Scottsdale business partner accuses former porn star of profiting from pandemic

SCOTTSDALE, AZ (3TV/CBS 5) — When Duane Bell moved to Arizona to help his friend turn around a financially troubled boxing gym, he saw it as a good business and personal opportunity. “Boxing is one of those things that you can see physically life-altering changes with people’s physiques,” said Bell.

The owner of the gym, a man named John “Jay” Grdina, was someone Bell says he had known for two decades. “We had mutual friends. I worked for him and his company and his ex-wife for many, many years,” said Bell.

Grdina was no ordinary gym owner. He and his former wife were a power couple in the porn business. Grdina was married to Jenna Jameson, and the two started the business, “Club Jenna,” which they sold to Playboy. In 2007, the Phoenix New Times named Grdina the “Best of Phoenix Porn King.”

Grdina and Jameson have since divorced. Grdina has formed and invested in several companies since then, including Pound Gym in Scottsdale. “I’ve had good experiences with Jay and nothing up to that point had led me to believe that I would be in the situation that I’m in now,” said Bell.

That “situation,” according to Bell, began during the pandemic. Gov. Doug Ducey ordered gyms shut down to prevent the spread of COVID-19. Bell says the bills piled up and the landlord locked the doors. At that point, according to Bell, he negotiated with new investors and took over the business.

About a year later, he says he learned Grdina had taken out a Paycheck Protection Program loan for the business for $60,000. “The loan had my name on it. It had the number to the gym. It had my email on it. The EIN (Employer Identification Number) attached to that loan was Grdina’s, Pound Gym LLC. I’m not a member of that LLC. It also had his bank account for Wells Fargo, which I’m not a signer on,” said Bell.

The Paycheck Protection Program was put in place by the Trump Administration to help small and medium-sized business weather the pandemic and keep paying their employees. In Arizona alone, businesses received $12 billion in loans. But the program was rife with fraud. “Most of the money did not go to workers who otherwise would have lost employment,” said David Autor, an economist at MIT who studied where the PPP dollars went. “We estimate that maybe one in four dollars actually went to a paycheck that otherwise wouldn’t have been paid. And the rest of it effectively went to business owners. And business owners are disproportionately from affluent households,” said Autor.

Autor says there were few safeguards in place to prevent fraud or abuse because the government was trying to get the money out the door quickly during the beginning of the pandemic. “So the end result is you could do almost anything you wanted with the money,” said Autor.

Bell contends that none of the PPP money ended up helping the gym operations. “The problem that I have is, you know we’re a small business. We’re a struggling small business at that. That money could have actually been put to good use. And my business could be double what it is now,” said Bell.

We looked into Grdina’s business background and found several lawsuits where it appears former business partners filed suit against him. One lawsuit was from a company that accused Grdina of fraud in a business deal that involved masks at the beginning of the pandemic. Court documents allege that Grdina ordered more than 1.5 million masks from a company in Hong Kong, then resold them without paying the company for the masks. That lawsuit was recently settled.

We attempted to contact Grdina by phone, email and traditional letter. We did not get a response. Scottsdale police opened an identity theft investigation into the dispute over the PPP loan and Pound Gym. In an email to Bell, the detective in the case stated that Grdina said the money was used for the gym.

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