Thursday, October 8, 2009

Thomson Lawsuit Creditors sue Kelly Gordon Rogers: Claims Fraud and Embezzlement

Kelly Gordon Rogers is named as the defendant in another lawsuit filed on October 2nd, 2009. Bill Thompson, CR591, LLC et al v. Kelly Gordon Rogers, alleges Fraud and Embezzlement against Rogers and was filed in the United States Bankruptcy Court for the Eastern District of Texas, Plano Division. The purpose of this suit is to arrest control of these assets from Debtor and place in the hands of Plaintiffs, who provided all of the funding for the purchase of these assets.

This lawsuit involves 20 of the 22 known members of the Company consisting of approximately 95% of the preferred member’s interest. In 2007, Rogers was searching for investors for this scheme. The stated purpose of this company was to purchase mineral interests and develop oil and gas wells. At the time Rogers solicited the investors, the company owned one producing oil well, and Rogers sought sufficient funds to enable the company to "Turn Key" two gas wells and to begin drilling a third gas well, according to the lawsuit. Based a powerpoint developed by Rogers and other information, the members invested $1,400,000 with self proclaimed Laywer Kelly Gordon Rogers.

The suit claims that Lawyer Kelly G Rogers embezzled company assets while acting as managing members. According to the suit, Rogers declared the first gas well a mechanical failure and had it plugged. The second gas well also purportedly suffered from mechanical failures and was terminated. It is unknown at this time if any work at all was done on these wells or what the funds for these wells were used for. In October, 2008, work on a purported third gas well was stopped and the gas well operators transferred to Rogers the sum of $180,000. These funds were previously paid by the company to the operators to develop a third gas well and the operators' payment to Rogers was a return of the unused portion of the prepaid drilling costs for the third gas well.

It goes on; although it is undisputed that the $180,000 received from the operator was the property of the company, Rogers testified that he "borrowed" the $180,000 for his personal use. According to Rogers, the $180,000 was used for home improvement. To date, Rogers has provided no promissory note or other evidence that he "borrowed" the money. Further, Rogers has so far repaid none of the money.

According to records from the Nevada Secretary of State, Lawyer Kelly G Rogers created an entity named Falcon Energy, LLC on March 29th, 2007. The status of this corporation was "Revoked" as of April 1, 2009. This is not unusual for Lawyer Kelly Gordon Rogers. Rogers has demonstrated a clear pattern of poor standing within organizations since 2002. A check of his law license shows he was suspended (Since this story broke, Kelly G Rogers has updated his law liscence. However, the Texas State Bar is looking into the case) by the Supreme Court of Texas in both 2002 and 2008. And now this entity is officially "Revoked" by the State of Nevada because the Rogers apparently didn't pay the $125.00 fee due to the state.

In terms of this investment, Rogers solicited money to fund a supposed entity called "Falcon Energy, LLC-Buck Hamilton Series" but there is no evidence that the entity was ever created. According to the case; it is presently unclear as to the status or nature of the company. Although Rogers solicited investments in a limited liability company, and Rogers had each of the investors execute both a subscription agreement and an LLC agreement, it is unclear if Rogers actually formed the entity. A review of the Nevada Secretary of State records indicates there is no entity named "Falcon Energy, LLC-Buck Hamilton Series". A review of the Texas Secretary of State records likewise establishes there is no entity with that name. As such, it is unclear as to the exact nature of the relationship between the platiffs and Rogers. Rogers raised $1,400,000 from Plaintiffs, ostensibly for the purchase of membership interests in the company.

Amazingly, when testifying in response to a 2004 examination request made by this group to the Trustee presiding over Rogers’s bankruptcy, Rogers testified; he did, in fact, "Form a Company" but could not remember where? Rogers further testified that documents reflecting the formation of the company could be found in his prior office space, which has been taken by the landlord. Rogers have since participated in an examination of the records located in Rogers’s prior office space and have yet to locate any records of the company. It maybe that the members of the company are simply members of an unincorporated joint stock association, a general partnership, or a trust. In any event, the company has significant assets which are under the direct control of Rogers. The purpose of this suit is to arrest control of these assets from Rogers and place it in the hands of the Plantiff, who provided all of the funding for the purchase of these assets.

To see an actual "Motion for Rule 2004 examination of Kelly Gordon Rogers, click on case number
09-42154-11. This trust invested $420,000 in the "Buck Hamilton Project". Based on the quote listed in the preceeding paragraph, the 2004 Examination request must have been granted since Rogers testified that he did form a company but couldn't remember where. To quote the motion; It is well settled that the scope of examination allowed under Rule 2004 is broader than discovery allowed under Federal Rules of Civil Procedure and may be in teh nature of a "Fishing Expedition". It is well established that the scope of a Rule 2004 examination is extreamely broad and...allowed for the 'purpose of discoverign assets and unearthing frauds' and has been compared to a 'fishing expidition'.

The suit claims the following.

First, Rogers is indebted to the company in the sum of at least $180,000 on a debt for fraud or defalcation while acting in a fiduciary capacity, embezzlement, or larceny.

Second, Rogers is indebted to the company in the amount of any company funds used for purposes other than in compliance of the LLC Agreement or the Subscription Agreement for false pretenses, false representations, or actual fraud.

Third, Plaintiffs request the Court declare Rogers home be subject to a constructive trust in favor of the Plaintiffs for the amount of $180,000. The basis of this request is that; (a) Rogers committed actual fraud or has committed constructive fraud through the breach of a preexisting fiduciary or confidential relationship (b) Rogers would be unjustly enriched by retaining the proceeds of the wrong and (c) there is a traceable res upon which to impress the trust.

Fourth, Plaintiffs request the Court to enter an order requiring Rogers to render a forensic audit of all transactions engaged in by Rogers.

In 2006, Kelly Rogers was sued by the SEC for his involvement as a facilitator in a ponzi scheme. The original complaint was filed on July 18th, 2007, Case 4:07cv346. Eventually, Rogers agreed to a final judgment contained in Doc 7-2, signed by Rogers. In the agreement, Rogers agrees to a variety of rules and restraints.

The ramifications of the; Bill Thompson, CR591, LLC et al v. Kelly Gordon Rogers are very important since it expose specifics of how Rogers sold securities to these investors. These details will be instrumental in answering the question; did Rogers violate his settlement with the SEC? Further, will any of these allegations assist the Collin County DA win a conviction on their indictment of Kelly Rogers? And did Rogers violate any FINRA rules when raising these funds for Falcon Energy, LLC-Buck Hamilton Series deal? For those who don't know, FINRA exists to for investor protections. They work hand in hand with the SEC. On you review their website, the headline reads; "Investor Protection, Market Interity". If you look at the SEC Case 4:07cv346 against Kelly Rogers, Marshall Gandy was the lead attorney for the SEC. If you review Marshall Gandy's new Lindedin profile, he is now Senior Regional Counsel at FINRA.

More to come.

1 comment:

JCT said...

Would you happen to have any contact information for Bill Thompson? Feel free to email to