DALLAS, TX – Eddie Wedelstedt, owner of the Denver-based adult video distribution company Goalie Entertainment Holdings, Inc., pleaded guilty Friday to federal obscenity and tax evasion charges.Under the agreement, Wedelstedt agreed to forfeit several adult bookstores and video arcades in Texas, and in exchange, all remaining charges against the company and five other defendants (including Wedelstedt’s wife, Vivian Lee Shoung) will be dismissed.
Wedelstedt’s plea to distributing obscene materials and obstructing an IRS investigation was bargained down from a 23 count indictment handed down last March, which targeted Wedelstedt, his company and six other individuals for racketeering, obscenity and tax evasion charges.
“We’re taking care of this case so nobody else will get hurt,” Wedelstedt told the Rocky Mountain News Friday. “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.”
In exchange for dropping the bulk of the charges, federal prosecutors are now assured Wedelstedt will do at least some time in jail. The agreement, which has not yet been approved by a judge, calls for a 13 month sentence followed by a year of supervised probation. Wedelstedt’s sentencing is scheduled for Feb. 9.
“It’s just the way the system works in America,” Wedelstedt said of his plea bargain. “I’ve been in this business for a long time, and after 12 years of investigating us, this is what they got.”
A federal grand jury indictment alleged that Wedelstedt traveled the country in his company’s Learjet, collecting cash from video arcades and stuffing it into a black bag, and later stowing some of that cash in a safety deposit box at a bank in Arapahoe County, Colorado.
In a statement released Friday, the Department of Justice said that Wedelstedt had admitted to conspiring with video arcade managers to hide arcades’ income from the IRS. The DOJ also said that Wedelstedt admitted to distributing a video that the grand jury in Dallas deemed to be 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 in their statement – a description that closely matches the textbook definition of obscenity, but curiously reveals absolutely nothing about the actual depictions contained on the “obscene” video.
Wedelstedt’s defense attorney, Washington, DC-based Hank Asbill, said he’s satisfied with the plea arrangement.
“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 that having to close his Texas locations will not ruin Wedelstedt financially, nor will a jail term break his spirit.
“The bottom line here 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.
Asbill said if the judge does not accept terms of the plea bargain, he and his client are prepared to go to trial. Asbill said that if there are any exceptions to the “precise deal” the parties agreed to, “Eddie has the right to withdraw his guilty plea, and we go to trial.”
