UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
CIVIL ACTION NO. L-98-3652
Filed Oct.30,1998 Federal Judge Benson Everett Legg
Donald D. Stone
PLAINTIFF
v
Robert E. Warfield, Sr.
c/o Moore, Warfield, & Glick Real Estate
53rd St. & Coastal Hwy.
Ocean City, MD 21842
(Worcester County) DEFENDANT
(410) 524-0300
Charles R. Longo
624 Harbor Drive
Annapolis, MD 21403
(Anne Arundel County) DEFENDANT
(410) 280-9421
Mark Sapperstein
15 Evan Way
Baltimore, MD 21208 DEFENDANT
(410) 653-0334
Gilbert Sapperstein
8508 Arbor Wood Rd.
Baltimore, MD 21208 DEFENDANT
(410) 486-3955
Sondra Sapperstein
8508 Arbor Wood Rd.
Baltimore, MD 21208 DEFENDANT
(410) 486-3955
Bruce A. Moore
23037 Drum Point Rd.
Ocean City, MD 21842
(Worcester County) DEFENDANT
(410) 213-1221
Hal P. Glick
c/o Moore, Warfield, & Glick Real Estate
120th St. and Bayside
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 524-1200
Christine Ward
c/o Moore, Warfield, & Glick Real Estate
120th & Bayside
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 524-1200
Charles T. Martin, individually
c/o Worcester County Sheriffs Dept.
1 West Market St.
Court House RM L16
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-1111
Michael A. McDermott, individually
c/o Worcester County Bureau of Investigation
13070 St. Martins Neck Rd.
Bishopville, MD 21813 DEFENDANT
(Worcester County)
(410) 352-3476
Joel Todd, individually
c/o Worcester County States Attorney Office
1 West Market St., Room 208
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-2166
Theodore R. Eschenburg, individually
Circuit Court Worcester County
Court House RM 228
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-0600
Thomas C. Groton, individually
Worcester County Circuit Court House
1 West Market St.
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-0700
Jane Powell, individually
Worcester County Circuit Court House
1 West Market St.
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-1221
Jack O’Conner
c/o Moore, Warfield, & Glick Real Estate
53rd and Bayside
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 524-0300
Paul Haskell, individually
c/o Ayres, Jenkins, Gordy, & Almand
5200-B Coastal Hwy.
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 723-1400
Kevin Schiller, individually
508 Dogwood Dr.
Salisbury, MD 21804 DEFENDANT
(Wicomico County)
(410) 546- 2887
William Turner, individually
c/o Berlin Town Council
10 William St.
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-2770
Frederick Parker, individually
c/o Berlin Town Council
10 William St.
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-2770
Paula Lynch, individually
c/o Berlin Town Council
10 William St.
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-2770
Dean J. Burrell, individually
c/o Berlin Town Council
10 William St.
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-2770
Township of Berlin Maryland
c/o Rex Hailey
Mayors Office
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-2770
Elroy Brittingham, Sr.,individually
c/o Berlin Town Council
10 William St.
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-2770
Prentice M. Lyons, individually
c/o Berlin Police Dept.
10 Williams St.
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-5332
Edward Hammond, Jr.
c/o Williams, Hammond, Shockley, Moore, & Harrison
3509 Coastal Hwy
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 289-3552 (from Edward Hammond Jr.)
Joseph G. Harrison, Jr.
c/o Williams, Hammond, Shockley, Moore, & Harrison
3509 Coastal Hwy.
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 289-3552
Joseph E. Moore
c/o Williams, Hammond, Shockley, Moore, & Harrison
3509 Coastal Hwy.
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 289-3552
Raymond C. Shockley
c/o Williams, Hammond, Shockley, Moore, & Harrison
3509 Coastal Hwy.
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 289-3552
Regan James Reno Smith
c/o Williams, Hammond, Shockley, Moore, & Harrison
3509 Coastal Hwy.
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 289-3552
J. Richard Collins
c/o Williams, Hammond, Shockley, Moore, & Harrison
3509 Coastal Hwy.
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 289-3552
Jeanne Lynch, individually
c/o Worcester County Commission
1 West Market St.
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-1194
Robert L. Cowger, Jr., individually
c/o Worcester County Commission
1 West Market St.
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-1194
Rex Hailey, individually
c/o Mayors Office
10 William St.
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-2770
Berlin Maryland Police Department
c/o Prentice M. Lyons
10 William St.
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-1333
Gary Mumford, individually
c/o Worcester County States Attorney Office
1 West Market St.
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-2166
Worcester County Sheriffs Department
c/o Charles T. Martin
Court House RM L16
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 631-1111
Worcester County States Attorney Office
c/o Joel Todd
1 West Market St. RM 208
Snow Hill, MD 21842 DEFENDANT
(Worcester County)
(410) 632-2166
James Bowden, individually
c/o Worcester County Bureau of Investigation
13070 St. Martins Neck Rd.
Bishopville, MD 21813 DEFENDANT
(Worcester County)
(410) 352-3476 (from James Bowden)
Regan Smith, individually
c/o Worcester County States Attorney Office
1 West Market St. RM 208
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-2166
Worcester County Commission
c/o Edward Hammond, Jr.
Williams, Hammond, Shockley, Moore & Harrison
3509 Coastal Highway
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 289-3552
James G. Barrett, individually
c/o Worcester County Commission
Court House RM 112
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-1194
Worcester County Bureau of Investigation
c/o Prentice M. Lyons
10 Williams Street
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-1333
Granville D. Trimper, individually
c/o Worcester County Commission
1 West Market St.
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-1194
Richard Outten, individually
Worcester County Circuit Court House
1 West Market St.
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 631-1221
Richard R. Bloxom, individually
Worcester County Circuit Courthouse
1 West Market St.
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-1221
Tom Jones, individually
c/o Worcester County Sheriffs Dept.
1 West Market St.
Court House RM L16
Snow Hill, MD 21863 DEFENDANT
(Worcester County)
(410) 632-1111
Martin Koerner, individually
c/o Worcester County Bureau of Investigation
13070 St. Martins Neck Rd.
Bishopville, MD 21813 DEFENDANT
(Worcester County)
(410) 352-3476
Michael Kinhart, individually
c/o Maryland State Police
Barrack V
9758 Ocean Gateway
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-3101
Carl F. Johnson
127 Meeks Dr.
Aberdeen, MD 21001 DEFENDANT
(Harford County)
(410) 272-4779
James Eyler
County Courts Bldg.
401 Bosely Ave., RM M1 3
Townson, MD 21204 DEFENDANT
(Baltimore County)
Maryland State Police
1201 Reistertown Rd.
Pikesville, MD 21208 DEFENDANT
(Baltimore County)
(410) 486-3101
David B. Mitchell, individually
c/o Maryland State Police
1201 Reistertown Rd.
Pikesville, MD 21208 DEFENDANT
(Baltimore County)
(410) 486-3101
Stephen Moyer, individually
c/o Maryland State Police
1201 Reistertown Rd.
Pikesville, MD 21208 DEFENDANT
(Baltimore County)
(410) 486-3101
Stanford Franklin, individually
c/o Maryland State Police
8908 Kelso Drive
Essex, MD. 21221 DEFENDANT
(Baltimore County)
(410) 682-6985
Joseph Curran, Jr., individually
c/o Maryland Attorney Generals Office
200 Saint Paul Place
Baltimore, MD 21202 DEFENDANT
(410) 576-6300
William F. Howard, individually
1118 Bryn Mawr Rd.
Baltimore, MD 21210 DEFENDANT
(410) 576-6300
Julie Tewey, individually
c/o Maryland Attorney Generals Office
200 St. Paul Place
Baltimore, MD 21202 DEFENDANT
(410) 576-6300
Andrew N. McDonald, individually
3910 Keswick Rd.
Baltimore, MD 21211 DEFENDANT
(410) 576-6300
Dale Kelberman, individually
c/o U.S. Attorneys Office
District of Maryland
101 W. Lombard St., RM 820
Baltimore, MD 21201-2692 DEFENDANT
(410) 962-4822
George Russell, III , individually
c/o U.S. Attorneys Office
District of Maryland
101 West Lombard St., RM 820
Baltimore, MD 21201-2692 DEFENDANT
(410) 962-4822
James R. Johnson
610 Harbor Dr.
Annapolis, MD 21403 DEFENDANT
(Anne Arundel County)
Dale Petty, individually
c/o Maryland State Police
9758 Ocean Gateway
Berlin, MD 21811 DEFENDANT
(Worcester County)
(410) 641-3101
Lynne Battaglia, individually
c/o U.S. Attorneys Office
District of Maryland
101 W. Lombard St., RM 820
Baltimore, MD 21201-2692 DEFENDANT
(410) 962-4822
Robert N. McDonald, individually
c/o Maryland Attorney Generals Office
200 St. Paul Place
Baltimore, MD 21202 DEFENDANT
(410) 576-6300
Vickie Gaul, individually
c/o Maryland Attorney Generals Office
200 St. Paul Place
Baltimore, MD 21842 DEFENDANT
(410) 576-6300
John B. Frische
c/o Miles & Stockbridge
10 Light St.
Baltimore, MD 21202 DEFENDANT
(410) 727-6464
Alan M. Grochal
c/o Tydings & Rosenberg
100 East Pratt St.
Baltimore, MD 21202 DEFENDANT
(410) 752-9700
Mary Frances Ebersol
c/o Tydings & Rosenberg
100 East Pratt St.
Baltimore, MD 21202 DEFENDANT
(410) 752-9700
Joel I. Sher
c/o Shapiro & Olander
36 St. Charles St., 20th Flr
Baltimore, MD 21201 DEFENDANT
(410) 385-0202
Timothy McCormack
c/o Shapiro & Olander
36 S. Charles St., 20th Flr
Baltimore, MD 21201 DEFENDANT
(410) 385-0202
Ann C. Lawrence
c/o Shapiro & Olander
36 S. Charles St., 20th Flr
Baltimore, MD 21201 DEFENDANT
(410) 385-0202
Jerome Miraglia
1409 Cooper
Virginia Beach, VA 23454 DEFENDANT
Lori Simpson, individually
c/o Coon & Schach
9 West Mulberry St.
Baltimore, MD 21201 DEFENDANT
(410) 244-8800
Gary Boardwine
19 Highshire Court
Baltimore, MD DEFENDANT
(410) 284-2488
John J. Sellinger
c/o Greenberg & Bederman
1010 Wayne Ave., Ste 1460
Silver Spring, MD 20910 DEFENDANT
(Montgomery County)
(301)565-2200
Gregory M. Burgee
c/o Miles & Stockbridge
30 W. Patrick St.
Frederick, MD 21701 DEFENDANT
(Frederick County)
(301) 662-5155
Earl Bartigis
c/o Miles & Stockbridge
30 W. Patrick St.
Frederick, MD 21701 DEFENDANT
(Frederick County)
(301) 662-5155
Bruff J. Procter
7501 Ridge Rd.
Frederick, MD 21702 DEFENDANT
(Frederick County)
(301) 377-4426
Michelle Procter
7501 Ridge Rd.
Frederick, MD 21702 DEFENDANT
(Frederick County)
(301) 377-4426
Danny B. O’Conner
c/o Severn & O’Conner
141 W. Patrick St.
Frederick, MD 21701 DEFENDANT
(Frederick County)
(301) 662-5155
John Milling
115 River Rd.
Bldg. 12, Suite 1205
Edgewater, NJ 07020 DEFENDANT
(Bergen County)
(201) 794-0714
Susan Michelle Cohen
4181 Rys Terrace
Fair Lawn, NJ 07410 DEFENDANT
(Bergen County)
(201) 794-0714
Kathleen Roberta Ternes
62 Baja Way
Elkridge, MD 21227 DEFENDANT
(Howard County)
(410) 799-7472
Melvin Blecher
4329 Van Ness St. NW
Washington, D.C. 20016 DEFENDANT
(202) 363-0373
Lauren Longo
624 Harbor Drive
Annapolis, MD 21403
(Anne Arundel County) DEFENDANT
(410) 280-9421
Thomas Scott, individually
c/o U.S. Attorney Generals Office
99 N.E. 4th St. 3rd Fl.
Miami, FL 33132-2111 DEFENDANT
(Broward County)
(305) 961-9334
Maureen Donlan, individually
c/o U.S. Attorney Generals Office
99 N.E. 4th St. 3rd Fl.
Miami, FL 33132-2111 DEFENDANT
(Broward County)
(305) 961-9334
Margaret Tindall, individually
c/o Maryland Attorney Generals Office
200 St. Paul Place
Baltimore, MD 21202 DEFENDANT
Betty S. Sconion, individually
c/o Maryland State Police
1201 Reistertown Road
Pikesville, MD 21208 DEFENDANT
Fiber Technology, Inc.
Bruff Procter, Resident Agent
7501 Ridge Rd.
Frederick, MD 21702 DEFENDANT
(Frederick County)
Chieftan Investors, Inc.
Mark C. Sapperstein, Resident Agent
28 Walker Ave.
Baltimore, MD 21208 DEFENDANT
Donald Stone Industries Inc.
1623 Forest Drive, Suite 203
Annapolis, MD 21403 DEFENDANT
(Anne Arundel County)
or:
Rte 50 & Golf Course Rd.
Ocean City, MD 21842
(Worcester County)
Shippers Choice, Inc.
Charles R. Longo, Resident Agent
1623 Forest Dr., Ste. 203
Annapolis, MD 21403-1020 DEFENDANT
(Anne Arundel County)
Shippers Choice of Virginia, Inc.
Charles R. Longo, Resident Agent
1623 Forest Dr., Ste. 203
Annapolis, MD 21403-1020 DEFENDANT
(Anne Arundel County)
Shippers Choice of Virgina, Inc.
Charles R. Longo, Resident Agent
6200 Jefferson Davis Hwy. DEFENDANT
Woodford, VA
Miles & Stockbridge Professional Corp.
Joseph Welty, Resident Agent
10 Light St.
Baltimore, MD 21202 DEFENDANT
(410) 727-6464
Shapiro & Olander Professional Corp.
Christopher Dean Olander, Resident Agent
36 S. Charles St., 20th flr
Baltimore, MD 21201 DEFENDANT
(410) 385-0202
Tydings & Rosenberg LLP
J. Hardin Marion, Resident Agent
100 East Pratt St.
Baltimore, MD 21202 DEFENDANT
(410) 752-9700
Williams, Hammond, Shockley, Moore, & Harrison Professional Corp.
Edward H. Hammond, Jr., Resident Agent
3509 Coastal Hwy.
Ocean City, MD 21842 DEFENDANT
(Worcester County)
(410) 289-3553
JURISDICTION
1. This court has original jurisdiction of all civil actions arising under the
constitution laws of the United States pursuant to Title 28, U.S.C. §1331 and
pursuant to Title 28, U.S.C. §1332, in that there is true diversity of
citizenship and the amount in controversy exceeds TEN THOUSAND DOLLARS
($10,000.00), exclusive of interest and costs.
2. Plaintiff is a citizen of the state of Florida.
3. Defendants are predominantly citizens of the state of Maryland, with two (2) defendants citizens of the state of New Jersey and one defendant a citizen of the state of Virginia.
4. 18 U.S.C. §1965 (d) of the R.I.C.O. statue provides for service in any
judicial district in which the defendant is found. This federal statue
provides for nationwide service of process.
COMPLAINT FOR MONETARY DAMAGES
VIOLATION OF CIVIL R.I.C.O. 18 U.S.C. §1962 (a), (b), (c), (d)
And CIVIL RIGHTS 42 U.S.C. §1983, §1985, §1986 and DUE PROCESS
THROUGH CONSPIRACY AND FRAUD
COMES NOW DONALD D. STONE, pro se, Plaintiff in this action and moves this
court for trial by jury against Defendants as follows:
SUMMARY OF CLAIM
In late 1993, Plaintiff began a privately-financed investigation into his former
business associates. The investigation was initiated because of an
extortion attempt on October 15, 1993 by Defendants Robert E. Warfield
(“Warfield”), Mark Sapperstein (“M. Sapperstein”), Charles R. Longo (“Longo”),
and Bruff J. Procter (“Procter”). The extortion attempt consisted of a
threat to have Plaintiff arrested on unspecified criminal charges if Plaintiff
did not capitulate to their demands. Plaintiff’s privately-financed
investigation, conducted over a period of approximately five (5) years and
continuing into the present, evolved into a non-partisan corruption
investigation into the unlawful and criminal activities that had targeted
Plaintiff as a victim by the Clinton/Gore/Reno United States Department of
Justice, the Democratic National Party, the Maryland Democratic Machine, the
United States Attorney’s office in Maryland and Florida, the Maryland Attorney
General’s office, the Maryland State Police, other Maryland law enforcement
agencies, the white collar criminal element at the Maryland Judiciary, and the
Maryland bar. These parties formed an impenetrable wall of corruption
acting in concert and furtherance of a conspiracy to wrest from Plaintiff his
valuable patent and intellectual property.
Plaintiff’s investigation was combined with what Plaintiff knew of FBI and IRS investigations into Defendants Judge Theodore R. Eschenburg (“Judge Eschenburg”) and Judge Thomas C. Groton (Judge Groton”), the Worcester County Circuit Court judges alleged involvement in the trafficking of large amounts of cocaine “under color of law” into Worcester County, Maryland from south Florida in the mid to late 1980s. Additionally, Judge Groton’s brother and Defendant Bruce A. Moore (“Moore”) were personally involved in the various criminal activities involving this cocaine trafficking.
Plaintiff’s investigation uncovered a multitude of additional victims of the unlawful and criminal activities that had targeted Plaintiff. All Defendants, acting in concert in furtherance of a conspiracy to fraudulently wrest from Plaintiff his valuable intellectual property, were simultaneously defrauding numerous other victims through extensive fraudulent schemes and violations of the Federal criminal statutes, specifically
a) United States Department of Education involving an estimated $8 million in
student loans.
b) 2000 documented victims in Maryland and Virgina.
c) The Honorable E. Stephen Derby, Judge, Federal Bankruptcy Court, District of
Maryland.
d) The United States Bankruptcy Court, District of Maryland in Baltimore.
e) The creditors of Charles R. Longo bankruptcy, case number 90-5-4907-SD.
f) The creditors of National Training Systems, bankruptcy case number
90-5-4018-SD.
g) The creditors of Shippers Choice, Inc., bankruptcy case number 94-57899.
h) The United States Department of Justice, Trustee Bankruptcy Program.
i) The United States Department of Justice, Inspector General’s office,
Education Division.
Plaintiff’s investigation showed that not only had Maryland Federal bankruptcy courts become a haven for Maryland’s criminals, but it was also a haven for the criminal element of the Bankruptcy Bar, the Maryland Bar, the Bankruptcy Trustee Program, and the United States Attorney’s office in Baltimore, Maryland.
Plaintiff, the inventor of United States patent number 5,314,940, and founder
of Donald Stone Industries, Inc., seeks the recovery of damages and his patent(s)
and intellectual property caused by a conspiracy and scheme whereby Defendants
Warfield, Sr.; Longo; Lauren Longo (“L. Longo”); Mark Sapperstein; Sondra
Sapperstein (“S. Sapperstein”); Gilbert Sapperstein (“G. Sapperstein”); Joseph
E. Moore (“J. Moore”); Hal P. Glick (“Glick”); Procter; Gregory M. Burgee
(“Burgee”); the law firm Miles and Stockbrige; and the law firm Williams,
Hammond, Shockley, Moore, and Harrison (“WHSM&H”)infiltrated and achieved
control over Donald Stone Industries, Inc. and simultaneously began using the
assets of Donald Stone Industries, Inc. to further other criminal activities.
In furtherance of this unlawful conspiracy and scheme, Warfield, Glick, Moore,
Longo, Procter, M. Sapperstein, G. Sapperstein and their co-conspirators, known
and unknown, engaged in extortion, mail fraud, wire fraud, conspiracy to commit
bankruptcy fraud, obstruction of justice, tampering with a victim, money
laundering, engaging in monetary transactions in property derived from specified
unlawful activity, interstate and foreign travel in aid of a racketeering
enterprise, sale or receipt of stolen securities, conspiracy to commit
securities fraud, all in violation of the Federal Racketeer Influenced and
corrupt Organizations Act (R.I.C.O.), 18 U.S.C. §1962 (a), (b), (c), (d) and
denied and violated Plaintiff’s Constitutional rights of due process under the
Fourth, Fifth, and Fourteenth Amendments and violated Plaintiff’s civil rights
protected by U.S.C. 42 §1983, §1985, and §1986. In furtherance of this
scheme, federal actors Lynne Battaglia (“Battaglia”); Dale Kelberman (“Kelberman”);
George Russell, III (“Russell”); Lori Simpson (“Simpson”); Thomas Scott
(“Scott”); and Maureen Donlan (“Donlan”) joined with state actors from the
Maryland Attorney General’s Office (William F. Howard (“Howard”); Joseph Curran,
Jr. (“Curran, Jr.”); Julie Tewey (“Tewey”); and Mitchell (“Mitchell”)), the
Maryland State Police, and others, known and unknown, acting in concert with the
private sector actors did scheme to prevent Plaintiff from vindicating his
rights in state court and conspired to prevent him from discovering exculpatory
evidence of the private sector actors’ multitude of unlawful and criminal
activities that had targeted him and his intellectual property as a victim.
Prior to and after the private sector actors obtained control of Donald Stone
Industries, Inc. unlawfully, the federal and state actors in concert conspired
with the private sector actors to fraudulently conceal from Plaintiff the
criminal and fraudulent schemes the private actors had perpetrated on Plaintiff
to unlawfully obtain control of Donald Stone Industries, Inc., obtain the
assignment of Plaintiffs patent(s) and intellectual property, and then the
unlawful conversion of Plaintiffs intellectual property to the private actors
personal assets. Defendants owe Plaintiff a duty to act in a lawful
manner. Defendants have breached the laws. As a result of
Defendants’ unlawful activities, Plaintiff has been damaged in his business and
intellectual property. As a result of the Defendants’ scheme, Plaintiff
has suffered and continues to suffer irreparable and substantial damage to his
business and intellectual property.
SUMMARY OF COMPLAINT
1. Plaintiff, Donald D. Stone (“Plaintiff”), an inventor, formed the corporation
Donald Stone Industries, Inc. (“DSII”) to commercialize a technology Plaintiff
had invented.
2. Unknown to Plaintiff, DSII’s attorney Burgee, Secretary/Treasurer Bruff J.
Procter, and alleged first investor Charles R. Longo were engaged in
numerous fraudulent interwoven and overlapping schemes, such as money laundering
and conspiracies to commit federal bankruptcy fraud, that were perpetrated by
Longo, a white-collar criminal who had 2,000 documented victims in Maryland and
Virginia. These bankruptcy fraud schemes were committed by concealing
assets from creditors by diverting Longo’s personal assets and the assets of his
corporations for which bankruptcy had been filed into legitimate businesses,
such as DSII, and real estate investments throughout Maryland. The schemes
perpetrated against Plaintiff and DSII were as follows:
3. In or about January 1991, Burgee, Procter, and Longo induced Plaintiff to
believe that Longo was an accredited investor (an individual with an annual
income of not less than $200,000.00 and a net worth of not less than
$1,000,000.00) who had invested $15,000 into DSII.
4. Plaintiff as inventor, President, and major shareholder with controlling
interest of DSII, having successfully introduced and interested numerous major
“Fortune 100” and “Fortune 500” corporations in the emerging technology and
inventions was unaware of Longo, Procter, Burgee, and the law firm of Miles &
Stockbridge’s ongoing criminal activities.
5. In the Fall of 1993, just as DSII was on the verge of possibly signing two
(2) potentially valuable licensing agreements for the technology Plaintiff had
invented, Longo and Procter, needing money to support one (1) of their
rapidly-collapsing fraudulent securities schemes, conspired with three (3) DSII
investors to fraudulently seize control of DSII. In the first of numerous
extortion attempts, Longo, Procter, and the other DSII investors threatened to
have Plaintiff arrested on unspecified criminal charges unless Plaintiff
capitulated to their demand to turn over DSII corporate documents in his
possession. Plaintiff complied.
6. After seizing control of DSII, Longo was made President of DSII. At
that point, Longo and Procter had exclusive control of DSII’s checking account.
7. In furtherance of their criminal conspiracy, Longo, Procter, Burgee, and
Miles & Stockbridge induced three (3) investors to invest additional money in
DSII. Longo and Procter then embezzled a portion of this money for their
personal enrichment and to finance their sale of fraudulent securities.
8. On or about January 12, 1994, in order to cover up their embezzlement of DSII
funds and to support their rapidly-collapsing fraudulent securities scheme,
Longo and Procter devised a scheme to extort Plaintiff’s patent. In this
extortion attempt, Longo, L. Longo, Procter, Glick, Moore, Sapperstein, G.
Sapperstein, and S. Sapperstein demanded that Plaintiff assign to DSII his
patent and pending patent for the technology upon which DSII was based.
Plaintiff refused to capitulate.
9. By February 1994, Longo, Procter, Moore, Warfield, Glick, Sapperstein, G.
Sapperstein, and Burgee, frustrated by their failure to extort from Plaintiff
his intellectual properties, and in furtherance of the conspiracy to extort
“under color of law,” had their attorneys devise another scheme to defraud
Plaintiff by filing a sham lawsuit against Plaintiff in another attempt to force
Plaintiff to capitulate to their demand that he relinquish his ownership of the
patent and patent pending upon which DSII was based. This lawsuit,
involving malicious prosecution, judicial abuse, and denial of due process, was
filed against Plaintiff in a “good old boy” backwater kangaroo court in a
district where the two (2) sitting judges were long-time personal acquaintances
and political cronies of three (3) of the DSII investors and the investors’ law
firm.
10. Plaintiff refused to capitulate to the extortion attempts and threats and
instead initiated an investigation into Longo’s background. Eventually this
investigation mushroomed into a corruption investigation identifying federal and
state law enforcement agencies and officials more interested in protecting their
personal and political agendas and politically-well-connected Maryland
businessmen who were involved in numerous federal racketeering activities and
state criminal law violations.
11. With each of Plaintiff’s refusals to capitulate to the intimidation,
threats, and extortion attempts brought about by the Defendants, the more the
Defendants were forced to enact multiple fraudulent schemes and cover ups for
their criminal activities, each one requiring greater participation by federal
and state agencies to provide “under color of law” resources to protect the
prominent and politically-well-connected Maryland businessmen to allow them to
operate without restriction while committing numerous federal felony offenses.
UNDERLYING FACTS
Re: Longo/National Training Systems/Shippers’ Choice, Inc.
1. On or about October 15, 1993, shortly after Plaintiff received an
extortion attempt from Longo, Warfield, Procter, Sapperstein, and G. Sapperstein,
in which they threatened to have Plaintiff arrested on unspecified charges if he
did not capitulate to their demand to turn over immediately all DSII corporate
documents in his possession, Plaintiff initiated a personally-financed
investigation into Longo and Longo’s business associates. The
investigation would not terminate until four (4) years later and would reveal
Longo and his business associates’ extensive white-collar criminal activities
that included complex numerous interwoven and overlapping fraudulent schemes.
The investigation was conducted in Maryland, Virginia, Washington D.C., New
Jersey, New York, Texas, Georgia, Florida, Indiana, and Alabama.
2. Longo, through his National Training Systems (“NTS”), which was a
professional truck driver training school, had victimized approximately 2,000
(two thousand) students in Maryland and Virginia in a United States Department
of Education student loan fraud scheme in the late 1980s.
3. Longo and NTS are alleged by the Maryland Attorney General’s office to have
defrauded NTS students of approximately $8 million in United States Department
of Education student loan money.
4. In or about October 1990, Longo was indicted in Virginia on 46 (forty-six)
counts of grand theft, arrested, and jailed for approximately 9 (nine) days in
Maryland. Due to a technicality, the charges were dropped and Longo
had records expunged.
5. By 1993, NTS in Virginia was closed as a result of numerous complaints.
6. Longo reopened in Virginia in or about 1993 under the name Shippers’ Choice
of Virginia. The company was registered under the name of other
individuals to disguise Longo’s ownership. The opening of Shippers’ Choice
of Virginia was financed with money Longo had obtained from an alleged
securities fraud scheme.
7. In or about September 1990, NTS filed bankruptcy in Maryland, with debts of
approximately $10,000,000.00 (ten million dollars), to use the protection of the
bankruptcy courts against an intensifying investigation by the Maryland Attorney
General’s office. In connection with this bankruptcy, Longo and his
associates made numerous fraudulent pre-petition and post-petition transfers of
assets to defraud the NTS creditors. The NTS bankruptcy was dismissed in
July 1992.
8. In or about November 1990, Longo and his wife (Linda) would jointly file
personal bankruptcy in Maryland to protect themselves from personal liability
with NTS and to use the protection of the bankruptcy courts against the
intensifying investigation by the Maryland Attorney General’s office.
Longo made numerous fraudulent pre-petition and post-petition transfers of
assets to defraud his personal creditors. Longo and his wife would later
split their case. Longo’s wife’s case and plan would be confirmed but
Longo’s case would still be open in 1998.
9. By conducting fraudulent transfers to conceal cash and material assets to
defraud the creditors of both the NTS bankruptcy and his personal bankruptcy,
and then diverting these assets into legitimate businesses and real estate,
Longo and his associates were able to finance a new corporation as a vehicle for
the furtherance of numerous fraudulent schemes.
10. Longo’s new corporation, Shippers’ Choice, Inc. (“SCI”), was another alleged
“professional truck driving school” which opened in Maryland on or about
September 27, 1990.
11. Beginning in or about 1992, Longo/SCI, with the assistance of Washington
Investments (“WI”), a corporation engaged in investment banking, would begin
selling student loans in bundled offerings of $10,000.00 (ten thousand dollars).
This alleged fraudulent securities scheme would gross Longo/SCI/WI approximately
$1,325,000.00 (one million, three hundred twenty-five thousand dollars).
This securities fraud scheme would collapse in late 1993/early 1994.
12. The money from the student loan offerings was to be used by SCI, a Maryland
corporation, but Longo was diverting a portion of the money to finance the start
up of Shippers’ Choice of Virginia.
13. Additionally, Longo is alleged to have been using money from these schemes
for his personal enrichment rather than for corporate purposes.
14. Longo had personally fraudulently represented in writing to investors of
these offerings that SCI was not a party to any litigation and that no
litigation had been brought against SCI. At the time Longo was making
these statements, SCI was operating against two (2) cease-and-desist orders from
the Maryland Higher Education Department and was continually involved in
litigation with the state of Maryland.
15. In or about March 1993, Michael Dennis Beck (“Beck”), an associate of
Longo’s involved in the alleged sale of the SCI fraudulent securities offerings,
pled guilty to one (1) count of federal felony offense (wire fraud) and was
incarcerated for 18 (eighteen) months on a charge unrelated to the alleged SCI
securities offerings.
16. The SEC is alleged to have been unaware of Beck’s activities in the sale of
the $500,000.00 (five hundred thousand dollars) fraudulent securities offerings
made by Longo/SCI/WI until mid 1996.
17. In or about December 1994, SCI declared bankruptcy in an effort to evade
liability for the fraudulent securities scheme.
18. Beginning in or about October 1993 and lasting until the present, DSII, the
victim or prize corporation, would become a mere continuation of SCI, which was
the continuation of NTS. Namely, all were vehicles through which Longo and
his associates engaged in fraudulent activities. With DSII, Longo and his
associates would have absolute control of the potentially valuable technology
and patent Plaintiff had invented and of DSII, a legitimate corporation
Plaintiff had formed. Hidden behind this legitimate corporation, Longo and
his associates would further their fraudulent and federal felony activities and
parlay the money and assets from their previous fraudulent schemes into an
ever-expanding collection of legitimate businesses, enterprises, and real
estate.
UNDERLYING FACTS
Re: “Good Old Boy” Syndicate Of Worcester County, Maryland
Extensive Pattern And History Of Criminal Activity And Corruption In Worcester
County, Maryland -- 1985 To Present
The paragraphs that follow describe the history and various components that make up the on-going corruption, criminal activities, and unwritten custom and policies conducted, “allowed,” and, at times, encouraged in Worcester County, Maryland by highly-placed and influential judicial, political, and financial leaders of Worcester County.
1. Plaintiff’s complaint against the Defendants residing in Worcester County
Maryland is not an isolated incident. Worcester County has an extensive
pattern and history of political corruption and criminal activity at all levels
of local government from the Worcester County Court House -- under the exclusive
control of Defendants Judge Eschenburg and Judge Groton – to all county, city,
and town Boards of Commissioners and law enforcement agencies of Ocean City,
Berlin, and Snow Hill, Maryland.
2. There are two main sources of income in Worcester County: tourism and real
estate. Defendants Moore, Warfield, and Glick own and operate Moore
Warfield and Glick, one of the largest real estate companies in the Worcester
County area. (At some point, Moore sold his interest in this company and
is no longer associated with it.)
3. Prior to becoming Worcester County Circuit Court judges, Defendants Judge
Eschenburg and Judge Groton were attorneys who dealt predominately with real
estate law. Judge Eschenburg is the administrative judge of the Circuit
and Judge Groton is his protégé. Worcester County is under the absolute
control of Judge Eschenburg and Judge Groton and two local law firms, one of
which is Defendant WHSM&H. Further, Defendant Ed Hammond, Jr. (“Hammond”)
of the law firm WHSM&H is the Worcester County solicitor.
4. Defendants Moore, Warfield, and Glick from real estate, and WHSM&H from law
-- along with their attorneys and Judge Eschenburg and Judge Groton -- form a
segment of what is commonly called a “Good Old Boys” network. If there is
something any of the “Good Old Boys” want to steal or obtain unlawfully, they
simply create a sham lawsuit under “color of law” and run it past their
political cronies and/or personal acquaintance/golfing buddy Judge Eschenburg or
Judge (Judge Groton doesn’t play golf).
Cocaine Trafficking In Worcester County, Maryland
5. In the mid to late 1980s, large quantities of cocaine were being trafficked
from Florida into Worcester County, MD under “color of law” by personal
acquaintances and/or political cronies and/or family members of Defendants Judge
Eschenburg and Judge Groton. Defendant Bruce Moore and Defendant Judge
Groton’s brother, Harry Groton, were also involved. Such trafficking could take
place because Judge Eschenburg, with his political connections and control of
the local law enforcement agencies (Worcester County Sheriffs Department, Berlin
Police Department, Ocean City Police Department, Maryland State Police, and the
Worcester County States’ Attorney) could provide absolute protection for certain
“Good Old Boys.”
6. Ultimately, the “Good Old Boys’” involvement in cocaine trafficking became
dangerous when Richard McCleary, one of the traffickers and a former law clerk
for both Judge Eschenburg and Judge Groton, allegedly threatened to kill his
wife. The FBI and IRS, fearing a possible murder, stepped in and shut down
the cocaine trafficking operation. As “punishment” for their involvement in the
operation, the United States Department of Justice simply slapped the wrists of
Judge Eschenburg, Judge Groton, and their personal acquaintances/political
cronies/family members and then had their names swept under the carpet.
McCleary eventually was sentenced to a 26-year term to be served in Maryland’s
state prison.
7. Completely unrestricted, emboldened, and politically protected at the federal
and state level, the “Good Old Boys” began escalating their corrupt and criminal
activities under the protection of Judge Eschenburg and Judge Groton.
Intimidation
8. In the early 1990s, Judge Eschenburg and one of his former law clerks (who
was then in private legal practice), tried to perpetrate an alleged fraudulent
scheme (similar to the one perpetrated on Plaintiff) on an inventor in Worcester
County. In an effort to threaten and intimidate this other inventor and
Worcester County resident, Judge Eschenburg made arrangements to have him
arrested by the Worcester County Sheriff’s Department and jailed.
Civil Rights Violations / Interference With Voter Rights
9. With the Worcester County Sheriff’s Department, the Worcester County
Commission, the Berlin Police Department, and the Ocean City Police Department
under their absolute control, Judge Eschenburg, Judge Groton, and the “Good Old
Boys,” made Worcester County the center of a modern-day version of the
post-Civil War South.
10. Prior to the 1990s, Blacks in Worcester County were kept in low-paying jobs
and were politically inactive. In the early 1990’s, Blacks became more
politically active in an effort to place an Black on the Worcester County
Commission. The “Good Old Boys” network, accustomed to more than 253 years
of absolute control of Worcester County, challenged the lawful political
activity of the Blacks. Allegedly, unknown “Good Old Boys” let it be known
to the Blacks that certain political leanings were frowned upon and that frowns
could be enforced by joblessness. In addition, voter-registration
campaigners in the Blacks districts allegedly encountered residents who feared
registering to vote because their land would be taken from them.
11. Judge Eschenburg, Judge Groton, and certain “Good Old Boys” turned their
criminal political oppression into a profit center for some of their political
cronies and personal acquaintances when they had Worcester County hire an
attorney from Mississippi to work with local attorneys alleged to be from the
law firm of WHSM&H. More than one-half million dollars in federal and
state tax dollars were spent by Worcester County in its alleged attempts to
violate the rights of Blacks.
Expanding Their Criminal Activities (Late 1993 – Early 1994)
12. In late 1993 and early 1994, Judge Eschenburg, Judge Groton, and certain
“Good Old Boys” resurrected their scheme to defraud an inventor and targeted
Plaintiff and his valuable patent and intellectual property.
Protection And Corruption
13. Judge Eschenburg and Judge Groton use the Maryland State Police, at their
barracks in Berlin, Maryland, to protect their personal acquaintances, political
cronies, and family members who are engaged in criminal activities or
corruption. Further, the Maryland State Police investigative procedures
provide protection for the Defendants because all investigations are conducted
through the Worcester County States Attorneys Office under the direction of
Defendant Joel Todd (“Todd”). Todd quashes and conceals or diminishes any
investigations being conducted into the activities of the personal
acquaintances, political cronies, and family members of Judge Eschenburg, Judge
Groton, and the “Good Old Boys.” Additionally, the Worcester County States
Attorneys Office knows the members of the “Good Old Boys” network and acts to
screen and protect the “Good Old Boys,” Judge Eschenburg, and Judge Groton from
investigations of their criminal activities and corruption.
14. When the Worcester County law enforcement agencies or Maryland State Police
accidentally investigate or arrest persons “protected” by Judge Eschenburg,
Judge Groton, or the “Good Old Boys,” Todd (the person who decides what cases to
prosecute) simply drops the case and sweeps it under the carpet or diminishes
the charges. In doing this, Todd can rely on the political connections of
Judge Eschenburg; Judge Groton; Mitchell; Curran, Jr.; and Defendant Stephen
Moyer (“Moyer”) of the Maryland State Police Internal Affairs Division to quash,
cover up, and conceal any unlawful or criminal activity Judge Eschenburg, Judge
Groton, and the “Good Old Boys” want to perpetrate.
15. Aggressive and relentless investigations, such as the one conducted by
Plaintiff, into the extensive criminal activities and corruption surrounding
Judge Eschenburg, Judge Groton, and the “Good Old Boys,” require Judge
Eschenburg, Judge Groton, and the “Good Old Boys” to call upon their “absolute
protection” resources to protect their unlawful activities and corruption.
At the state level, absolute protection is given directly by the head of the
Maryland State Police, Defendant David B. Mitchell, acting in concert with the
Maryland Attorney General, Defendant Joseph Curran, Jr. With unlimited
federal and state tax dollars and financial resources, Mitchell and Curran, Jr.
provide an impenetrable wall of protection for Judge Eschenburg, Judge Groton,
and the “Good Old Boys.”
16. Further, it is an unwritten policy and custom for local political entities
and law enforcement agencies throughout Worcester County to work in concert with
each other to protect Judge Eschenburg, Judge Groton, the “Good Old Boys,” their
family members, and their circle of personal and political friends from
investigations and to conceal their fraudulent activities. Acting under
this unwritten policy and custom, the Mayor of Berlin (Rex Haley), Berlin Town
Council members (Elroy Brittingham, Sr. (“Brittingham”), Dean J. Burell
(“Burrell”), Paula Lynch (“P. Lynch”), Frederick Parker (“Parker”), and William
Turner (“Turner”)), and Worcester County commissioners (James G. Barrett
(“Barrett”), Granville D. Trimper (“Trimper”), Robert L. Cowger, Jr. (“Cowger”),
and Jeanne Lynch (“J. Lynch”)) work with Judge Eschenburg, Judge Groton, and the
“Good Old Boys” to use local law enforcement agencies (Worcester County Sheriffs
Department, the Worcester County Bureau of Investigation, Ocean City Police
Department, Berlin Police Department, and the Worcester County States Attorneys
Office) to conduct sham investigations, falsify law enforcement reports, and
fraudulently conceal exculpatory evidence from victims.
17. The core of the protection and corruption in Worcester County – at both the
state and federal levels -- is the Democratic National Party acting to protect
the Maryland Democratic Machine. At the federal level, protection is
provided to Judge Eschenburg, Judge Groton, and the “Good Old Boys” by Clinton,
Gore, and United States Attorney General Janet Reno through the Democratic
National Party and the Maryland Democratic Machine. This protection is
evidenced by the use of the United States Attorney for Maryland (Battaglia), and
through their use of the Chief of the White Collar Crime division of the United
States Attorneys’ Office for Maryland (Kelberman).
18. Battaglia and Kelberman control the FBI investigations in Maryland. It
is their unwritten policy and custom to quash any casual or cursory
investigation by the FBI or any agency of the Department of Justice in which the
“paper trail” would lead to Miles and Stockbridge, Tyding and Rosenberg, and
Shapiro and Olander (three of Maryland’s most politically powerful and connected
law firms that were engaged in unprecedented unrestricted unlawful and criminal
activities).
Federal Prosecutors As Federal Predators
19. As the Republican Party continues to force the Democratic National Party
closer to bankruptcy, the unwritten policy and custom of the Clinton/Gore
administration and the United States Attorney General Reno is to use the
Department of Justice and the United States Attorneys to protect the unlawful
criminal activities and corruption of the Maryland and Florida Democratic
parties. Through fraudulent concealment of exculpatory evidence, quashing
criminal investigations, and in an on-going effort to discredit the Plaintiff,
Maryland Democrats and their political cronies are unlawfully enriching
themselves as they continue to expand their criminal activities, moving from one
fraudulent scheme to the next under the absolute protection of the United States
Department of Justice.
20. Battaglia and Kelberman are using the Department of Justice to protect the
criminal activities of the Maryland Defendants to serve political and/or
personal agendas, as follows:
a) Protect, promote, and facilitate any and all criminal activities that
enrich the Maryland Democratic Machine through their allegiance to members of
the Maryland Democratic Machine.
b) Protect the white collar criminal element at the Maryland Bar -- such
as Miles and Stockbridge, Tydings and Rosenberg, and Shapiro and Olander -- to
guarantee themselves of well-paying jobs at politically-powerful law firms in
the event that they take jobs in the private sector (i.e., former Maryland
Attorney General Richard Bennett, is now a partner at the firm of Miles and
Stockbridge.) Bennett is acting as chief counsel in the investigation of
the alleged campaign finance fraud by Clinton and Gore while Miles and
Stockbridge continued to conspire with Defendant Longo to commit federal
bankruptcy fraud and money laundering.)
c) Enable Maryland’s white collar criminal element at the Maryland
Bar and politically powerful and connected Maryland law firms, such as Miles and
Stockbridge, to conduct their criminal activities through the Maryland
Bankruptcy courts thereby defrauding the United States government and creditors
while enriching themselves. (i.e., Under the protection of Battaglia and
Kelberman, Longo and other Defendants have moved seamlessly from one fraudulent
scheme to another during the last seven years. And, Lori Simpson was a
former Department of Justice United States Bankruptcy trustee. Aware that
federal bankruptcy fraud was more lucrative and protected -- by Gore, Reno,
Battaglia, and Kelberman –- Simpson took a position with a law firm founded by a
former Miles and Stockbridge employee as a sub-contractor to the Department of
Justice as a bankruptcy trustee.)
Reno’s Involvement
21. Federal protection, from as high up as United States Attorney General Reno,
is allowing the Maryland Democratic Machine, through the criminal activities of
Judge Eschenburg, Judge Groton, and the “Good Old Boys,” to target private
citizens such as the Plaintiff. The protection includes but is not limited
to attempts to discredit Plaintiff and fraudulently concealing from Plaintiff
exculpatory evidence of the criminal activities by Battaglia, Kelberman, and
their co-conspirators.
Bankruptcy Court
22. Under the protection of Battaglia, Kelberman, Russell, and Simpson,
Maryland’s bankruptcy courts have become a haven for Maryland’s Democratic
white-collar criminals. With Longo and his co-conspirators, Battaglia and
Kelberman devised schemes to shield Longo while allowing him to continue with
his criminal activities.
Failed Justice
23. Battaglia and Kelberman control the FBI in Maryland. They simply quash
any investigation into the activities of their political and personal cronies.
Additionally, they act in concert with the Maryland Attorney Generals Office and
the Maryland State Police to thwart any investigations that may be started at
the state level involving violations of federal statutes and Constitutional
rights. Efforts by Plaintiff to bring to justice the Defendants have been
and are continuing to be blocked by both federal and state law enforcement
agencies.
UNDERLYING FACTS
Re: Background Of Defendants Mark, Gilbert, And Sondra Sapperstein
1. Plaintiff was induced by Defendant Procter to believe that Defendants Mark
Sapperstein and Gilbert Sapperstein were legitimate businessmen with numerous
business dealings with cities and municipalities throughout Maryland, and
alleged contracts with Bell Atlantic and Cellular One concerning cellular towers
that were owned by Mark, Gilbert, and/or Sondra Sapperstein or businesses or
corporations controlled by them.
2. In the summer of 1993 in a conversation with Plaintiff, Procter alleged that
Mark Sapperstein and Gilbert Sapperstein had tried in the spring of 1993 to
purchase a bingo hall from organized crime for an estimated $18 million.
Procter stated further that the Sappersteins had spent an estimated $50,000.00
in legal fees only to have the deal collapse. (In late 1994, Plaintiff
reported this information to the Maryland State Police Officer Major Cook at the
Maryland State Police headquarters in Pikesville. Major Cook had been
appointed by the Maryland governor to investigate alleged criminal activities
concerning bingo halls in Maryland.
3. Further, when Mark Sapperstein and one of his companies that builds cellular
towers wanted to erect a tower in a neighborhood where the residents objected,
they simply circumvented the legal process and had construction of the tower
started on a weekend when there weren’t any building inspectors available to
stop the construction.
4. In or about June 1995, Plaintiff discovered a falsified contract Mark
Sapperstein had entered into with the town of Ocean City, Maryland concerning
cellular tower site services that were being provided to Ocean City.
5. Additionally, Defendant Procter alleged to Plaintiff that Defendant Mark
Sapperstein was spending a large amount of time and money entertaining Ocean
City’s (MD) City Manager, Dennis Dare. In addition to the falsified
contract, Defendant Sapperstein had with the town of Ocean City, Sapperstein was
actively trying to influence City Manager Dare in an effort to sell to the town
of Ocean City a large piece of property that Mark, Gilbert, and Sondra
Sapperstein owned for Ocean City to use for the unnecessary expansion of the
Ocean City airport, an expansion involving large amounts of federal and state
tax dollars.
6. Through their alleged political and personal connections with the Maryland
Attorney General Defendant Curran, Jr., Mark, Gilbert, and Sondra Sapperstein
can engage in whatever unlawful and criminal activities they desire in the state
of Maryland.
BACKGROUND
1. In or about September 1989, Plaintiff, a surfer for over 25 years, envisioned
a non-abrasive, non-skid coating for surfboards. With only a high school
education and no formal chemistry background, Plaintiff began independent
research and development on a non-abrasive, non-skid coating for surfboards.
2. In or about October 1990, Plaintiff discovered that a mixture of
off-the-shelf components, such as VaselineTM (from the drug store) and
PlastidipTM (from the hardware store), could produce certain qualities desirable
for non-abrasive and non-skid coatings on water-wet surfaces. Plaintiff
continued his independent research and development through 1991 until he
believed he had a working formula to demonstrate.
3. In or about September 1991, after several hundred experiments, Plaintiff
finally developed a formulation that met all the necessary criteria for a
possible surfboard application: non-abrasive, wet traction coating, adhesion to
substrate, and easy to clean.
4. On or about September 20, 1991, Plaintiff demonstrated his invention, which
he named Octo-Grip, at the Action Sports Retail Trade Show in Atlantic City, New
Jersey.
5. Shortly thereafter, Procter, a customer of Plaintiff’s fiberglass repair
company in Ocean City, Maryland, convinced Plaintiff that he (Procter) could
raise the operating capital to finance the cost to patent Plaintiff’s technology
and to commercialize it. Plaintiff entered into a verbal agreement with Procter
where Procter was to receive shares in the proposed corporation in exchange for
his work raising money on behalf of the proposed corporation.
6. In or about October 1991, Procter introduced Plaintiff to Longo touting Longo
as a potential investor in the proposed corporation.
7. In or about November 1991, Procter and Plaintiff contracted Ken Darnell, a
patent agent, to conduct a patent search to determine if the invention Plaintiff
had discovered could be patented. The patent search, concluded in November
1991, showed that Plaintiff’s invention was unique and could be patented.
8. In or about November 1991, Procter introduced Plaintiff to Burgee, an
attorney with the law firm Miles & Stockbridge at the Miles & Stockbridge office
in Frederick, Maryland. Procter and Burgee were childhood friends and Burgee was
Procter’s personal and business attorney. Plaintiff and Procter engaged
Burgee to form a corporation to be known as Donald Stone Industries, Inc. for
the purpose of developing Plaintiff’s invention and to commercialize the
resultant technology.
9. Unknown to Plaintiff at the time he was introduced to Burgee, Longo, Procter,
Burgee, and Miles & Stockbridge were engaged in numerous fraudulent schemes
allegedly involving money laundering and conspiracies to commit federal
bankruptcy fraud by diverting Longo’s personal assets, as a debtor in
possession, and the assets of the bankrupt NTS, a corporation Longo exclusively
controlled, into various legitimate businesses and real estate transactions in
Frederick, Maryland and throughout Maryland.
10. On December 6, 1991, DSII was incorporated as a Maryland corporation with an
initial stock distribution of 5,000 (five thousand) shares of Common stock,
3,000 (three thousand) shares of Class A Voting Common stock, and 2,000 (two
thousand) shares of Class B Non-voting Common stock.
a) The Articles of Incorporation were signed in the offices of Miles &
Stockbridge in Frederick, Maryland. The Articles of Incorporation recorded
the following as officers of the Corporation: Donald D. Stone, President
and Bruff J. Procter, Secretary/Treasurer.
b) On or about December 7, 1991, in the presence of Burgee in the Miles &
Stockbridge offices in Frederick, Maryland, Plaintiff and Procter were issued
stock in DSII as follows: Donald D. Stone, President, stock certificate
number A-1 for 61% of the Class A Voting stock, which represented controlling
interest of DSII; and Bruff Procter, Secretary/Treasurer, stock certificate
number A-2 for 39% of the Class A Voting stock.
c) Neither Burgee nor Procter explained to Plaintiff that investors in
DSII would be sold shares of stock from Plaintiff’s 61%.
11. On or about December 6, 1991, Burgee advised Plaintiff and Procter that
operating capital for DSII could be raised through a private offering to
not-more-than 35 (thirty-five) accredited investors (individuals with an annual
income or not less than $200,000.00 and a minimum net worth of $1,000,000.00)
and that Burgee and Miles & Stockbridge could provide DSII with the necessary
documents and questionnaires that investors would have to complete for
consideration as accredited investors.
12. In or about January 1992, Burgee and Miles & Stockbridge prepared a
Licensing Agreement by which Plaintiff would license his invention to DSII.
a) On or about January 13, 1992, Plaintiff signed the licensing agreement
as licenser. Procter, as receiver for DSII, signed the licensing agreement
as licensee.
b) Burgee never informed Plaintiff that neither he nor Miles &
Stockbridge had experience or expertise in drafting patent licensing agreements.
c) Burgee and Miles & Stockbridge, as corporate attorney for DSII, never
filed the license agreement with the U.S. Patent Office.
d) Burgee was acting under a gross conflict of interest by concurrently
representing DSII, Procter, and Plaintiff.
13. On or about January 7, 1992, Longo, Procter, Burgee, and Miles & Stockbridge
induced Plaintiff (working in Florida) to believe that Longo was an accredited
investor.
a) Longo, Procter, and Burgee told Plaintiff that Longo had presented
check number 272, drawn on Citizens Bank of Maryland in the amount of $15,000.00
(fifteen thousand dollars) as an investment in DSII.
b) In or about May 1995, Plaintiff discovered that the $15,000.00 check
presented by Longo as an investment into DSII was made payable to Bruff Procter,
an individual, not to DSII.
c) Procter refused to open an DSII corporate checking account.
Instead, Procter deposited the $15,000.00 check into the bank account of Fiber
Technology in Frederick County National Bank in Frederick, Maryland.
d) Further, Plaintiff discovered that the deposit transaction did not
occur until January 23, 1992.
e) Fiber Technology was a checking account exclusively controlled by
Procter and his wife Michelle Procter. Though some of the $15,000.00
investment into DSII was used for DSII expenses, a portion of the investment was
used by Procter and his wife for their own personal enrichment.
14. Between January 1992 and the spring of 1992, Plaintiff made repeated,
unsuccessful requests to Procter for Procter to open a DSII corporate checking
account and to deposit the invested funds into that account.
15. In the spring of 1992, when Procter had still not opened a DSII corporate
checking account or deposited the funds into a DSII account, Plaintiff, who was
working in Florida, returned to Maryland and personally collected from Procter
$5,507.69 (five thousand, five hundred seven dollars and sixty-nine cents), the
amount remaining from the $15,000.00 investment.
a) Plaintiff then opened a DSII corporate checking account at Calvin B.
Taylor Bank in Ocean City, Maryland, and deposited into the DSII corporate
checking account $5,507.69, the amount retrieved from Procter.
b) The DSII corporate checking account was structured so that either
Plaintiff or Procter could sign checks on the account without requiring a
countersignature.
c) Plaintiff used the funds to continue DSII research, development,
marketing, and to cover the expenses to obtain a patent on the developing
technology.
16. Also in the spring of 1992, because it appeared that the technology DSII was
developing would have a greater number of possible applications -- and
thereby greater financial value -- than was originally envisioned, Procter
approached Burgee about how to raise additional operating capital for DSII.
a) Shortly after Procter’s request to Burgee, Burgee arranged a meeting
of Plaintiff, Procter, and Burgee at the downtown Baltimore offices of Miles &
Stockbridge with Miles & Stockbridge attorney John B. Frisch (“Frisch”).
b) Burgee and Frisch led Plaintiff and Procter to believe that additional
capital could be raised by making a private offering to Miles & Stockbridge
clients Sandy Panitz, Frank Sarro, and others.
c) Plaintiff requested that additional capital be raised within three (3)
months because DSII and Plaintiff were operating under extreme financial
hardship.
17. In the fall of 1992, DSII terminated its relationship with Miles &
Stockbridge because of nonperformance and delays by Miles & Stockbridge.
18. In or about September 1992, Plaintiff personally borrowed $5,000.00
(five thousand dollars) from Capital Cash (P.O. Box 9560, Manchester, New
Hampshire) at 21.9% interest to keep Plaintiff and DSII solvent because of
Procter’s refusal to raise any operating capital for DSII (other than the
alleged $15,000.00 Longo, Procter, and Burgee were inducing Plaintiff to believe
was an investment into DSII).
19. In the Fall of 1992, Plaintiff returned to Florida and began working in a
cabinet shop to support himself and the research and development efforts for
DSII.
20. In or about December 1992, Procter secured a $30,000.00 (thirty thousand
dollars) investment into DSII from Sapperstein of Baltimore, Maryland for which
Sapperstein was given 4% of Class A Voting Common stock in DSII.
Plaintiff, working in Florida, traveled to Maryland to meet Sapperstein, to
receive the investment, and to deposit the $30,000.00 into the DSII checking
account at Calvin B. Taylor Bank in Ocean City, Maryland.
21. In or about December 1992, DSII paid to Andrew Sherman (“Sherman”), an
attorney, the sum of $2,000.00 (two thousand dollars) for Sherman to create a
Licensing Memorandum which DSII could use to introduce its technology to
potential licensees. DSII terminated its agreement with Sherman in or
about late February 1993, for delay in producing the finished Memorandum.
22. During the first quarter of 1993, Plaintiff, continuing to work in a cabinet
shop in Florida, and Procter engaged in a massive licensing effort.
a) The licensing effort consisted of contacting personnel in major
corporations throughout the United States that might have applications for
DSII’s technology and then faxing them the DSII licensing memorandum.
b) From this licensing effort, Plaintiff and DSII met with
representatives of Stride Rite shoes in Boston, Massachusetts, one of the
largest seller of shoes in the United States, for the possible application of
DSII’s technology in their Sperry Top Sider shoe soles. From this meeting,
DSII was introduced to a raw material supplier to Stride Rite.
c) Also from this licensing effort, DSII entered into a research and
development agreement with Golf Pride, a division of Eaton Industries and the
largest manufacturer of golf club grips in the world, for the possible
application of DSII’s technology in their golf club grips.
d) Both agreements indicated the enormous possible potential value of
DSII’s emerging technology.
23. During the first quarter of 1993, as Plaintiff was preparing the 1992 K-1
tax forms for investors, Procter informed Plaintiff that the $30,000.00 invested
by Sapperstein was actually not made by Sapperstein but rather by his father
Gilbert, and that the K-1 form was to be made out to Gilbert Sapperstein.
24. In or about March 1993, Sapperstein invested an additional $15,000.00
(fifteen thousand dollars) in DSII for which he was given 2% of DSII’s Class A
Voting stock.
25. All corporate documents and stock certificates would remain in the exclusive
control of Burgee, Procter, and Longo in the offices of Miles & Stockbridge
until Spring 1993.
26. During the second quarter of 1993, DSII entered into a research and
development agreement with Miles Polymer, a large international chemical
conglomerate, for possible application of DSII’s technology in polyurethane shoe
soles. DSII also initiated contacts with Nike and Goodyear Tire and Rubber
Company. This agreement and these contacts reaffirmed the enormous
possible potential value of DSII’s emerging technology and Plaintiff’s
invention.
27. On or about June 17, 1993, Warfield and Glick made a combined investment
into DSII of $22,500.00 (twenty-two thousand, five hundred dollars) for which
they were given 2.5% of DSII’s Class A Voting stock.
28. In the fall of 1993, Longo, Procter, John L. Milling (“Milling”), John J.
Sellinger (“Sellinger”), James R. Johnson (“J. Johnson”), Carl F. Johnson (“C.
Johnson”), and Gary Boardwine (“Boardwine”) realized that their securities fraud
scheme, being perpetrated through SCI and WI, was collapsing. They then
focused their attention on DSII as a legitimate enterprise to further their
fraudulent schemes and began shifting their accomplices into doing work for DSII.
a) In the summer of 1993, Longo introduced Plaintiff to Milling, a
securities attorney in New Jersey, stating that Milling could help with DSII’s
licensing efforts.
b) Unknown to Plaintiff at the time Milling was introduced to him,
Milling was creating the securities documents Longo was using to sell the
fraudulent securities through SCI and WI.
c) Allegedly, under this fraudulent scheme, the student loans were
bundled into $10,000.00 (ten thousand dollars) packages by Longo/SCI then sold
by WI to investors throughout the United States
i) To insure the investment, Longo’s long-time personal friend and
business attorney, Sellinger, was alleged to be acting as the escrow agent
between SCI and WI.
ii) Sellinger was alleged to be maintaining a cushion in the escrow
account to make the investors “whole” in the event there was a default on the
securities. However, Longo and Sellinger never maintained this account,
thereby defrauding the investors who bought these securities.
iii) The money from the sale of these fraudulent securities was to be
used to operate SCI, but Longo was diverting a portion of the money from the
sale of these fraudulent securities through Boardwine and C. Johnson, persons
who had been involved with Longo in numerous other fraudulent schemes, to
Shippers’ Choice of Virginia.
29. On or about September 28, 1993, after a DSII corporation meeting in the real
estate office of Moore, Warfield, and Glick at 128th Street in Ocean City,
Maryland, Longo persuaded Plaintiff that he (Longo) could get the DSII corporate
papers in order, would help Plaintiff issue stock certificates to investors, and
would obtain additional financing for DSII. Plaintiff, believing Longo had
befriended him -- and at that time unaware of Longo’s propensity to engage in
criminal conduct -- gave over to Longo DSII’s corporate documents and the stock
certificates issued to Plaintiff (certificate number A-1) and to Procter
(certificate number A-2) on December 7, 1991.
30. In or about mid-October 1993, Plaintiff personally financed his travel and
lodging to attend the Licensing Executive Society business convention in San
Francisco, California on behalf of DSII to introduce DSII’s emerging technology
to major United States corporations.
a) At this convention, Plaintiff was able to interest H.B. Fuller, the
third largest adhesives and sealant manufacturer in the United States, and
Becton Dickinson, one of the largest medical product suppliers in the United
States, in the emerging technology Plaintiff had invented.
b) While at this convention, Longo, L. Longo, Sapperstein, G. Sapperstein,
S. Sapperstein, Procter, and Warfield seized control of DSII by calling and
holding a fraudulent board meeting. At this meeting they elected Longo as
president of DSII.
c) Longo, Procter, Sapperstein, G. Sapperstein, and Warfield then
threatened Plaintiff via fax that if he did not immediately return all corporate
documents then in his possession to the corporate officers that they would have
him arrested on unspecified criminal charges.
31. Longo -- shortly after seizing control of DSII on or about October 15, 1993,
and threatening to have Plaintiff arrested on unspecified criminal charges --
and Milling represented to Dan Dague, the President of GLS Plastics, a potential
licensee, that they represented Plaintiff’s personal interest.
32. After Longo was elected president of DSII, Longo, Procter, Sapperstein, G.
Sapperstein, Moore, Warfield, and Glick changed DSII’s corporate structure and
strengthened their control of DSII by denying and concealing the existence of
the Class A Voting stock certificate issued to Plaintiff on December 7, 1991,
that would invalidate any and all actions taken by Longo, Procter, Moore,
Warfield, Sapperstein, G. Sapperstein, and Glick against Plaintiff.
a) Longo and Procter changed the DSII checking account so they had
exclusive control of DSII’s funds.
b) Longo changed DSII’s address to 8346 Washington Ave. in Jessup,
Maryland. This address was also the corporate address of SCI, a
corporation exclusively controlled by Longo, and the address from where Longo
was operating his securities fraud schemes and bankruptcy fraud schemes.
33. On or about October 29, 1993, Longo; Procter; Sapperstein; G. Sapperstein;
Burgee; Glick; Moore; Warfield; Miles & Stockbridge; Joseph Harrison, Jr.
(“Harrison”); and the law firm of WHSM&H, highly confident they could extort
from Plaintiff the potentially valuable patent and pending patent upon which
DSII was based through the use of threats, extortion, and intimidation,
convinced Warfield and Glick to invest additional money in DSII and Moore to
invest for the first time in DSII.
a) Warfield invested an additional $12,500.00 (twelve thousand, five
hundred dollars), for which he was given an unknown number of shares of DSII
stock.
b) Glick invested an additional $17,500.00 (seventeen thousand, five
hundred dollars), for which he was given an unknown number of shares of DSII
stock.
c) Moore invested $22,500.00 (twenty-two thousand, five hundred dollars)
for which he was given an unknown number of shares DSII stock.
34. Longo , L. Longo, and Procter then proceeded to embezzle a portion of the
funds invested by Warfield, Glick, and Moore into DSII to finance Longo’s/SCI’s
securities fraud schemes and for their personal enrichment.
a) On or about October 29, 1993, Procter wrote check number 101 in the
amount of $10,000.00 (ten thousand dollars) on DSII’s checking account to
American Credit Company. American Credit Company was a trade name used by
SCI’s for a “paper company” under Longo’s control that was used to conceal and
divert money into and between Longo’s numerous fraudulent schemes.
b) On or about November 11, 1993, Longo wrote check number 118 in the
amount of $20,000.00 (twenty thousand dollars) on the DSII’s checking account to
Cash. Allegedly, Boardwine took this check to the bank, cashed it, then
delivered the $20,000.00 of cash to Longo.
c) On or about November 29, 1993, Longo wrote check number 130 in the
amount of $4,475.50 (four thousand, four hundred seventy-five dollars and fifty
cents) on DSII’s checking account to Taze and Hewitt for a heat pump unit to be
delivered to Longo’s personal residence at 624 Harbor Drive in Annapolis,
Maryland.
35. Longo, L. Longo, Procter, Sellinger, Burgee, Boardwine, C. Johnson, J.
Johnson, Milling, Sapperstein, G. Sapperstein, and S. Sapperstein devised
numerous, simultaneously-enacted schemes to defraud Plaintiff, DSII, Moore,
Warfield, Glick, Harrison, and WHSM&H.
a) On or about November 15, 1993, Golf Pride was to advise DSII if they
would be executing a licensing agreement with DSII. This licensing
agreement would be the result of a research and development agreement initiated
by Plaintiff in early June 1993.
b) Longo, L. Longo, Procter, Burgee, Miles & Stockbridge, Boardwine,
Sellinger, and C. Johnson were after the potentially large initial cash payment
from this licensing agreement so they could use it to cover up Longo’s
embezzlement of DSII funds and for their personal enrichment.
c) Additionally, Longo, J. Johnson, Procter, Burgee, Miles & Stockbridge,
Boardwine, Sellinger, Milling, and C. Johnson were after the initial cash
payments and royalties from this licensing agreement so they could divert the
cash and royalties to support their rapidly-collapsing fraudulent securities
scheme.
36. At some undetermined date after October 1993, Moore, Warfield, and Glick
were allegedly introduced to Rusty Krauss (“Krauss”). Krauss was a
securities broker who was working for WI and helping Longo, Sellinger, Milling,
Procter, SCI, and WI sell the fraudulent securities.
37. In furtherance of the conspiracy, scheme, and artifice to defraud Plaintiff,
Longo, Procter, Moore, Warfield, Glick, Sapperstein, and G. Sapperstein would
devise a scheme to use WI to raise venture capital for DSII if they could extort
from Plaintiff “under color of law” Plaintiff’s intellectual property.
This would allow Longo, Procter, Sellinger, Milling, WI, and WI’s officer J.
Johnson to make a smooth transition from the sale of the fraudulent SCI/WI
securities into fraudulent securities offerings on DSII based on Plaintiff’s
potentially valuable patent and pending patent and the potential for possible
patent licensing agreements on a domestic and international basis.
38. Between November 1993 and February 1994, Longo; Procter; Moore; Glick;
Warfield; Sapperstein; G. Sapperstein; Sellinger; Boardwine; C. Johnson; J.
Johnson; Millings; Burgee; Miles & Stockbridge; Melvin Blecher (“Blecher”), from
the law firm of Foley and Lardner; Harrison; Regan James Reno Smith (“Smith”);
Richard Collins (“Collins”); and Hammond (from the law firm of WHSM&H); and WHSM&H
began to devise another scheme and artifice to defraud Plaintiff and wrest from
him control of DSII and his potentially valuable patent by resorting to
extortion “under color of law.”
a) This scheme was initiated because neither Golf Pride nor GLS purchased
a licensing agreement from DSII.
b) Longo, L. Longo, Burgee, Miles & Stockbridge, and Procter convinced
Moore, Warfield, Glick, Sapperstein, G. Sapperstein, and S. Sapperstein that
they could extort from Plaintiff his patent and the pending patent(s) thereby
making them (Longo, Procter, Moore, Warfield, Glick, Sapperstein, and G.
Sapperstein) owners of Plaintiff’s potentially valuable intellectual properties,
personal property, and assets.
c) Unknown to Moore, Warfield, and Glick, this scheme and artifice to
defraud Plaintiff would enable Longo, Procter, Sapperstein, G. Sapperstein,
Boardwine, Sellinger, and C. Johnson to cover up their embezzlement of the
investments Moore, Warfield, and Glick had made into DSII.
39. James Eyler (“Eyler”), Attorney-in-Charge of the Miles & Stockbridge offices
in Baltimore, Maryland, and Burgee continued to knowingly and fraudulently
conspire to provide legal assistance to Longo, Procter, Moore, Warfield, Glick,
Sapperstein, G. Sapperstein, and WHSM&H in furtherance of the scheme.
a) Miles & Stockbridge continued their involvement with Longo, Procter,
Moore, Warfield, Glick, Sapperstein, G. Sapperstein, and WHSM&H to cover up the
earlier criminal conduct of Burgee, Procter, and Longo that was committed in the
Miles & Stockbridge offices in Frederick, Maryland, against Plaintiff and DSII.
b) Miles & Stockbridge also continued their involvement with Longo, L.
Longo, Procter, Moore, Warfield, Glick, Sapperstein, G. Sapperstein, S.
Sapperstein, and WHSM&H so they could continue to fraudulently divert and/or
protect Longo’s and Procter’s assets from the creditors for Longo’s personal
bankruptcy, the bankruptcy of Longo’s NTS, and eventually the SCI bankruptcy.
40. Unknown to Black and Decker, one of the largest manufacturers of hand tools
in the United States, located in Townsend, Maryland, and a primary client of the
politically-powerful and prestigious Baltimore law firm Miles & Stockbridge,
Miles & Stockbridge attorneys Eyler, Frisch, and Jerome T. Miraglia (“Miraglia”)
were conspiring with Burgee, Longo, Procter, Moore, Warfield, Glick, Sapperstein,
G. Sapperstein, and WHSM&H to devise a fraudulent scheme and artifice to defraud
Plaintiff by conspiring to extort “under color of law” from Plaintiff his patent
and intellectual properties.
a) This was done in the event that if Miles and Stockbridge’s client,
Black and Decker, might have a possible application for the emerging technology
and inventions of Plaintiff, Miles & Stockbridge would be able to obtain
preferential licensing deals if Longo and Procter controlled the inventions and
technology.
41. On or about November 15, 1993, Plaintiff -- unaware of Longo’s propensity to
engage in fraudulent schemes -- began to conduct a personally-financed
investigation into Longo’s background.
a) Plaintiff started his investigation by filing a complaint with Tewey,
Assistant Attorney General of the Securities Division of the Maryland Attorney
General’s office about Longo’s continued and repeated refusal to return to
Plaintiff the stock certificate (number A-1) issued to him on December 7, 1991.
b) In or about January 1994, Plaintiff contacted Burgee in the Miles &
Stockbridge law offices in Frederick, Maryland to have him speak with Tewey.
Burgee agreed to talk to Tewey if she would contact him. However Tewey,
not wanting to become involved in a possible securities fraud investigation that
involved the prestigious and politically-powerful Maryland law firm of Miles &
Stockbridge or the personal and politically-powerful friend of her boss,
Maryland Attorney General Joseph Curran, Jr., refused to contact Burgee stating
attorney/client privilege, even though no attorney/client privilege can exist
for a corporation.
c) Despite numerous telephone calls and letters by Plaintiff between
November 1993 and June 1994, the Maryland Attorney General’s office closed its
files on Plaintiff’s complaint.
d) Tewey never disclosed to Plaintiff that Longo, SCI, and NTS had been
under investigation by the Maryland Attorney General’s office for approximately
four (4) years.
e) Tewey also never disclosed to Plaintiff that the Maryland Attorney
General’s office was pursuing a class action lawsuit against Longo on behalf of
approximately 2,000 victims of Longo’s NTS scheme.
f) Tewey also never disclosed to Plaintiff that the Maryland Attorney
General’s office had been instrumental in forcing Longo and NTS into bankruptcy.
42. On or about January 12, 1994, Longo, as President of DSII, sent a letter to
Plaintiff at Plaintiff’s Florida residence in an extortion attempt demanding
that Plaintiff assign to DSII the pending patent and the patent awarded to
Plaintiff. The letter further stated that if Plaintiff did not assign the
patent and pending patent(s) to DSII, that the investors would take whatever
actions were necessary to force Plaintiff to assign the patent and pending
patent(s). Plaintiff refused to capitulate.
43. On or about February 14, 1994 -- after Plaintiff refused to capitulate to
the second extortion attempt made by Longo -- Procter, Burgee, Miles &
Stockbridge, Warfield, Glick, Moore, Sapperstein, G. Sapperstein, and WHSM&H
devised a fraudulent scheme to extort from Plaintiff his intellectual properties
“under color of law.” In this scheme, they had WHSM&H file a sham lawsuit
against Plaintiff in the Circuit Court for Worcester County in Snow Hill,
Maryland alleging breach of fiduciary responsibility.
a) Longo, Procter, Warfield, Glick, Moore, Sapperstein, and G.
Sapperstein had no grounds for this suit since Longo, Procter, and Burgee had
knowingly and willfully, as part of their money laundering and bankruptcy fraud
schemes, conspired to defraud and misrepresent to Plaintiff and DSII that Longo
was an accredited investor.
b) The suit was filed in Worcester County, Maryland despite the fact that
Longo was operating DSII at the SCI location in Jessup, Maryland, approximately
100 miles away.
c) The suit was filed in Worcester County because the two (2) judges
sitting in Worcester County, Judge Theodore R. Eschenburg (“Judge Eschenburg”)
and Judge Thomas C. Groton (“Judge Groton”), were long-time personal
acquaintances and political cronies of Moore, Warfield, Glick, Harrison, and
WHSM&H.
44. On or about March 10, 1994, Plaintiff was served in Jensen Beach, Florida
with the complaint (Case Number 94CV0182, Docket Number SP 59/117) for the sham
lawsuit initiated on February 14, 1994.
45. The trial of DSII and Longo v Donald D. Stone was scheduled for December 19,
1994 so that Plaintiff would be forced to drive the 2,000 mile round trip to
Maryland during the Christmas holiday season to defend himself from the sham
lawsuit.
46. In or about March 1994, Plaintiff would discover that certain individuals in
the Ocean City/Worcester County, Maryland area were bragging to personal
acquaintances about how they were going to steal Plaintiff’s intellectual
properties from him.
47. On or about March 14, 1994, in furtherance of the conspiracy to extort
Plaintiff’s inventions, Blecher knowingly, willfully, and with intent to
defraud, sent a letter to Plaintiff with an opinion that the technology for
which Plaintiff was awarded a patent and for which another patent was pending
had been developed while Plaintiff was employed by DSII. At the time this
letter was written, Blecher had in his possession documents that proved
Plaintiff’s original invention was invented prior to the formation of DSII.
48. In or about March 1994, Longo’s/SCI’s fraudulent securities scheme had
collapsed and Longo had failed to extort Plaintiff’s patent and technology.
49. In or about May 1994, Plaintiff filed his response with the Court. The
trial of DSII and Longo v Donald D. Stone was set for December 19, 1994.
50. In or about June 1994, having discovered Longo’s penchant for fraud from
newspaper articles about Longo and NTS, Plaintiff contacted Maryland Assistant
Attorney General Howard in an effort to learn more about Longo’s numerous
fraudulent schemes. Howard, on behalf of the Maryland Higher Education
Commission, was at that time in charge of a four-year, on-going investigation
and litigation against Longo, Longo’s (bankrupt) NTS, and Longo’s (current) SCI.
51. In or about August 1994, a DSII check was made out to Chieftan Investors for
airfare to an alleged meeting with Goodyear Tire and Rubber in Akron, Ohio.
Chieftan Investors, Inc. is a Maryland corporation of which Sapperstein and G.
Sapperstein are directors. Sapperstein and G. Sapperstein are alleged to
have used the Chieftan Investors’ corporate plane to fly Longo to the meeting
with Goodyear Tire and Rubber. When Longo arrived, Goodyear aborted this
meeting and refused to talk to Longo.
52. Unknown to Goodyear Tire and Rubber, by refusing to talk to white-collar
criminals Longo, Procter, Moore, Warfield, Glick, Sapperstein, G. Sapperstein,
Harrison, and WHSM&H, they helped to temporarily foil the fraudulent schemes of
the defendants.
53. By late 1994, Longo, Sellinger, Milling, Procter, Boardwine, and C. Johnson
-- unable to extort from Plaintiff his intellectual property, unable to obtain
clear title to the patents, unable to obtain any financing from license
agreements based on the patents, with the SCI/WI securities fraud scheme in a
total state of collapse, facing the pending trial of DSII and Longo v Donald D.
Stone scheduled for December 19, 1994, and faced with the December 12, 1994
trial of SCI against the State of Maryland -- began making preparations
for taking SCI into bankruptcy.
54. On or about December 10 and 11, 1994, Plaintiff drove from Florida to
Maryland to defend himself in the sham lawsuit.
55. On or about December 12, 1994, Plaintiff was present in the Annapolis,
Maryland courthouse when the Maryland Attorney General’s office forced Longo’s
SCI into bankruptcy.
a) This was the third time in four (4) years that a corporation
controlled by Longo and Longo had been forced into federal bankruptcy.
b) Longo chose to file bankruptcy for SCI to avoid a trial being pursued
by the Maryland Attorney General’s office against SCI.
56. On or about December 16, 1994 -- as part of the conspiracy to extort and
defraud Plaintiff “under color of law” and on behalf of Longo, Procter, Moore,
Warfield, Glick, Sapperstein, G. Sapperstein, Burgee, Miles & Stockbridge, Eyler,
Frisch, and Miraglia -- Harrison and Smith made “a fix” with Judge Eschenburg to
postpone the trial of DSII and Longo v Donald D. Stone. Plaintiff was
advised by Paul Haskell (“Haskell”), the Law Clerk, of the postponement and that
the trial was rescheduled for June 19, 1995.
a) Harrison, Moore, Warfield, Glick, Sapperstein, and G. Sapperstein were
alleged to have recently discovered that Longo and Procter had been embezzling
money from DSII.
b) Harrison arranged the ex parte meeting with Judge Eschenburg and Smith
because Harrison could not make Longo appear in a Worcester County Circuit Court
trial.
c) Smith, a part-time Worcester County Assistant State’s Attorney and an
employee of WHSM&H, conspired with Judge Eschenburg to cancel the trial that had
been scheduled for December 19, 1994.
d) Judge Eschenburg, Harrison, and Smith, in furtherance of the
conspiracy to defraud Plaintiff, denied Plaintiff a trial by jury.
57. In December 1994, Harrison asked Plaintiff for an out-of-court settlement
proposal. Harrison refused the proposal put forth by Plaintiff.
58. In early 1995, Longo testified under oath in a federal bankruptcy court
proceeding for the bankruptcy for SCI that DSII had never invested money into
SCI. Present at this proceeding was Alan Grochal (“Grochal”), attorney for
SCI and Longo.
59. On February 22, 1995, Plaintiff received a telephone call from Sapperstein.
During this telephone conversation, Sapperstein stated that they (Sapperstein,
G. Sapperstein, Moore, Warfield, and Glick) realized they had made a terrible
mistake when they seized control of DSII and that they realized Longo was a
thief. Sapperstein further stated that they would help Plaintiff put Longo
in jail and that putting Longo in jail wouldn’t be an easy task.
Sapperstein then asked Plaintiff for a settlement proposal. Plaintiff
referred Sapperstein to the settlement proposal in the possession of Harrison in
Ocean City, Maryland.
60. Unknown to Plaintiff, shortly after SCI declared bankruptcy in early 1995,
Longo, Procter, Moore, Warfield, Glick, Sapperstein, G. Sapperstein, Harrison,
WHSM&H, Grochal, Mary F. Ebersol (“Ebersol”), Tydings & Rosenberg, Burgee, and
Miles & Stockbridge devised a scheme and artifice to simultaneously defraud the
creditors of SCI and Plaintiff.
a) The scheme consisted of diverting the cash assets of SCI into and
through the DSII checking account, a refinement of what Longo, Procter, Burgee,
and Miles & Stockbridge had so successfully done for Longo’s personal bankruptcy
and for the bankruptcy of Longo’s NTS.
b) The scheme would enable Longo and Procter to begin restitution of the
money they had been embezzling from DSII and also to defraud the creditors of
SCI.
c) Grochal, Ebersol, and Tydings & Rosenberg knew that if they conspired
to defraud Plaintiff and the creditors of SCI, and if they helped Longo, Moore,
Warfield, Glick, Sapperstein, G. Sapperstein, Burgee, Procter, Miles &
Stockbridge, and WHSM&H extort from Plaintiff “under color of law” his
intellectual property, they would be assured of collecting their on-going legal
fees from Longo’s bankruptcy and the SCI bankruptcy.
61. On or about February 28, 1995, one (or more) unknown Defendant(s) placed a
mailing block on the DSII monthly bank statements. This block kept the
DSII monthly statements from being mailed to the corporate address (also the
address for SCI) so the DSII banking records showing the co-mingling of the DSII
assets with the bankrupt SCI would be concealed from Joel I. Sher (“Sher”), the
bankruptcy trustee for the SCI bankruptcy, who was now receiving the SCI mail.
62. In or about late May/early June 1995, Plaintiff secured the services of
Daniel Bowler (“Bowler”), a process server, to serve a subpoena deuce tecum on
the Records Custodian at the law offices of Miles & Stockbridge at 10 Light
Street in Baltimore, Maryland to secure documents Plaintiff needed for his
defense in the trial of DSII and Longo v Donald D. Stone to take place on June
19, 1995.
a) Bowler was alleged to have been told by a Miles & Stockbridge
secretary that Miles & Stockbridge did not have a records custodian.
b) Bowler was further alleged to have been told by the same Miles &
Stockbridge secretary that Miles & Stockbridge did not have any papers
pertaining to Plaintiff or DSII.
c) Plaintiff knew these alleged statements were an attempt to block his
access to important documents he needed for his defense because he had in his
possession, at the time the subpoena was served, documents that were drafted and
signed by Frisch and Miraglia, attorneys at Miles & Stockbridge working at the
Miles & Stockbridge offices at 10 Light Street in Baltimore, Maryland.
63. In late May/early June 1995, Plaintiff had a subpoena duece tecum served on
the United States Attorney for Maryland, Lynne Battaglia (“Battaglia”), to
appear in court on June 19, 1995 on his behalf in the trial of DSII and Longo v
Donald D. Stone.
a) Plaintiff was contacted by Assistant United States Attorney Russell on
behalf of Battaglia alleging that Battaglia had no personal knowledge or
documents regarding the matter between Longo and Plaintiff and that Plaintiff
was involved only in a business dispute with Longo.
b) Battaglia enacted this ruse to defraud Plaintiff, knowing that if Plaintiff
were allowed to speak with Assistant United States Attorney Dale Kelberman (“Kelberman”)
-- the person who had extensive personal knowledge of the matters concerning
Longo, SCI, and DSII -- that Kelberman would be required to make disclosures.
c) Battaglia knew the disclosures Keblerman could make would be damaging
to her personal and political agenda, and to her personal and political
relationship with Curran, Jr..
d) Battaglia also knew the disclosures Keblerman could make would be
damaging to the Maryland Attorney General Curran, Jr., and to Curran, Jr.’s
agenda to protect the Maryland political machine from criminal investigation.
e) Battaglia further knew the disclosures Keblerman could make would open a
Pandora’s box of corruption involving various levels of the Maryland state
government, prominent businessmen, and the politically powerful and prestigious
law firm of Miles & Stockbridge.
f) Battaglia additionally realized that any federal investigation into
Longo would lead to an investigation into politically-powerful Miles &
Stockbridge, which would be detrimental to Battaglia’s personal agenda in the
future when she would be seeking lucrative employment in the private legal
sector.
64. Also in or about late May/early June 1995, Plaintiff had Howard served with
a subpoena duece tecum for Howard to appear in court to testify against Longo
and Curran, Jr.’s personal acquaintances concerning the Maryland Attorney
General’s four-year investigation against Longo, NTS, and SCI.
a) Howard, as Assistant Attorney General, had been Longo’s nemesis for
the previous four (4) years.
b) Howard’s investigation into Longo’s schemes forced Longo into personal
bankruptcy and into filing bankruptcy for NTS.
c) Howard disclosed to Plaintiff during a telephone call after the
subpoena was served, that Sapperstein and G. Sapperstein were well known to the
Maryland Attorney General’s office, stating specifically that the Sappersteins
had “numerous friends at the Maryland Attorney General’s office.” Howard
would later deny making these statements.
65. On or about June 5, 1995, on behalf of Curran, Jr. and Howard, Maryland
Assistant Attorney General Andrew N. McDonald (“A. McDonald”) filed a motion to
quash the subpoena duece tecum served on Howard.
a) The motion stated that Howard had no personal knowledge of the matter
between Longo and Plaintiff, that Plaintiff was harassing Howard, and that
Plaintiff was wasting the State’s resources.
b) Judge Groton approved the motion.
c) Howard had the subpoena quashed to discredit Plaintiff and to block
Plaintiff’s access to documents, exculpatory evidence, and testimony that would
be devastating and damaging to Curran, Jr.’s personal acquaintances and
political cronies Sapperstein and G. Sapperstein.
d) In or about early 1996, Plaintiff would obtain legal tape recordings
revealing that both Howard and McDonald knowingly, willfully, and with malicious
intent made false statements against Plaintiff in the motion to quash the
subpoena duece tecum.
66. In or about June 1995, Plaintiff had subpoenas duece tecum to appear and
testify on his behalf served on Smith and Gary Mumford (”Mumford”), an
investigator for the Worcester County State Attorney’s office.
a) Smith and Mumford entered a motion to quash the subpoenas they had
been served stating they had no personal knowledge of DSII or of the pending
litigation.
b) Judge Groton, knowing Smith was employed by the law firm Longo used (WHSM&H),
quickly approved the motion.
c) Plaintiff knew the statements made by Smith in his motion to quash the
subpoena were false because Smith had extensive personal knowledge of the
litigation of DSII and Longo v Donald D. Stone and is alleged to have discussed
this litigation with his personal acquaintances.
d) Plaintiff also knew the statements made by Smith in his motion to
quash the subpoena were false because Smith had conspired in an ex parte meeting
with Judge Eschenburg to cancel the trial scheduled for December 19, 1994 and to
deny Plaintiff a trial by jury.
e) Plaintiff knew the statements made by Mumford in his motion to quash
the subpoena were false because Plaintiff had spoken with Mumford in the
Worcester County States Attorney’s office in or about December 1994 about both
Longo and Harrison being involved in a securities fraud.
67. In or about June 1995, Plaintiff again secured the services of Bowler to
serve a subpoena duece tecum to appear and testify on Plaintiff’s behalf to
United States bankruptcy trustee Simpson.
a) Bowler attempted to serve this subpoena on several occasions -- even
when Simpson was known to be in her office -- without success.
b) In or about early 1997, Plaintiff would discover that Simpson had
personal knowledge and documents concerning DSII and Longo that were critical to
Plaintiff’s defense in the trial of DSII and Longo v Donald D. Stone.
68. On June 19, 1995, prior to the start of the trial, Harrison engaged in an ex
parte meeting with his long-time personal acquaintance Judge Groton.
69. On June 19, 1995, during the opening of the trial of DSII and Longo v
Donald D. Stone, Judge Groton made derogatory remarks in open court about
Plaintiff acting as his own attorney (pro se). Judge Groton further stated
that he was in a hurry to get the trial over with because he had a busy
schedule.
70. On June 19, 1995, during the trial of DSII and Longo v Donald D. Stone,
Longo testified that he had not been an accredited investor at the time he made
his alleged $15,000.00 investment into DSII.
a) This testimony voided Longo’s grounds to sue Plaintiff.
b) Further, this testimony confirmed to Plaintiff that Longo, Procter,
Burgee, and Miles & Stockbridge had devised a fraudulent scheme to defraud
Plaintiff and DSII, to embezzle DSII assets, to hide Longo’s assets from
bankruptcy creditors, and to provide a base from which Longo, Procter, and
Burgee could perpetrate additional fraudulent schemes.
71. On June 19, 1995, during the trial of DSII and Longo v Donald D. Stone,
Plaintiff introduced a document from the State of Maryland Department of
Assessments and Taxation dated June 12, 1995, that DSII was not a corporation in
good standing for nonpayment of its corporate personal property taxes.
a) Longo, under the advice of his attorney (Harrison) testified that he
had revived the DSII corporate charter at some time during the period between
June 12 and June 19, 1995.
b) Longo’s statement was proved false when, on or about October 5, 1995,
DSII forfeited its charter to do business in Maryland because of non-payment of
its corporate personal property taxes.
c) Since DSII did not exist as a legitimate corporate entity at the time
of the trial (June 19, 1995), there were no legal grounds for the suit, thereby
voiding all legal action connected with the suit.
72. On June 19, 1995, during the trial of DSII and Longo v Donald D. Stone,
Burgee failed to disclose that Longo was not an accredited investor at the time
of Longo’s alleged $15,000.00 investment into DSII. Even though required
by law and the Code of Professional Ethics, Burgee withheld exculpatory evidence
that Longo was not an accredited investor in an effort to cover up the earlier
criminal conduct Longo, Procter, Burgee, and Miles & Stockbridge had committed
when they induced Plaintiff to believe that Longo was an accredited investor.
73. On or about June 20, 1995, Plaintiff realized that it was futile to obtain a
fair trial before judges that were long-time personal acquaintances and
political cronies of three (3) of the plaintiffs and their law firm, and unable
to seek the court’s protection against Judge Eschenburg’s and Judge Groton’s
personal and political cronies and fraudulent schemes, Plaintiff capitulated.
The result of the trial was the following settlement:
a) The license agreement Plaintiff signed on January 13, 1992, with DSII
pertaining to U.S. patent number 5,314,940, would remain valid.
b) The following patents, issued and pending, would be world-wide
assignments by Plaintiff to DSII:
Patent No. 5,314,940, issued May 24, 1994
Patent pending 08/021,131, filed February 23, 1993
Patent pending 08/145,189, filed November 3, 1993
c) Plaintiff was to receive $10,000.00 (ten thousand dollars).
d) Plaintiff was to receive a stock certificate for 49% of DSII’s Class A
stock.
e) Plaintiff’s voting rights were forfeited and were to be voted by proxy
by Longo, Moore, Warfield, Glick, Procter, G. Sapperstein, and Sapperstein.
74. On or about October 5, 1995, DSII forfeited its charter to do business in
the state of Maryland because of non-payment of its corporate personal property
taxes.
75. In November 1995, Plaintiff filed a complaint with Todd of the Worcester
County State’s Attorneys’ office accusing Longo of embezzling money from DSII
during the time Longo was president of DSII.
a) Todd referred the complaint to the Worcester County Bureau of
Investigation.
b) The complaint was investigated by Michael McDermott (“McDermott”) of
the Worcester County Bureau of Investigation.
c) McDermott interviewed Longo, Procter, and Sapperstein.
d) According to the investigation report, Sapperstein denied calling
Longo a thief during his telephone conversation with Plaintiff on or about
February 22, 1995.
e) According to the investigation report, Longo told McDermott that he
had invested DSII funds into SCI. As evidence of this transaction, Longo
presented McDermott with copies of a promissory note between DSII and SCI, DSII
ledger sheets, a 1099 form to DSII from Shippers’ Choice of Virginia, canceled
checks from the DSII checking account, and other documents.
f) McDermott reported to his superior officer, Maryland State Police
Sergeant Michael Kinhart (“Kinhart”), the head of the Worcester County Bureau of
Investigation, that Plaintiff’s complaint was unfounded. Kinhart signed
off on the investigation.
g) Kinhart signed off on the Worcester County Bureau of Investigation in
order to protect Judge Eschenburg’s and Judge Groton’s personal acquaintances
and political cronies -- specifically Moore, Warfield, Glick, and WHSM&H -- from
a criminal investigation.
h) Plaintiff knew Longo, Procter, Moore, Warfield, Glick, Sapperstein, G.
Sapperstein, Harrison, and WHSM&H had devised this fraudulent scheme to cover up
Longo and Procter’s embezzlement of DSII assets.
i) Plaintiff knew the investigation was a sham designed to protect Moore,
Warfield, Glick, Harrison, and WHSM&H from criminal liability and to preserve
the unconsummated court order of June 20, 1995 from the sham judicial preceding
by Judge Eschenburg and Judge Groton that would give them control of Plaintiff’s
potentially valuable patent and pending patents.
j) Plaintiff knew Moore, Warfield, Glick, Harrison, and WHSM&H wielded
enough political clout in Worcester County to have any allegations about Longo’s
activities declared unfounded.
k) Todd and officers McDermott, Kinhart, and James Bowden (“Bowden”) knew
that a legitimate investigation would implicate Judge Eschenburg and Judge
Groton because the court-ordered settlement from the trial of DSII and Longo v
Donald D. Stone had not yet been enacted.
76. In or about January 1996, Plaintiff sent a written inquiry to Judge
Eschenburg questioning whether Judge Eschenburg’s relationship with Moore,
Warfield, and Glick was a possible conflict of interest and asking why
Plaintiff’s request for a jury trial was denied.
a) Judge Eschenburg denied any conflict of interest.
b) Judge Eschenburg evaded Plaintiff’s request for an explanation of why
his request for a jury trial had been denied by claiming the issue was moot.
c) Judge Eschenburg postponed the trial and denied Plaintiff’s request
for a jury trial to protect his personal and political cronies from public
scrutiny.
77. In or about January 1996, Plaintiff sent a written inquiry to Judge Groton
questioning whether his relationship with Moore, Warfield, and Glick was a
possible conflict of interest and asking why Plaintiff had been denied a jury
trial.
a) Judge Groton refused to respond personally to Plaintiff’s inquiry and
instead had Haskell, his law clerk, respond that he (Judge Groton) had no
conflict of interest.
b) Judge Groton did not respond to Plaintiff’s request for an explanation
of why his request for a jury trial had been denied.
c) Judge Groton denied Plaintiff’s request for a jury trial to protect
his personal and political cronies from investigation and public scrutiny.
78. In or about February 1996, Plaintiff paid $600.00 (six hundred dollars) to
court reporter Kevin Schiller (“Schiller”) for a copy of the transcripts of the
June 19-20, 1995 trial of DSII and Longo v Donald D. Stone.
79. In November 1996, Plaintiff made a written request for information under the
Maryland Public Information Act to Todd to obtain the evidence that had been
given to McDermott by Longo during the November 1995 investigation conducted by
the Worcester County Bureau of Investigation.
a) Plaintiff made his request to Todd even though Plaintiff knew Todd
employed Smith as a part-time States Attorney and that Smith was also an
attorney for the law firm Longo used (WHSM&H).
b) Todd claimed he had no record of Plaintiff’s complaint.
c) Todd further claimed he had no information about who would have
custody of the evidence collected during the Worcester County Bureau of
Investigation’s investigation or of the final report of the investigation.
d) Todd referred Plaintiff to the city of Berlin (Maryland) Police Chief,
Prentice M. Lyons (“Lyons”).
e) Todd tried to block Plaintiff’s access to the investigation report and
documents because Todd knew they would provide Plaintiff with clear and
convincing evidence that Longo, Procter, Sapperstein, G. Sapperstein, Moore,
Warfield, Glick, Harrison, and WHSM&H had given McDermott fraudulent DSII ledger
sheets.
f) Todd tried to block Plaintiff’s access to the investigation report and
documents because Todd knew that McDermott and Kinhart had falsified the
Worcester County Bureau of Investigation report.
80. In furtherance of the scheme to defraud Plaintiff and to punish Plaintiff
for his request for an investigation into DSII assets, in or about March 1996,
Harrison filed a motion to enforce the court order issued on June 20, 1995,
which Judge Groton allowed. The motion allowed Harrison to deduct $600.00
(six hundred dollars) from the $10,000.00 escrow account containing the money
payable to Plaintiff under the court-ordered settlement.
81. On June 16, 1996, Plaintiff -- under threat of being held in contempt of
court by Judge Groton -- capitulated to the court-ordered settlement.
a) G. Sapperstein refused to sign the court-ordered proxy statement in an
effort to sever his relationship with the criminal activities of Longo, Procter,
Moore, Warfield, Glick, Burgee, Miles & Stockbridge, Harrison, and WHSM&H.
82. On or about June 16, 1996, Plaintiff received stock certificate number 48
for 490 shares of Class A non-voting stock, representing 49% of DSII stock.
Since the trial and resulting court order under which this certificate was
issued was a sham because DSII had forfeited its Maryland corporate charter on
October 5, 1995, the certificate was fraudulent.
83. Needing confirmation of federal bankruptcy fraud in order to petition the
U.S. Attorney to initiate a grand jury investigation against Moore, Warfield,
Glick, Sapperstein, G. Sapperstein, Procter, Longo, Burgee, and Miles &
Stockbridge in or about November 1996, Plaintiff made a request for information
under the Maryland Public Information Act to Kinhart.
a) Plaintiff’s request put Kinhart between “a rock and a hard place.”
Kinhart knew he had to respond to Plaintiff’s request but he didn’t want to
further his involvement in the cover-up conspiracy.
b) In or about December 1996, in response to Plaintiff’s request, Kinhart
sent to Plaintiff a packet of documents and evidence that were alleged to be
those collected during the Worcester County Bureau of Investigation’s
investigation and the Bureau’s final report.
c) The documents provided clear and convincing evidence that the
investigation had been a sham.
d) The packet of information was accompanied by a note that Kinhart had
hand-printed on plain paper, thereby making the information available to
Plaintiff without formally continuing the Bureau’s involvement with the
Longo-et. al. cover-up conspiracy.
84. Fearing more fraud and cover up, on or about November 17, 1996, Plaintiff
filed a request with Officer Stephen Moyer of the Maryland State Police Internal
Affairs department asking that the Maryland State Police provide written
confirmation, on official Maryland State Police stationery, that the documents
and evidence sent to Plaintiff by Kinhart were indeed the true and correct
evidence given to McDermott by Longo and the true final investigation report.
a) Plaintiff’s request was forwarded to Major Stanford Franklin
(“Franklin”) of the Maryland State Police.
b) Franklin told Plaintiff he had reviewed the Worcester County Bureau of
Investigation report and the evidence and found that Plaintiff’s request for
verification of the evidence and report was trivial.
c) Franklin led Plaintiff to believe that there was no evidence of fraud
and that he didn’t have the resources to conduct the type of investigation
Plaintiff’s request required.
d) Plaintiff then called the Federal Bureau of Investigation (“FBI”)
office in Baltimore, Maryland. The FBI agreed to offer assistance to the
Maryland State Police to conduct the type of investigation Plaintiff’s request
required. The FBI also told Plaintiff that they thought the Maryland State
Police or Maryland Attorney General’s office maintained an agency at the
Maryland Attorney General’s office that assisted Maryland State Police with
financial investigations.
e) Plaintiff also called the Internal Revenue Service Criminal
Investigation Division. They also agreed to offer assistance to the
Maryland State Police to conduct the type of investigation Plaintiff’s request
required.
f) Plaintiff relayed these offers of assistance to Franklin.
85. On or about February 21, 1997, Kinhart told Plaintiff that Captain Tom Jones
(“Jones”) of the Worcester County Sheriff’s Department might have the evidence
and the final report from the November 1995 embezzlement complaint filed by
Plaintiff.
86. Between January and March 1997, Franklin reopened the November 1995
embezzlement complaint Plaintiff filed and assigned the case to Officer Dale
Petty (“Petty”). Petty and Franklin closed the case on the basis that the
State Police did not have the probable cause needed to obtain subpoenas for bank
records and other documents related to DSII and Longo.
87. On or about February 27, 1997, Jones told Plaintiff that he (Jones) had no
record of the Worcester County Bureau of Investigation final report. Jones
further stated that he thought the evidence collected in the investigation had
been returned to the victims.
88. In or about February 1997, Plaintiff filed a request for information under
the Maryland Public Information Act with Tewey to secure documents that would
confirm the statements Howard had made that the Sappersteins were well known to
the Maryland Attorney Generals’ office and that the Sappersteins had “numerous
friends at the Maryland Attorney Generals’ office,” and for documents pertaining
to Plaintiff’s complaint to the Maryland Attorney General’s office about Longo’s
securities fraud.
89. In or about February 1997, Tewey replied to Plaintiff’s request for
information. Her reply stated that Howard denied making the statement
about the Sappersteins.
90. In or about February 1997, Plaintiff obtained documents through a Freedom of
Information Act request that indicated a meeting took place in or about
September 1994, between Howard, Kelberman, Simpson, and Michael Beck (from the
Maryland Higher Education Commission) during which they discussed numerous
activities of SCI and NTS (both corporations under Longo’s exclusive control)
including alleged multiple federal felony offenses involving possible securities
fraud and/or mail fraud occurring during the time DSII was under the exclusive
control of Longo.
a) The Maryland Attorney General’s office and Curran, Jr. had conspired
to unlawfully withhold and conceal these documents because they knew that
disclosure of these documents would have a devastatingly negative affect on the
outcome of the suit brought by DSII and Longo v Donald D. Stone.
b) Curran, Jr. did not want Plaintiff to have access to any evidence that
would negatively impact Curran, Jr.’s personal acquaintances and/or political
cronies, such as Sapperstein, G. Sapperstein, and Longo’s business associates.
c) Curran, Jr. did not want Plaintiff to have access to this evidence
even though the Maryland Attorney General’s office had, over the past four (4)
years, spent a large amount of federal and state tax dollars investigating Longo
and his numerous fraudulent schemes and was currently pursuing an $8,000,000.00
(eight million dollars) class action law suit against Longo on behalf of 2,000
documented victims in the states of Maryland and Virginia.
91. On or about March 2, 1997, Plaintiff wrote a letter to Richard Outten (“Outten”),
Clerk of the Court for Worcester County Circuit Court in Snow Hill, Maryland to
obtain exemplified copies of certain documents from the trial proceeding of June
19 and 20, 1995 of DSII and Longo v Donald D. Stone. Plaintiff was
contacted by Mrs. Jane Powell (“Powell”), Court Records Supervisor of Worcester
County Circuit Court. Powell sent Plaintiff a court docket upon which he
was to mark the documents he wanted. He returned the marked docket to
Powell -- with specific instructions to have either Judge Eschenburg or Judge
Groton exemplify the requested documents -- and his check for payment of these
exemplified documents. Unknown to Plaintiff, Judge Eschenburg, Judge
Groton, Outten, Powell, and Judge Richard R. Bloxom (“Judge Bloxom”) of the
Worcester County District Court conspired to devise a scheme and artifice to
defraud Plaintiff. In furtherance of the conspiracy to defraud Plaintiff “under
color of law,” Judge Eschenburg and Judge Groton refused to exemplify the court
documents. Outten and Powell, because they had received payment for and
therefore had to produce exemplified documents, had Judge Bloxom exemplify the
documents.
a) Plaintiff returned the documents to the Worcester County Circuit Court
several times demanding the documents be exemplified by either Judge Eschenburg
or Judge Groton as requested.
b) Eventually, Plaintiff advised Judge Bloxom, Judge Groton, and Judge
Eschenburg to keep the exemplified documents that Judge Groton and Judge
Eschenburg refused to exemplify and that Plaintiff would obtain a writ of
mandamus from a federal court commanding Judge Groton and Judge Eschenburg to
exemplify the court documents as Plaintiff had requested.
c) Judge Groton, knowing the entire proceeding was a sham and that his
cronies now had control of Plaintiff’s patent and pending patents, refused to
exemplify the documents in an attempt to sever the paper trail to the judicial
fraud to extort from Plaintiff his intellectual property that Judge Groton had
helped perpetrate on Plaintiff.
92. In or about May 1997, Plaintiff -- as a party of interest -- filed a Motion
2004 (Examination of the Debtor) with the United States Bankruptcy Court in the
bankruptcy filed by SCI to obtain the documents of the alleged investments of
DSII money into SCI.
93. In order to quash Plaintiff’s 2004 Motion, on or about May 27, 1997, Grochal,
the attorney for the debtor corporation SCI and Longo, claimed before the United
States Bankruptcy Court that Plaintiff’s motion was made to harass Longo and
SCI, that the Worcester County Bureau of Investigation report showed that
Plaintiff’s allegations of Longo embezzling money from DSII were unfounded, and
that the allegedly-embezzled money was an investment made by DSII in SCI.
94. In or about early January 1995 -- after filing the SCI bankruptcy papers,
during the time the honorable Judge E. Stephen Derby (“Judge Derby”) (the
federal bankruptcy judge) was presiding over the SCI bankruptcy and Longo’s
personal bankruptcy), and continuing until the present -- Longo, Tydings &
Rosenberg (the law firm representing SCI and Longo for the bankruptcy), and
Tydings & Rosenberg attorneys Grochal and Ebersol (a former law clerk for Judge
Derby), Procter, Moore, Warfield, Glick, Burgee, Miles & Stockbridge,
Sapperstein, G. Sapperstein, Harrison, Sellinger, Boardwine, Milling, C.
Johnson, J. Johnson, and WHSM&H refined the numerous schemes and artifices to
defraud the legitimate creditors of both Longo’s personal and the SCI
bankruptcies and Plaintiff by concealing the whereabouts of the assets of SCI
through false and fraudulent statements.
95. On or about June 26, 1997, Plaintiff made a request through the Maryland
Public Information Act to the Worcester County Sheriff Charles T. Martin
(“Martin”) to provide Plaintiff with copies of the Worcester County Bureau of
Investigation’s report concerning the embezzlement of DSII assets by Longo and
of the tape recording of the conversation between Plaintiff and Jones on or
about February 27, 1997. Martin refused to comply with Plaintiff’s request
by never responding.
96. In or about August 1997, Plaintiff had to terminate his privately-financed
investigation because he was unable to obtain protection from state and federal
law enforcement agencies that were allowing Plaintiff to be victimized by Longo
and his white-collar crime syndicate.
COUNTS 1-6
CIVIL R.I.C.O.
in violation of 18 U.S.C. §1962 (a) (b) (c) (d)
Plaintiff repeats and re-alleges each and every allegation contained in the preceding paragraphs and following paragraphs and counts of this Complaint as if fully set forth herein.
On or about the dates and locations listed below, the Defendants enumerated as to each account did conspire knowingly, willfully, and with malicious intent to devise fraudulent schemes and artifices to obtain money and property from Plaintiff by means of false and fraudulent pretenses, representations, and promises, for the purposes of executing such schemes and artifices in violation of 18 U.S.C. §1962 (a) (b) (c) (d) and attempting to do so:
COUNT 1 Beginning in or about December 1991 and continuing until the present,
Defendants Moore, Warfield, Glick, Sapperstein, G. Sapperstein, Procter, M.
Procter, Burgee, Eyler, John B. Frische (“Frische”), Miraglia, Longo, Harrison,
J. Richard Collins (“Collins”), Smith, Judge Groton, Judge Eschenburg, Sellinger,
Boardwine, Milling, Grochal, Ebersol, Hammond, Miles & Stockbridge, WHSM&H, and
known and unknown co-conspirators have engaged in racketeering activity as
described in 18 U.S.C. §1961 (1) involving violations of 18 U.S.C. §1962 (a) (b)
(c) (d), §152, §1951, §1503, §1512, §1956, §1957, §1341, §1343, §2315, §1952,
and 15 U.S.C. 77(g) and acquired and maintained directly and indirectly in
violation of 18 U.S.C. §1962 as defined in U.S.C. §1961 an interest in and
ultimately absolute control of DSII.
COUNT 2 In violation of 18 U.S.C. §1961 (5), the pattern of activities as set
forth in the proceeding allegations and the counts below began on or about
December 1991 and continue through the present, defining a continuous on-going
pattern of numerous predicate R.I.C.O. violations within ten (10) years of each
other.
COUNT 3 In violation of 18 U.S.C. §1961 (4), the enterprise (victim or prize)
was DSII.
COUNT 4 Defendants Longo, Procter, Burgee, Moore, Warfield, Glick Sapperstein,
G. Sapperstein, Miles & Stockbridge, and WHSM&H are “persons” within the meaning
of 18 U.S.C. §1961 (3).
COUNT 5 DSII is an “enterprise” within the meaning of 18 U.S.C. §1961 (4) and is
engaged in, and its activities affect, interstate commerce.
COUNT 6 From in or about November 1991 and continuing to the present, Defendants
Longo, Procter, M. Procter, Burgee, Miles & Stockbridge, co-conspirators known
and unknown, Moore, Warfield, Glick, Sapperstein, G. Sapperstein, Christine Ward
(“Ward”), Sellinger, Grochal, Ebersol, Milling, WHSM&H, Boardwine, and Kathleen
Roberta Ternes (“Ternes”) received income, derived directly and indirectly, from
a pattern of racketeering activity, as defined in 18 U.S.C. §1961 (1) and as set
forth in paragraphs below, and used and invested, directly and indirectly, part
of such income and the proceeds thereof in the acquisition of an interest in and
in the operation of DSII in violat