Image Entertainment Corp. narrowed its net loss for the third quarter when compared with the same period from a year ago. The Chatsworth-based home entertainment production and distribution company incurred a $228,000 expense related to a proposed merger with BTP Acquisition Co. that has since fallen through resulting in a lawsuit. Image reported a net loss of $2 million, or a loss of $0.09 per diluted share, on revenues of $27.3 million for the quarter ending Dec. 31. For the same period in 2006, the company had a net loss of $3.5 million, or a loss of $0.09 per diluted share, on revenues of $24.4 million. Image entered into an agreement to sell a controlling share to BTP but the merger fell apart over a lack of financing. Image then sued for the payment of a $4.2 million breakup fee after the nixed merger. Shares of Image closed at $1.21
