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Fight over Beach Theatre has drama of Hollywood hit

ST. PETE BEACH — The story behind the Beach Theatre's recent closing is complicated, dramatic and at times hard to believe. There are allegations of fraud and sabotage. Of deceit and greed.

It all sounds a bit like, well, a movie.

Two men are battling over the business. One is St. Petersburg native Michael France, the theater's owner and an accomplished screenwriter. The other is Brenton Clemons, a local small-business owner.

Clemons has filed a lawsuit against France and is seeking to take the theater. He alleges that France defaulted on a loan that has now grown to more than $100,000. Clemons' attorney says his client has big plans for the theater. He wants to make it the centerpiece of St. Pete Beach.

France says Clemons lied. He says he tried to pay him back, but Clemons refused. Clemons, he says, wanted him to default on the loan so he would lose the theater. France is fighting to keep it and one day reopen it.

Ultimately, it seems, the courts will decide the theater's fate.

This began in 2007 when France bought the business. Back then, money wasn't a problem. He paid $800,000 in cash. That same year, he and his wife, Elizabeth, got a $640,000 loan to buy a beachfront home on Sunset Way. In 2010, they paid the mortgage off early.

About two years ago, though, Mrs. France filed for divorce. France had long believed the independent theater couldn't survive as a for-profit, but he couldn't make the change to a nonprofit during the divorce proceedings.

Over the past few years, sentiment was the main thing keeping it open. Matinee and evening shows alike drew sparse attendance despite cheaper ticket prices than multiplexes. Even special events like Saturday screenings of The Rocky Horror Picture Show, accompanied by the Interchangeable Parts performance troupe, were "up and down" in attendance, according to France.

France also faced an unavoidable and expensive issue with his theater's soon-to-be outdated projection system.

Beach Theatre still operated with a 35mm film projector while the industry inexorably moved toward digital projection, with movies downloaded by computer rather than film threaded through projectors.

Theater conversion to digital projection is expensive, averaging $70,000 per screen, depending upon the venue's design. Large theater chains like AMC Theatres and Muvico can afford the expense, with some costs shared through an agreement between movie studios and the National Association of Theatre Owners. Many smaller indoor and drive-in theaters, like Beach Theatre, are being priced out of business nationwide.

France estimated the transition would cost him between $50,000 and $80,000. The theater also needs thousands of dollars in other upgrades.

To pay for those expenses, France asked Fifth Third Bank for an $80,000 credit line in May. The bank, he says, approved the loan but insisted that he pay the $27,000 he owed in past-due taxes and insurance bills. So, France sought a quick fix. Through a third party, France says, he found Clemons.

For France, the terms of the loan contract were harsh. He agreed to pay back the principal with 15 percent interest, plus a $4,000 fee — in one week. If he defaulted, a penalty of $500 per day would accrue.

Clemons' recently hired attorney, Charles Gallagher, was surprised that France — or anyone else — would have agreed to what he called "loan shark" terms, but Gallagher said he was even more surprised when he was told something else: France's attorney drew up the agreement.

France said he didn't know who wrote it, but court records filed by France's new attorney acknowledge that his former counsel was indeed the author.

On May 25, the agreement was finalized and France received the money. That same day, records show, he paid the delinquent taxes.

Soon after, France alleges, Clemons contacted officers and employees at the bank to tell them he owned the theater and that they shouldn't loan France the money. France says he has proof of that, including an email and witnesses, that he will present in court.

Because of Clemons' actions, France says, the bank denied him the credit line. Still, he insists that he tried to pay back the short-term loan before the due date, but Clemons refused the money.

"He obviously wanted to file a lawsuit, file forfeiture papers and attempt to take control of the theater," France said. "He interfered with the bank loan and made absolutely certain that wouldn't happen."

Gallagher denied that his client did any of those things. France, he said, attempted to repay Clemons back a portion of the money but only after the due date had passed.

On June 1, the day after the money was owed, Clemons filed a mortgage with the Pinellas County Clerk of Court. Twenty days later, he filed a notice of foreclosure on the theater.

Clemons, Gallagher said, could take possession as early as four months from now.

France is determined to prevent that.

His countersuit against Clemons alleges that the contract violated Florida law. He's also seeking damages over the failed deal with Fifth Third Bank.

Even if he wins, France, 50, isn't sure what to do with the theater. His divorce still hasn't been finalized, and the residual payments from his movies — which include GoldenEye, Hulk and The Punisher — have dwindled.

Clemons, 48, whom Gallagher described as an entrepreneur with a diverse portfolio of businesses including real estate and biofuel, could not be reached for comment.

For now, the 72-year-old theater will remain closed, its projector still and its sign thanking moviegoers for all the fond memories. When asked what the chances were that it could ever reopen, France's response was simple: "To be continued."

Times staff writer Katherine Snow Smith and researcher Natalie A. Watson contributed to this report. Reach John Woodrow Cox at jcox@tampabay.com. Reach Steve Persall at persall@tampabay.com.

Fight over Beach Theatre has drama of Hollywood hit 11/20/12 [Last modified: Tuesday, November 20, 2012 11:10pm]
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