Strange how a spot of money will make people act......
AIKEN - Attorneys representing James Brown's troubled estate believe the late singer's former advisers "siphoned off" millions of his money, court papers filed this week reveal.
The 37-page lawsuit filed Tuesday in Aiken County Court names as defendants former trustees David Cannon, Buddy Dallas and Alford Bradley; Atlanta entertainment attorney Joel Katz; Atlanta law firm Greenberg-Traurig and Enterprise Bank of South Carolina.
The lawsuit alleges that Mr. Cannon channeled money Mr. Brown earned performing and from a $26 million bond deal and then doled that cash out to himself, Mr. Dallas and Mr. Bradley.
They, along with Mr. Katz and Greenberg-Traurig, are also accused of conspiring to refinance the 1999 bond - which essentially mortgaged Mr. Brown's future music royalties - in order to earn "excessive and exorbitant fees and commissions," knowing that doing so would cost Mr. Brown millions, the suit says.
Enterprise Bank is named as a defendant because bank officials should have spotted the shady transactions but instead were "aiding and abetting" by allowing them to continue, say the attorneys, who were appointed by the court to represent Mr. Brown's estate after the three trustees resigned.
When Mr. Brown asked the three advisers "where his money went," the lawsuit states, "their typical response was that Mr. Brown himself would need to 'cut expenses or increase revenue.'"
On Wednesday, Mr. Dallas called the accusations "outrageous" and "unfounded."
"It's an attempt to try to relive Mr. Brown's life by people who did not have anything to do with Mr. Brown's life," he said. "Mr. Brown had a mind of his own."
Mr. Dallas disputed the claims that he served as more than the music legend's personal attorney. He said he never worked as Mr. Brown's entertainment attorney or financial adviser, and only worked to keep the singer out of criminal trouble.
In a statement, Greenberg-Traurig defended its attorney, Mr. Katz.
" James Brown never indicated to Joel Katz that he was unhappy with any legal services that Joel or our firm provided," the statement said.
"We find it very unfortunate that people who had very little contact with James Brown decided to file a lawsuit. We are confident that, when the true facts are presented, it will be clear that the plaintiffs' claims are without merit."
Messages left for the other defendants were not returned Wednesday.
All three former trustees - who were longtime advisers to the singer - have been accused of mishandling Mr. Brown's estate , but until now only Mr. Cannon had been formally accused of misappropriating money.
Mr. Cannon, who says he cannot repay $373,000 in royalty money he admits he mistakenly misdirected, has until Friday to put up a bond or face a six-month jail sentence .
A court hearing is set in Aiken County today to hear other matters related to the estate's legal challenges, possibly including attempts by Mr. Bradley and Mr. Dallas attempts to regain their status as trustees. They say Judge Jack Early improperly forced them to resign last year.
Mr. Cannon resigned in August after attorneys appointed by the court to help settle the singer's estate accused him of misappropriating millions of Mr. Brown's earnings.
The lawsuit filed Tuesday includes the other two former trustees and Mr. Katz, who was another adviser to the singer, and his Atlanta law firm. Enterprise Bank maintained bank accounts for Seventh Decade Productions, a company funded solely by Mr. Brown's earnings.
The suit accuses the defendants of breach of fiduciary duty, negligence and of joining in a civil conspiracy aided by Enterprise Bank. The attorneys for the estate - who represent the new estate representatives, attorneys Adele Pope and Robert Buchanan - ask for actual and punitive damages.
They have requested a jury trial.
Reach Sandi Martin at (803) 648-1395, ext. 111, or sandi.martin@augustachronicle.com
The accusations
Specific allegations contained in the lawsuit filed in Aiken County Court on Tuesday:
* Starting in 1999, David Cannon paid himself or his company, DGC Associates, about $7.3 million from James Brown checking accounts or the educational trusts the singer set up for his grandchildren and needy children.
Of that total, $405,000 was from a $900,000 royalty check that was supposed to be used to repay the 1999 bond Mr. Brown secured for $26 million. Mr. Cannon repaid $350,000 during a court hearing last year.
* Mr. Cannon was paid a $4.9 million commission on the $26 million bond, which the estate attorneys call "exorbitant and excessive." Buddy Dallas' commission, they said in the lawsuit, has yet to be determined.
* Over the years, Mr. Cannon improperly paid Mr. Dallas at least $282,000, and Alford Bradley received at least $50,000. The lawsuit alleges that those payments wiped out $10 million in bond funds that were deposited into a Morgan Stanley account.
* The three trustees did not make payments on Augusta property, resulting in a $914,000 judgment against Mr. Brown.
Source: Lawsuit No. 2008-CP-02-322
Comments
Strange how a spot of money will make people act......
They stole this man money, he was dumb to the fact.
The question of the day is this: Why in the heck has the judge in this case given David Cannon so much leniency? This man has admitted guilt and still treated as if he did nothing wrong...I promise you, if it had been a common person they would have been locked up long ago.
After anyone dies, their money and words are left to the living liars, thieves, and others they trusted. The death and bond connecting the two is immediately set-aside for the living person to spend as their money. It is an everyday occurence, it is sad to say, but it will always be that way. Trusting in others is an item of the past.
*Advice: Give money and items to your loved ones before you die, or have legal, written documents given to the person who you choose.
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