The story is fully dealt with in Marc Ryan's "Trumpet Records: Diamonds on Farish Street". Basically, Lillian McMurry loaned Thomas a guitar and amp, as stated, to work up a B side for Catfish Blues. Thomas disappeared. After waiting a while for him to show up, McMurry felt she had no choice but to report the missing equipment. Many months later, McMurry was contacted by the police who said that they had Thomas and the missing equipment. Thomas had been in jail for 8 months!
According to McMurry she went to a preliminary hearing on the matter, "I said ...'You mean to tell me that he has been locked up for eight months in jail here? And I wasn't even called - and you're just now having a hearing? ... Justice works mighty slow. If the man's been in jail eight months, he oughta be out. I think he's served his time.' I was so mad I went and hired the lawyer Bernard Chill. Now this was back in poor times ... We paid the lawyer $125 to try to get Slim out."
Eventually a trial was held, Thomas was persuaded to plead not guilty (he was reluctant to do so), and he was set free. He became a devoted friend of Mrs. McMurry's.
McMurry did credit Thomas as "Elmo James" on the B side of Dust My Broom, but, to be fair, he was missing with her guitar and amp at the time. She only had the one song by James (who had been poached by the Biharis for Modern) and one by Thomas. I don't know if Thomas saw any money from the record, but at the very least he got a guitar, amp, and lawyer's fee out of the deal.
