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Mike Davis Accuses Rob Spallone -update

Porn Valley- Mike Davis has apparently been peddling his story around the business and a version of it appears on today. I also spoke to Rob Spallone after Davis had called me levelling a number of serious charges against Spallone which Spallone is denying. Things seemed so buddy-buddy just a few weeks ago when Davis was part of Spallone’s entourage at the great industry debate that was aired on KSEX,

But Davis and Spallone are now former business partners in Lowdown Productions along with another partner named Guenther. Davis claims Spallone has stolen four movies from him.

“And he’s held the company- extortion- for $15,000,” claims Davis. “What he’s done is implicated me, the president of the company. I’m going to have to take recourse against him. He was also a personal friend. But I have an obligation to the company. Any damage that Rob Spallone has done is unrepairable. The tapes have been stolen. They’re at Gentlemen’s Video [Mike Esposito’s company]. Basically there’s no assurance that they haven’t been duplicated and taken from the original masters. At this point he can’t return them. There’s a police report for theft and extortion. Three months prior to this Rob embezzled over $30,000 from the company as well and wrote himself a check. His actions have been terrible and they’ve got worse and worse.”

“Things blew up,” said Davis. “He [Rob] wanted to act like a criminal and basically he did. The company had four films in the warehouse that we had in a file cabinet. Rob took the tapes on Wednesday and took them to Gentlemen’s Video and then demanded $15,000 in extortion for them. Rob said if you want the tapes, pay me $15,000. He feels he was a partner of the company. In the interim, we were each going to have shares in the company. But he was going through a divorce and asked that to be held off on those shares being assigned to him. At that point his ownership has never been delivered to him. Three weeks ago he asked for a salary of $500 a week from Lowdown.

“That $500 a week reduced him at current status as an employee,” Davis reasons. “Basically what he did as an employee was steal company property and then extort the other two owners- at this point we’re owners now- he has no ownership position. He says he wants $15,000 or you’re never going to see the tapes.

I asked Davis if there was handwriting on the wall indicating that there was a falling out in the deal. “I think Rob probably never had the intentions of rolling out a business,” Davis says. “He gets frustrated. It’s time and the money is down the line. Rob is more of an immediate gratification type of guy.”

Davis says the movies were shot over a period of six months. “Rob’s contribution to the 33 1/3% ownership was his expertise. All along that was going to be his contribution. At the end we were going to adminsiter 33 % of the company,” Davis says. At this point he gave us editors, art directors- everyone who was basically substandard. We had to re-do editing several times. We had to re-do boxcovers. Basically, probably, it would lead you to believe that he never had any intention of rolling it out.”

According to Davis the titles of the movies are Raunchy Rookies, Eaunchy Rookies 2, Spring ’em Black 1 and Toilet Bowl Bitches. “Then we had solo material,” Davis adds. “We shot about 30 additional scenes of masturbation which which would have been 3 additional movies at 10 scenes per movie.”

Davis said he and Spallone got together in business this past January. “I like him as a friend,” he says. “I’m a real estate developer and a publisher. I published an entertainment magazine- Bold Entertainment Magazine.”

According to Davis, Spallone allegedly embezzled over $30,000 from the company.

“Rob wrote himself a check. He was a signator on Lowdown Entertainment. He wrote himself a check for over $30,000. I confronted him and said what are you doing? He says I need this- I have severe gambling debts. I’m like you replace that money. So what he did was prepare a phony tax return and went to Wells Fargo and got a loan to pay back. At that point he paid back $25,000; then he paid back another $3,000. Then an outstanding amount of $8,000. He said, hey, can you make it a company loan? I said I’ll reduce it to a company loan, a no interest note. You just pay it back because you’re going through a divorce and everything. Initially he brought me into the crime of embezzlement.

“When you steal that kind of money, that kind of amount makes it a felony,” Davis contends. “Our third partner, a German investor, Guenther, was like where is this money? We was looking online at the bank account and said what happened to the amount? There was $30,000 that Rob just cashed into his account. I simply said let me look into it. I leaned on Rob and Rob did a phony tax return. He got a loan from Wells Fargo approved and put back $25,000, then $3,000 and then the remainder of $8,000 is still outstanding. I guess fraud was happening even three months ago. I didn’t put my foot down as I should have. But when Rob stole the tapes on Wednesday- which implicated me to crime- if I don’t go and report these tapes stolen and report what was going on that makes me an accomplice. And I have a fiduciary responsibility as president of the company to the other investor.

“Then Rob was living at my home,” Davis continues. “Rob made a decision that he stole and implicated me. He wants me to go along with that.”

Davis says a police report has been filed for theft, embezzlement and extortion. “Now that Rob is going through a divorce with pending custody of his children, the attorney we also hired feels that should be made available because Rob has gone this drastic. Rob’s being investigated and with his record I don’t think he stands a chance. There’s two people- me and my partner who are alleging this.

“I’ve been to Rob four times saying hey look there’s got to be a way we can work this out,” Davis claims. “No one wants to go this route. His attitude was basically I don’t give a fuck. He said, ‘I robbed the tapes; I have the records of the film and I have the tapes- what do the fuck do you have? Nuthin’ I’m going to take care of you Mike.’ And he also suggested for me to be brought into this thing further and said, ‘Why don’t you just rob the money from the bank account and take an $8,000 payment. You’ll be okay, bro. And just leave the third partner flat, dry and hung out.’ I said I don’t do that.”

Davis said with the filing of a police report, Tuesday he goes to the atorney. “He’s going to file an injunction because Rob has also taken control of the warehouse. The company leased the warehouse. We paid for first, last and a security deposit. He’s basically saying the warehouse [on Winnetka & Plummer] is his because he managed the construction work. The construction work was also paid by Lowdown. Carpeting, walls, heaters, everything.

“This thing has gone too far,” says Davis. “The police and the attorney think this thing can’t be mitigated even if he returns the tapes because they’ve been out of the care and custory and control of the company. Who’s to say those tapes haven’t been duplicated? It’s been Wednesday It’s now Sunday and he can’t even now say, here, take back the tapes let’s just work it out because we assume they’ve already been duplicated and the damage is beyond repair. This is one thing that Rob went too far on.”

According to Davis, he spoke to Spallone and tried to arbitrate Saturday. “I went to Gentlemen’s Video and spoke to him in the parking lot. He basically did not want to reason. Rob does not understand any kind of corporate structure. Rob signed an operating agreement to the company. Rob will sign anything, read nothing. His signature and word means nothing and that’s just where it’s at. Rob also thinks he’s intimidating. He doesn’t intimidate me at all. I’m not worried about anything. What’s right is what’s right. He just took it too far and I’m not going to go along with the scam.”

I tell Davis that I’m going to have to get Spallone’s side of the story.

“He’s going to assert that he had 32% of the ownership but he can’t submit any documentation that it’s been transferred to him,” Davis contends. “Right now as it is he’s just an employee that stole and he tried to extort the owners for $15,000. I have ownership of those tapes and I’ve tried to explain to Rob that you stole from me. And I said, Rob, I’m not going to go along with this theft. You stole these tapes and you want me to go along with it. It’s theft on the company; it’s the company property. He doesn’t see that. I said you want me to go further to destroy and rob the third partner because you robbed me? That’s not going to happen.

“I guess the tapes are worth about $40,000,” Davis surmises. “I guess the only way to deal with this is come up with $40,000 which Rob can’t. I don’t think returning of the tapes is an option now.”

I said to Davis there’s one nagging question in his whole scenario. Why did he do about Spallone allegedly embezzling $30,000 to begin with? “I used poor judgement,” Davis admits. “I let friendship stand in the way of what I should have done then. I contest to that. But what I did do was freeze the account and take him off has signator. But a copy of the check is black and white with his signature on it. And he can’t justify why.”

Davis said the only thing on his mind at the moment is straightening this situation out. “Me and my partner want to roll out the company. Rob wants to extort $15,000 and to a new company, cash flow is important. When you have no cash flow you can’t adhere to this kind of extortion and terrorisnm. Rob basically wants to cripple the company. He wants to silence the partnership and just go along like a quiet little robbery. I geuss he’s having a financial strain with his divorce and gambling debts, and his VCA account which has been basically taken from him. He’s a desperate man that did desperate things. This is a reflection of his actions.

“I got along with him like we were brothers,” Davis keeps telling me. “And I like him and I’ve pleaded to him, hey, you’re going too far. But I guess Rob assessed what he thought was a certain weakness and that he got away with stealing once; he got away with stealing twice. It’s just the ultimate thing I’m going to do and they’re not going to do anything. Mike’s my friend and Mike will back me up. I am his friend but there comes a point where someone goes too far- my back’s against the wall, now.

“I’m not going in on the scam,” says Davis.”I’m not going to allow him to rob the company or rob the German partner. He said he’s silent and can’t prove his position. He put money into the company. His cashier’s check has been cashed.”

Davis explains that Kat Kleevage first brought him and Spallone together. “Kat knows Rob; she shoots for him, and I knew her- and there’s no shame in my thing- she’s an escort. And I used her services before. I’m not married and there’s no shame in whatever I do. She said I know Rob, he’s a producer. He wants to own his own company and needs some start-up capital. Why don’t you meet him? I met him first time on a Hustler shoot. I think he was doing one of his last Sopornos. We hit it off. He seemed like a nice guy. I introduced him to a partner of mine who was going to invest in my magazine that I decided not to go foward with. Then I brought Guenther in with me and rolled him into this deal.

“I just can’t believe Rob has gone this far to where people have to go to the police and have to seek an injunction legally against him,” Davis goes on to say. “He laughs at all this stuff until it comes to a point where he has to answer it and, oh my God, what do I do? But the damage has gone too far. I don’t know what can rectify this situation. I’m certainly not going to sit back and be intimidated. I think there’s a certain amout of intimidation with the German guy who’s a little bit scared. I think Rob has preyed upon him a little bit because of his citizenship status and being that Rob says he’s a silent partner. It doesn’t matter if you’re silent or not. If I’m representing his interests, he’s not silent.”

Davis states that Spallone doesn’t have dime-one invested in the company. “But at the time he invested he said he needed to get paid. The time you invested was going to be your share. He didn’t understand that. He’s exerting ownership without having ownership, without having a dollar in it or without having any membership transferred into his name. It’s basically a theft. An employee stole tapes. We have all the documentation that we paid for editing on thse films. We paid for artwork on these films, and we paid for production on these films. Rob didn’t pay a dime.”

Rob Spallone, as you might expect has a totally different take on the issue though he and Davis are clear at least on the fact that Davis was Kat Kleevage’s trick.

“Kat says I have these guys- they want to invest,” Spallone relates. “She brought the guy over, and he was already trying to get into the business for about a year. I said listen, pal, you want to get into this business? There’s not a lot of money. I’ll be really straight up. If you have money and you want to invest you can make money. If you only have a few dollars it’s not worth my time. So they put $50,000 into the account. This is supposed to be this big rich guy. He brings in a partner. How rich can you be if you need a partner for $25,000?

“So he brings in his partner,” Spallone goes on to say. “Then we shot a little bit. We needed more money- $37,500 each they put up. Thenm we were going to duplicating and printing. I called in every favor I could. I shot girls for $400. I got artwork done for $300. Then we got a place. But before we got the place like two or three times I was backing out. I didn’t like the Guenther guy. My people who were editing would call up and say listen you got to do me a favor. I’m doing this for you, Rob, not for this guy. And this guy’s calling me every five minutes. Then Tony the big fat kid who works for Tommy Sinopoli- with all the tattoos, the little fat guy? He did the artwork. He did me a favor and the guy [Guenther] was bothering him. He said, Rob, I’ll do it for you but if that guy keeps calling, I’m not going to do it. Like, Guwenther, lay off- this was the second argument that we had.

“Then the other day I’m working and busting my ass,” Spallone continues. “I’m working for a month putting a warehouse together. He’s like why are you painting it this color? Whadya mean why am I painting it this color? Are you going to come over here and fucking paint? Then the other day I’m on the freeway. They call up. What’s up? We want to do this- you know what? I want nothing to do with it. I’m taking the movies; they’re mine. I shot ’em. That’s how it works. Yeah, but you borrowed money from the company. I said I borrowed money from the company and I paid it back. Mike lent me the money. End of story. Alright, what do you want to do? I said I’ll tell you what. I want $500 a week from now on. If you have to give me $500 a week plus I still own a third of the company.

“Then, the other day he started with something. You know what? I’m out. We had sat down three days earlier and made a buy out plan. Rob, without you… I’m,like, Mike, do yourself a favor. Me and you are friends. Take the money that’s in the account. You have $20,000. I took my name off the account. I said take the 20 grand, I’ll get another $8,000 for the movies and that’s it. Take your money. Well Guenther thinks we can roll without it. Mike, I said, those movies would have cost you $10,000 each to shoot without me. Well, Guenther’s got the salesperson, they think they can sell 2,000 pieces. 2,000? The big companies aren’t selling 2,000. He said, CDi, Guenther says he can sell Charlie Brickman for $37,000. I said tell you what. Give me $15,000 in cash for those movies and go get the $37,500. You’re ahead of the game. Common sense. Okay we’re going to bring you the $15,000. Then they didn’t come up with the money. I said, know what? Forget it. You have until Tuesday morning. If you want the movies they’re yours.

“I took nothing from the company,” Spallone contends. “I told you I was taking them, they’re mine. I shot ’em. All the paeprwork, the chromes, they’re mine. But what about the warehouse they ask? The warehouse is mine. It’s in Rob Spallone’s name. I paid the rent from my company. Star World wrote thje check for the rent. I said if you want the warehouse, give me another $5,000 for the month I put into it so I can get a place. Give me twenty grand. Well, we put money into this thing, too, they said. I said it doesn’t matter. I want out. You’re going to pay me to leave. Otherwise the lease is in my name, I’m stuck. But I can rent it out. I can already rent it if I want to. No big deal. Then they came to see me yesterday. They go, Rob, you took the movies. I go, Mike, I didn’t take nuthin’. There’s not a person in this business who says I ever stole from them. Companies give me forty grand to shoot a movie. I went to jail. Jack game me money to shoot a movie. I still shot the movie while I was in jail. I don’t steal. I said if you want the movies come up with the money. If you think they’re worth this much all I’m asking for is 15 grand. I’m being nice. If you think they’re worth that much, buy them. But I’m being honest with you. I don’t think they are. I think you’ll end up with 90 grand into the four movies if you give me the money.”

Spallone says Davis has never worked a day in his life. “He’s inherited money- God bless him. The other guy I don’t know from Adam but I don’t work for free. But I don’t taking nothing that isn’t mine. It’s very simple.”

Spallone says a deal was supposed to have gone down this weekend with Davis giving him money. “On Friday they didn’t give me the money and yesterday Mike wanted to come talk to me. I said here is the deal- 15 grand for the four movies, the four movies are yours. I’ll give you the model relweases, everything. You guys are keeping the company so you pay me for the movies. But Guenther’s going to try and sell them. I said, listen. Give me the money then you go and try to sell ’em. What do you mean? I’m not going to get anything for this. I worked for five months. What did you guys do?”

To Davis’ contention that he was only an employee, Spallone said he took his name off the company when he was going through his divorce. “I took my name off the checking account. But I had the checking account for five months. There was no problem.”

To Davis’ claim that he allegedly stole $30,000 from the company, Spallone said he never heard of such a thing. “Mike personally lent me money,” Spallone says. “Stole? Never!”

And to all the other charges Davis is levelling, Spallone says he has no idea what Davis is talking about. “Tell him to call Rob.”

That should be an interesting conversation.



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