Another Porn Business in a Wedelstedt Location

Porn Studies > Porn in the News

Terrell Tribune, Texas, 2/28/06 - In spite of Terrell's longtime adult book and video store abruptly closing a couple of weeks ago due to controversy surrounding its court-documented owner, Colorado-based Goalie Entertainment Holdings Inc., it didn't take long for a new adult movie store to open in the same location.

Within days of Goalie Entertainment Holdings closing the store, Dreamers DVDs replaced the shop on the service road of Highway 80, on property inside the city of Terrell's extraterritorial jurisdiction, Feb. 18, despite widespread speculation that the two businesses are illegally working together.

"We heard all of those rumors when we went to the county," said Tom Kroesche, a lawyer for Dreamers DVDs. "We are not related to Goalie Entertainment."

Much of the speculation stems from Goalie Entertainment Holdings owner Edward Wedelstedt pleading guilty Nov. 4 in Dallas to federal obscenity, racketeering and tax charges.

Wedelstedt, who owns adult stores in 18 states, is considered by many to be the leading distributor of pornography in the United States.

As part of a pending global settlement agreement in exchange for dismissal of the charges, Wedelstedt agreed to forfeit his three Texas-owned stores, cancel leases on several other stores in the state and stop servicing several other Texas adult stores, according to one of his lawyers, Hank Asbill.

Despite Asbill saying Wedelstedt would act in complete accordance with his agreement, many Kaufman County residents believe he still has something to do with the new store.

"We are a totally separate operation," Kroesche said. "We have a totally different business in that the business is a pure take home video store."

Kroesche also mentioned Dreamers DVDs, unlike many of Wedelstedt's stores, doesn't have video arcades where customers pay to see pornographic videotapes.

Wedelstedt's court date on the federal charges is March 2, which is when the judge will either accept or reject the plea bargain.

"We had a license issued with the county and we are purely a take-home business," Kroesche said. "We are like Blockbuster, we do rental and sales only."

Background ...

Pornphobia Hurts Children's Charities

Rocky Mountain News, 2/20/06 - Eddie Wedelstedt says he isn't afraid to go to prison, but that he is afraid for the children's charities he has built with earnings from his pornography empire.

The 63-year-old Greenwood Village multimillionaire is scheduled to be sentenced in Texas next month because his company, Goalie Entertainment Holdings Inc., shipped an obscene video across state lines and didn't report to the Internal Revenue Service cash gifts that Wedelstedt gave some employees.

Wedelstedt expects to spend 13 months behind bars under the terms of his plea bargain.

"As fat as I am, I'll get back in shape," Wedelstedt said recently, chuckling.

Then he turned serious.

"As long as they don't mess with my kids," he said. "Please don't screw with the foundation. These kids deserve a break. Let's not punish the children if somebody thinks I'm a bad guy."

But some of the children's charities to which Wedelstedt has contributed are uncomfortable about taking his money, after publicity about his criminal conviction and the fact that his fortune was built on the adult sex industry.

"We're just very careful who we associate with," said Mike McCubbin, spokesman for Big Brothers Big Sisters of Colorado Inc., which Eddie's Kids lists among the dozens of children's charities it has supported.

"If you know you're getting money from a disreputable source - and I'm not saying Eddie's Kids is disreputable - it can kind of taint what you do," McCubbin said.

Beneficiaries deny knowing

Wedelstedt, an ebullient fast-talker who calls women "honey" and describes dressing up as Santa Claus as a boy to go door-to-door giving gifts to the needy, supports kids three ways: Through direct personal donations to children's charities; through a foundation called Eddie's Kids, which donates tickets to sports events; and through the Goalie Charitable Foundation. The Goalie Charitable Foundation, according to its Web site, provides "financial assistance to neglected, underprivileged and abused children, children with life-threatening illnesses and children who need financial assistance for education."

Wedelstedt said Eddie's Kids alone probably raises about a million dollars a year - much of which comes from those in the sex entertainment business.

"In the adult industry, they write checks to me beyond belief," Wedelstedt said.

He said Eddie's Kids provides tickets for about 45,000 children each year to attend major-league and college sporting events, mostly in Colorado and California. At Denver Nuggets basketball games, "Eddie's Kids" sit in their own section.

"I just care about kids, that's all," he said.

But some children's charities said accepting donations resulting from Wedelstedt's pornography business puts them in an awkward position.

McCubbin, of Big Brothers Big Sisters of Colorado Inc., said he intended to contact Eddie's Kids to have a thank-you note from the organization removed from the Eddie's Kids Web site.

"Your kindness provided so many wonderful experiences . . ." said the note, attributed to Kathryn Grainger of Big Brothers Big Sisters of Colorado Inc.

McCubbin confirmed that Kathryn Grainger is a former employee. But he said he had never heard of Eddie's Kids.

The tickets that Eddie's Kids pays for are distributed by Kroenke Sports Enterprises, operator of the Pepsi Center.

"We never received any tickets knowingly from Eddie's Kids," McCubbin said. "If we were to get tickets from Eddie's Kids, we would probably thank them for their generosity and pass on the tickets."

Kroenke spokesman Paul Andrews confirmed that the sports company's community relations staff distributes the tickets to charitable organizations.

Andrews said Kroenke Sports officials are aware of Wedelstedt's profession.

"The Eddie's Kids foundation for 10 years has provided an opportunity for families and kids that would not have the ability to come to a game . . . We will continue doing business with the Eddie's Kids foundation," Andrews said.

Denver Public Schools and several individual schools also are listed among the Eddie's Kids beneficiaries and mentioned on the Web site.

"Opportunities like this allow kids and their families a moment to forget about their plight and enjoy being together," says a note attributed to Tim Tennant, Teacher, Denver Public Schools.

DPS spokeswoman Tanya Caughey confirmed that Tennant was a DPS teacher from October 1997 to August 2002. Caughey said the school district doesn't keep track of ticket donations and doesn't investigate "established" charities that make donations. "I believe schools would say, 'No, thank you,' if approached directly by a pornography business offering to donate sporting event tickets to students," she said.

Andrews said any group that doesn't want to accept tickets paid for by Eddie's Kids should notify Kroenke Sports. "We will respect their wish," he said.

At the Kempe Children's Foundation, which fights child abuse and neglect, spokeswoman Lindsey Zimmerman confirmed that Wedelstedt has made personal donations, most recently in 2003. A 1998 newspaper article said Wedelstedt bought two corporate tables at a gala fundraising event that year.

If Wedelstedt should offer more money, "our foundation board of directors would meet to consider that," Zimmerman said. "When donor issues of this nature are brought to our attention, we deal with those situations on a case-by-case basis."

Wedelstedt said he was surprised that some local organizations that have accepted his donations have denied knowing about his adult entertainment business.

"Hypocrites," he said. "They came to my parties, came to my events. Then they turn around and say they didn't know I was adult?

"They knew," he said.

Eddie Wedelstedt Pleads Guilty to Distributing Obscene Material

Rocky Mountain News, 11/5/05 - Self-proclaimed porn kingpin Eddie Wedelstedt, a Greenwood Village businessman who oversees one of America's largest adult-movie distributorships, pleaded guilty Friday in Texas to federal obscenity and tax-evasion charges.

As part of a plea bargain, the 62-year- old president and founder of Denver- based Goalie Entertainment Holdings Inc. agreed to forfeit a half-dozen adult bookstores and video arcades in Texas.

The deal also includes forfeiture of $1.25 million that federal authorities seized during search raids of some of those businesses earlier this year.

Wedelstedt's two-count guilty plea to distributing obscene material and obstructing an IRS investigation was negotiated down from a 23-count indictment last March that targeted him, his company and six others for racketeering, obscenity and tax charges.

"We're taking care of this case so nobody else will get hurt," said Wedelstedt, who flew back to Denver in his private jet immediately after his Dallas plea.

"Let's be honest. I do this to protect my employees . . . 1,100 of them. I'm not happy about it, but that's OK."

All charges against the company and its subsidiaries will be dropped, along with dismissal of the criminal cases against five individual defendants who include Wedelstedt's wife, Vivian Lee Schoug.

In exchange, federal prosecutors have been assured Wedelstedt will do some jail time.

Pending a judge's approval of the agreement, it calls for a 13- month prison sentence to be followed by a year of supervised release. Wedelstedt's sentencing is scheduled for Feb. 9.

"It's just the way the system works in America," Wedelstedt said about his plea deal. "I've been in this business for a long time . . . and after 12 years of investigating us, this is what they got."

Wedelstedt, whose privately held holding company owns 60 adult video stores in 18 states, is perhaps better known in Denver for his high-profile philanthropy. Eddie's Kids, a charity he founded, gives away sports tickets to poor kids. And he has been mentioned in Colorado newspaper society columns as a generous donor to such causes as the Kempe Children's Foundation, which combats child abuse, and the Denver Nuggets Wives Organization.

A federal grand jury accused Wedel- stedt of traveling the country in his company's Learjet and stuffing cash from back-room video arcades into a black bag, later stashing some of the money in a safety deposit box at an Arapahoe County bank.

The Justice Department said Friday in a news statement that Wedelstedt admitted conspiring with arcade managers to hide that income from the Internal Revenue Service.

It said Wedelstedt also admitted to distributing a video that the grand jury in Dallas found obscene.

"The video can generally be described as depicting hard-core pornography with patently offensive depictions of adults performing sexual conduct," the Justice Department said.

The government amassed more than 2,000 boxes of documents to make its case. Initially, prosecutors sought the forfeiture of his entire empire, by some estimates valued at more than $40 million.

Wedelstedt's Washington, D.C., defense attorney, Hank Asbill, said he is satisfied with the negotiated plea.

"It took a lot of fighting and effort to get - and a willingness to go to trial if we didn't get it," Asbill said.

Asbill said getting run out of Texas isn't going to break Wedelstedt financially. Nor will a jail sentence.

"The bottom line here," Asbill said, "is that by taking personal responsibility for one of his companies and shipping a single movie to Texas deemed by some as obscene, he has been assured of running his business nationwide, with a temporary hiatus in the northern district of Texas."

Asbill said if the judge doesn't accept terms of the plea bargain, Wedelstedt is prepared to go to trial. Any exceptions "to the precise deal the parties have agreed on, Eddie has the right to withdraw his guilty plea, and we go to trial."

While this case involves stores all across the country, investigators in Dallas were the first to file this case, therefore Wedelstedt will report to Dallas when the trial plays out.

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