Michael Fenne made a name for himself back in October when as head of Pixelon he orchestrated the most outrageous promotional event ever seen in the Internet Economy. To celebrate the streaming media company's launch last fall, Fenne paid $12 million to stage a star-studded party in Las Vegas. This week, he was back in the news when Virginia authorities jailed him without bail, ending a four-year manhunt for one of the state's most-wanted fugitives.
David Kim Stanley, who under the name Michael Fenne persuaded investors to hand over at least $20 million to fund Pixelon,turned himself in Wednesday. In 1989, he pleaded guilty in Virginia to 24 counts of defrauding victims, many of them elderly parishioners at his father's church. He also pleaded guilty to 31 similar charges in Tennessee. All told, prosecutors estimate that Stanley swindled his victims out of more than $1 million.
Stanley, whom the judge hearing the case reportedly branded "the golden-tongued salesman," was sentenced to reimburse his victims and serve eight years in prison. Stanley didn't come up with all the cash and had been on the run since 1996 when he failed to appear for a court hearing associated with the fraud conviction, says Virginia special prosecutor Gerald Gray. In 1998, Virginia police added him to the state's most-wanted list. Stanley also faces fraud charges in Tennessee, according to Gray.
Stanley/Fenne's tenure at Pixelon was brief. He quickly lost favor with his investors, who were infuriated by the excesses of the launch party. Among the entertainers hired were The Who, Kiss, the Dixie Chicks and Tony Bennett. He was ousted from Pixelon soon after the bash.
There were hints at the launch that Fenne might be keeping a secret. For all his showmanship, the soft-spoken Southerner was curiously bashful. Even as he was wooing reporters for the extravagant event, he declined to discuss his background with The Standard and refused to be photographed.
Since then, the company has gone through two more chief executives and has dramatically scaled back its plans to offer a wide variety of original content. Robert Feldman, Pixelon's CTO, now gives the firm a clean bill of health. "We have a certified audit without a single comment on it," Feldman says. Feldman, however, could not provide the name of the firm or further details about the audit. He added that San Juan Capistrano, Calif.-based Pixelon is in the process of closing an additional round of $25 million in strategic investments and was signing up new customers.
Paul Laberge, VP of corporate development at Alliance (AACB) Atlantis, a Canadian film and television production company with $800 million in revenue last year, confirms talks with Pixelon. "We're certainly impressed with their product," he says, while declining to discuss the nature of the talks.
Representatives from Pixelon's investor, a Chicago brokerage called Advanced Equities, were not available by press time to comment on the revelation that it had handed $20 million to a convicted felon.
Following his departure from Pixelon, Stanley was living in San Bernardino County, Calif., says Jimmy Widener, special agent of the Virginia state police bureau. When police arrived at Stanley's residence last week, he was already gone. The fugitive turned himself in Wednesday, through his lawyer, Anthony Collins, who says he plans to file a motion withdrawing Stanley's 1989 guilty plea.
Wise County Circuit Court Judge J. Robert Stump ordered Stanley held without bail while he repays defrauded victims. Meanwhile, the Net has clearly not seen the last of this strange case. The judge has taken the unusual step of providing Stanley - who still owns shares of Pixelon and some real estate - with an Internet connection, a phone and a fax machine so that he can try to liquidate his assets.
