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FSG obtains $23 million judgment in theft, misappropriation, and fraud case
IRVINE, CA, February 27, 2015 – Friedman Stroffe & Gerard, P.C. (“FSG”) today announced that it has obtained a $23 million final judgment in a California federal court against Utah-based, SilverLeaf Financial, its CEO Shane Baldwin, and related Baldwin controlled entities, for theft, misappropriation, and fraud.
Among other things, the complaint alleged that the defendants engaged in a pervasive scheme to defraud investors out of hundreds of millions of dollars through the sale of sham “participation interests” in loans secured by real estate, instead diverting those monies to themselves to facilitate a lavish lifestyle that included exotic cars, court-side professional basketball seats and private jets.
Characterizing the defendants’ conduct as deceptive and malicious, Judge Andrew Guilford levied over $11 million in punitive damages against the defendants to punish and deter future conduct in addition to the almost $12 million in compensatory damages. FSG also obtained a judgment quieting title to Silverleaf owned real estate worth millions of dollars, awarding title to those properties instead to FSG’s client.
“Friedman Stroffe & Gerard’s victory on behalf of Plaintiff, and the sizeable judgment awarded by the court, signals a clear judicial recognition of the centrally important role real estate plays in America’s economy and its intent to vigorously protect those who invest in it, in good faith, against the trickery and deceit of others” said FSG shareholder James D. Stroffe. “As a firm specializing in sophisticated financial and real estate matters, our role is to protect our clients – through litigation, if necessary — against the predatory and deceitful business tactics of others, like those perpetrated by Mr. Baldwin and SilverLeaf Financial.”
FSG’s team on this case consisted of James Stroffe, Jennifer Stroffe, and Sasan Behnood.