Divorce Lawyer In the Crosshairs

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Echoes of the sordid collapse of show biz payroll company Axium can be heard in the equally sordid divorce proceedings of the company’s former chairman and chief executive.

John Visconti and his estranged wife, Maha, have been in a pitched battle since she filed for divorce more than three years ago, before the company’s demise. A new lawsuit filed by Maha Visconti adds more wrinkles to the story of Axium’s last reel: She accuses her husband’s former divorce lawyer of helping him use Axium to hide money, and is seeking $101 million in damages.

Axium seized up and filed for bankruptcy in January 2008, disrupting a number of local companies in the entertainment industry that depended on it to handle their payrolls. At the time, Axium’s largest lender filed a lawsuit against John Visconti and his partner, alleging they looted Axium money to support a lavish lifestyle that included luxury cars, private jets, numerous homes and an apartment for an actress-model.

Maha Visconti filed suit earlier this month in Los Angeles Superior Court against her estranged husband’s former lawyer, Jeff Sturman, claiming he helped John Visconti divert millions of dollars from Axium to secret bank accounts. What’s more, she alleges that Sturman helped his client hide vital information, including Axium’s financial reports, to deny her access to the company’s assets – which she claims were community property – and to prevent her from collecting child and spousal support.

“There was a major fraud at Axium International,” said Hieu Do, a Westminster attorney representing Maha Visconti in the suit. “And Jeff Sturman withheld some of the financials of Axium International to hide what happened.”

Sturman, a lawyer at Beverly Hills family law boutique Kolodny & Anteau, declined to comment on the pending litigation.

Sturman and his firm are best known for representing Lisa Bonder Kerkorian in a child support case against her ex-husband, billionaire Kirk Kerkorian. After that high-profile matter, Sturman filed a civil suit against Kerkorian’s former attorney, Terry Christensen, and private sleuth to the stars, Anthony Pellicano, over conversations he had with Bonder Kerkorian that were wiretapped. Pellicano and Christensen were both convicted in 2008, but a judge rejected Sturman’s suit in 2009.

In the divorce case, Maha Visconti now alleges Sturman helped her husband use Axium as his “own piggy bank.”

John Visconti, an Iranian immigrant, purchased Axium for $4 million in 2001 and built the company into one of the entertainment industry’s largest payroll companies. Axium, which was headquartered on the Miracle Mile, handled payrolls for major studios and independent producers and had offices in Los Angeles; Burbank; New York; London; Toronto; and Vancouver, British Columbia.

According to the trustee handling the bankruptcy proceeding, things went downhill for Axium when it needed to pay $31 million in back taxes in 2007. That forced Axium to default on loans made by its primary lender, Golden Tree Asset Management. Golden Tree swept $22.5 million out of Axium’s accounts, and the company filed for bankruptcy in January 2008.

Marriage dissolved

Maha Visconti met and married John Visconti in 2001, and the couple had a son two years later. When the Visconti’s marriage dissolved in 2006, Axium was operating at full speed. The company employed more than 550, had earnings that amounted to nearly $31 million and handled as much as $1.8 billion in payrolls annually.

Sturman represented John Visconti in the divorce proceedings in 2007 through 2009.

In her lawsuit, Maha Visconti claims Sturman “played every trick in the book and created a big mess and disarray, consistently told lies under penalty of perjury to the court, withheld information from plaintiff that were in his possession,” during the two-year period he was involved in the case.

She further claims that Sturman maintained in divorce proceedings that his client had “zero ability” to pay child support and his attorney’s fees. But at the same time, she alleges, Sturman was secretly receiving millions of dollars as payment from Axium.

What’s more, Maha Visconti and her attorney claim that Axium purchased staffing firm Ensemble Chimes Global in 2007 for what they considered a wildly inflated $80 million, and that some of that cash was sent to secret bank accounts.

Two weeks after Axium filed for bankruptcy, Ensemble Chimes was sold at auction for about $8.1 million to Jacksonville, Fla.-based MPS Group Inc., a provider of staffing and consulting services.

Do, Maha Visconti’s lawyer, said his client opposed the sale.

“The bankruptcy trustee, Howard Ehrenberg, rushed the sale of Chimes,” Do said.

Ehrenberg, the court-appointed trustee handling the bankruptcy, declined to comment on Maha Visconti’s allegations. At the time of the auction, he was quoted as saying that he got as much as he could.

Maha Visconti’s criticism of Ehrenberg over the sale of Ensemble Chimes is the latest in their clashes.

Ehrenberg filed suit against Maha Visconti in May of last year, seeking to recover thousands of dollars he claims she received in cash advances and loans from Axium to purchase, improve and maintain four homes in the L.A. area.

Maha Visconti has denied any wrongdoing.

Michael Collum, a Beverly Hills divorce lawyer not involved in the case but who read court documents at the Business Journal’s request, said Maha Visconti appears to be accusing Sturman of wrongdoing in an attempt to get divorce money from Visconti, Sturman or the trustee.

“It’s a grasp at trying to recover something,” Collum said. “But I don’t see merits to this complaint.”

Jonathan Cole, a Sherman Oaks attorney representing John Visconti in the Axium bankruptcy proceedings, said Maha Visconti doesn’t have standing to pursue her allegations.

“I don’t believe that Maha Visconti has any standing to control or assert these claims,” Cole said. “The bankruptcy trustee for Axium is the entity with standing to pursue claims against the Kolodny firm.”

Ehrenberg sued Louis Dienes, a Century City attorney who served as Axium’s outside lawyer, in June. The suit alleges Dienes helped John Visconti and Ronald Garber, Axium’s former vice chairman and chief operating officer, loot the company’s assets by doctoring loan agreements. David Parker, a downtown L.A. attorney representing Dienes, has denied the allegations.

Meanwhile, Ehrenberg has been sorting through other issues related to the bankruptcy proceedings, including the recovery of about $4 million in preferential transfers, which are payments made to creditors within 90 days of the company filing for bankruptcy.

Maha Visconti is doing her own investigation of Axium’s downfall, Do said. “She’s spending a lot of time litigating this case and trying to investigate. We are doing a lot of work trying to determine what happened to all the money.”

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