the profits.
Fraze claims that Parsley did not tell him that he had been disbarred in 2005 in “a disciplinary proceeding arising from allegations that he committed state and federal crimes by misrepresenting property ownership in obtaining a mortgage loan.”
In November 2008, Fraze says, Parsley approached him about a second movie.
Again, Parsley falsely claimed to have other sources of funding, Fraze says.
Fraze adds that LA Productions producer and president Julian Jung Lee promised to finish “Serpent Rising” in time to enter the movie in the 2009 Cannes Film Festival.
Lee is not a party to Fraze’s complaint.
Fraze says he made two loans totaling $350,000 for “Serpent Rising,” and the defendants promised $420,000 in return, claiming that Fraze would “definitely get (his) money back.” Fraze says Parsley also promised him 25 percent of the profits from “Serpent Rising.”
Later, Fraze says, he contributed a bridge loan of $125,000 – the amount supposedly necessary to finish “Serpent Rising.”
But the whole deal was a sham, Fraze claims: Parsley never had any other investors, and he lied about the budget of the film, claiming it was $100,000 cheaper than the actual price and concealing other escalating costs.
Parsley’s first $60,000 payment was due in July 2009, but Fraze says Parsley and LA Pictures haven’t paid a penny.
And neither movie is finished, Fraze says.
He demands an accounting and repayment of his loans.
He is represented by Paul Lopach with Holme Roberts & Owen of Denver.