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Veritas News Network - Truth is Trending

Truth is trending on the Veritas News Network! VNN is an online publication featuring the news and is dedicated to in-depth investigative reporting with a consumer advocacy focus. Our Managing Editor is a veteran investigative journalist who has won dozens of awards.  Several categories of news are featured on the Veritas News Network include Citizen Journalism, Consumer News, Ripoffs & Scams, Consumer Advocacy, World News, US News, Crime, Economic News, Editorial & Opinion, Education, Health & Science, Human Rights, Investigative Reports, Investing, Legal News, Money, Personal Finance, Op-Ed, Politics, Technology, and Travel. 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Featured topics on VNN in our Opinion-Editorial (Op-Ed) section include The Secrets of Arbitration, The ABC's of Arbitration, The Fourth Estate: Media Ethics Disappear, Arbitration Undermines Homebuyers in Las Vegas Luxury Condos, Rolling Stone Raises Questions About Journalism Ethics, Immigration and Ferguson: A Country Divided, Tax Lien Investment Company PIP West Responds to Criticism, Is Your Local News A Scripted Fraud?, and Are Tax Lien Investments the Latest Real Estate Ripoff? Stories examined on VNN in our Investigative Reports section include Forced Arbitration: The End of Class Action?, Dying to Drink: College Binge Drinking Proves Fatal, Wrongful Convictions: The High Price of Justice Denied, Net Neutrality Sparks Protest, Facebook Claims Messenger 'Privacy Invasion' is False, Media Credentials: Crossing the Line, Student Loan Debt: Too Big to Fix?, No Legal Recourse for Lost Home: Texas Bar Dismissed Complaint, Citizen Journalism: Understanding the Freedom of Information Act, Arbitration: A Cheaper Alternative to Court?, Arbitration: An Unfair Advantage, Veterinarian Malpractice: Your Computer May Be Worth More Than Your Pet, Man Made Skies: Geoengineering for Climate Change?, Cyber-Stalkers: Online Predators Pose Offline Challenges, Protect Yourself Against ID Theft: The Laws May Not, The Fourth Estate: Shield Law, New Technology Beats Domestic Snooping, Gift Cards: Holiday Favorites But Susceptible to Scammers, Can the NCAA Adapt to Impending Change: Inside the Future of College Sports, NCAA: College Football's Supervisors Set to Collect Big on Bowl Games. Stories covered by VNN in our Human Rights Watch section include Citizen Journalism: Understanding Rights and Responsibilities, Raising the Shield: Free Flow of Information Act, From World's Policeman to Police State, Online Privacy in the Age of Everyday 'Big Brothers', Victims of Human Trafficking Hide in Plain Sight in Pennsylvania, Searching For Justice: Inmate's Death Caused by Jailers, Arbitration: Fair or A Scam Against The Public?, Officer Identified in Garner Killing: Death Ruled A Homicide, Lawsuit Alleges Southwest Airlines Secretly Records Calls. Topics explored on VNN in our Legal section include Civil Forfeiture: Policing For Profit Violates Civil Rights, Blind Justice: Arbitrators Have Immunity From Lawsuits, Herbalife Settles Class Action for $15 Million, Online Dating Service Fined by FTC for Fake Profile Scheme, New York Cracks Down on Portfolio Recovery Associates, Debt Collectors: Harassing the Elderly, FTC Approves Final Order Settling Charges Against Snapchat, TracFone Settles FTC Complaint for $40 Million, Exoneration of the Wrongfully Convicted Reaches Record High, Wells Fargo and JP Morgan Loan Officers Accused of Taking Kickbacks, Chimpanzee Loses Bid for Habeas Corpus, Sony Settles False Advertising Claim with the Federal Trade Commission, Civil Forfeiture: Bank Accounts and More At Risk, Municipalities Take Big Pharma to Court, Slander Suit Reinstated Against Boeheim and Syracuse University, Facebook Sues Paul Ceglia's Lawyers, Federal Trade Commission Halts Online Credit Score Scheme. Featured topics on VNN in our Education section include The Hidden Face of Student Loan Debt, College Crime Transparency Required Under Federal Law, Colleges Cut Student Work Hours to Avoid Healthcare Costs, No Easy Fix: Death, Taxes, and Student Loan Debt. Stories reported on VNN in our Investing, Ripoffs & Scams, Health & Science, and Money sections include New York Attorney General Sues Over Fraudulent Mortgage Scheme, Tax Lien Investing, R&J Consulting: Another Scam Debt Collector?, Arbitration 101: How it Impacts the Everyday Consumer, Phone Scammers Target Microsoft Users, Scammed Real Estate Investor Continues Fight for Justice, 43 Million Americans Strapped With Medical Debt, Feds Hope to Spur Struggling Housing Market, Monsanto Blamed for Decline of Monarch Butterflies, Obscure Law Shields Vaccine Manufactures from Liability: National Vaccine Injury Compensation Program Pays Out Billions, Ebola: Playing the Race Card, House Republicans Call for Ebola Travel Ban, McDonald's Aims to Debunk Pink Slime, Plastic, and Rot-Fail Myths, New Jersey Issues Mandatory Ebola Quarantine for NBC News Crew, Stanford Researchers Unlock the Peanut Allergy in DNA, Smartphone Apps: The Future of Health, New Healthcare Law Redefines 'Insurance', New Nutrition Science Means New Food Labels, New Cholesterol Guidelines Take Aim at Heart Attacks and Strokes. Featured US News, Politics, and Tech stories on VNN include Dropbox Denies Breach: Claims Cloud Service Wasn't Hacked, DEA Sued For Creating Fake Facebook Account in Drug Sting, Brinksmanship Continues Between President Obama and GOP, Kmart Added to List of Data Breaches, American Arbitration Association Launches New Consumer Rules, Jimmy Johns and Dairy Queen Added to LIst of Data Breaches, Center for Immigration Studies: Immigrant Families Benefit Significantly from Obamacare, Dali Lama Protesters Take to New York City Streets, Is Uber Saving Lives?, Sales Tax Could Be Coming to Online Purchases, Runaway Afghanistan Soldiers Seek Asylum, Fighting the Penalty of Free Speech, Detroit Bankruptcy: Michigan Governor Testifies, Congress to Speaker Boehner: Cancel Recess, eBay Seeks to Dismiss Data Breach Lawsuit, Apple's Watch: Connecticut AG Questions Health Privacy, Hotel Owners Seek Ability to Block Guest WiFi Access, FCC to Vote on Net Neutrality, Dread Pirate Roberts: The Lord of the Silk Road Confounds Expectations, Wal-Mart Claims Tracy Morgan is Responsible For His Injuries. Apple Won't Turn Over Data for Most iPhones Even With Search Warrant. Concise 'News Briefs' on a diversity of topics include Presidential Plan to Raise Capital Gains Taxes, Hershey's Launches Chocolate Way on Britain, FCC Regulates Internet Service as a Utility, New Jersey Supreme Court Says Arbitration Terms Must Be Clear, Wal-Mart Settles NY False Advertising Case, Air Marshal Whistleblower Case Headed to Supreme Court, Casinos Crumbling: Grim News for Gamblers, Price-Fixing in the German Beer Industry, Can Obamacare Succeed Without Young Adults?, Judge Rules NSA Tactics Unconstitutional, Carnival Offers Glimpse Into Shipboard Crime, Israel Ready For Unilateral Action Against Iran, Gay Marriage Legalized in New Jersey, and $100 Million Charity Fraud Case Begins in Ohio. 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Now displaying: January, 2019
Jan 28, 2019

The longstanding case between Jason Hartman and Results Property Management principals Quentin Kearney and Ken Logan is moving forward with a case management conference scheduled for January 4.

Logan and Kearney have been embroiled in a legal battle with real estate expert Hartman for eight years. The dispute began over invoices for property maintenance. Hartman alleged the billing invoices were too vague, and that he was unable to determine what work had been done and who had performed the work. When he didn’t receive detailed invoices, Hartman posted online a video showing the suspicious invoices.

The judge presiding over the case recently appointed a Special Master.

“The Court, having reviewed the motions and the suggestions of the parties, and upon careful consideration of the pleadings, finds that this case raises unique, complex and troubling issues, potentially meriting additional discovery and inquiry, and therefore appointment of a Special Master is necessary and appropriate and therefore pursuant to Missouri Supreme Court Rule 68.01 does immediately appoint the Honorable J.D. Williamson as Special Master in this matter,” the judge’s ruling reads.

A Special Master is an official appointed by a judge to make sure that judicial orders are actually followed, or in the alternative, to hear evidence on behalf of the judge and make recommendations as to the disposition of a matter.

The judged ordered the plaintiff and the defendants evenly split the cost of the Special Master, although a request can be made to have only the defendant pay.

Kearney to be deposed

The Court also granted plaintiff’s request to re-open the deposition of Quentin Kearney. Hartman’s attorney argued in his motion that Kearney had been uncooperative during a previous deposition.

Hartman also asked for the court to disqualify the defendant’s counsel. The request comes on the heels of an action taken by attorney David Zeiler, who represents Kearney and Logan.

For many years, Hartman had been represented by Lee Hardee III of Kansas City, Missouri, but the case took a bizarre turn in early August when Hardee was forced to recuse himself from the case. Hardee was notified — while arguing in court on the same case — that Logan and Kearney were suing him for abuse of process. The pair are represented by Zeiler and Michael Hughes.

Hardee, who suffers from hypertension, was subsequently admitted to the hospital, reportedly due to stress.

Due to a conflict-of-interest, Hardee had to file a motion to withdraw from the Results Property Management case, leaving Hartman without counsel just hours before the trial was scheduled to begin.

The newly-appointed Special Master, Honorable J.D. Williamson, will preside over the case management conference. A pre-trial hearing is tentatively scheduled for Feb. 1.

Jan 25, 2019

Courts entertain some bizarre cases brought by HOA’s

David and Arna Orlando never thought they’d get sued by a homeowner’s association for parking at their own house.

The couple were the target of a lawsuit filed by the The Kimry Moor Homeowners Association just outside Fayetteville, NY. The HOA sought an injunction in Onondaga County, NY Supreme Court to stop them from parking their 2014 black Ford150 truck in their own driveway.

The association asserted its regulations only allow residents to park “private, passenger-type, pleasure automobiles” in driveways. The association owns the driveways in the development. The association argued the couple’s pickup did not qualify as a private passenger-type vehicle.

The Orlandos contended their pickup was a personal passenger vehicle and not a commercial vehicle of any sort.

The couple eventually moved to Florida and the lawsuit was subsequently settled to the satisfaction of both sides. The Orlandos are prevented from discussing details of the settlement, but cases like theirs are not so rare.

What is an HOA?

Independent American Communities, an HOA watchdog blog operated by Deborah Goonan, describes them this way: “Homeowners, condominium, cooperative, and property owners associations are collective legal entities – usually incorporated. Governing documents of HOAs – which include Declarations of Covenants, Conditions, and Restrictions (CC&Rs), By Laws, and Articles of Incorporation – are legally binding on both individual members and their Association, with U.S. courts generally viewing the relationship as contractual between and among the parties.”

The blog explains for homeowners the risk of entering into a homeowner’s association.

“But that contract is usually written by and for developers, making it one-sided in favor of the HOA,” IAC reports. “In addition, governing documents are not subject to state or federal review, and state laws impose very few restrictions on the terms of HOA contracts. A buyer or heir to HOA property must agree to all terms without any opportunity for negotiation before taking title to that property.”

HOA loses case, homeowner loses privileges 

Even when an HOA loses in court, it could take vindictive measures. A Florida homeowner took his HOA to court so he could review information that should have been public record. He won his summary judgment case, gaining access to the management contract and financial records of his HOA, including the specific compensation of its manager. As reported by Jan Bergemann, president of Cyber Citizens For Justice, Inc.:

In an order granting plaintiff’s motion for summary judgment, Circuit Court Judge William L. Roby ruled against Piper’s Landing, Inc. in Martin County, Fla. in a case where the homeowner’s association refused to allow a member to inspect the management contract and the financial records indicating the specific compensation of manager Brian Reich.

Not long after, the homeowner received the following letter:

Bill Peters, of Bel Air, MD was sued by a neighboring HOA over a 2-foot span of his driveway.

The case started when Harford County issued permits for Peters to build the driveway. He said he gave the neighboring homeowners’ association, which his property is not a part of, a month’s notice, according to wbaltv.com.

He spent $15,000 to build his driveway, which passed county inspection. Then, the Emerald Hills Homeowners Association took him to court.

Peters won the case, but it cost him $50,000 in legal fees.

How to protect assets 

The Homeowners Protection Bureau, LLC offers information and resources regarding disputes and asset protection. If sued by an HOA, it is best to consult an attorney.

Jan 23, 2019

Judge rules Quentin Kearney can be deposed once again 

A Special Master has been appointed to oversee some aspects of the ongoing litigation between Jason Hartman and Results Property Management principles Ken Logan and Quentin Kearney. A Special Master is appointed by a judge to oversee one or more aspects of litigation

“The Court, having reviewed the motions and the suggestions of the parties, and upon careful consideration of the pleadings, finds that this case raises unique, complex and troubling issues, potentially meriting additional discovery and inquiry, and therefore appointment of a Special Master is necessary and appropriate and therefore pursuant to Missouri Supreme Court Rule 68.01 does immediately appoint the Honorable J.D. Williamson as Special Master in this matter,” the decision reads.

Logan and Kearney have been embroiled in a legal battle with real estate expert Hartman for eight years. The dispute began over invoices for property maintenance that Hartman alleged were so vague he was unable to determine what work had been done and who had performed the work. When he didn’t receive detailed invoices, Hartman recorded a video showing the invoices and posted it to the internet.

Hartman’s motion to disqualify counsel 

In a November 13 filing, Hartman’s attorney, Kenneth Caldwell, asked the court to disqualify defendants’ co-counsel David Zeiler due to “extraordinary circumstances.”

For many years, Hartman had been represented by Lee Hardee III of Kansas City, Missouri, but the case took a bizarre turn in early August when Hardee was forced to recuse himself from the case. Hardee was notified — while arguing in court on the same case — that Ken Logan and Quentin Kearney were suing him for abuse of process. The pair are represented by Zeiler and Michael Hughes.

Hardee, who suffers from hypertension, was subsequently taken to the hospital and admitted, reportedly due to stress.

Due to a conflict-of-interest, Hardee had to file a motion to withdraw from the case, leaving Hartman without counsel just hours before the trial was scheduled to begin.

Along with the appointment of the Special Master to continue with the case questions, the Court granted plaintiff’s request to re-open the deposition of Quentin Kearney. Hartman’s attorney argued in his motion that Kearney was uncooperative during a previous deposition.

A case management conference is set for Dec. 17. The Special Master will attend the conference and report any finding.

Jan 21, 2019

Legal battle continues in Results Property Management case

A lawyer for Results Property Management has filed a motion to continue trial, and requesting sanctions in response to a motion filed by the plaintiff’s attorney to have him disqualified from the case.

As reported Nov. 30, an ongoing legal battle between Jason Hartman and Results Property Management principals Ken Logan and Quentin Kearney continues with Hartman’s attorney calling for the disqualification of the attorney for Results Property Management.

In a November 13 filing, Hartman’s attorney, Kenneth Caldwell, asked the court to disqualify defendants’ co-counsel David Zeiler due to “extraordinary circumstances.”

For many years, Hartman had been represented by Lee Hardee III of Kansas City, Missouri, but the case took a bizarre turn in early August when Hardee was forced to recuse himself from the case when he was notified — while arguing in court on the same case — that Ken Logan and Quentin Kearney were suing him for abuse of process. The pair are represented by Zeiler and Michael Hughes.

Hardee, who suffers from hypertension, was subsequently taken  to the hospital and admitted, reportedly due to stress.

Due to a conflict-of-interest, Hardee had to file a motion to withdraw from the case, leaving Hartman without counsel just hours before the trial was scheduled to begin.

Hartman’s new lawyer filed a motion seeking to disqualify Zeiler. In Hughes’ Nov. 19 motion, he states, “The Motion to Disqualify Counsel also misses the mark on the law. Plaintiff’s counsel must be confused in which case he is filing the instant motion. He appears to be arguing that counsel should be disqualified in the Hardee Lawsuit when discussing the standard for disqualification under the “necessary witness rule.” Nowhere does the plaintiff’s counsel suggest that either of defendants’ counsel are necessary witnesses in the instant case.”

It continues, “Additionally, Plaintiff’s counsel offers no Missouri law to support his proposition that disqualification of counsel is an appropriate remedy due to Mr. Hardee’s withdrawal from this action.”

Hughes further states, “The other reasons that plaintiff’s counsel asserts for the requested continuance are disingenuous at best. The fact that he entered his appearance on September 5, 2018, but just recently received the case file appears to be a problem between him, his client, and Mr. Hardee and does not rest at the feet of the Defendants. A previously scheduled trial is something that he should have disclosed to his client and something that his client should have considered before hiring him.

” Moreover, if plaintiff’s counsel had a previously scheduled trial when he entered his appearance on September 5, 2018, why is he waiting until now to request a continuance of the trial setting? It also should be pointed out to the Court that plaintiff has at least two other lawsuits pending in Jackson County, Missouri, with different attorneys on each one.”

An eight-year case over vague invoices

Logan and Kearney have been embroiled in a legal battle with real estate expert Hartman for eight years. The dispute began over invoices for property maintenance that Hartman alleged were so vague he was unable to determine what work had been done and who had performed the work. When he didn’t receive detailed invoices, Hartman recorded a video showing the invoices and posted it to the internet.

Hughes wrote in his recent motion, “Additionally, regardless of how voluminous the case file may be, the issues in this case after nearly a decade of litigation are extremely narrow. First, were there repair and maintenance services performed on plaintiff’s property? Second, did the contract plaintiff signed obligate him to pay for these repair and maintenance services? Third, was the plaintiff responsible for paying for these repair and maintenance services? Fourth, did the defendants or their vendors perform these repair and maintenance services? Fifth, were the amounts that defendants charged plaintiff fair and reasonable? How long can it take plaintiff’s counsel to get up to speed on these issues that have a value of $2,500? As noted, by the time this case goes to trial, it will have been going on in one phase or another for nearly a decade. It is time to bring it to a conclusion by having the trial, as scheduled, on February 11, 2019. The Court should overrule the plaintiff’s Motion to Continue the Trial Setting.”

Hartman also filed a Doe lawsuit after numerous libelous posts showed up on various websites, such as Ripoff Report. A Doe lawsuit is filed when the plaintiff wants to determine who is behind a defamatory or threatening anonymous post on the internet or someone who uses a fictitious name for the purpose of scamming or defrauding. Logan and Kearney allege that lawsuit unjustly named them.

Jan 18, 2019

The ongoing legal battle between Jason Hartman and Results Property Management principals Ken Logan and Quentin Kearney continues. Now Hartman’s attorney is calling for the disqualification of the attorney for Results Property Management.

Missouri lawyer Lee Hardee III was forced to recuse himself from the case in early August, after he was notified while in court on the same case that Logan and Kearney were suing him for abuse of process. Hardee was representing Hartman, the plaintiff in the case.

Due to a conflict-of-interest, Hardee filed a motion to withdraw, leaving Hartman without counsel hours before the trial was to begin.

In a November 13 filing, Hartman’s new attorney, Kenneth Caldwell, asked the court to disqualify defendants’ co-counsel David Zeiler due to “extraordinary circumstances.”

“On August 5, 2018, during the deposition of plaintiff Jason Hartman by defendants’ co-counsel Michael Hughes, something extraordinary occurred. Just before plaintiff’s counsel, Lee Hardee was to ask follow up questions of his client, defendants’ co-counsel David Zeiler threatened Hardee personally with a lawsuit, if Hardee did not dismiss Hartman’s claims against his clients in a separate, unrelated case. At the same time, Zeiler handed Hardee a copy of the lawsuit he intended to file against Hardee for Abuse of Process,” Caldwell wrote in his petition. “Hardee had no authority to dismiss his client’s lawsuit in the other case and Zeiler subsequently filed the lawsuit against Hardee the same day.”

Caldwell’s motion continued: “Zeiler’s threat of, and subsequent action of filing a lawsuit against Hardee (who was Hartman’s agent by virtue of the attorney-client relationship), by any definition was an abusive litigation tactic and seriously rattled Hardee and interfered with Hardee’s ability to finish the Hartman deposition. It likewise interfered with his ability to take the Kearney deposition on August 7, 2018. Zeiler intentionally used this abusive litigation tactic to gain an unfair litigation advantage in this case.”

Results Property Management case origins

The case stems from a dispute over invoices billed to Hartman for property maintenance allegedly performed by Metrowide Building Services, a firm owned by Logan, according to Missouri Secretary of State corporate records. Hartman alleged the invoices he received were vague and listed none of the pertinent information regarding the work performed. He requested a detailed invoice as to what specific work was performed, where it was performed, and by whom.

When he didn’t receive the information, Hartman recorded a video showing the invoices and posted it to the internet. That was the beginning of the eight-year legal feud between the parties.

Caldwell said he entered his appearance on September 20 but only recently received Hardee’s voluminous file. “As far as the undersigned can gather from a brief review of the lengthy history of the case, depositions remain to be taken, there are hundreds of files to pore through, there are numerous deposition transcripts to review, pre-trial proceedings are just around the corner, and a trial is scheduled to begin on February 11, 2019,” Caldwell noted.

Caldwell alleges that Zeiler, Kearney, and Logan “obviously knew and intended that their lawsuit against Hardee put Hartman at a serious disadvantage in preparing for trial.”

Court documents show that Hardee fell ill and was hospitalized after the August court proceeding. Although Hartman tried to depose Kearney directly pro se, Kearney’s counsel, Hughes, substantially interfered by answering deposition questions meant for Kearney, who refused to respond to most of the questions.

Due to the circumstances and defendant’s counsel’s interference as supported by the affidavit of Hartman, Caldwell also asked the court to allow the right to take (re-take) Kearney’s deposition.

As of today, the court has not answered the request.

Jan 16, 2019

The Welcome Inn labor relations case could be coming to an end — but only if the defendants accept a settlement demand offered by the attorney for the plaintiffs.

Attorney John Ireland, representing April Brashier, Chad Lebow, Richard Orencia and more than two dozen former and current employees, offered a Nov.30 settlement demand.

The demand would settle the case for approximately 34 plaintiffs, who allege Welcome Inn owners operated in violation of the Illinois Fair Labor Standards Act.

Last month the case involving the Quincy, IL hotel had been reassigned to Judge Colin Stirling Bruce and Magistrate Judge Eric I. Long. U.S. Magistrate Judge Tom Schanzle-Haskins is no longer on the case.

A telephone conference was held between Ireland and attorneys for the defendant Kevin Doherty, Ambrose McCall and Thomas Luetkemeyer. The parties indicated discovery has not been initiated due to interest in mediation, court records show.

Case history

Plaintiffs April R. Brashier, Richard M. Orencia, and Chad Lebow filed a lawsuit against Quincy Property LLC, doing business as “Welcome Inn,” and against Brett Burge, Kenneth Logan, Quentin Kearney and Joe Wimberly under FLSA and Illinois Wage Laws. The lawsuit, filed Jan. 28, 2017, alleges the plaintiffs worked at the defendants’ hotels and weren’t paid overtime due under FLSA.

The plaintiffs further allege they were misclassified as salaried employees exempt from FLSA, and that the defendants illegally deducted amounts from their pay in violation of FLSA.

Under FLSA, employees may bring a collective action against an employer to recover unpaid overtime or minimum wages. Unlike class action suits under the Federal Rule of Civil Procedure, whereby potential plaintiffs are included unless they opt out, potential plaintiffs in FLSA collective actions must affirmatively opt in to the suit, according to Cornell Law School.

Brashier claims in court documents she was unjustly terminated at Welcome Inn for complaining about a lack of overtime pay, and threatened with illegal wage deductions.

Lebow alleges the defendants also retaliated against him. He claims they reduced his wages and/or tried to intimidate him by “strictly scrutinizing his work because he requested overtime pay.”

Settlement possible in near future

According to court documents, the defendants intend to respond to the settlement demand. A status conference is scheduled for Jan. 9 at 10:30 a.m. Magistrate Judge Eric I. Long will conduct the proceedings.

The case is Brashier et al v. Quincy Properties Llc, Doing Business as Welcome Inn et al.

Jan 15, 2019

The Welcome Inn labor relations case is moving forward after months of legal wrangling.

Plaintiffs April R. Brashier, Richard M. Orencia, and Chad Lebow filed a lawsuit against Quincy Property LLC, doing business as “Welcome Inn,” and against Brett Burge, Kenneth Logan, Quentin Kearney and Joe Wimberly under FLSA and Illinois Wage Laws. The lawsuit, filed Jan. 28, 2017, alleges the plaintiffs worked at the defendants’ hotels and weren’t paid overtime due under FLSA.

A telephone conference was held Oct. 15 with counsel for plaintiff, John Ireland, and defense counsel, Mary Yong and Thomas Luetkemeyer.

Court documents show that plaintiffs’ counsel is in the process of obtaining demands from each of the plaintiffs. Those documents note that Ireland has presented a demand for 21 of the plaintiffs. He hopes to have demands for the remaining plaintiffs by the end of the week. Demands are a collection of all documents that show injuries and/or loss of wages. It is a step undertaken prior to litigation.

Ireland said he believes it’s too early in the Welcome Inn case to engage in mediation. Defense counsel Luetkemeyer agreed it would be best to wait until after demands have been presented, and responses made, before scheduling mediation.

Another status conference to further discuss mediation is scheduled for November 30 with Magistrate Judge Schanzle-Haskins presiding.

Jan 11, 2019

Popular Arizona restauranteur Julian Wright is embroiled in a bitter battle with former managers who claim Wright misappropriated funds.

Wright responded to those allegations by accusing the former managers of misappropriation.

Wright owned the Gringo Star Street Bar, which subsequently closed without notice to investors. Wright’s limited liability company is Fork & Dagger, LLC., listed as “manager” in legal documents.

Whiskey Rocks Tempe, LLC, is a limited liability company organized for the operation of  the Gringo Star Street Bar. True Gentlemen, LLC (“TL”) is a member of Gringo, hence, Fork & Dagger is one corporation. Operating under it is Whiskey Rocks Tempe, and under that True Gentlemen.

Wright’s rebuttal contends: “Throughout the past year, TL (Gringo Star managers) has alleged and asserted to other Gringo members that “manager” (referring to Wright) had engaged in fraud and other improprieties, and had overcharged for corporate overhead and other expenses. Most recently, in the course of soliciting other members to contribute to an alleged litigation fund being amassed by TL. It stated it would be filing a ‘public complaint’ against Manager for its alleged wrongdoing.”

As previously reported, investors in the Gringo Star Street Bar are still awaiting a return on their investment.

Overview of the case

The bar opened in 2013, offering arcade games, food and drinks, dancing, and street art. The 6,500-square foot bar on the corner of 5th Street and Mill Avenue was once home to the Library Bar and Grill, another of Wright’s establishments. Gringo Star’s opening was highly anticipated from both a consumer and investor standpoint. Mill Avenue is popular for its unique taverns and nightlife, which draws patrons from nearby Arizona State University. From an investment standpoint, it appeared to offer a good return.

The following allegations were set forth in Wright’s response:

  1. Pursuant to the agreement of the parties, Manager permitted two of TL’s Members, Hartley Rodie and Stephen Sperry, to conduct and oversee Gringo’s day-to-day business.
  2. While Sperry and Rodie operated Gringo’s business successfully and profitably between 2013 and 2016, Gringo’s net income declined significantly after 2016.
  3. Upon information and belief, Sperry and Rodie neglected their duties to Gringo upon their potential involvement in other restaurant ventures.
  4. Sperry and Rodie also engaged in excessive participation or giveaways of Gringo’s property, giving away food, drinks and other property of Gringo in “comps” totaling $1,027,902.00 out of total gross income (including comps) of $10,548,451.00.
  5. Although Sperry and Rodie controlled the day-to-day operations of Gringo, Manager provided oversight, corporate-type and administrative services and caused an outside bookkeeper and CPA to pay bills and handle other accounting matters for Gringo.

Wright maintains that all finances are properly accounted for.

The matter is expected to go to arbitration.

Jan 9, 2019

When the Gringo Star Street Bar in Tempe, Arizona closed abruptly in mid-January, investors said they were taken by surprise when they learned via Facebook post that the popular nightspot had closed its doors for good.

“I had no idea it closed,” said a Tempe resident at the time, who had invested in the establishment. His sentiment was echoed by other investors, who wished to remain anonymous for fear of financial retribution. The surprise was not that the establishment had closed, but that shareholders had learned of the closure on social media.

As reported January 20, a post on the bar’s Facebook page alerted customers to the closing. There was no explanation given and numerous questions from patrons were left unanswered.

In March, Wright told shareholders that once the books were reconciled, they would receive their return on investment. Months passed without payment.

Now the former managers are in a bitter legal battle with Wright, alleging he misappropriated Gringo Star’s funds.  Conversely, Wright is alleging it was not he, but his former managers, who misappropriated funds.

The bar opened in 2013, offering arcade games, food and drinks, dancing, and street art. The 6,500 square foot bar on the corner of 5th Street and Mill Avenue was once home to the Library Bar and Grill, another of Wright’s restaurant bars. Gringo Star’s opening was highly anticipated from both a consumer and investor standpoint. Mill Avenue is popular for its unique taverns and nightlife which draws patrons from nearby Arizona State University.

From amigos to antagonists

Investors said things started going south after a couple of years. They no longer received dividends and found Wright difficult to reach. They allege when they asked questions about their investment or the financial health of the Gringo Star Street Bar, they were either ignored or not given an answer. When they did receive an answer, they allege it wasn’t a favorable one. In fact, two investors said Wright would answer with a “F**k you” if he didn’t like what was being asked of him. Veritas News was provided with a string of text messages allegedly between a shareholder and Wright that does show crude language.

At that time, Wright did provide a profit and loss statement for 2017.  The records show total sales of just over $1 million, but with overall sales down 39.4 percent.

Currently faced with arbitration through the American Arbitration Association (AAA), Wright sent a memo to investors stating, “The proforma Operating Budget provided to you prior to your investment projected that operating expenses would total 18.27% of gross sales. Actual operating expenses of Gringo Star from 2013 totaled 18.13% of adjusted gross revenues (i.e., total gross revenues less $1,027,902.00 of drinks and food that (former managers) comped to unknown persons during their management of Gringo Star).”

It continues, “The proforma Opening Budget projected that corporate overhead would total 3.01% of gross sales. From 2013 to 2017 corporate overhead actually totaled 3.03% of adjusted gross sales (gross less [former managers’] giveaways).”

No date has been set for the arbitration.

Jan 7, 2019

It was more bad news for some who invested in a Tempe bar owned by Julian Wright as the IRS has sent notifications that they owe money.

According to one shareholder, the IRS sent notification that money is owed for the Canteen bar.

“He’s costing his investors almost a quarter of a million dollars because he didn’t do something right,” the investor said. “We’re paying penalties and interest and the investors had nothing to do with it.”

The shareholder said it makes no sense that those who invested in the Canteen are liable to the IRS. “According to him (Wright), he sold have the business to someone else and they took it over.  Then the other owner put in that they put in a million dollars in assets, when it was really only $300,000 in assets for depreciation. So why aren’t they paying it instead of us paying it.”

For some investors, there was another potential loss as Wright abruptly closed the Gringo Star Street Bar on the popular Mill Avenue. The closure left shareholders to wonder if they will see any income from the sale, which Wright said was $300,000.  The Tempe bar  opened in 2013, offering arcade games, food, drinks, dancing and street art. The 6,500 square foot bar on the corner of 5th Street and Mill Avenue was once home to the Library Bar and Grill, another of Wright’s bar/restaurants. Gringo Star’s opening was highly anticipated from both a consumer and investor standpoint.

Shareholders said when the bar first opened, it appeared to be a sound investment. They said they did see a return on the funds they entrusted with Wright.

But after a couple years, they said things started going south. They no longer received dividends and Wright was difficult to reach. They allege when they asked questions about their investment or the financial health of the Gringo Star Street Bar, they were either ignored or not given an answer. When they did receive an answer, they allege it wasn’t a favorable one. In fact, two investors said Wright would answer with a “F**k you” if he didn’t like what was being asked of him. Veritas News was provided with a string of text messages allegedly between a shareholder and Wright that does show crude language.

One investor said he has received no explanation for the money owed the IRS. He said he was told that Wright didn’t want to get into a pissing match with the new owner.

“He’s supposed to be fiscally responsible to us,” the shareholder said. “We invest with him to make money.”

Wright is the president of Fork & Dagger Restaurant Group. He has opened and closed bars in and around Tempe. In October, ABC15 reported Wright’s plans to open Equal Parts, a “rustic northern Italian” eatery in downtown Chandler had been scrapped for a different concept. The new concept will be called Las Palmas Cantina.

Wright has been featured in several Phoenix New Times stories. He has also been featured in a promotional video for Tempe.

Learning the IRS wants the investors to pay penalties and interest didn’t sit well for those who already anticipate a loss from Gringo Star.

Gringo Star Street Bar’s Jan. through Oct. 2017 profit and loss statement indicates the establishment took a  negative 37 percent change in sales. The 2016 profit and loss statement also indicates a loss of revenue.

Arizona Leisure’s website states, “Without a doubt, Tempe’s Mill Avenue District is the hottest entertainment center in Arizona. It is the hot spot in the Valley of the Sun Phoenix area with the highest concentration of restaurants, cafes, microbreweries, sports bars, unique shopping and nightlife than any other place in the Metro area.”

The location of the bar and its proximity to the university leaves one investor baffled as to Gringo Star’s demise.

“It’s a popular area and a college hangout,” the shareholder noted. “I thought it would be a good investment. Lots of foot traffic.”

College students and foot traffic weren’t enough to keep Gringo Star out of the red, according to another shareholder. “It was mismanaged. They were giving out too many comps and not watching the bottom line.”

What will happen next, the shareholders said they aren’t sure. Those interviewed said they hope to receive some money from the sale, however, noted they won’t be surprised if they don’t.

“We probably won’t see a nickel. I’ll be surprised if we do,” said one investor.

They are hoping after the bills are paid that there will be something left for the investors to receive. For those invested in the Canteen, the Gringo Star profits could pay the IRS.

Jan 4, 2019

The owner of the Gringo Star Street Bar in Tempe, Arizona said a manager posted the closure notice on Facebook before he had the chance to notify investors.

That’s one of the complaints investors stated when owner Julian Wright abruptly closed the popular bar located on Mill Avenue.

“There was no communication,” said an investor who trusted his money with Wright. “I found out Gringo Star closed when I saw it on Facebook.” The shareholder noted that there had been “street talk” that business was faltering and that it was apparent the bar was not doing well, however, he was “left in the dark.”

The Jan. 19 closure announcement was vague, leaving investors to wonder what was going on. They alleged Wright was a poor communicator and that it wasn’t until he was contacted by an investor that  all investors were notified that the bar had been sold.

Wright said investors were aware he’d been trying to sell. “The investors that keep in touch with me had known about us trying to sell this business for a year now, including a time in October when it was in escrow and was supposed to close and then a day before it fell out so I didn’t want to get anyone too excited to look like this was a done deal.”

Wright sold the bar for $300,000 but had not received any money at the time of the sale. He said last week he has since received the money and investors will be paid.

The bar opened in 2013, offering arcade games, food, drinks, dancing and street art. The 6,500 square foot bar on the corner of 5th Street and Mill Avenue was once home to the Library Bar and Grill, another of Wright’s bar/restaurants. Gringo Star’s opening was highly anticipated from both a consumer and investor standpoint.

Shareholders said when the bar first opened, it appeared to be a sound investment. They said they did see a return on the funds they entrusted with Wright.

But after a couple years, they said things started going south. They no longer received dividends and Wright was difficult to reach. They allege when they asked questions about their investment or the financial health of the Gringo Star Street Bar, they were either ignored or not given an answer.

No government funding 

When asked if he receives any government funding, Wright said, “No such thing exists for bars in Tempe.” He added, “I’m the biggest investor since day one.”

The Tempe city government was contacted for confirmation, however, did not respond. Phone calls were not returned and an email sent requesting the information under the Freedom of Information Act received no acknowledgement or response of any kind.

Wright said his businesses are privately financed and added that he’s very protective of his investors.

In response to allegations that he’s lax in his communication with his shareholders, Wright said, “I’m not the greatest communicator especially since I no longer have my company controlled who handled all the investor communications.”  He said there are certain types of investors, such as those who complain or feel something underhanded is going on, that he no longer does business with. “I don’t accept money from investors like that anymore and so I’m ridding myself of those cancerous types of individuals.”

When asked why Gringo Star Street Bar wasn’t able to keep the doors open, Wright said Mill Avenue is very competitive. “After Gringo Star opened, countless other bars, seeing our success, opened around us and in better locations.” He added that there have been more bars that have failed on Mill Avenue than have been successful. Wright noted that a bar in a college town rarely has a lifespan beyond three years.

“The fact it lasted five years is pretty impressive,” he said.

Despite the investor complaints, Wright said no money was lost.  “That’s the reality,” he said.

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