Francis said Michael Barrett, Roman Pelikh and Will L'Heureux set up a sham company called WMR Marketing Inc. in 2002 to illegally funnel Mantra funds.
The allegations said that the trio illegally procured hundreds of thousands of dollars from his production company, Mantra Films, and then conspired to have him arrested for tax evasion to keep him from finding out.
XBIZ was unable to find any registry with California’s secretary of state or any other information about WMR.
According to the suit, the trio made "hundreds of thousands of dollars" of fraudulent expenses and reimbursements by 2004 against Mantra Films, which produces “Girls Gone Wild.”
Francis claims that after Barrett resigned in 2004 as the company's chief financial officer he contacted the IRS and falsely accused Francis of tax evasion.
Francis, according to the suit, said that Barrett was "hoping that the IRS would prosecute and incarcerate Francis, thereby removing the possibility" that he would "catch the ongoing theft.”
"While Barrett was secretly trying to get Francis investigated by the Reno [Nevada] division of the IRS to recover his bounty from the mistaken books he previously prepared, provided and vouched for to Francis' tax return preparers, he never disclosed any problem to Francis," the suit said.
Francis was indicted in April 2007 on two counts of tax evasion in Reno, Nev., for illegally deducting $20 million in false business expenses.
Calls to Francis attorney David Schack of K&L Gates went unreturned by post time.
