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Posted 05/31/2015 10:40 am
Lots of good stuff you miss if you don't read the decision... just the summary from a newspaper article - often written without bothering to read the documents. BTW- the opinions are free to download, although you need a PACER (US Courts e-filing system) account (for casual busybodies like myself, they waive the fees if you don't go over $10 or $15 a quarter) (and there is the per-page charge for the search)
The judge found against PCI (corporate) on all charges, not just the regular fraud, but negligence count AND the RICO count.
There was also quite a bit about the ownership structure - between
Father- Anthony J. Delluniversita
Son- Paul A. Delluniversita
Because of this, the Judge found Anthony's actions were sufficient to pierce the corporate veil, so his 60% of the judgment is personal, while Paul's is not
That's going to make Thanksgiving and other family occasions a little difficult...
I'm just going to quote one of the three damage awards:
We now know the 2010-2011 incarnation of PCI. I'm sure buried in the transcripts are the details of who he bought it from (probably DLRC when they shutdown Dominion Grading Service) and who he sold it to (which seems to still be alive - I've seen a 2015 ASE in an PCI slab on ebay).
The judge found against PCI (corporate) on all charges, not just the regular fraud, but negligence count AND the RICO count.
There was also quite a bit about the ownership structure - between
Father- Anthony J. Delluniversita
Son- Paul A. Delluniversita
Quote:
6. PCA is a New York-based rare coins dealer. It purchases ungraded coins, grades the coins—sometimes through an independent third party grader—and sells the coins to customers.
7. PCA employs a team of sales representatives who solicit customers through a telemarketing operation.
8. PCA failed to follow a number of corporate formalities, including issuing stock, finalizing by-laws, and executing organizational meeting minutes. (Plaintiff's Exhibit 22).
9. Defendant Anthony owns 60% of PCA while his son, Defendant Paul, owns 40% of the company. PCA distributes 60% of its earnings to Anthony and 40% to Paul on a weekly basis.
10. Paul serves as PCA's president, but he is only a "figurehead" or "paper" president and his only responsibility is to make sure that salespersons are on the phone.
11. Anthony manages all PCA operations not handled by Paul, including the training of sales representatives and the setting of coin prices.
12. In November of 2010, Anthony purchased PCI, a coin grading company.
Anthony solely-owned and operated PCI, acting as its only coin grader.
13. Paul was unaware that Anthony was PCI's sole grader and testified that no one at PCA knew that Anthony owned PCI. Anthony testified that he did not inform Paul that he was PCI's sole grader because "it was not his concern."
6. PCA is a New York-based rare coins dealer. It purchases ungraded coins, grades the coins—sometimes through an independent third party grader—and sells the coins to customers.
7. PCA employs a team of sales representatives who solicit customers through a telemarketing operation.
8. PCA failed to follow a number of corporate formalities, including issuing stock, finalizing by-laws, and executing organizational meeting minutes. (Plaintiff's Exhibit 22).
9. Defendant Anthony owns 60% of PCA while his son, Defendant Paul, owns 40% of the company. PCA distributes 60% of its earnings to Anthony and 40% to Paul on a weekly basis.
10. Paul serves as PCA's president, but he is only a "figurehead" or "paper" president and his only responsibility is to make sure that salespersons are on the phone.
11. Anthony manages all PCA operations not handled by Paul, including the training of sales representatives and the setting of coin prices.
12. In November of 2010, Anthony purchased PCI, a coin grading company.
Anthony solely-owned and operated PCI, acting as its only coin grader.
13. Paul was unaware that Anthony was PCI's sole grader and testified that no one at PCA knew that Anthony owned PCI. Anthony testified that he did not inform Paul that he was PCI's sole grader because "it was not his concern."
Quote:
15. Anthony sold PCI in December of 2011.
15. Anthony sold PCI in December of 2011.
Because of this, the Judge found Anthony's actions were sufficient to pierce the corporate veil, so his 60% of the judgment is personal, while Paul's is not
Quote:
52. As previously discussed, Anthony, through PCI and PCA, orchestrated a fraud against Pereida. Anthony used the appearance of PCI as a separate corporation to deceive Pereida into believing that she was purchasing independently-graded coins through PCA. The Court concludes that Plaintiff can pierce PCI and PCA's respective corporate veils to hold Anthony personally liable for the economic and exemplary damages established under the common law fraud claim.
53. The Court concludes that Plaintiff cannot pierce PCI and PCA's respective corporate veils to hold Paul personally liable because he was not aware of or involved in the scheme to defraud Pereida.
52. As previously discussed, Anthony, through PCI and PCA, orchestrated a fraud against Pereida. Anthony used the appearance of PCI as a separate corporation to deceive Pereida into believing that she was purchasing independently-graded coins through PCA. The Court concludes that Plaintiff can pierce PCI and PCA's respective corporate veils to hold Anthony personally liable for the economic and exemplary damages established under the common law fraud claim.
53. The Court concludes that Plaintiff cannot pierce PCI and PCA's respective corporate veils to hold Paul personally liable because he was not aware of or involved in the scheme to defraud Pereida.
That's going to make Thanksgiving and other family occasions a little difficult...
I'm just going to quote one of the three damage awards:
Quote:
On the claim for common law fraud, Plaintiff is entitled to recover from PCI and PCA, jointly and severally, the sum of $536,934.00 for economic damages along with pre and post-judgment interest, and court costs of $1,332.45 and may hold Anthony personally liable for these amounts. Plaintiff is also entitled to recover an additional $536,934.00 for exemplary damages—$268,457.00 from PCI and $268,934.00 from PCA—along with post-judgment interest and may hold Anthony personally liable for these amounts.
On the claim for common law fraud, Plaintiff is entitled to recover from PCI and PCA, jointly and severally, the sum of $536,934.00 for economic damages along with pre and post-judgment interest, and court costs of $1,332.45 and may hold Anthony personally liable for these amounts. Plaintiff is also entitled to recover an additional $536,934.00 for exemplary damages—$268,457.00 from PCI and $268,934.00 from PCA—along with post-judgment interest and may hold Anthony personally liable for these amounts.
We now know the 2010-2011 incarnation of PCI. I'm sure buried in the transcripts are the details of who he bought it from (probably DLRC when they shutdown Dominion Grading Service) and who he sold it to (which seems to still be alive - I've seen a 2015 ASE in an PCI slab on ebay).
-----Burton
Author: 3rd Edition of the Sample Slabs book, https://www.sampleslabs.info/
50+ year / Life / Emeritus ANA member (joined 12/1/1973)
Life member: Numismatics International, CONECA
Member: TNA, FtWCC, NETCC, EveryCountry (online) coin club
Owned by three cats and a wife of 40+ years (joined 1983)
Author: 3rd Edition of the Sample Slabs book, https://www.sampleslabs.info/
That's hilarious, I can just see everyone rolling their eyes.
RICO against the individuals/PCA and simple fraud against PCI.
