Legal Fight Over FriendFinder Acquisition Apparently Settled

LOS ANGELES — Penthouse Media Group apparently has settled with Broadstream Capital Partners, which alleged it breached a joint venture deal over the purchase of adult and social-networking giant FriendFinder when it was known as Various Inc.

Broadstream Capital, XBIZ has learned, filed a motion to dismiss its long-running legal battle just one week before the two companies were slated to begin a jury trial last month at U.S. District Court in Los Angeles.

In its original suit, Broadstream claimed damages would be “believed to be in excess of $20 million.”

When reached by XBIZ Thursday, attorneys from both sides — Jeffrey Valle representing Broadstream and Ira Rothken representing Penthouse Media Group (now known as FriendFinder Networks) — said they couldn’t comment on the dismissal of the case, citing confidentiality tenets.

Broadstream Capital Managing Partner Jim Goldfarb also told XBIZ that he would not disclose any information relative to the case.

“I believe the outcome speaks for itself,” he said.

Terms of the apparent settlement were not disclosed.

Last year, Penthouse changed its name to FriendFinder Networks, which now includes Penthouse magazine, AdultFriendFinder.com, 25 other social-networking sites and additional adult-business properties.

In December 2007, Penthouse purchased Various in a cash-and-stock deal for $500 million. Various owned and operated AdultFriendFinder.com and dozens of other social-networking sites.

In the suit, Broadstream claimed that during the bidding process for the FriendFinder properties, Penthouse contacted Various company officials to put in a separate bid from a bid it was working on with Broadstream, which said it was working on a joint venture with Penthouse.

Broadstream alleged that Penthouse committed breach of contract, breach of the covenant of good faith and fair dealing, breach of fiduciary duty and constructive fraud.

Penthouse challenged the breach of contract complaint by focusing on the nondisclosure agreement portion of the original deal, claiming that it is unenforceable.

Broadstream asserted that during the bidding process, Broadstream “learned that Penthouse directly contacted Various to put in a separate bid,” and “ultimately submitted a bid that was higher than the offer from Broadstream and converted this business opportunity from an opportunity for the joint venture to an opportunity for Penthouse alone.”

Penthouse later charged that Broadstream induced 20 third parties to sign a three-page document that it described as a nondisclosure agreement, but which also contained a noncompete provision.

Once a party signed the nondisclosure agreement, Penthouse attorneys argued at the time, Broadstream intended to extort exorbitant fees and compensation if it ultimately decided to participate in the acquisition of Various.

They also claimed that Broadstream falsely claimed that it was a merchant bank “with significant experience investing in the adult entertainment industry.”

The trial was slated to have an array of witnesses, including several funds that received correspondence with Broadstream, Various’ Andrew Conru and Lars Mapstead. Also, Penthouse CEO Marc Bell and President Daniel Staton would have testified.

Bell did not respond to an XBIZ request for comment over the apparent settlement.

Copyright © 2025 Adnet Media. All Rights Reserved. XBIZ is a trademark of Adnet Media.
Reproduction in whole or in part in any form or medium without express written permission is prohibited.

More News

Alabama Notifying Adult Sites of New Tax Set to Take Effect Sept. 1

The Alabama Department of Revenue has begun sending notices to adult site operators about a new 10% tax on their revenues, set to be enforced starting Sept. 1.

Ondato, CCBill Announce Strategic Partnership for Global High-Risk Market

Age and identity verification firm Ondato and payment processor CCBill have formed a strategic partnership to serve the global high-risk market.

Ofcom Investigates 4 More Adult Companies for OSA Compliance

U.K. media regulator Ofcom has launched investigations into whether four companies operating adult websites have implemented requisite age assurance measures under the Online Safety Act, the agency announced Thursday.

Taylor Nicole Launches New Site Through YourPaysitePartner

Creator Taylor Nicole has launched her new official website through YourPaysitePartner (YPP).

Adult Networking Platform SpicyGigs.com Launches

SpicyGigs, a new adult industry networking platform, has officially launched.

Pineapple Support to Host 'Cream Pie Challenge' Fundraiser

Pineapple Support is hosting its Cream Pie Challenge through August to raise funds for mental health services for industry performers.

Kyrgyzstan President Signs Measure Outlawing Internet Porn

President Sadyr Japarov of Kyrgyzstan on Tuesday signed into law legislation outlawing online adult content in the country.

NC Legislature Overrides Veto of Extreme Anti-Adult Industry Bill

The North Carolina state legislature on Tuesday voted to override Gov. Josh Stein’s veto of a bill imposing regulations that industry observers have warned could push adult websites and platforms to ban most creators and content.

Report: VPN Downloads Soar in UK Following Age Verification Deadline

Virtual private network apps, which can be used to circumvent geo-specific age verification requirements, are topping Apple App Store downloads in the U.K. in the wake of new Online Safety Act rules, the BBC is reporting.

Strike 3 Holdings Sues Meta for Pirating Vixen Media Group Content to Train AI

Vixen Media Group owner Strike 3 Holdings filed suit in federal court this week, accusing Facebook parent company Meta of copyright infringement and alleging that Meta has extensively pirated VMG content to train its artificial intelligence models.

Show More