Investors Say Paying Bills Is a Struggle
After raking in millions of dollars in casino profits over the past five years, three original investors in the Bicycle Club now say they are struggling to pay mounting debts.
In an attempt to recover their monthly dividends of $300,000 apiece, the partners filed court affidavits last month asking a federal judge to reverse his order seizing the club’s profits. The action followed convictions in a separate drug money laundering trial that did not involve the investors.
Here is how the partners described their sudden financial hardships:
- Julieann Coyne Wasson, 40, said the court-imposed freeze on her monthly profits cause her “harm” because “I provide the primary support for my family, which consists of my husband and two small children.”
Over the past five years, Coyne has received $9.7 million in casino profits.
In November, Coyne purchased a 5,800-square-foot house on a private street near Universal Studios for $1.5 million. Since then, she has paid for extensive renovation work on the estate while continuing to reside in her Studio City residence, on the market for $1.2 million.
- M. Dale Lyon, 60, said in court records in 1983 that he was in a “financial bind” before he invested in the Bicycle Club. He had been fired as an executive at Imperial Bank, was in the middle of a difficult divorce with the third of four wives and listed debts exceeding $300,000.
Now, Lyon has come to rely on the casino profit distributions as his primary source of income. He said he needs the dividends to pay off more than $850,000 in loans that he acquired to purchase additional ownership shares in the Bicycle Club.
“A freeze of distributions,” he said in an affidavit, “would harm me in several ways.”
Lyon’s casino profits since 1985 total $13.8 million.
- David Pierson, 55, assigned one-half of his interest in the Bicycle Club to his wife of 25 years as part of their divorce settlement in December. The Piersons recently sold their Beverly Hills estate for $3.5 million and a pair of Rolls-Royces.
Now the Piersons claim they each need their casino profits to pay off staggering monthly bills. Lois Pierson must find a way to make her $13,000 monthly mortgage payment on a Victorian that is costing her an additional $65,000 a month to refurbish. David Pierson declared that he owes $400,000 in legal bills and $282,112 in federal income taxes.
“Not having these funds available to pay my legal expenses and income taxes creates a substantial hardship for me,” Pierson said.
After reviewing the appeals by the three partners, U.S. District Court Judge Norman C. Roettger Jr. decided to continue freezing the monthly profits pending outcome of a forfeiture trial.
