EC3 and Braun Strowman are currently involved in a lawsuit related to their business ties to the Magic City Live and K5 Network brands after a former partner committed fraud and stole digital content from them.
According to court documents filed in Orange County (Florida), EC3 (Michael Hutter) and Braun Strowman (Adam Scherr) are suing former business partner Eric Holzer (also known as “Lord Business” on the K5 Network) on several counts including claims of fraud, breach of contract and theft of digital content.
In 2018, EC3 (Hutter) was asked by long-time friend Jedediah Koszewski (JC) to purchase a “Direct-to-Garment” printer for use in a business he’d started with Holzer. After Hutter purchased the printer as a loan to the pair, the partnership was named “Magic City Prints” and Holzer and JC went back to Hutter asking for an additional $7,000 loan for additional printing equipment to expand their business and Holzer pitched adding Hutter as another partner.
According to the documents, Hutter agreed and purchased the equipment in May 2019 and they jointly and severally entered into a lease agreement for warehouse space in Winter Garden, Florida to serve as Magic City’s base of operations. Holzer then filed Articles of Incorporation for Magic City on his own and without consent from Hutter, and listed himself in the Articles as the sole officer of the corporation. It was after this that Hutter introduced Scherr to the group and he was promised that his Meat Castle brand of apparel would be printed and fulfilled by Magic City, and the group entered a Joint Venture Agreement together.
The lawsuit then states that Holzer pitched the idea to Scherr to invest in Magic City, and drew up a Memorandum for the investment that required Scherr to pay $15,000 in exchange for an ownership interest in the group and a specific percentage of profits. Scherr issued a check in November 2019 for the sum but received nothing in return for his investment and it is believed that Holzer “converted all or a portion of those funds to his own use and benefit.” A review of the Joint Venture bank account reveals Holzer withdrew thousands of dollars from the account without Scherr’s knowledge or authorization, a requirement for the terms of the JVA.
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As it relates to the K5 brand, Scherr, Hutter, JC and Holzer formed K5 Entertainment Inc together, which included a large investment of personal funds from Hutter and Scherr that included start-up capital for video and audio equipment and other production costs. The lawsuit maintains that the K5 multimedia brand would not exist without Scherr or Hutter’s involvement due to the fact that their celebrity status was the main reason viewers would be visiting the YouTube channel. Holzer, allegedly upset over a business matter related to their group’s ventures, then took an undisclosed amount of digital content along with computer hardware and software without Scherr or Hutter’s consent. According to the complaint, Holzer has refused to return the content to K5, Scherr, Hutter or JC and he has no legal right to maintain possession of the content.
Holzer has filed a motion to dismiss and started a GoFundMe page to assist with legal aid. It is on the crowdfunding page that Holzer claims JC, EC3 and Strowman asked him to leave both ventures without compensation despite more than a year of time invested into both brands. Holzer claims he maintained “a percentage ownership of both businesses” and lost access to the business facilities without notice, and that the plaintiffs are still using the rented space and assets for “new business endeavors” and “wrestling promos” with no compensation returned for his initial investments. Holzer claims he’s countersuing on the basis that his former business partners have not acted in good faith and breach their fiduciary duties owed to him.
Lawyers for Scherr and Hutter are seeking the return of the digital footage and content by Holzer, as well as monetary damages related to the unauthorized publication of their likenesses by Holzer.
WrestleZone received the following response from Hutter, Scherr and JC’s legal team in response to the lawsuit, noting that they will defer to the information in the court records and deny the allegations by the opposing side.
“We do not litigate cases through the media or in public forums. The lawsuit papers contain our positions on the matters that are the subject of the lawsuit. Any information that you wish to gather regarding the lawsuit is best found in the lawsuit filings.”
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