FRONT ROYAL – Lawyers for seven people and businesses sought dismissals from the Front Royal-Warren County Economic Development Authority’s $4.5 million civil lawsuit on Thursday in Warren County Circuit Court.
The lawsuit, which was filed in April, alleges that nine individuals and companies were “confederates or co-conspirators” of former EDA Executive Director Jennifer McDonald in various real estate transactions she allegedly perpetrated with allegedly stolen money.
Those seeking dismissals on Thursday were Century 21 Campbell Realty and its owners Jeanette and Walter Campbell, TLC Settlements LLC and its employee Tracy Bowers, Rappawan Inc. and its Vice President William T. Vaught Jr.
Arguments were not made on the behalf of the case’s two remaining defendants, Service Title of Front Royal LLC and its employee Victoria L. Williams.
None of the civil defendants have been criminally charged.
The case coincides with the EDA’s separate, ongoing $21.3 million civil lawsuit that alleges McDonald and 13 other individuals and companies conspired to defraud the authority. Although the two cases are being litigated separately, many of the allegations in both lawsuits are related to the same transactions.
The accusations against the Campbells, who are McDonald’s aunt and uncle, center around the Royal Lane property they sold to the EDA. Other accusations detail how their real estate company served as a broker for McDonald in her allegedly illegitimate real estate purchases.
The accusations against Vaught and Rappawan center around land deals in which McDonald purchased two land parcels from the company. A month later, the lawsuit explains that McDonald sold the land back to Rappawan for a $600,000 loss.
The two settlement companies, according to the lawsuit, handled closings for allegedly illegitimate real estate purchases.
The EDA is accusing the nine defendants in the $4.5 million lawsuit of being co-conspirators that are jointly liable in a scheme to defraud the authority. Lawyers representing the seven defendants in court Thursday expressed umbrage with their clients being lumped into an overarching conspiracy theory when they were all involved in different real estate transactions that had nothing to do with each other.
Defending Rappawan and Vaught, attorney Robert Light noted that the EDA’s lawsuit claims his clients “had to know” the real estate transactions they participated in were illegitimate without providing evidence of why they had to know.
Light said that using “blank conclusory statements” without providing facts does not prove that the defendants knew McDonald used allegedly stolen money for land deals.
Vivian Giles, representing the EDA, begged to differ.
“Transitions like this don’t just happen, they just don’t,” she said.
Giles said there are connections between the defendants, adding that being involved in a conspiracy does not mean that each conspirator knows of each other’s actions or even their identities.
“They almost had to know a conspiracy was afoot,” she said.
Phil Griffith, representing TLC Settlements and Bowers, noted that the company made $12,398 from real estate deals it settled related to the case. To participate in an illicit scheme and make such little money, Griffith said this would be the worst conspiracy in Virginia's history.
Giles responded that TLC Settlements conspired in the overarching scheme by serving “to cleanse the money” and to give the deals to have an appearance of legitimacy.
Lawyers for the defendants also argued that statute of limitations for accusations against their clients expire after two years while the EDA’s attorneys claimed a five-year time frame.
Circuit Court Judge Bruce D. Albertson did not make any rulings, saying he will further consider the matters and submit written decisions in the future.