Justice for the TICS

Rita DiDonna is a 72-year-old widow from Woburn, Massachusetts. When her husband died, Mrs DiDonna was left with enough money she would never have to worry about finances. Her house was paid for and she had a half million dollars in assets. She only needed a safe place to invest the assets that would provide a reasonable return and she would be able to live out her days in security and comfort. Her husband had always handled the family's finances while he was alive, but a lawyer in Massachusetts put Mrs. DiDonna in touch with David Bralove and Rick Brown of B&B Realty in Bethesda, Maryland. Bralove and Brown were successful in selling her a stake, a "tenancy in common" (TIC), in a commercial property in Alexandria, Virginia.

Bralove and Brown got Mrs. DiDonna's half million dollars, the elderly widow got a TIC.

At first, there was money coming in from the Virginia investment, but then the amounts began getting smaller and it wasn't long before the payments stopped altogether. In their place, Mrs. DiDonna began receiving notices of money due for this expense and money due for that expense, and there was something about a hold up on a lease being renewed, and then notices of default, and more money was needed, and then the bank sold the mortgage to somebody in California, and there were more default notices and more demands for more money to cover repairs and fees and who knows what-all, and then there were ominous notices about a foreclosure and the need for even more legal fees and fees to pay all these companies Mrs DiDonna had never heard of to find capital to forestall the foreclosure. But the capital never came, just notices for more money to pay more fees, and then money for lawyers to negotiate with California, and then more money to pay the California company for extensions so that they wouldn't foreclose, but by that time she was tapped out.

When the old woman had nothing left to give, she received a glimmer of hope from Bralove and Brown of Maryland. There was a chance she could save her investment, they told her, if she would declare bankruptcy. A bankruptcy would force a delay on the foreclosure and give XYZ Capital a chance to secure the refinancing that, they had been assured, was Just Around the Corner.

Bankruptcy!

Yes, bankruptcy is unpleasant. But Bralove and Brown were sympathetic to Mrs. DiDonna's plight and understood she was desperate and needed money to buy basic necessities. If she would declare bankruptcy, Bralove and Brown would send her a cash payment of $20,000 to help her out. 

Frightened, confused, and broke, Mrs. DiDonna accepted the offer of twenty grand and declared bankruptcy.

The next thing she knew, she received a letter—a demand letter—from someone named Arent Fox telling her the people in California took her house away. They owned it now and she had to leave!

It turned out Arent Fox is a business just up the street from the White House that extracts private profit from public law—lobbyists. They have four hundred lawyers working there who are so good at the law that some of them can extract profit at rates of up to one thousand dollars per hour. They even have some people working there who made the laws in the first place—from lawmaker to lawmilker.

The only thing the elderly widow had left was her house.

The TIC that Bralove and Brown drafted and sold to Rita DiDonna contained a "springing guaranty", [1][2] a complex mechanism that removes a borrower's legal right to bankruptcy protection in the event a borrower files for bankruptcy protection. While Mrs DiDonna's bankruptcy benefited Bralove and Brown by delaying the foreclosure, it was catastrophic for Mrs DiDonna.

With the bankruptcy protections removed, G8 Capital of Ladera Ranch, California was able to take her house away from her, and Rita DiDonna had to move in with her daughter and her family.

She still lives there with her daughter, but rarely leaves her room. She suffers from depression and doesn't understand how all this happened. She feels too foolish and too defeated to come to the phone. Her half million dollars is gone. Her house is gone. And David Bralove and Rick Brown of Bethesda, Maryland didn't even send her the $20,000 they'd promised.

According to his bio, David Bralove's "expertise extends to the negotiation and drafting of complex business and real estate acquisition and financing agreements among parties with diverse interests and goals. His success and demand as an advocate for real estate clients results from his ability to be both creative and persuasive in the deal-making process."

Rick Brown's bio states he is "an industry leader and has spoken on TIC issues at the National TIC Association Annual Conference, the National CCIM Annual Conference and the NAR National Convention. He served as a local and national director for the National Association of Realtors (NAR) for 12 years and was National Chairman of the NAR Realtors Political Action Committee in 1990. He currently serves on the NAR Federal Taxation Committee."

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Fantastical creatures


From the G8 website:

G8 Capital has completed and successfully managed more than 65 portfolio acquisitions across 40 Managed Funds since 2007, representing more than $500 million in principal balance or real estate value. G8 Capital is a prudent and disciplined investment firm focused on opportunity-based acquisitions of both residential and commercial assets....

Once a portfolio is acquired, G8 Capital's approach is to work closely with the borrowers to assess their situation and determine work-out solutions where possible. Work out solutions may include short sale, obtaining deed in lieu of foreclosure, or restructuring the loan.

The December 9, 2013 purchase of the Alexandria Corporate Park property was the 64th of G8 Capital's 65 total real estate portfolio purchases. Save for a final acquisition six months later in mid-2014, G8 Capital left the field of play. In fact, I have tried calling the general number listed on the website several times in recent months and no one answers the phone—most recently, not even an automated message system.

Evan Gentry is also the founder and CEO of Money360, a commercial real estate online marketplace lending platform (crowd-funding) with the same address and same execs as G8 Capital.

Money360 is a revolutionary online marketplace for commercial real estate loans. Money360 enables borrowers to directly access affordable commercial real estate loans through an innovative online lending platform, eliminating the overhead and processing costs associated with traditional banking models...

For the past seven years, Money360's affiliate, G8 Capital, has been creating significant opportunities in distressed real estate markets, leveraging its many relationships with banks, investors, borrowers and real estate/note sellers. Money360 was founded in 2010, pioneering peer-to-peer lending for commercial real estate. Today, Money360 is taking advantage of recent regulatory changes that allow it to market private investment opportunities on its public website, helping accredited investors find attractive investment opportunities and helping borrowers obtain the funding they need.

Money360 announced earlier this month it has now closed more than $100 million in commercial real estate loans. These loan types include "bridge loans" and "cash out financing", which seem suspiciously akin to springing guaranties and mezzanine loans and reconveyance fees and substitution trustees and all the other fantastical creatures that appeared on the earth for no reason just last week.

Over the last ten years, twenty-five million American families have had their homes taken from them through the agency of these creatures—a grand dispossession of the American people. Much of the wealth has ended up in places like Atlas 44 of Phoenix, whose members look for "off shore hedge funds and event-driven real estate deals" and on the board of which Evan Gentry sits.

The tactics G8 Capital used to acquire the property of others included deceptive naming, unethical lawyering, "complexification", and HOA abuse.

Of course, G8 is far from the only player in the mortgage industry that engaged in this kind of activity and, sometimes, the process of obtaining property belonging to someone else was a joint effort, as in this example involving G8 and Deutsche Bank.

A $25 million lawsuit G8 filed against Deutsche Bank in New York's southern district, in fact, elegantly bathes the entire industry in obloquy. In the suit, G8 claimed it had developed "good and valuable" contacts within a particular bank and got word that a large portfolio was coming down the pike. After researching the properties, G8 decided they wanted to place a bid on it, but didn't have the capital to pull it off. So, they approached Deutsche Bank, with whom they'd done lots of business already, looking for capital or a joint partnership. After signing a confidentiality agreement, G8 turned over the details of the portfolio and the due diligence on it. Deutsche Bank looked it over and said they needed to think about it.

As the deadline for placing the bid approached, the requests from G8 for a response from Deutsche Bank became increasingly urgent. At the last minute, Deutsche Bank pulled out of the deal, saying there wasn't enough time to make a decision. G8 was left under-capitalized and forced to place a bid on only a portion of the portfolio. The bid didn't succeed because, according to the bank selling the portfolio, a last minute surprise bid came in from a third party for the whole package, so they accepted the third party's bid.

Of course, the third party was Deutsche Bank. Nasty burn. So Evan Gentry flew up to New York, grabbed a lawyer, and sued.

The brief he filed is all very They. Did. This. And. I'm. In. Dig. Nant. As. Hell. Even I felt bad for him.

Deutsche Bank responded with what can only be called the legal equivalent of a sneer of contempt. Regarding point one, we deny. Regarding point two, we admit. Regarding point three, we don't know. And so on all the way through, finishing with: Love, Deutsche Bank  p.s., in pari delicto.

In pari delicto is a legal doctrine that goes way back. It says that a court will not intervene in a dispute between wrongdoers, or, as one court put it, will not serve as a paymaster to thieves. Essentially, Deutsche Bank was saying Gentry is like the drug addict who goes to the cops when his dealer rips him off and wants them to get his heroin back for him.

Last time I looked, it had been a year, and G8 hadn't responded.

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Depredations

As I was investigating G8 Capital, I came across Chuck and Sallie Myers, who also had the great misfortune of crossing paths with David Bralove and Rick Brown. Bralove and Brown had some TICs for sale, and Chuck and Sallie bought in. Their investment, too, was wiped out in the end. When I came across them, it was in an online exchange between Sallie and Evan Gentry and another one of the TIC owners on the website petition.org before the foreclosure.

The other TIC owner, a Kentuckian, had posted something on the website which made it clear he felt the TIC owners had been misled by G8 Capital, the mortgage-holder on their investment property—that G8 had promised to be flexible until the federal government had signed a major lease on which it seemed to be unaccountably dragging its feet. But then G8 had pulled the trigger and the property was headed for foreclosure.

Evan Gentry made a long reply in which he professed the extreme lengths he, personally, had gone to on their behalf with his own investors, how betrayed he felt by this criticism, how there had never been any assurances given, and how the potential for loss is just part of investing. Very smooth. Sallie responded very politely and very sweetly, thanked him for his response, asked that he understand how difficult it is to lose everything you've worked for, and expressed her appreciation for the hard work Bralove and Brown and Gentry were doing to save their investment.

By this time I had done enough digging that I had my suspicions about several aspects of the deal, including the delay in the lease signing and the manner in which G8 had acquired the distressed mortgage in the first place. I hadn't yet begun to look at Bralove and Brown, but I wanted to see the communications between the various parties.

I also wanted to see the original documents concerning the investment property.

Despite repeated requests, months passed before I finally received the documents from Todd Lewis, the attorney for one of the TIC owners (there are more than two dozen) whom I had considered a friend.  However, I still did not receive the communications between B&B and the TIC owners. Finally, after my continued requests for the communications were fruitless, I determined to reach out to the TIC owners myself. I sent an email to Sallie and Chuck Myers and cc'd Todd Lewis.

Within minutes of sending the email, I received a call from a furious Todd Lewis, alleging I was jeopardizing the legal position of his client, and forbidding me from having any further contact with any other TIC owners. I reminded him I was under no obligation to him and insisted he justify his claim I was jeopardizing his client's position. Finally, he told me that his legal strategy was to keep the other TIC owners at arm's length while he brought suit on behalf of his client against B&B Realty. He wanted his client to get as much in damages as possible, first, and bringing in the other TIC owners would "dilute their position" because they would have to share B&B's assets.

I told him such a strategy seemed absurd, not to mention unethical and, probably, illegal.

The conversation was at an impasse, unsurprisingly. As it was Friday (May 6, 2016), I challenged Lewis to write a brief over the weekend, and I would write one, too. We would present them the next Monday to his client. If my brief were better, we would do things my way.

The next day, an event occurred that prevented me from giving this any attention for the next month. When I did get back to it, I finished the brief I had started and gave it to Todd Lewis' client. I never heard anything more about it until the threatening letter Bralove sent the TIC owner. Apparently, Todd Lewis had taken the brief I wrote, filed it, but filed it in the wrong court, for which reason it was thrown out.

I never received a response from Sallie and Chuck Myers. I assumed that Todd Lewis had contacted them and warned them off me. I decided to try again and learned that my first email had arrived when Chuck Myers was on his death bed. The foreclosure had taken a severe toll on Mr Myers and he had subsequently suffered two strokes (when Chuck Myers regained consciousness after one of the strokes, the first words out of his mouth were "I've lost all our money!"). By the time I reached out to the Myers the second time, Mr. Myers had died.

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Proposed legal strategy

[Note: this paragraph is likely no longer accurate. The property G8 acquired through foreclosure is tied up in court, so they can't sell it, which is what they would like to do. They are getting their rents and so on, but Evan Gentry is working a whole new angle these days and would probably gladly be done with Alexandria Corporate Park.]

With that in mind, check out a foreclosure case from the 6th Circuit: "The law firm of Lerner, Sampson & Rothfuss (LSR) filed a foreclosure action against Rick Slorp on behalf of its client, Bank of America. Because Countrywide had originated Slorp's mortgage, LSR attached to the complaint an assignment purporting to assign an interest in Slorp's mortgage to Bank of America. The state court awarded judgment to Bank of America. Slorp subsequently retained counsel who questioned the assignment's validity, and he sought to depose Shellie Hill, the LSR employee who had executed the assignment on behalf of Mortgage Electronic Registration Systems, Inc. (MERS). Bank of America promptly dismissed the foreclosure action, and the state court vacated its judgment." Slorp v. Lerner, Sampson & Rothfuss, 2014 U.S. App. LEXIS 18816 (6th Cir. Sept. 29, 2014)

Would it be possible to get G8 Capital to dismiss its foreclosure action, have the foreclosure vacated by the court, and work out a new repayment agreement with the TIC owners? It would depend on how much encouragement could be brought to bear.

[It should be noted that the case just cited was a successful appeal of a lower court's decision denying the plaintiff's motion to add a RICO pleading.]

One thing that could encourage Gentry to remove the foreclosure, work things out, and save Rita DiDonna from ruin would be a vigorous effort to bring Bralove and Brown to justice (an effort that would be greatly aided if the TIC partners regained possession of the property because that would give the plaintiffs access to Bralove and Brown's ownership percentage to satisfy, at least in part, any damages a court might award).

If Bralove and Brown were facing professional sanctions, and a decision against them were lodged in a breach of fiduciary duty action, and a serious civil fraud effort were looming, even a criminal fraud prosecution possible, I'm sure Gentry would rather step away cleanly by dismissing the foreclosure and renegotiating the loan rather than being compelled to testify under oath.

A much better solution from G8's standpoint would be to renegotiate the loan for the original amount they put into it—$22 million, or whatever—plus attorney fees, and a reasonable return on the investment. Essentially, G8 would be selling the property back to the passive TICs at a price that would allow the TICs to recoup the equity in the building while allowing G8 execs to continue occupying the front pews on Sunday mornings.

The equity recovered would allow the passive TICs easily to secure the financing necessary to swing the deal. The TICs would appoint a new property manager and divide the equity in the Bralove and Brown-owned TICs and Welch-owned TICs according to their ownership percentages. A lawsuit against Bralove and Brown for breach of fiduciary duty would still be on the table, [settled: and G8 could still pursue its suit against the Welch springing guaranty].

The full text of the breach of fiduciary duty complaint I wrote is here, but, in brief:

I am not an attorney, but the breach of fiduciary duty case against B&B seems to be very straightforward. The problem would probably be collecting on a judgment for damages. Nevertheless, it should be pursued regardless because, if nothing else, that would be the way to reach G8 Capital and Evan Gentry.

At a trial, part of demonstrating breach of fiduciary duty could include showing collusion between G8 and B&B. Once shown, the liability for failing to procure business loss insurance can be extended to G8 since G8 knew of the requirement and had an obligation to ensure all provisions of the loan documents were honored. A lender, too, can have a fiduciary duty to a borrower in certain situations.

One such situation is when the borrower is at a disadvantage for lack of knowledge to which the lender is privy. G8 knew, or should have known, that the managing TIC, B&B, had failed to procure business loss insurance as required by the terms of both the Deed of Trust and the Property Management Agreement. The TICs were never informed of this contractual omission—neither by B&B, nor by G8. Likewise, in the alternative, if there were a policy but no claim made, or a claim made but not honored, or a claim honored but the funds not applied appropriately, G8 violated its fiduciary duty to the TICs by opportunistically using its superior position to seize the property.

So, in my view, if Gentry refuses to restore the property on reasonable terms, or has already sold it, litigation can, and should, be pursued anyway against G8 as well.

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Eyebrow-raising

In 2013, Evan Gentry donated in the neighborhood of a half million dollars to a tax-exempt organization in California called The Perfect Moment, which claims to be all about helping the "poorest of the poor" in Mozambique, Africa. The charity is run by a guy named Steve Samuelian, who shares an office with G8 Capital in Ladera Ranch.

The Perfect Moment helped the poorest of Mozambique's poor in 2013 by sending a $500,000 tax-exempt gift to another charity called "Care for Life", which does its good work from 3850 E Baseline Rd Ste 114 Mesa, AZ 85206. 

Care for Life, too, is a charity dedicated to fighting poverty. That's why Evan Gentry doesn't have to pay taxes on the half million dollars Care for Life received from the profit he generated ruthlessly impoverishing other Americans in a rigged game.

Tempering the comfort one can take in knowing all these American families were impoverished for a good cause, however, is the unsettling discovery that you can drive back and forth in front of 3850 E Baseline Rd in Mesa all day long and you'll never spot a single penny's worth of anything that even remotely looks like fighting poverty. 

And what does poverty-fighting even look like, anyway? Well, who better to ask than Care for Life, who did a half million dollars worth of it in 2013?

So, we walk through the little "garden office park" called 3850 E Baseline Rd looking for Ste 114, past SW Properties, past DPR Realty, past Willis Property, past North American Title, past AFLAC, past Mesa Mortgage, past Bethea, Gillette, Johnson & Phelps, past Cuff Law Office, past Arnett Insurance, past Empire West Title, and B2B CFO, and Naegle & Crider, and Harper Precision Advisory Group, and the Law Office of Ann Williams, and, oh, here it is, Suite 114, oops, where's Care for Life? This says LeSeuer Investments, well, maybe someone from LeSeuer Investments knows where Care for Life fights poverty.

Inside, a guy comes out of a conference room and says Care for Life fights poverty somewhere else and only keeps its books there at LeSeuer Investments. While I was disappointed I wouldn't be able to see what fighting poverty actually looked like, it was the books I was really interested in, anyway, so I asked to see them.

I waited up front while he retrieved the charity's most recent Form 990. When he returned, however, he wouldn't give me the copy as the law requires. So, I asked whether he was familiar with Evan Gentry, the philanthropist, and his company, G8 Capital. No, he wasn't. How about The Perfect Moment? He visibly flinched. Yes, he was familiar with The Perfect Moment.

How much did The Perfect Moment give you?

He looked at the 990 and told me it was two hundred thousand dollars.

Could he explain the three hundred thousand dollar discrepancy?

No, he couldn't.

Old man LeSeuer, the founder of LeSeuer Investments, had deep, long-standing ties to the Church of Jesus Christ of Latter Day Saints. Evan Gentry, too, is active in the LDS church and, at one time, listed his residence at an extravagant LDS temple off I-495 in Maryland.

Gentry is angling for a position of high status in the church and one needn't have a degree in humans to understand how a six-figure donation could help a social-climbing member of the flock realize his ambitions.

Just a few miles down the road from LeSeuer Investments sits this earthly splendor, the brand new LDS temple in Gilbert, Arizona:

Whatever its effectiveness in fighting poverty, it looks expensive. As it turns out, LeSeuer Investments recently received approval to build 262 single family homes on a little over 200 acres of land that it owns adjoining the temple pictured. LeSeuer Investments, in fact, also owned the patch of desert the Gilbert temple now consecrates. Lucky them!

Thirty-three miles away from the Gilbert temple lies the Miracle Mile on Camelback Road in Phoenix with its own title companies and mortgage banks and K St lobbying firms. If you drive east on the Miracle Mile on your way to the Gilbert temple but, instead of continuing east through Scottsdale, you turn right and cut down through south Phoenix to Baseline Dr, then take a left toward LeSeuer Investments and the new temple in Gilbert, you will observe at nearly every major intersection panhandlers—beaten up white men, young and old and middle aged—walking along the median where cars wait for red lights to turn green.

They are carrying cardboard signs inscribed with hand-lettered pleas for help.

It would be interesting to know for how many of these men a foreclosure on their homes began their downward spirals of divorces, addictions, and despair into the ranks of the panhandlers. And the homeless.

Among all those families against whom G8 has successfully deployed bedazzling jargon and three-card monte foreclosures to strip them of their homes, there is a decent chance there were a few who eventually found their way to the traffic islands of Phoenix and who now, degraded, shuffle up and down in the 120 degree Arizona heat asking for help.

Picture Evan Gentry waiting in, say, a BMW for the light to change and one of these losers with his cardboard begging sign walks past Gentry's BMW. Gentry always helps out the less fortunate, so the tinted window slides down and an arm reaches out in a blast of cool air and places a dollar in the dirty hand of the sun burnt guy.

The panhandler doesn't know, of course, that the guy congratulating himself, as he drives away, on the virtue he just purchased for a buck is the same guy who runs the distressed mortgage foreclosure mill that took his home and destroyed his marriage and crippled his children's futures. He doesn't even know how rigged the game was against him. All he knows is he is a loser.

What do you suppose that guy and the millions of others like him in our new America would do if they knew that the gain realized from their impoverishment wasn't sent off to help the impoverished of Mozambique as they had been led to believe, but stayed right here in the Phoenix area?

Imagine if they got a view of the BMW zipping along past LeSeuer Investments and on up to this temple, this glorious monument in the desert to the towering achievement that is Evan Gentry's status. What do you suppose the bus loads of panhandlers would do if they came up behind Evan Gentry and watched as he placed the protective covering over his shoes to protect the pure, blinding white carpet that stretched ahead of him under the cool magnificence of the temple and those panhandlers knew that the equity Evan Gentry stripped out of their lives had paid for that carpet? What do you think a few bus loads of them, with their picket signs and tragic stories and television news crews in tow would do when they reached the edge of that pure white carpet and watched as Evan Gentry, one of life's true winners, strode confidently out onto that white expanse?

Breach of fiduciary duty

First, while Bralove and Brown will claim they had no fiduciary duty to the TIC owners, i.e., they were not legally bound 1) to refrain from opportunism (exploiting their position as Project Manager) and 2) to subordinate their personal gain to the good of the enterprise as a whole. But numerous courts have ruled that certain conditions and activities establish "partnership". It seems clear to me several of these conditions are met. As just one example, in an email from Bralove and Brown to the TICs, the TICs were encouraged to continue looking for tenants for the building.

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For what shall it profit a man

I asked a Chinese friend recently, as he and his family were preparing to return to China after their first trip to the United States, what had most surprised him about America. He thought for a moment, then said, "I am surprised how Americans live. I thought Americans would live better. It is a very rich country, but the people live poor."

Indeed.

Gordy Spires is an American who used to live rich. He had a good business, a wife, and a nice house overlooking the ocean in Carlsbad, California. He also had a top-of-the-line, exquisitely lawyered, cutting edge mortgage—chock full of nominal lenders and balloon payments and reconveyance fees and all the other fantastical creatures the mortgage industry belched out in a cloud of noxious vapor for no apparent reason just last week.

At some point, Mr. Spires got Behind on His Payments, which rendered his mortgage "distressed". At G8 Capital, a distressed mortgage is referred to as an "opportunity", but not an opportunity to help someone struggling get back on their feet, rather, an opportunity to take their property away and keep it for themselves. Mr Spires fought hard for his property. but, in the end, G8 was able to take 4743 Crater Rim Rd from the Spires.

A major part of Mr Spires' argument in court was that he no longer knew who had possession of the deed on his house. Admittedly, when I read through the filing documents, my first reaction to this argument was skepticism. I had read the original mortgage agreement, which included fourteen pages of opaquely written fine print so full of booby traps and stacked against the homeowner that I took his pleading as a somewhat desperate last ditch effort to keep his home.

I would later learn that this homeowner's allegations were legitimate and, in fact, his objections were to what was standard operating procedure for G8.

It's a tactic you might call the "foreclosure shuffle" and involves titles and deeds changing hands for no apparent reason other than to make it more difficult for a homeowner already in distress to emerge from his or her difficulties.

Here is the pertinent section of the court transcript:

09-90133-LT 

Case type: ap
Related bankruptcy: 08-13091-LT13
Chief Judge: Laura S. Taylor
Date filed: 03/26/2009
Date of last filing: 01/12/2010
Date terminated: 01/12/2010


: SO I'M GOING TO DENY THE MOTION. I UNDERSTAND WHERE YOU'RE COMING FROM, AND I WELL APPRECIATE HOW CONFUSING THIS RECORD IS. I HAVE TO SAY AGAIN — I'VE SAID IT TWELVE TIMES; I'LL SAY IT ONE MORE TIME — I DON'T THINK THE SOLUTION OF THE QUITCLAIM WAS THE ELEGANT ONE, AND I HAVE A FEELING THAT G8 WILL THINK BETTER NEXT TIME IT'S PUT IN THE UNFORTUNATE SITUATION OF HAVING TO CLEAN UP A RECORD OF HAVING A BETTER EXPLANATION IN THERE FOR WHAT THEY'RE DOING. I CAN'T FIND ANYTHING IN THIS RECORD THAT STRIKES ME AS NEFARIOUS OR INDICATES TO ME THAT G8 ISN'T IN SOME WAYS A VICTIM, AS WELL. THEY MAY WELL HAVE CLAIMS AT SOME POINT AGAINST G.E. MONEY BECAUSE IT APPEARS TO BE THE SECOND TRANSFER OF AN INTEREST IN A NOTE AND DEED OF TRUST ALREADY PROPERLY TRANSFERRED TO THEM THAT HAS CONFUSED THE RECORD AND HAS CAUSED THEM TO INCUR ATTORNEYS FEES; BUT, OTHERWISE, IT SEEMS A FAIRLY STRAIGHTFORWARD FROM THEIR PERSPECTIVE TRANSACTION TO ME. SO I'M NOT INCLINED TO CHANGE MY RULING.

: I UNDERSTAND THE COURT'S ANALYSIS, YOUR HONOR, AND I APPRECIATE IT. JUST TWO REQUESTS: ONE, WOULD IT DIFFER THIS COURT'S OPINION IF G.E. MONEY AND G8 WERE ACTUALLY THE SAME ENTITY?

: WELL, IF THEY'RE EXACTLY THE SAME ENTITY — I MEAN, I HAD SOME QUESTIONS IN MY OWN MIND AS TO WHO THEY ARE.

: UH-HUH.

: IF IT IS IN FACT AND INDEED — IF G.E. MONEY AND G8 — ONE'S AN LP AND ONE'S AN LLC, SO I'M NOT SURE THEY COULD BE; BUT, IF THEY WERE, SURE, BECAUSE AT THAT POINT THAT INTERMEDIATE TRANSFER WOULD BE A TRANSFER TO A THIRD PARTY AND THAT ONE WOULD BE GOOD. YOU HAVE THE QUITCLAIM BACK. SO I'D BE ASKING QUESTIONS ABOUT WHAT EXACTLY WAS GOING ON AT THAT PARTICULAR POINT IN TIME. AND TO THE EXTENT THEY'RE RELATED ENTITIES, THAT MAY EXPLAIN SOME OF THE QUICK AND DIRTY NATURE OF THE TRANSACTIONS; BUT, STILL, IF WE'RE LOOKING AT THAT SECOND SET OF TRANSFERS, ONCE TRANSFER FROM ENTITY A TO ENTITY B OCCURS, NOTWITHSTANDING THE RELATIONSHIP BETWEEN A AND B, IF THEY ARE IN FACT AND INDEED SEPARATE ENTITIES, THEN A DOESN'T HAVE ANYTHING LEFT TO TRANSFER AND ANYTHING IT DOES AT THAT POINT IN TIME CREATES A CLOUD ON TITLE AND IT'S A CLOUDABLE ACT OR A CLOUDING ACT AND IT'S IMPROPER. THEY PURPORTED TO TRANSFER WHAT THEY DO NOT OWN, AND YOU CANNOT TRANSFER AN INTEREST THAT YOU DON'T OWN. CERTAINLY, SOMEONE CAN RELY ON THAT TO THEIR DETRIMENT; BUT, ESPECIALLY IN THE REAL PROPERTY WORLD, ONCE THAT ASSIGNMENT WAS RECORDED EVEN THIS OTHER ENTITY, THIS PROPERTY ASSET MANAGEMENT, SHOULD HAVE BEEN ON NOTICE.

: THANK YOU, YOUR HONOR. ALSO, TOO, ONE OTHER REQUEST, YOUR HONOR. MY CLIENTS ARE IN THE PROCESS OF PACKING UP. THEY WOULD REQUEST — AND THEY'LL PAY REASONABLE RENT, BUT THEY WOULD REQUEST ANOTHER TEN DAYS IF THE COURT IS SO INCLINED. THEY HAVE PUT APPLICATIONS IN AND THEY'RE GOING TO LEAVE, BUT THEY DO NEED SOME TIME.

: WHAT'S THE STATUS, MR. BRITTON, OF THE COURT ORDER FROM THE STATE COURT?

: YOUR HONOR, THIS —

: I MEAN, I CAN'T DO ANYTHING WITH THE STATE COURT ORDER.

: THIS ACTION'S BEEN PENDING. THEY AGREED, APPARENTLY, IN THE STATE COURT TO BE OUT. THEY GOT A CONTINUANCE FROM THE STATE COURT BASED UPON THIS HEARING. SO, YOU KNOW, THIS HAS JUST BEEN GOING ON AND ON AND ON AND ON. SO WE WOULD OBJECT TO ANY ADDITIONAL TIME.

: WELL, I DON'T THINK I HAVE JURISDICTION TO DO THAT. IF THERE'S A STATE COURT ORDER, I DON'T HAVE JURISDICTION. THE PROPERTY'S BEEN FORECLOSED, SO IT'S NO LONGER AN ASSET OF THE ESTATE. SO THAT WOULD, IN EFFECT, BE AN INJUNCTION AND YOU DON'T WANT TO BRING THAT ACTION. WHAT I WOULD OFFER HERE IS THAT, MR. BRITTON, IF THEY'RE WILLING TO PAY RENT, THE FOUR OF YOU ARE HERE AND I SUGGEST YOU TALK BECAUSE I THINK, AT THAT POINT IN TIME, IF THEY NEED TIME TO GET OUT, THE QUICKEST WAY TO GET YOUR NAME IN THE PAPER IS TO SAY: NO, WE'RE TAKING YOUR HOME. WE WON'T TAKE YOUR RENT FOR TEN DAYS. SO I WOULD STRONGLY SUGGEST THAT A BUSINESS RESOLUTION BE REACHED.

: YOUR HONOR, THE LENDER AT THEIR REQUEST DID A WALK-THROUGH OF THE PROPERTY. SO THEY'VE BEEN ABLE TO SEE THE PROPERTY, SO THEY'VE BEEN ALLEVIATED OF ANY CONCERN THAT THE PROPERTY IS GOING TO BE SEVERELY DAMAGED. SO, YOU KNOW, I JUST THINK IT'S REASONABLE. I'M SURE THAT, IF WE GO BACK TO THE STATE COURT, THAT THE COMMISSIONER WOULD PROBABLY GIVE US THE ADDITIONAL TIME; BUT SINCE WE'RE HERE THIS MORNING AND TO ALLEVIATE YET THE NEED FOR ANOTHER EX PARTE APPEARANCE, THAT'S WHY I'M MAKING THE REQUEST.

: WELL, AND, AGAIN, I THINK IT'S MORE A QUESTION OF JURISDICTION. HAVING DETERMINED THAT I'M NOT GOING TO STEP AWAY FROM MY PREVIOUS ORDER, STAY OF RELIEF'S BEEN GRANTED, AND THAT WOULD BE A REIMPOSITION OF THE STAY.

: THAT'S TRUE.

: I DON'T THINK I HAVE THE POWER TO DO THAT. I AGREE WITH YOU THAT IT'S A REASONABLE REQUEST PROVIDED THAT MARKET RENT IS PAID AND PROVIDED THAT, AS I BELIEVE TO BE THE CASE, NO DAMAGE TO THE PROPERTY WOULD OCCUR. THIS IS JUST ALLOWING PEOPLE TO WITH DIGNITY LEAVE THEIR HOME, AND I WOULD STRONGLY URGE THE LENDER TO ALLOW THAT TO HAPPEN. AND YOU CAN QUOTE ME TO THE COMMISSIONER IF YOU GO IN FRONT OF HIM OR HER.

: THANK YOU, YOUR HONOR.

: YOUR HONOR, WE WILL DISCUSS THAT AFTER THIS. JUST TO CLARIFY THE RECORD, MR. GILLILAND INDICATED TO ME THAT THERE IS NO RELATIONSHIP BETWEEN G.E. AND G8 CAPITAL. G.E. WAS APPARENTLY OWNED BY LEHMAN BROTHERS, AND G8 IS A VENTURE CAPITAL FIRM. NO RELATIONSHIP WHATSOEVER.

[Rego's question concerned GE Money and G8 Capital, and there absolutely was a relationship. GE Money became GE Capital which bought Moneyline and became GenPact Mortgage Services. Evan Gentry, CEO of G8 was also CEO of both GenPact and Moneyline.]

: ALL RIGHT. WELL, IT WAS AN INTERESTING QUESTION. AND THE "G'S" DID IT. IT'S ALWAYS POSSIBLE WHEN YOU HAVE — IN THIS WORLD OF INITIALS, I DO WONDER. SO THANK YOU FOR CLARIFYING THAT.

: AS A COMMENT, "G" FOR GREED.

: WELL, THAT COULD BE.

: NO DISPARAGING THE PARTIES.

: NO OFFENSE TO ANYONE. TO YOUR CLIENT, NO. ALL RIGHT. SO, MR. BRITTON, YOU MAY SUBMIT THE ORDER SINCE IT'S IN YOUR FAVOR, AND WE WILL TAKE THAT EXPENSE AND BURDEN OFF MR. REGO. MR. REGO, THANK YOU FOR YOUR REQUEST. WELL ARGUED, BUT I CAN'T AGREE WITH YOUR FACTUAL ASSUMPTIONS.

: THANK YOU FOR THE COURT'S TIME, YOUR HONOR.

: THANK YOU.

(WHEREUPON, THE PROCEEDINGS ADJOURNED.)

Recently, I tracked Mr Spires down and learned the foreclosure, as is so often the case, cost the Spires their marriage as well as their home. Today, Mr Spires is selling insurance and living alone in an apartment in Ft Worth, TX.

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My role

I was out west investigating G8 Capital, looking for a way for Pat and his father to avoid losing their Alexandria Corporate Park TICs, when I got a call from Pat Welch. He was panicked. G8 was trying to serve his father court papers notifying him that G8 was exercising the springing guaranty the elder Welch had signed. For waiving his right to bankruptcy protection, Mr Welch was on the hook for $14 million.

"We can absorb the loss on ACP," Pat told me. "But a $14 million hit would be devastating."

With this new threat in mind, I returned to the east coast and continued my investigation of G8, assembling damning evidence against them, some of which is linked above. The natural course of the investigation led me to looking into David Bralove and Rick Brown and their real estate office, B&B Realty. Bralove and Brown seemed even more blameworthy and dirtier than G8 Capital and soon my focus was on them.

After my disagreement with Todd Lewis over his legal strategy, I stopped working for Pat. But I still had all this work and, what seemed to me, clear evidence of wrongdoing on the parts of both G8 Capital and B&B Realty and of collusion between them. I didn't want to just throw away all that hard work. Up until that point, while the information I had harvested was damning, it hadn't "paid off" anywhere. I wanted to see my work have an impact to the benefit of the victims in this case. The benefit victims received would be the means, I supposed, by which I would receive my own financial reward. In other words, if Pat and his father were able to escape the $14 million suit, or if the property were restored to the TICs, or if Bralove and Brown or Gentry lost a judgment, I assumed I would be rewarded fairly.

Then there was the matter of simple right and wrong. I stopped working for Pat because the strategy pursued by Todd Lewis seemed as ethically wrong as it was strategically inept. So, I began contacting the other TIC owners on Aug 5 last summer because they, after all, were victims, too.

Twelve days after I began contacting the other TIC owners, the Welchs received a scare letter dated Aug 17 from Bralove threatening extreme anger if I didn't stop my activities. In response, Pat called me and demanded I take down the site. I refused.

For the rest of August and through September 22, I continued to update this web page and develop a coherent legal strategy whereby the TICs would have a chance to see justice served. To that end, I found a respected law firm in Richmond who agreed to take the matter on.

Then, on September 22, I notified the TICs that I was stepping off.

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Web traffic

The following chart is a color coded chart of web traffic to this website (ffinalysis.com) from Aug 01, 2016 to Nov 23, 2016 (the date of this writing). During that time, eliminating the spiders, bots, and so on, there were 3,274 hits on the website from 274 unique IP addresses (a hit is a page view, not a visit, so if someone visited the site and clicked on three internal links, it would count as four hits and one visit) (and, yes, the "274" in both numbers above is accurate at the time of this writing and not a typo).

I have left out of the chart above the "path-of-visit" parameter, i.e., the information I gleaned from the raw server access logs that tells me not only who visited and when, but what they actually looked at while on the site.

I began contacting the other TIC owners on August 5, 2016. That corresponds to the fourth column from the left in the chart above (the reason it isn't the fifth column is because there was no traffic on August 2).

The column that spikes up suddenly with cyan is on August 23. That is G8 Capital. Arent Fox also begins its investigation then.

The isolated green spikes on the right are, I'm assuming, VPN services, i.e., people disguising themselves or cloaking their identities—some kind of monitoring service.

The Welchs settle

On September 30, I gave the following letter to Pat:

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Pat,

It is clear that G8's sudden willingness to settle is not because of restless investors. If they thought they had a good enough case at the outset to get a judgment for $14 million, they are not going to decide suddenly that it's taking too long and just walk away. And they didn't walk away because springing guaranties are difficult cases (they are no more difficult now than they were a year ago).

From their point of view, circumstances have changed. And I'm the one who changed them. I have accomplished exactly what I set out to do a year and a half ago. I did what you asked me to do and what you provided the financial support for. I came through.

So, I ask myself why would Pat refuse to recognize this valuable ally, one who can accomplish the seemingly impossible, one who is on the verge of saving his Dad $14 million, and potentially much more?

I have no answer for that.

So, going forward, here's where things stand, and what I see as the appropriate course:

A small group of the TIC owners have formed an ad hoc steering committee with the goal of purchasing the property back at a price sufficient for G8 to make some return, but low enough the TIC owners would get their equity back and have the means to obtain financing easily and on good terms.

But that would certainly be contingent on me ceasing any and all anti-G8 activities, so it is unclear what impact a buy-back would have on the suit against your Dad. It would likely depend on how the transaction was structured, whether it is a sale, or a vacating of the foreclosure, and in consequence, where that would leave the various bankruptcies.

Among the TICs, there is substantial appetite for aggressively going after Bralove and Brown. I imagine Bralove assumes there is. And, just as I predicted, traffic over the last couple of days from Bethesda, Gaithersburg, etc., is focused on the G8 fraud I have on the web site. In other words, it appears Bralove is preparing his own attack to force the deal to unfold in a way favorable to him, or, at least, relieving as much of the liability as possible.

For now, we'll let him think that's the best way, and then let him establish the collusion himself, doing our work for us.  He figures, correctly, that Gentry has more at stake than either he or Brown, and is more vulnerable on more fronts. My guess is he will try to use that to his advantage through a soft blackmail play.

Here's what I think you should do:  Once G8 receives a query letter from the ad hoc committee and there is an offer on the table, then you ask G8 to drop the $14mm suit, which would allow you to join the "passive TICs" in their offer to buy back the building.  You fund the legal cost of that effort, which ensures a seat at the table with the ad hoc committee and G8 when the buy-back is negotiated. G8 would then have the opportunity to include in its asking price any attorneys' fees or whatever they feel they are out from your suit. That cost would be refinanced and spread among all the TIC owners and would ultimately be included in your damages plea against Bralove. (Btw, now filing suit against Bralove and Brown for breach of fiduciary duty becomes much more worthwhile, because the TICs wouldn't be trying to recoup the value of the entire property, just the actual out of pocket damages, which wouldn't be insubstantial, but much more recoverable.)

The best part is you and the TICs absorb Bralove's and Brown's equity with the repurchase of the building, which would have them in a spitting greed rage for years, and would be justice served, and a nice windfall for everyone.

As part of the buy-back deal, I agree not to pursue any of the several threats I've got lined up against G8, which would make all the evidence Bralove accumulated of collusion, or whatever, between he and G8 useless, in pari delicto. It's only useful to us, and only in the event G8 is recalcitrant.

Good for you, good for the TICs, good for G8 (at least, much better than it could be), but very very bad for Bralove and Brown.

Which brings me to me: will it be good for me?

I want you to know that I take the personal danger part of this seriously. Bralove and Brown are going to be like cornered boars and I doubt there is much they wouldn't do for money. The $165,000 you are willing to settle with G8 for should go to me. That would enable me to set up in a safe place, and allow me to get the legal ball rolling (which is a necessary step before G8 will agree to just drop the springing guaranty completely). Once G8 sees an offer on the table, they can tie up their loose ends in the final sale.

In early October, I received a letter from Ken Welch:

October 4, 2016

Dear Craig,

Thank you for your interest and information gathering efforts with respect to Alexandria Corporate Park. Patrick and I appreciate it. I am pleased to report, however, that I have now resolved my disputes with David Bralove and Rick Brown (and also of course the disputes between entities controlled by me and entities controlled by them). Therefore, please do not take any further action intended to benefit me and Patrick. In fact, I would be grateful if you would please refrain from making any disparaging remarks about Bralove and/or Brown and/or entities or transactions affiliated with them and if you would also permanently take down ffinalysis.com and all material you have posted anywhere else on the internet that is related to Bralove and/or Brown and/or entities or transactions affiliated with them, including any such material posted at craignelsen.com. Thanks again.

Ken Welch

(The disputes he mentions here have to do with a commercial property in North Carolina—an investment structured similarly to ACP.)

The letter from Ken requesting I take down this site was demanded by Bralove and Brown as a condition of the settlement. So, clearly, just as the chart of the web traffic above indicates, Bralove and Brown had serious concerns about my activity here. I believe they know how liable they are and vulnerable to a legal action as I outlined above.

What got G8 to walk away from the suit, as I showed Pat, was the very serious liability they face as I have documented elsewhere on this site and the threat of litigation they share with B&B.

Then Pat told me that G8 had, indeed, walked away from the $14 million suit.

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My play for pay

I drew up the following and gave it to Pat:

October 27, 2016

ASSESSING THE VALUE OF SERVICE RENDERED TO DATE

(doesn't include the personal charm, clever witticisms, and warm humanity)

  1. I played the pivotal and sufficient role in getting the $14 million dollar personal guaranty lawsuit against your Dad dropped. While the ACP stuff hurt, it was the personal guaranty suit that was "devastating".
  2. I told you I thought, given what I'd uncovered, G8 was vulnerable to unorthodox attack. You are a very orthodox kind of guy, so you were very skeptical. In fact, you thought my stated goals would be impossible to achieve. But you did keep me funded as I worked on this, and that counts for a lot.
  3. On the other hand, there are numerous examples of recommendations I made that turned out to be right and that, had you accepted them, would have saved you a lot of money. And I'm not even talking about Todd. (I'm not sure where the resistance was coming from because you hold things very close to your chest. That's probably a trust issue. Nevertheless, it seriously hampered my effort.) There was the long delay in getting the documents I requested, the lack of a full title search—a bunch of stuff—but the most salient one is the dropping of the effort and coming to terms with Bralove/G8. I understand it, because at some point it's not worth it in terms of quality of life—and I can't put myself in your Dad's shoes—but it was there (and still is, frankly).
  4. On the other hand, you've provided the use of a vehicle, free storage, free apartment, and (numerous) Milk Bones for Buddy. And that counts for something.
  5. All in all, I feel good about what I accomplished, and am confident I can and will deliver the rest of it. But, in the interest of simplicity, let's call the value to you and your Dad of the service I rendered to this point an even $14 million.
CALCULATING A PERCENTAGE OF THE VALUE I PROVIDED
  1. So, how would we calculate a fair amount for me? One way to look at it would be as a kind of "reverse debt". G8 had a claim on your money and you wanted to get the money back, i.e., remove the claim. Debt collectors charge a percent of the debt they collect based on the perceived difficulty of recovering the debt—the likelihood they will be successful. If the debt is new and owed by a reputable, accessible person with plenty of money, the fee will be very low. But if the debt is old, and the person hard to find, and the lender considers the money pretty much gone, etc., the fee will range up to 50 percent of the debt. So, my percent should range somewhere between 0 – 50 percent.
  2. Arguing for a higher fee is the admitted difficulty (impossibility!) in getting G8 to drop the case. And it was a whole hell of a lot of work. But arguing for a lower fee is the fact that you paid me my fee (partially) before I had recovered anything. For a year and a half. And I had no track record. Well, that's not entirely true. You knew me well enough not to dismiss me completely when I said I could accomplish the impossible. Arguing for a lower fee as well is whatever the terms of the settlement with G8 and B&B were that weren't in your favor, though I should have been in the loop on that and can't for the life of me figure out why I wasn't (by that time you should have recognized my input as at least worth considering). Also arguing for a lower percent would be the uncompleted part of what I set out to do, though, again, it wasn't my decision to pull the plug.
  3. At this point, between zero and fifty, twenty percent would seem fair to me. But there is an added consideration. Avoiding a nasty court case with a potentially devastating judgment against you is not the same thing as recovering a debt, where the money is already out of your hands. Without me in the picture at all, and with a competent lawyer, you might have gotten a judgment in your favor through the normal orthodox boring expensive method. I put your odds there at about 25 percent. That 25 percent would drop the twenty percent mentioned above to fifteen percent, i.e., $2.1 million. Then, there is the effect of G8 investors' impatience, or what-have-you, which I very generously put at another 25 percent, bringing the final total to $1.4 million.
STRUCTURE OF PAYMENT
  1. So, that's what I think is fair if we could put a bow and this whole thing and walk away. However, there is still the matter of the other TICs—they deserve justice and I intend to help them get it. I don't think Rita DiDonna or anyone else victimized by those predators should have to let things stand the way they are. And, it appears to me, that that is what will happen without my involvement. Therefore, I am going to go after Bralove and Brown, whether there is money for me in it or not. However, because of that disadvantageous agreement the North Carolina guy drew up (as we discussed), my further activity may carry some risk for you.
  2. To get around this impasse, I suggest you pay me $200,000 now and I form two LLCs.
    1. The first LLC would act as a steering committee of TIC owners managing the take-down of Bralove and Brown and, if it comes to that, negotiating with G8. I would be in the background, though I would put up the money to get things rolling, to be reimbursed in the event the TICs win a judgment against those skunks. (The other TIC owners are like you—skeptical—and they aren't very keen on throwing more money at ACP, if they even have any to throw, but once it got rolling...).
    2. The other LLC would act as an investment vehicle to which you would commit a total of $1.2 million and which would be owned by the two of us. We would write up an agreement governing the method of draw downs, profit disbursements, etc. and invest in, say, a cannabis growing warehouse (did you read that article I sent you—it's the big new thing with weed and is what I suggested three years ago for the Brentwood space), and the heroin addiction treatment program (there is a huge demand for that right now, and the way I would structure it, it would be phenomenal, unique, effective, and inexpensive).
  1. I want to hurry on this because it will really really really suck if any more of the TIC owners die before they have a chance to see justice done.

Pat's response was that my numbers were too high, that the $14 million suit was really only a hundred some thousand dollars because everything else was protected by LLCs. Come on, I said, be serious. What, then, is the figure you think is fair? He didn't have a figure and said he needed to talk to his Dad, and that was the last I heard from him.

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Meeting with T. Lewis

I made a lunch date with Todd Lewis and we met on November 16th. I told him I had asked to meet him because I wanted to ascertain whether there was anything I was missing that would bear on the value of my role in G8's dropping of the personal guaranty suit.

Todd asked me what I thought my role was and I told him I thought it was primary—that, had it not been for me, the suit would still be on.

Todd remarked that everyone likes to imagine themselves the central player in events, but that my name hadn't even come up in negotiations. I had no impact at all.

Why did Bralove condition the settlement in North Carolina on my ceasing activity and taking down the site, I asked.

I don't remember his response to that, or whether he had one.

I asked him who had approached whom to propose a settlement, and he said he approached G8.

Really? What did you offer them to get them to walk away? What did you threaten them with if not my work?

Todd responded that G8 didn't think they could overcome the flawed service of the court papers. I expressed skepticism and he said there was also a suit alleging fraud. I can't remember whether he said it was already filed or that he intended to file it.

Fraud? I said. On what grounds?

He said he couldn't remember.

From this I concluded that my work was, indeed, the primary cause of G8 walking away from the suit. I might be wrong, of course. However, I don't see any better explanation. If that is the case, and if Todd was telling the truth about taking the initiative and approaching G8 with the settlement offer, then it is certainly possible that Todd simply took my work to G8. It wouldn't be the first time.

Regardless, nothing is preventing the other TIC owners from using my work to pursue justice (if nothing else, it has been shown to have merit). Nor is anything preventing me from spearheading the effort. I say we pull off the gloves.

At the end of the meeting between Todd and me he asked me to not do anything on this for a couple of weeks, but he wouldn't say why. He said it in the manner your parents would tell you when you were a kid not to go into the upstairs guest room until after Christmas, i.e., I've got a pleasant surprise for you if you just do as I say and don't ask any questions. I asked Pat what Todd's reason might be for this request. Pat didn't know.

The only reason I can think of that Todd would have for asking me to delay moving on this would be so that he could move on it himself.

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Plan of attack (incomplete)

  1. Vulnerabilities (actual and potential)
    1. G8 Capital
      1. manner of acquisition of property
      2. collusion with B&B
        1. delay on GSA lease signing
        2. delay on GSA expansion
        3. settlement with Welchs
      3. delay on GSA lease signing
      4. external irregularities
        1. mortgage/document fraud (Las Vegas)
        2. HOA abuse (Ridgecrest)
        3. perjury, abuse of process, fraud (Spires)
        4. money laundering (Phoenix)
      5. interference with contract (GSA expansion)
      6. unorthodox public relations efforts incl. as described above
    2. B&B
      1. document irregularities
        1. VA Corp commission
      2. collusion with G8
        1. delay on GSA lease signing
        2. delay on GSA expansion
        3. settlement with Welchs
      3. breach of fiduciary duty regarding lack of business loss insurance
      4. profiteering on price of TIC shares
      5. Rita DiDonna
  2. Steps
    1. reactivate ad hoc committee
    2. raise initial fee for DurretteCrump
    3. form LLCs
    4. contact all passive TIC owners (i.e., all but B&B and Welchs)
      1. introduce effort
      2. state general terms to join effort
      3. invite to conference call
    5. conference call
    6. prepare offer for G8/prepare to bring suit

[http://www.consumerfinance.gov]

Read the legal argument (includes timeline)